Brown v. Panther II Transportation, Inc/Panther Premium Logistics, Inc. et al

Brief in Support to 20 MOTION to Strike 18 Amended Complaint or in the Alternative Motion to Dismiss

E.D. Va.August 2, 2016

1 THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA SABRINA RENEE BROWN, Plaintiff v. PANTHER II TRANSPORTATION, INC. Case No: 2:16cv158 PANTHER PREMIUM LOGISTICS, INC. and HIRE RIGHT Defendants BRIEF IN SUPPORT OF MOTION TO STRIKE, AND/OR IN THE ALTERNATIVE, MOTION TO DISMISS PLAINITFF'S (SECOND) AMENDED COMPLAINT Come now the Defendants, Panther II Transportation, Inc. and Panther Premium Logistics, Inc. (collectively the "Panther Defendants") and for their Brief in Support of Motion to Strike, and/or in the alternative, Motion to Dismiss Plaintiff's (Second) Amended Complaint, submit the following. INTRODUCTION AND PROCEDURAL POSTURE Plaintiff's third attempt at pleading her claims against the Panther Defendants pursuant to the Fair Credit Reporting Act ("FCRA") fails again as a matter of law. The (Second) Amended Complaint she filed on July 22, 2016 was filed in violation of the Federal Rules of Civil Procedure, as noted in the Court's electronic docket sheet. Moreover, she has failed to remedy the pleading deficiencies which existed in her previous two (2) complaints. Lastly, she has failed to plead facts sufficient to give rise to a claim under § 1681s-2(b) on her new "failure to flag" Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 1 of 22 PageID# 328 2 theory, as that claim is understood in this circuit. Plaintiff's (Second) Amended Complaint still does not state a viable cause of action under the FCRA and must be dismissed. ARGUMENT I. THE (SECOND) AMENDED COMPLAINT WAS FILED IN VIOLATION OF RULE 15(A) OF THE FEDERAL RULES OF CIVIL PROCEDURE. This Court should strike Plaintiff's (Second) Amended Complaint because it was filed in violation of Rule 15(a). In relevant part, that rule states that a "party may amend its pleading once as a matter of course: […] (B) if the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule 12(b), (e) or (f), whichever is earlier. In all other cases, a party may amend its pleading only with the opposing party's written consent or the court's leave." Fed. R. Civ. P. 15(a)(1)(2) (emphasis added). Pursuant to Rule 12(f) of the Federal Rules of Civil Procedure, the court may strike any filing that is "redundant, immaterial, impertinent, or scandalous." Fed. R. Civ. Pro. 12(f); see e.g, Vasquez v. Johnson County Housing Coaltion, Inc., 2003 WL 21479186, *1 (D. Kan. June 16, 2003) (court strikes amended complaint under Rule 15(a) for being filed without leave of court). In this case, Plaintiff's (Second) Amended Complaint was filed without leave of court and/or without obtaining written consent of the Panther Defendants. As such, it should be struck and not considered by this Court. The Court should continue to evaluate and rule upon the existing Motion to Dismiss Plaintiff's (Second) Amended Complaint and not permit Plaintiff to flout this Court's rules by filing complaints without leave. Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 2 of 22 PageID# 329 3 II. PLAINTIFF'S (SECOND) AMENDED COMPLAINT SHOULD BE DISMISSED PURSUANT TO RULE 12(B)(3) AND/OR 12(B)(6) OF THE FEDERAL RULES OF CIVIL PROCEDURE. A. Standard of Review for Motion to Dismiss under Rule 12(b)(3) This Court should apply a well-known and easily understood standard in evaluating Defendants' Motion to Dismiss for improper venue. When deciding such a Motion, "the pleadings are not accepted as true, as would be required under a Rule 12(b)(6) analysis." Sucampo Pharms, Inc. v. Astellas Pharma, Inc., 471 F.3d 544, 549 (4th Cir. 2006). Moreover, the court may consider evidence outside of the pleadings on a Rule 12(b)(3) motion. Id. at 550. Lastly, in deciding a motion challenging venue, "all inferences must be drawn in favor of the plaintiff, and 'the facts must be viewed as the plaintiff most strongly can plead them.'" Silo Point II, LLC c. Suffolk Const. Co., 578 F. Supp.2d 807, 809 (D. Md. 2008) quoting Sun Dun, Inc. of Washington . Coca-Cola Co., 740 F. Supp. 381, 385 (D. Md. 1990). As argued herein, venue is not proper in the Eastern District of Virginia. B. Standard of Review for motion to dismiss under rule 12(b)(6) The standard of review this Court must apply to Defendants' Motion to Dismiss is well- known. "A pleading that states a claim for relief must contain . . . a short and plan statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. Pro. 8(a)(2). When a pleading fails to satisfy this standard, it is subject to dismissal under Rule 12(b)(6) when it does not "contain sufficient factual matter, accepted as true, 'to state a claim that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 1949, 173 L. Ed. 2d 868 (2009) quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). A complaint "that allows the court to draw the reasonable inferences that the defendant is liable for the misconduct alleged" has facial plausibility and satisfies the pleading standard of Rule 8(a)(2). Id., quoting Twombly, 550 U.S. at 556, 127 S.Ct. 1955. Importantly, a court is not required "to accept