Crawford v. Lawrence

1

HASSAN CRAWFORD, Plaintiff, v. JAMES LAWRENCE, et al., Defendants.

No. 1:23-cv-192

United States District Court, S.D. Ohio, Western Division

January 16, 2024

Bowman, Magistrate Judge

OPINION AND ORDER

DOUGLAS R. COLE, UNITED STATES DISTRICT JUDGE

Plaintiff Hassan Crawford alleges that National Credit Systems, Inc. (NCS) and two of its employees-James Lawrence and Joel Lackey-engaged in debt collection practices that violate the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq.; the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq.; Ohio Revised Code Chapter 1349;^[1] and the Ohio Consumer Sales Practices Act (OCSPA), Ohio Rev. Code § 1345.01 et seq. (Compl., Doc. 3, #31-32). Based on allegedly improper collection efforts, he asserts five counts against the three Defendants: one count for violating each of the four statutes, along with a fifth count for intentional infliction of emotional distress (IIED). (Id. at #36-40).

Defendants have moved to dismiss Crawford's Complaint pursuant to either Federal Rule of Civil Procedure 12(b)(1), (b)(5), or (b)(6), arguing that Crawford (1) did not serve Lawrence or Lackey properly, (2) has not demonstrated standing to sue and (3) has failed to state a claim on which relief can be granted. (Doc. 8). For the reasons discussed below, the Court GRANTS Defendants' Motion to Dismiss (Doc. 8). The Court thus DISMISSES Crawford's Complaint (Doc. 3) WITHOUT PREJUDICE for lack of standing. But the Court GRANTS Crawford thirty days to move for leave to file an amended complaint, in which motion he shall address the deficiencies the Court identifies below and attach his proposed amended complaint.

BACKGROUND

Crawford alleges that he contacted Defendants seeking validation of a debt that he saw on his credit report on or around February 8, 2023. (Doc. 3, #33-34). But he says Defendants never responded to his two requests for validation and continued to include the disputed debt in his credit report without any notation that it was disputed. (Id. at #33-35). Accordingly, Crawford says he suffered damages “[i]nclud[ing], but [] not limited to, FDCPA [violations], FCRA [violations], and damage to plaintiff's creditworthiness by other conspirators agents, servants and employees of the defendant(s).” (Id. at #34).

Based on those allegations, Crawford filed suit and moved to proceed in forma pauperis (IFP). (Doc. 1). Because he is proceeding pro se, his case was referred to a Magistrate Judge under this Court's General Order Cin 22-02. The Magistrate Judge granted Crawford's motion to proceed IFP (Order, Doc. 2) and his Complaint was entered on the docket that same day (Doc. 3). The Complaint asserts that “[e]ven though National Credit Systems et. al., James Lawrence, Joel Lackey had actual knowledge that the amount [of debt] they were trying to collect was false, they still conspired to damage the Plaintiff's reputation for credit worthiness [sic] by reporting a tradeline that was not complete and accurate.” (Id. at #35). So it alleges that Defendants' debt collection practices violated FCRA, the FDCPA, Ohio Revised Code Chapter 1349, and the OCSPA, as well as constituted IIED. (Id. at #36-40). And Crawford seeks injunctive relief, actual damages, statutory damages, and punitive damages based on those allegations. (Id. at #40-42).

Next, Defendants moved to dismiss Crawford's Complaint under either Federal Rule of Civil Procedure 12(b)(1), (b)(5), or (b)(6), arguing that Crawford (1) did not serve Lawrence or Lackey properly, (2) has not demonstrated standing to sue, and (3) has failed to state a claim on which relief can be granted. (Doc. 8). On the service issue, they argue that the certified mail receipts that are meant to demonstrate Crawford's effecting service on Lawrence and Lackey reveal that the summons was executed at an address in Denver, Colorado, where neither Lawrence nor Lackey works or resides, and that the signature “SBS” on the mail receipts matches neither of their initials. (Id. at #58-59). On the standing issue, they assert that their Motion makes a factual attack on jurisdiction. (Id. at #59). But more specifically, they contend that Crawford failed to allege a cognizable injury in fact, let alone one that is traceable and redressable, because “[h]e never alleges that a third party viewed what he claims to be an inaccurate credit report, that his credit score suffered or that he was denied credit based on the[se] alleg[ed]” inaccuracies. (Id. at #61). In the alternative, Defendants argue that Crawford has not alleged the requisite elements of any of his claims, and that his IIED claim is preempted by FCRA. (Id. at #61-65).

