Asbury v. People's Choice Home Loan, Inc.

Asbury v. People's Choice Home Loan, Inc.

05 C 5483

COUNSEL: [*1] For Lillie Asbury, Plaintiff: Daniel A. Edelman, James O. Latturner, Jeremy Patrick Monteiro, Edelman, Combs, Lattumer & Goodwin, LLC, Chicago, IL.JUDGES: William J. Hibbler, Assigned Judge or Magistrate Judge. Amy J. St. Eve, Sitting Judge if Other then Assigned Judge.OPINION: Defendant's Motion to Dismiss (doc. # 11) is GRANTED in part and DENIED in part. Asbury's 15 U.S.C. § 1681m claim is DISMISSED with prejudice.STATEMENT

Lillie Asbury alleges on behalf of herself and a putative class that People's Choice Home Loan, Inc. violated the Fair Credit Reporting Act when it accessed her credit report. Asbury claims that People's Choice violated FCRA in two ways: 1) by accessing her report without her permission and without a permissible purpose in violation of 15 U.S.C. § 1681b; 2) by failing to make the disclosures required by 15 U.S.C. § 1681m. People's Choice moves to dismiss Asbury's claims, arguing that she cannot state a claim on which relief can be granted.

In 2003, Congress enacted the Fair and Accurate Credit Transactions Act (FACTA), which amended numerous FCRA provisions, including § 1681. [*2] FACTA limits enforcement of § 1681m to Federal agencies and other officials identified in the Act. 15 U.S.C. § 1681m(h)(8). Although Asbury argues that a private right of action does exist under § 1681m, courts in this District have repeatedly rejected her argument. See, e.g., Killingsworth v. Household Bank (SB), N.A., No. 05-C-5729, 2006 WL 250704, at *3-4 (N.D. Ill. Jan. 31, 2006) (Darrah, J.); Tremble v. Town & Country Credit Corp., 05 C. 2625, 2006 WL 163140 (N.D. Ill. Jan 18, 2006) (Kennelly, J.); Murray v. Finance America, No. 05 C 1255 (N.D. Ill. Jan 5, 2006) (St. Eve, J.) (unpublished order); Murray v. American Int'l Gr., No. 05 C 3881 (N.D. Ill. Dec. 23, 2005) (St. Eve., J.) (unpublished order); Wanek v. C.M.A. Mortgage, No. 05 C 4775 (N.D. Ill. Dec. 12, 2005) (Lindberg, J.) (unpublished order); Griffin v. First Premier Bank, No. 05 C 1873 (N.D. Ill. Dec. 12, 2005) (Bucklo, J.) (unpublished order); Hernandez v. Citifinancial Serv. Inc, No. 05 C 2263, 2005 U.S. Dist. Lexis 32532 (N.D. Ill. Dec. 9, 2005) (Filip, J.); McCane v. America's Credit Jewelers, Inc., No. 05 C 5089, 2005 WL 3299371 [*3] (N.D. Ill. Dec. 1, 2005) (Conlon J.); Murray v. Cingular, No. 05 C 1344 (N.D. Ill. Nov. 2, 2005)(Manning, J.)(unpublished order); Pietras v. Curfin Oldsmobile. Inc., No. 05 C 4624, 2005 WL 2897386 (N.D. Ill. Nov. 1, 2005) (Conlon, J.); Murray v. Household Bank (SB), N.A., 386 F. Supp. 2d 993, 999 (N.D. Ill. 2005) (Gettleman, J.); Perry v. First Nat'l Bank, No. 05 C 1470. 2005 U.S. Dist. Lexis 23100, (N.D. Ill. Sept. 13, 2005); Murray v. Cross Country Bank, 399 F. Supp.2d 843, 844 (N.D. Ill.2005) (Zagel, J.). After reviewing counsel's argument and the other courts' orders, the Court agrees with the reasoning set forth in its colleagues' orders, adopts that reasoning, and concludes that no private right of action exists for violations of § 1681m. Asbury's § 1681m claim is DISMISSED with prejudice.

Defendant also moves to dismiss Asbury's § 1681b Section 1681b limits the circumstances under which it is permissible to obtain a credit report for transactions that are not initiated or authorized by a consumer. 15 U.S.C. § 1681b. One permissible purpose that does not require consumer consent [*4] is the making of a "firm offer of credit or insurance." 15 U.S.C. § 1681b(c)(1)(B)(i). Accordingly, Asbury's § 1681 claim rests on whether the mailing sent by People's Choice constitutes a firm offer. People's Choice argues that the mailing it sent, which Asbury attached to her Complaint, constitutes a firm offer as a matter of law. The Court disagrees.