as true a legal Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 3 of 22 PageID# 330 4 conclusion couched as a factual allegation" (Papasan v. Allain, 478 U.S. 265, 286 (1986)), or a legal conclusion unsupported by factual allegations. Iqbal, 556 U.S. at 678. The Court may also consider documents attached as exhibits to Plaintiff's Complaint in evaluating a Motion to Dismiss under Rule 12(b)(6). Simons v. Montgomery County Police Officer, 762 F.2d 30, 31 (4th Cir. 1985). "A pro se complaint should be liberally construed." See Taylor v. First Premier Bank, 841 F. Supp2d 931, 933 (E.D. Va. 2012) citing Gordon v. Leake, 574 F.2d 1147, 1151 (4th Cir. 1978). However, the complaint should survive a motion to dismiss under Rule 12(b)(6) for failure to state a claim only when a [pro se] plaintiff has set forth "enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570. It is against this well- known background of federal law that Plaintiff's Complaint filed herein must be measured. C. This Court lacks venue over this case and it should be dismissed on that basis alone. There continues to be no venue for this case under 28 U.S.C. §1391 and it should be dismissed on that basis alone. When the Defendant challenges venue, "the plaintiff bears the burden of establishing that venue is proper." Bartholomew v. Va. Chiropractors Ass'n, 612 F.2d 812, 816 (4th Cir. 1979). The FCRA contains no specific venue provision, such that analysis of the issue proceeds under the standard federal venue statute. Belfiore v. Summit Federal Credit Union, 452 F. Supp.2d 629, n. 5 (D. Md. 2006). Pursuant to § 1391 "where jurisdiction in federal court is not based solely on diversity of citizenship, venue may be found in one of three places: (1) a judicial district where any defendant resides, if all defendants reside in the same State, (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred …, or (3) a judicial district in which any defendant may be found, if there is no district in which the action may otherwise be brought." JTH Tax, Inc. v. Houle, 2011 WL 3290378, * 2 (E.D. Va. June 27, 2011) quoting 28 U.S.C. § 1391. In evaluating a motion to dismiss for Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 4 of 22 PageID# 331 5 improper venue, the Court may also look beyond the pleadings in determining whether venue is proper. W. Ref. Yorktown, Inc. v. BP Corp. N. Am., 618 F. Supp.2d 513, 516 (E.D. Va. 2009). If venue is improperly laid, this Court "shall dismiss, or if it be in the interest of justice, transfer such case to any district or division it could have been bought." 28 U.S.C. §1406(a). As Plaintiff's pleadings and the evidence submitted herewith make clear, venue is not proper in this district. First, Panther II Transportation, Inc. is an Ohio Corporation, with its principal place of business in Medina, Ohio. See "Exhibit A," (attached) Aff. of Allen Motter, dated May 27, 2016. Co-Defendant Panther Premium Logistics, Inc. is a Delaware Corporation, with its principal place of business also in Medina, Ohio. Id. Hire Right1 appears to be a resident of Oklahoma, such that there is no venue under subdivision (1) of §1391 because all of the defendants do not reside in Virginia. Mendez v. Law Offices of Cohen & Slamowitz, LLP, 2011 WL 5828573, *3 (D. N.J. Nov. 18, 2011) (venue not proper in FCRA case under 28 U.S.C. §1391(b)(1) "because Defendants do not reside in the same state."). Second, none of the events or omissions giving rise to Plaintiff's claims occurred in Virginia, let alone a 'substantial part' of them. Plaintiff alleges that the Panther Defendants in Ohio inaccurately reported two accidents to co-defendant HireRight in Oklahoma.2 One of these accidents took place in Arkansas and the other in Pennsylvania. See Pl.'s Am. Compl., "Exhibit A." In FCRA suits, venue is typically found in the district where the credit reporting agency is located or where the furnisher of the inaccurate information is located. Smith v. HireRight Solutions, Inc., 2010 WL 2270541, *4 (E.D.Pa. June 7, 2010) (in FCRA suit, venue proper in Oklahoma where consumer reports were generated); Bogollagama v. Equifax Info. Servs., LLC, 2009 WL 4257910, at *3 (E.D. Pa. Nov. 30, 2009) (finding that operative facts in FCRA case arose in forum where credit reports were 1 Because Plaintiff re-alleges her claims against Hire Right, Defendants include its residency in the analysis. 2 Though co-defendant HireRight received mail in Oklahoma, according to Exhibit C3 of Plaintiff's Amended Complaint, it is headquartered in California. Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 5 of 22 PageID# 332 6 compiled and issued); Klingensmith v. Paradise Shops, Inc., 2007 WL 2071677, at *2-3 (W.D. Pa. July 17, 2007) (in FCRA class action, venue issue focused on conduct of the Defendant); Barela v. Experian Info. Solutions, Inc., 2005 WL 770629, at *4 (N.D. Ill. Apr. 4, 2005) (an assessment of the relevant events and alleged harms in an FCRA case points to the defendant's place of business as the appropriate venue). The disputed accidents did not take place in this district. The Defendants' alleged actions which form the basis of Plaintiff's claims did not occur in this district. The only connection this case has to this district is the fortuitous circumstance that the Plaintiff lives in this district, which cannot confer venue under the amended version of 28 U.S.C. § 1391. Ianello v. Busch Entertainment, Corp., 300 F. Supp.2d 400, 403 (E.D.Va. 2004). Since venue is not proper in this district under any provision of 28 U.S.C. §1391, the cast must be dismissed pursuant to 28 U.S.C. 1406(a). D. Plaintiff has no private right of action under §1681s-2(a). The FCRA is a comprehensive federal statute enacted in 1970 "to ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy." Saunders v. Branch Banking and Trust Co. of Va., 526 F.3d 142, 147 (4th Cir. 2008) quoting Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 52 (2007) (citations omitted). "The FCRA places distinct obligations on three types of entities: (1) consumer reporting agencies [CRAs]; (2) users of consumer reports; and (3) furnishers of information to consumer reporting agencies." Nguyen v. Ridgewood Sav. Bank, 2015 WL 2354308, *7 (E.D.N.Y. May 15, 2015) (numbers added) quoting Redhead v. Winston & Winston, P.C., 2002 WL 31106934 (S.D.N.Y. Sept. 20, 2002) (citations omitted). Though Plaintiff fails to specifically allege which of these three categories of entities the Panther Defendants fall into, a fair inference from the allegations in Plaintiff's (Second) Amended Complaint is that they fall into the latter category (3) and are, Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 6 of 22 PageID# 333 7 therefore, arguably subject to the duties the FCRA imposes on 'furnisher's of information' to credit reporting agencies. 'Furnishers of information' to consumer reporting agencies have fairly limited duties under the FCRA, all of which arise under §1681s-2. Pursuant to § 1681s-2(a), 'furnishers of information' must "refrain from knowingly reporting inaccurate information (see §1681s- 2(a)(1)), and to correct any information they later discovery to be inaccurate." See §1681s- 2(a)(2); Longman v. Wachovia Bank, N.A., 702 F.3d 148, 150 (2nd Cir. 2012). Further, pursuant to §1681s-2(b) "furnishers of information have a responsibility to conduct an investigation after receiving notice of a credit dispute from a consumer reporting agency." Nguyen, 2015 WL 2354308 at *7 citing 15 U.S.C. §1681(b) (citation omitted). Though Plaintiff's (Second) Amended Complaint is far from a model of clarity, it appears that she is only expressly seeking redress against the Panther Defendants under §1681s-2(a) and §1681s-2(b). Plaintiff has failed to allege sufficient facts to give rise to a claim under any of these sections of the FCRA and the (Second) Amended Complaint should be dismissed in its entirety. At page one of her (Second) Amended Complaint, Plaintiff for the first time references §1681s-2, the only statute which imposes duties on furnishers of credit information, such as the Panther Defendants. Throughout the (Second) Amended Complaint, she invokes various provisions of §1681s-2(a) to support her claims against the Panther Defendants. As this Court and others across the country have repeatedly held, there is no private right of action under §1681s-2(a) or any of its subsections. "FCRA explicitly bars private suits for violations of §1681s-2(a)." Saunders, 526 F.3d at 149. As Judge Smith succinctly put it "[N]o private cause of action exists pursuant to subsections of the FCRA other than subsection [§1681s-2](b)." Taylor v. First Premier Bank, 841 F. Supp.2d 931, 932 (E.D. Va. 2012); Craighead v. Nissan Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 7 of 22 PageID# 334 8 Motor Acceptance Corp., 2010 WL 5178831 (E.D. Va. Dec. 14, 2010), aff'd 425 Fed.Appx. 197 (4th Cir. 2011) (no private right of action under §1681s-2(a)); Gray v. Wittstadt Titel & Escrow Co., LLC, 2011 WL 6139521, *3 (E.D. Va. Nov. 28, 2011) (same); see also, Boggio v. USAA Federal Sav. Bank, 696 F.3d 611, 615-616 (6th Cir. 2012) (same); Sanders v. Mountain Am. Fed. Credit Union, 689 F.3d 1138, 1147 (10th Cir. 2012) (same); Simms Parris v. Countrywide Fin. Corp., 652 F.3d 355, 358 (3rd. Cir. 2011) (same). As the court noted in Chipka v. Bank of America, 355 Fed. Appx. 380, 383 (11th Cir. 2009), "Congress . . . expressly reserved enforcement of subsection (a) [of §1681s-2] to governmental agencies and officials, thereby limiting a consumer's private cause of action against a furnisher of credit information to violations of §1681s-2(b)."; see also, Nelson v. Chase Mahattan Mort. Corp., 282 F.3d 1057, 1059 (9th Cir. 2002) (no private right of action under §1681s-2(a)); Longman, 702 F.3d at 151 (same); Whisenant v. Fisrt Nat'l Bank & Trust Co., 258 F. Supp.2d 1312, 1314 (N.D. Okla. 2003) ("Congress did not create a private right of action for violations of [§1681s-2(a)])". As the Court noted in Nelson, there is no private right of action under this subsection because "Congress did not want furnishers of credit information exposed to suit by any and every consumer dissatisfied with the credit information furnished." Nelson, 282 F.3d at 1059. There can be no doubt that Plaintiff's claims asserted pursuant to any of the subsections