Crawford responded. (Doc. 9). First, he argues that he stated his claims with sufficient detail to satisfy notice pleading requirements. (Id. at #68-71). Second, he says the Court has personal and subject matter jurisdiction under 15 U.S.C. § 1692(e). (Id. at #71-73). Finally, he says he was denied both a new car loan with a lower interest rate and a new credit card because of Defendants' conduct. (Id. at #73). So, citing Krueger v. Experian Info. Sols., Inc., No. 20-2060, 2021 WL 4145565 (6th Cir. Sept. 13, 2021), he claims he has standing. (Id. at #73). And Crawford attaches five exhibits in support of these arguments: (1) a waiver of service document, which he claims he sent to Defendants; (2) what looks like a printout of part of a credit report with “National Credit Systems; Last reported Jun. 11, 2023” written at the top of the page; (3) a page captioned “Inquiry details” that appears to list five credit inquiries from December 9, 2022; (4) an unauthenticated copy of a letter addressed to Defendants' counsel requesting validation of a debt; and (5) a USPS mailing label. (Id. at #76-81).

Defendants have since replied. (Doc. 10). They argue that (1) the Court cannot consider Crawford's allegations that Defendants' actions caused him to be denied a car loan and credit card because he raised them in his Response, (id. at #83-84); (2) “to the extent that such allegations had been made in the Complaint, the complaint would remain deficient because there is no allegation that any negative credit information was disseminated,” (id. at #84-86); and (3) amendment would be futile because an amended complaint could not withstand a motion to dismiss under Rule 12(b)(6) for failure to state a claim, (id. at #86-87).

The matter is now before the Court on the Motion to Dismiss.

LEGAL STANDARD

As noted above, Defendants move to dismiss both for lack of jurisdiction under Rule 12(b)(1), for failure to effect proper service of process under Rule 12(b)(5), and for failure to state a claim under Rule 12(b)(6). Because jurisdictional issues precede consideration of the merits and because the Court concludes that they are dispositive here the Court addresses only jurisdiction in this Opinion. United States ex rel. Kreindler & Kreindler v. United Techs. Corp., 985 F.2d 1148, 1155-56 (2d Cir. 1993) (“Where, as here, the defendant moves for dismissal under Rule 12(b)(1) as well as on other grounds, the court should consider the Rule 12(b)(1) challenge first[.]” (cleaned up)).

“If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action.” Fed.R.Civ.P. 12(h)(3). “[C]hallenges to standing are properly brought under Fed.R.Civ.P. 12(b)(1) for a lack of subject-matter jurisdiction.” Miller v. Collins, No. 23-3191, 2023 WL 7303305, at *2 (6th Cir. Nov. 6, 2023). And when a defendant challenges the Court's jurisdiction under Rule 12(b)(1), “the plaintiff has the burden of proving jurisdiction in order to survive the motion.” Rogers v. Stratton Indus., Inc., 798 F.2d 913, 915 (6th Cir. 1986); Courtney v. Smith, 297 F.3d 455, 459 (6th Cir. 2002) (“[T]he plaintiff, as the party invoking federal subject matter jurisdiction, has the burden of persuading the court that all of the requirements necessary to establish standing to bring the lawsuit have been met.”). Further, a dismissal under Rule 12(b)(1) is without prejudice because it “allows for the possibility of repleading the action to bring it within the subject matter jurisdiction of some court.” Ohio Nat'l Life Ins. Co. v. United States, 922 F.2d 320, 325 (6th Cir. 1990).

A challenge to the court's subject-matter jurisdiction under Rule 12(b)(1) can be either facial or factual. Id. “A facial attack .. merely questions the sufficiency of the pleading.” Id. The standard for whether a “complaint [] allege[s] jurisdiction adequately” is whether it “contain[s] non-conclusory facts which, if true, establish that the district court ha[s] jurisdiction over the dispute.” Carrier Corp. v. Outokumpu Oyj, 673 F.3d 430, 440 (6th Cir. 2012) (emphasis added). “When ruling on a motion to dismiss for lack of standing or a facial challenge to its subject-matter jurisdiction under Rule 12(b)(1), the district court must accept all material allegations of the complaint as true.” Phillips v. Trump, No. 18-6341, 2019 WL 7372704, at *1 (6th Cir. Nov. 20, 2019).

“On the other hand, when a court reviews a ... factual attack ... no presumptive truthfulness applies to the factual allegations.” Ohio Nat'l Life Ins. Co., 922 F.2d at 325. And when reviewing a factual attack on jurisdiction courts may consider sources outside the pleadings. Id.(“[A] trial court has wide discretion to allow affidavits, documents and even a limited evidentiary hearing to resolve disputed jurisdictional facts.”); Nichols v. Muskingum Coll., 318 F.3d 674, 677 (6th Cir. 2003) (“[T]he court may consider evidence outside the pleadings to resolve factual disputes concerning jurisdiction, and both parties are free to supplement the record by affidavits.”).

One more thing worth noting:...