The mailing does guarantee a minimum loan amount of $ 20,000 and makes clear that Asbury is pre-approved for the offer, subject to meeting certain predetermined criteria of creditworthiness. Both guarantees are necessary, but not sufficient, elements of a firm offer. See Cole v. U.S. Capital, 389 F.3d 719, 726-7 (7th Cir. 2004) (citing 15 U.S.C. § 1681a(1)(1-2) and Trans Union Corp. v. FTC, 267 F.3d 1138, 1143 (D.C. Cir. 2001) and Trans Union Corp., 81 F.3d 228, 234 (D.C. Cir. 1996)). The Seventh Circuit makes clear that the offer is not to be considered in a vacuum and that both the creditor and the debtor must know the terms attached to the offer in order to determine whether it is advantageous to accept the offer. Id. The precise [*5] rate of interest is among the more important terms. Id. The mailing sent by People's Choice, however, makes no reference to interest. People's Choice argues that it would not, for business reasons, charge a higher interest rate than the market rate, but this argument is unavailing. Defendant's argument assumes as true facts that are not pleaded in the Complaint (or even contained anywhere in the record). At this stage in the proceedings, the Court must construe the facts and draw all reasonable inferences in favor of the plaintiff, and it cannot find, as a matter of law, that the disputed mailing constituted a firm offer of credit under the FCRA.

Next, People's Choice argues that the Court should dismiss Asbury's claim because she pleads only statutory damages and has not alleged any actual damages. Section 1681n(a)(1)(A) provides that a plaintiff who proves that a person willfully violated the FCRA may recover "any actual damages sustained by the consumer as a result of the failure or damages of not less than $ 100 and not more than $ 1,000." The starting point for interpreting a statute is the language of the statute itself. Cler v. Ill. Educ. Ass'n, 423 F.3d 726, 730 (7th Cir. 2005). [*6] Section § 1681n clearly and unambiguously allows a plaintiff to recover actual or statutory damages, and courts in this District have consistently interpreted § 1681n as allowing a plaintiff to recover actual or statutory damages. See In re Trans Union Corp. Privacy Litigation, 211 F.R.D. 328, 341-42 (N.D. Ill. 2002) (interpreting § 1681n as allowing recovery for statutory damages or actual damages); Buxton v. Equifax Credit Info. Serv., No. 02 C 6288, 2003 WL 22844245 (N.D. Ill. Dec. 1, 2003) (same); Murray v. New Cingular Wireless Serv., Inc., 232 F.R.D. 295, 302-03 (N.D. Ill. 2005) (same); Murray v. Cingular Wireless II, LLC, No. 05 C 1334 (N.D. Ill. Dec. 22, 2005) (unpublished order) (same). People's Choice relies heavily on Ruffin-Thompkins v. Experian Info. Solutions, 422 F.3d 603 (7th Cir. 2005) to support its argument that statutory damages are not available unless a plaintiff proves actual damages. Ruffin-Thompkins. 422 F.3d at 610. Ruffin-Thompkins, however, makes no such explicit holding. Id.; see also Wantz v. Experian Info. Solutions, 386 F.3d 829, 834 (7th Cir. 2004) [*7] (reasoning that a plaintiff could have successfully recovered punitive damages if a willful violation of the statute had been proven even though plaintiff proved no actual damages); Murray v. GMAC Mortg. Corp., No. 05-8035, -- F.3d --, 2006 WL 90081, at * 3 (7th Cir. Jan. 17, 2006) ("That actual loss is small and hard to quantify is why statutes such as the Fair Credit Reporting Act provide for modest damages without proof of injury."). Instead, Ruffin-Thompkins suggests that if a plaintiff could not prove a claim under § 1681o (which covers negligent violations of the FCRA), then she could not recover under § 1681n for a willful violation. Ruffin-Thompkins, 422 F.3d at 607, 610. The Court joins its colleagues and holds that § 1681n allows a plaintiff who proves a willful violation of the FCRA to recover actual or statutory damages. The Defendant's Motion to Dismiss Asbury's § 1681b claim is therefore DENIED.