of §1681s-2(a) should be dismissed with prejudice because no private right of actions exists to enforce any of them. E. Plaintiff fails to allege sufficient facts to give rise to a claim under § 1681s-2(b). The majority of Plaintiffs (Second) Amended Complaint is a rehashing of her previous two complaints with one additional claim which is addressed below. Plaintiff has failed to plead facts upon which relief can be granted pursuant to §1681s-2(b) for any one of several reasons. "To state a claim under [§1681s-2(b)], Plaintiff must allege: (1) that he notified a consumer Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 8 of 22 PageID# 335 9 reporting agency that he disputed the accuracy of information in his consumer report; (2) that the consumer reporting agency notified [the provider] of Plaintiff's dispute; and (3) that [the provider] failed to adequately investigate after receiving the notice from the consumer reporting agency." Rossman v. Lazarus, 2008 WL 4181195, *7 (E.D. Va. Sept. 3, 2008) (citation omitted); Alston v. Wells Fargo Bank, N.A., 2013 WL 4507607, *4 (D. Md. Aug. 22, 2013) (same); Ausar-El v. Barclay Bank Del., 2012 WL 3137151 (D. Md. July 31, 2012) (same). Importantly, the second element of the claim requires that the plaintiff allege that the credit reporting agency notified the furnisher of the information of the dispute, not that the furnisher simply acquired notice of the dispute from the plaintiff or otherwise. The statute expressly states that the furnisher's duty to investigate is only triggered "'after receiving notice pursuant to section 1681i(a)(2)' from a credit reporting agency." Dill v. Comenity Bank/Sports Authority, 2014 WL1432502, *3 (W.D. Okla. April 14, 2014) citing 15 U.S.C. §1681s-2(b)(1) (citation omitted). Notice must come from the credit reporting agency and "notice of a dispute received directly from the consumer does not trigger furnisher's duties under subsection (b) [of §1681s-2]." Pinson v. Equifax Credit Info. Servs, Inc., 316 Fed. Appx. 744, 751 (10th Cir. 2009); SimmParris, 652 F.3d at 358 (same); Vilar v. Euifax Information Services, LLC, 2014 WL 7474082, *13 (D.N.M Dec. 17, 2014) (Plaintiff must allege that the credit reporting agency notified the furnisher of information to support claim under §1681s-2(b); notice by consumer not sufficient). Though in the (Second) Amended Complaint, Plaintiff addresses this pleading infirmity which existed in an earlier iteration of the complaint by specifically alleging that Hire Right gave notice to the Panther Defendants of her claim, this cannot save her claim from dismissal. Section 1681s-2(b) requires that after the credit reporting agency provides notice of the plaintiff's dispute to the furnisher of information, the furnisher must then conduct a "reasonable" Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 9 of 22 PageID# 336 10 investigation of the dispute. Johnson v. MBNA Am. Bank., NA, 357 F.3d 426, 430-31 (4th Cir. 2004) accord Chiang v. Verizon New England, Inc., 595 F.3d 26, 37 (1st Cir. 2010), Westra v. Credit Control of Pinellas, 409 F.3d 825, 827 (7th Cir. 2005). First, as a matter of pleading, Plaintiff has failed to allege that the investigation the Panther Defendants performed was not reasonable. The closest she gets is by repeatedly alleging that the investigation was 'useless' and 'inadequate'. See Pl.'s (Second) Amd. Compl., pp. 3, 6. Second, even if this Court were to construe "useless" or "inadequate" as the equivalent of "unreasonable", the facts alleged in the (Second) Amended Complaint demonstrate that the Panther Defendants' investigation was "reasonable" as a matter of law. "[H]ow thorough an investigation must be to be 'reasonable' turns on what relevant information was provided to a furnisher by the CRA [Credit Reporting Agency] giving notice of a dispute." Boggio 696 F.3d at 617. A CRA is required to notify the furnisher of the dispute and provide "all relevant information regarding the dispute." §1681i(a)(1)-(3). The FCRA then requires the furnisher of information to "review all relevant information provided by the [CRA] pursuant to [§] 1681i(a)(2)." 15 U.S.C. § 1681s-2(b)(1)(B). "[T]he nature and specificity of the information provided by the CRA to the furnisher may affect the scope of the investigation required of the furnisher." Boggio, 696 F.3d at 617 citing Johnson, 357 F.3d at 431. Where the CRA only provides "scant information . . . regarding the nature of the [consumer's] dispute", a cursory review of internal documents is reasonable under the FCRA. Westra, 409 F.3d at 827. Where the CRA fails to provide all relevant information to the furnisher, the consumer may have a claim under the FCRA against the CRA, but not the furnisher of information. Chiang, 595 F.3d at 40. Here, Plaintiff has failed to plead what information the CRA provided to the Panther Defendants, such that it is impossible to conclude on the facts as plead in Plaintiff's (Second) Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 10 of 22 PageID# 337 11 Amended Complaint that their investigation of the dispute was unreasonable, which is necessary to state a proper claim under §1681s-2(b). However, taking the facts as alleged in Plaintiff's (Second) Amended Complaint as true, as the Court must on a Motion to Dismiss pursuant to Rule 12(b)(6), Hire Right notified the Panther Defendants of Plaintiff's dispute, but did nothing more and provided no additional information about it. See Pl.'s (Second) Am. Compl., p. 3. Because this is all Plaintiff alleges with respect to the notice, this is all the Court may consider in evaluating Defendants' Motion to Dismiss pursuant to Rule 12(b)(6). In response to this vague and scant notice and based on Plaintiff's own allegations contained in the (Second) Amended Complaint, the Panther Defendants did the following as part of their investigation: - obtained a police report about the March 1, 2015 accident. See Pl.'s (Second) Am. Compl., p. 3 - received a letter from Zurich American Insurance Company confirming the March 1, 2015 accident and assigning it an injury claim number. See Pl.'s (Second) Am. Compl., p. 4 - obtained a letter of representation from attorney Robert Garlick putting the Panther Defendants on notice that he was representing the persons injured in the March 1, 2015 accident. See Pl.'s (Second) Am. Compl., p. 7. - took a statement from the Plaintiff herself who admitted she was involved in the December 2014 accident. See Pl.'s Am. Compl., "Exhibit D" - Confirmed that they received a call into their dispatch that advised them that the Plaintiff had struck a woman's side mirror on December 6, 2014 and that the woman filed a claim with Panther. See Pl.'s Am. Compl., "Exhibit G" This is precisely the nature of an investigation courts have found to be reasonable, in light of the vague and nondescript type of notice that Plaintiff alleges Hire Right provided to the Panther Defendants. See Westra, 409 F.3d at 827. Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 11 of 22 PageID# 338 12 For example, similar to the notice provided by Hire Right in this case, in Westra, the notice from the CRA simply said that the Plaintiff was "disputing the charge on the basis that the account did not belong to him." Westra, 409 F.3d at 827. In response, the furnisher simply checked its internal records, which the court concluded constituted a reasonable investigation in light of the "scant" information provided by the CRA. Id. Similarly, in Towner v. USAA Federal Sav. Bank, 2015 WL 429975, * 5 (D. Utah Feb. 2, 2015), after receiving a notice from the CRA that the customer disputed the account, the furnisher simply checked its own records which amounted to a "reasonable" investigation under the FCRA. The allegations in Plaintiff's (Second) Amended Complaint make it clear that the Panther Defendants did much more than review their own records, which amounted to a "reasonable" investigation given similar notices from CRAs in the aforementioned cases. Though whether or not an investigation is "reasonable" is often a jury question, in this case, reasonable minds cannot conclude anything other than the Panther Defendants' investigation prompted by Hire Right's "scant" notice of Plaintiff's dispute was "reasonable" as a matter of law. Gorman, 583 F.3d at 1157 (court may decide the issue "when only one conclusion about the conduct's reasonableness is possible."). In addition to this failure, Plaintiff has also failed to plead sufficient facts to allege that the Panther Defendants acted with the requisite intent. "Generally, consumers can bring private causes of actions against both furnishers and CRAs for willful or negligent violations of FCRA provisions.. . " Kelly v. Suntrust Bank, 2016 U.S. Dist. LEXIS 23451 (E.D. Va. Feb. 25, 2016). "Willfulness" under the FCRA is defined as including a knowing violation of the Act and its statutory requirements, as well as "reckless" violations of the Act. Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 57 (2007). Recklessness under the Act means an "action entailing an 'unjustifiably high risk of harm that is either known or so obvious that it should be known." Id. at Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 12 of 22 PageID# 339 13 68. Not only has Plaintiff failed to expressly plead that the Panther Defendants willfully or recklessly violated the FCRA, there are no facts alleged in the (Second) Amended Complaint that even approach this high bar. Though Plaintiff alleges at page 4 that the Panther Defendants reported the accidents to the CRA, "knowing they were inaccurate" that is not the same thing as willfully or knowingly violating the terms of the FCRA. Moreover, Plaintiff's allegation that the Panther Defendants reported the existence of these accidents knowing they did not occur conflicts with Plaintiff's attached exhibits, which demonstrate that they did, in fact, occur. See, Pl.'s Amd. Compl., "Exhibits A, D, E, and G". Where there is a conflict between a plaintiff's bare allegations in the complaint and the exhibits upon which she relies, the exhibit prevails. Fed. R. Civ. Pro. 10(c); Moody v. City of Newport News, Va., 93 F. Supp.3d 516, 527 (E.D.Ca. 2015). Because Plaintiff has not and cannot allege that the Panther Defendants willfully violated the terms of the FCRA, her claim under §1681n