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Butler v. Midland Funding

United States District Court, N.D. Florida, Pensacola Division

December 11, 2017

MIDLAND FUNDING, et al., Defendants.



         This matter is before the court on defendants Midland Funding LLC and Tim Boland's motion to dismiss (doc. 14) and defendant Great Lakes Educational Loan Services, Inc.'s motion to dismiss (doc. 20). Plaintiff responded in opposition to the motions. (Docs. 18, 24). The matter is referred to the undersigned Magistrate Judge for a Report and Recommendation pursuant to 28 U.S.C. § 636 and N.D. Fla. Loc. R. 72.2(E). After reviewing the parties' submissions, the undersigned recommends that the motions to dismiss be granted because the amended complaint fails to state a claim against the defendants for a violation of the Fair Credit Reporting Act. Plaintiff's claims, however, should be dismissed without prejudice to him filing a second amended complaint.


         Plaintiff, proceeding pro se, filed an amended complaint naming 6 defendants; (1) Midland Funding LLC (“Midland”); (2) Tim Boland, a manager at Midland; (3) Great Lakes Educational Services, Inc. (“Great Lakes”); (4) Equifax; (5) TransUnion; and (6) Experian. Plaintiff says he asked the defendants for: (1) “account records (original)”; (2) “documentation showing whether Midland Funding or Great Lakes are licensed, bonded, or insured”; (3) “the original contract or promissory note”; and (4) ‘documentation showing why [his social security number] was sold to a third party debt collector.” Defendants did not provide the requested information. Plaintiff claims “these companies have blatantly tarnished [his] credit report.” He alleges each defendant violated the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681 et seq. As relief, he seeks punitive damages of $580, 000 “for hardship, harassment, fraud, and the selling of private information.” Midland, Boland, and Great Lakes moved to dismiss the amended complaint, arguing they cannot be held liable under the FCRA for failing to provide the requested information.


         In considering a motion to dismiss for failure to state a claim, the court reads plaintiff's pro se allegations in a liberal fashion, Haines v. Kerner, 404 U.S. 519, 520-21 (1972), accepts all factual allegations in the complaint as true, and evaluates all reasonable inferences derived from those facts in the light most favorable to the plaintiff. Hunnings v. Texaco, Inc., 29 F.3d 1480, 1483 (11th Cir. 1994). A few exceptions modify this rule, such as where the facts alleged are internally inconsistent or where they run counter to facts of which the court can take judicial notice. 5B Charles A. Wright and Arthur R. Miller, Federal Practice and Procedure § 1357 (2008). Further, only well-pleaded factual allegations are taken as true and only reasonable inferences are drawn in favor of the plaintiff. See Oladeinde v. City of Birmingham, 963 F.2d 1481, 1485 (11th Cir. 1992); see also Associated Builders, Inc. v. Ala. Power Co., 505 F.2d 97, 100 (5th Cir. 1974) (“unwarranted deductions of fact are not admitted as true”). Mere “labels and conclusions” are not accepted as true. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)) (noting courts “are not bound to accept as true a legal conclusion couched as a factual allegation”); Ashcroft v. Iqbal, 556 U.S. 662, 680-81 (2009) (explaining that conclusory allegations are not entitled to a presumption of truth).

         As the Supreme Court reiterated in Iqbal, although Rule 8 of the Federal Rules of Civil Procedure does not require detailed factual allegations, it does demand “more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” 556 U.S. at 678. A complaint must state a plausible claim for relief, and “[a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. The mere possibility the defendant acted unlawfully is insufficient to survive dismissal for failure to state a claim. Id. The complaint must include “[f]actual allegations . . . [sufficient] to raise a right to relief above the speculative level, ” Twombly, 550 U.S. at 555, or, “nudge[] the[] claim[] across the line from conceivable to plausible[.]” Id. at 570.


         “Congress enacted the Fair Credit Reporting Act to ensure ‘fair and accurate credit reporting.'” Pedro v. Equifax, Inc., 868 F.3d 1275, 1280 (11th Cir. 2017) (quoting 15 U.S.C. § 1681(a)(1)). “The FCRA imposes a host of requirements concerning the creation and use of consumer reports.” Spokeo, Inc. v. Robins, - U.S. -, 136 S.Ct. 1540, 1545 (2016). Section 1681s-2(b) of the FCRA imposes obligations on furnishers of consumer credit information. These obligations, however are only triggered by “indirect” disputes-that is, when a furnisher receives notice from a consumer reporting agency that a consumer disputes certain information. See 15 U.S.C. § 1681i(a)(2); Green v. RBS Nat'l Bank, 288 F. App'x 641, 642 (11th Cir. 2008) (“The FCRA does provide a private right of action for a violation of § 1681s-2(b), but only if the furnisher received notice of the consumer's dispute from a consumer reporting agency.”) (citing 15 U.S.C. § 1681s-2(b)(1)). Section 1681s-2(b) states that after receiving such notice, a furnisher shall:

(A) conduct an investigation with respect to the disputed information;
(B) review all relevant information provided by the consumer reporting agency pursuant to section 1681i(a)(2) of this title;
(C) report the results of the investigation to the consumer reporting agency;
(D) if the investigation finds that the information is incomplete or inaccurate, report those results to all other consumer reporting agencies to which the person furnished the information and that compile and maintain files on consumers on a nationwide basis; and
(E) if an item of information disputed by a consumer is found to be inaccurate or incomplete or cannot be verified after any reinvestigation under paragraph (1), for purposes of reporting to a consumer reporting agency only, as ...

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