necessarily fails as a matter of law. Similarly, she has failed to allege that the Panther Defendants were negligent in anyway. In order to satisfy the pleading requirements of the FCRA, even a pro se must allege that the defendants were negligent or willful in violating the statute. See, e.g, Abbot v. Experian Information Solutions, Inc., 2016 WL 1365950, * 3 (N.D.Ca. April 6, 2016) ("[b]ecause Plaintiff fails to allege that [the defendant furnisher] violated the FCRA willfully or negligently, Plaintiff cannot bring any claims under the FCRA."); Cox v. Transunion, Inc., 2003 WL 22245323, *1 (D. Kan. Sept. 26, 2003) ("[p]laintiff fails to aver that Defendant acted negligently or willfully in violating the Fair Credit Report Act" and claim dismissed) (emphasis in original). At the very least, she must plead facts from which a finder of fact could conclude that the Panther Defendants were negligent. However, she fails to allege that they failed to exercise reasonable care with respect to their investigation, nor does she allege how or why their investigation was Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 13 of 22 PageID# 340 14 inadequate or inadequate. She also never mentions that the Panther Defendants procedures for investigating disputes were unreasonable or that they failed to follow those procedures in investigating her disputes. Chiang, 595 F.3d at 38 (plaintiff presented "no evidence that the procedures employed by [the furnisher] to investigate the reported disputes were unreasonable"). She merely denies that the two disputed accidents occurred and that the Panther Defendants investigations were "useless" and "inadequate". Importantly, "[a]n investigation is not necessarily unreasonable because it results in a substantive conclusion unfavorable to the consumer, even if that conclusion turns out to be inaccurate." Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1161 (9th Cir. 2009). Even in the light most favorable to the Plaintiffs, she has alleged no more than she had countervailing evidence to that produced by the Panther Defendants' investigation. She claims that the accidents on December 6, 2014 and March 1, 2015 did not occur and should be removed from her records. See Pl.'s (Second) Amd. Compl., p. 2. However, among other things, she also alleges that she admitted to the Panther Defendants that she was involved in the December 6, 2014 accident. See Pl.'s Amd. Compl., "Exhibit D". She also alleged that the Panther Defendants received a letter of representation from a lawyer representing the persons who were involved in the March 1, 2015 accident, as well as a police report chronicling the accident. See Pl.'s Am. Compl., "Exhibit E". This is hardly enough to carry her burden to allege a colorable claim of negligence under §1681s-2(b). See Williams v. LVNV Funding, LLC, 2014 WL 4066612, *7 (D.Colo. Aug.14, 2014) (case dismissed on motion to dismiss when court concluded that Plaintiff failed to allege facts which could demonstrate that Defendant's conduct was 'unreasonable') Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 14 of 22 PageID# 341 15 Plaintiff seems to be advancing a theory that has been rejected in courts across the country. She has simply alleged in her (Second) Amended Complaint nothing more than the Panther Defendants' investigation was "unreasonable" simply because they reported inaccurate information. Of course, this assumes that Plaintiff's bare allegations that the information was inaccurate are not contradicted by the exhibits which demonstrate the accidents did, in fact, occur. The district court in Abbot rejected the same theory. There, the court noted that "Plaintiff seems to assume that [the defendant furnisher's] investigation must have been unreasonable if [it] reported inaccurate information after the investigation." Abbot, 2016 WL 1365950, *4. In relying on Gorman, the district court concluded that "Plaintiff's conclusory allegation that [the defendant furnisher] 'failed to conduct a reasonable allegation [sic]' is insufficient to plausibly alleged that the [defendant furnisher] conducted an unreasonable investigation in violation of the FCRA." Id.; see also, Vasquez-Estrada v. Collecto, Inc., 2015 WL 6163971, * 3 (D. Or. Oct. 20, 2015) (same); Arianas v. LVNV Funding, LLC, 132 F. Supp.3d 1322, 1328 (M.D.Fla. 2015) (same). As the First Circuit noted in Chiang, "[t]o the extent that [plaintiff's] argument reduces to the claim that any investigation that did not accept [plaintiff's] allegations as accurate was by definition unreasonable, it fails." Chiang, 595 F.3d at 41. In sum, Plaintiff does no more than allege that the Panther Defendants investigation was unreasonable because she claims that the underlying accidents did not occur which, standing alone, is simply insufficient as a matter of law to state a claim under the FCRA. F. Plaintiff has also failed to allege sufficient facts to support the new claim alleged in the (Second) Amended Complaint made pursuant to § 1681s- 2(b). In her (Second) Amended Complaint, Plaintiff now claims that the Panther Defendants violated § 1681s-2(b) by failing to "flag" various accidents as disputed by the Plaintiff when they Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 15 of 22 PageID# 342 16 allegedly reported them to Hire Right, a credit reporting agency. Plaintiff's reliance on the Third Circuit case of Seamans v. Temple University, 744 F. 3d 853 (3rd Cir. 2014) to support her claims for relief under § 1681s-2(b) is misplaced for any one of several reasons. First and foremost, a decision of a sister circuit is not binding on this Court on the issue of Plaintiff's entitlement to relief under § 1681s-2(b); rather, this Court must be guided by decisions from the Fourth Circuit including, and particularly, Saunders v. Branch Banking And Trust Co., 526 F.3d 142 (4th 2008). Second, Seamans was decided after a trial on the merits while here, Plaintiff has yet to demonstrate that she can sufficiently plead a claim for relief in her complaint, let alone prove her case at trial. In Saunders, the Fourth Circuit outlined the duties imposed on furnishers of credit information under the FCRA. After it receives notice from a CRA, the furnisher must: (a) conduct an investigation with respect to the disputed information; (b) Review all relevant information provided by the consumer reporting agency pursuant to § 1681i(a)(2) of this title; (c) report the results of the investigation to the consumer reporting agency; [and] (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 . . . Saunders, 526 F.3d at 148, citing § 1681s-2(a)(2). In her (Second) Amended Complaint, with one notable exception, Plaintiff does no more than allege the Panther Defendants did exactly what was required of them under the FCRA. As pointed out in previous submissions, the Panther Defendants need only conduct a "reasonable" investigation, which does not mean an investigation that vindicates the Plaintiff. Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 16 of 22 PageID# 343 17 Here, Plaintiff alleges that the Panther Defendants conducted an investigation of the various accidents which Plaintiff disputes to ensure, in fact, that they did occur. (Second) Am. Compl. at pp. 1, 2, 4, 5, and 7. She goes on to allege that Hire Right, Inc., a credit reporting agency under FCRA, notified the Panther Defendants of her dispute. (Second) Am. Compl. at p.3. The Panther Defendants' investigation confirmed that each of the accidents had in fact occurred, which nullifies any statutory requirement found in § 1681s-2(a)(2)(D) that the Panther Defendants notify any reporting agencies because the information being reported was not "inaccurate or incomplete." Missing from this is any allegation that the Panther Defendants failed to review "all relevant information provided by" Hire Right because there is no allegation of what, if any, information Hire Right provided to the Panther Defendants, aside from two letters. Specifically, Exhibit B, which Plaintiff alleges is the notice Hire Right provided to the Panther Defendants does not expressly indicate it provided notice of the dispute to the Panther Defendants; rather, it describes the proof that the Panther Defendants sent to Hire Right supporting its conclusion that the accidents had occurred. Also, while Exhibit G does expressly state Hire Right provided notice of Plaintiff's dispute to the Panther Defendants, and goes on to allege in detail the evidence the Panther Defendants relied on in concluding the accidents occurred, it does not state what 'relevant information' Hire Right provided to the Panther Defendants, apart from Plaintiff's contention that they did not occur. Because Hire Right did nothing more than provide notice to the Panther Defendants that she contended the accidents did not occur, the investigation performed, as alleged by Plaintiff, is more than "reasonable" given the scant information provided by Hire Right. Boggio, 696 F.3d at 617 ("how thorough an investigation must be to be 'reasonable' turns on what relevant information was provided to a furnisher by the CRA [Credit Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 17 of 22 PageID# 344 18 Reporting Agency] giving notice of a dispute"); Westra409 F. 3d at 827 (when the CRA only provides "scant information . . . regarding the nature of the [consumer's] dispute", a cursory review of internal documents is reasonable under the FCRA). The recent case of Maiteki v. Martin Transportation Ltd., 2016 WL 3747396 (7th Cir. July 13, 2016) provides a good illustration of what constitutes a "reasonable investigation" under the FCRA on very similar facts. There, the plaintiff had previously worked for Martin Transportation Ltd. as an over the road truck driver. While working there, his employer contended that he was involved in two separate incidents of improper driving. First, he was cited for speeding by the Illinois State Police and second, an automated speed gauge reported that Maiteki was speeding on a separate occasion. Id. at *1. Mateiki denied that either of these incidents occurred and demanded a reinvestigation under the FCRA. Id. After Hire Right notified Martin Transporation of the dispute, it investigated Mateiki's contention that these incidents did not occur. Id. They confirmed the existence of a police report to support the speeding incident and then confirmed the speed gauge reading with a fleet manager. Id. In spite of the plaintiff's contentions that these two incidents did not, in fact, occur, the district court granted summary judgment to the defendant and the Seventh Circuit affirmed. The appellate court rejected all of Plaintiff's contentions that the investigation conducted by Martin Transportation was unreasonable. First, the court pointedly noted that "an investigation does not have to be exhaustive to be reasonable; an information furnisher may balance the costs and benefits of engaging in additional procedures." Id. at 3 citing Seamans v. Temple Univ., 744 F.3d 853, 865 (3rd Cir. 2014) and Johnson v. MBNA Am. Bank, N.A., 357 F.3d 426, 432-33 (4th Cir. 2004). Second, the court held that checking internal documents and consulting with plaintiff's fleet manager to confirm the two incidents was "reasonable", in spite Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 18 of 22 PageID# 345 19 of plaintiff's position that the incidents never occurred. Id. In the case at bar, the Panther Defendants did considerably more in response to Plaintiff's dispute than Martin Transportation did in response to Maiteki. In addition to confirming that a police reported existed chronicling one accident, they also confirmed the same fact with an insurance company and the law firm representing the parties injured in the same accident. Pl.'s (Second) Am. Compl. at pp 2-3. They confirmed another incident by confirming that the accident had occurred with the Plaintiff herself. See Pl.'s Am. Compl., "Exhibit D." As a matter of law, the investigation conducted by the Panther Defendants was reasonable and this case must be dismissed with prejudice. Lastly, Plaintiff's new theory of a "failure to flag" the accidents as disputed is belied by her own allegations. First and foremost, the Plaintiff herself provided notice to Hire Right that she disputed the accuracy of the information about the accidents as reported by the Panther Defendants, such that, as a practical matter, Hire Right already had notice that Plaintiff disputed this information. Plaintiff has not alleged that any other credit reporting agency was not notified of her dispute. Plaintiff's new theory that the Panther Defendants violated the FCRA by failing to notify Hire Right that she disputed the existence of the prior accidents is not supported by the facts alleged in Plaintiff's (Second) Amended Complaint. CONCLUSION Though Plaintiff has now had three opportunities to properly plead a private cause of action under the FCRA, she still has failed to allege facts sufficient to state a claim upon which relief can be granted. First, this Court lacks venue over this case and it should be dismissed on that basis alone. Second, there is no private right of action under § 1681s-2(a) such that any claims based on that statutory subsection must be dismissed as a matter of law because they simply do not exist. Third, Plaintiff has failed to plead facts upon which relief can be granted Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 19 of 22 PageID# 346 20 under § 1681s-2(b) for any one of the several reasons the Panther Defendants argue in their various submissions in response to Plaintiff's Complaints, including and especially that Plaintiff's allegations make it clear that the Panther Defendants' investigation was "reasonable" as a matter of law. For these reasons and any articulated at oral argument, the Panther Defendants respectfully urge this Court to dismiss Plaintiff's (Second) Amended Complaint filed herein, and to award them their costs and fees expended in the matter. Respectfully Submitted, PANTHER II TRANSPORTATION, INC., and PANTHER PREMIUM LOGISTICS, INC. By: _______________/s/____________________ Bryan K. Meals, Esquire (VSB No. 40184) DAVEY BROGAN & MEALS, P.C. 101 Granby Street, Suite 300 Norfolk, VA 23510 Telephone: (757) 622-0100 Facsimile: (757) 622-4924 E-mail: bmeals@dbmlawfirm.com Counsel for the Panther Defendants Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 20 of 22 PageID# 347 21 CERTIFICATE OF SERVICE I certify that on this 2nd day of August, 2016, I electronically filed Defendants’ Brief in Support of Defendants' Motion to Strike or in the Alternative Motion to Dismiss Plaintiff’s (Second) Amended Complaint with the Clerk of Court using the CM/ECF system and will send notice of said filing via U. S. Mail, postage prepaid, and electronic mail to the following: Sabrina Renee Brown, Pro Se Plaintiff 5693 Campus Drive Virginia Beach, VA 23462 s.brown.1968@hotmail.com _______________/s/____________________ Bryan K. Meals, Esquire (VSB No. 40184) DAVEY BROGAN & MEALS, P.C. 101 Granby Street, Suite 300 Norfolk, VA 23510 Telephone: (757) 622-0100 Facsimile: (757) 622-4924 E-mail: bmeals@dbmlawfirm.com Counsel for the Panther Defendants Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 21 of 22 PageID# 348 22 Case 2:16-cv-00158-RAJ-DEM Document 21 Filed 08/02/16 Page 22 of 22 PageID# 349 Case 2:16-cv-00158-RAJ-DEM Document 21-1 Filed 08/02/16 Page 1 of 2 PageID# 350 Case 2:16-cv-00158-RAJ-DEM Document 21-1 Filed 08/02/16 Page 2 of 2 PageID# 351