Sigler v. Bank, Case No. 3:09-CV-615-MEF.

712 F.Supp.2d 1265

Charles SIGLER, Plaintiff,v.RBC BANK (USA), et al., Defendants.

Case No. 3:09-CV-615-MEF.

United States District Court,

M.D. Alabama,

Eastern Division.

May 10, 2010.

Anthony B. Bush, Lewis, Bush & Faulk, LLC, Montgomery, AL, for Plaintiff.

Bryan Glen Hale, John Paul Scott, Jr., Starnes & Atchison LLP, Birmingham, AL, for Defendants.

Cynthia Brown, Tyler, AL, pro se.

MEMORANDUM OPINION AND ORDER

MARK E. FULLER, Chief Judge.

This cause is before the Court on two motions by which two of the three remaining named defendants to this action seek dismissal, pursuant to Federal Rule of Civil Procedure 12(b)(6), of certain of Plaintiff's claims in the Third Amended Complaint. For the reasons set forth below, the Court finds that the motions are due to be GRANTED, and the claims DISMISSED.

FACTUAL¹ AND PROCEDURAL BACKGROUND

In early December of 2008, Cynthia Brown (“Brown”) met with Robert L. Davis (“Davis”), the President of the Tuskegee location of RBC Bank (USA) (“RBC Bank”). Brown sought a consumer loan. Brown executed a Promissory Note and Security Agreement in favor of RBC Bank to obtain $32,000 at an annual interest rate of 10.368%. The loan was secured by a “travel trailer.” Rather than signing her own name on the loan documents, Brown signed the name of Plaintiff Charles Sigler (“Sigler”). Brown did not have Sigler's permission to do so. Neither RBC Bank, nor Davis, provided the loan documents to Sigler.

Between December of 2008 and January of 2009, multiple retail establishments, including Sears, Dillard's, and Victory Nissan denied Sigler's applications for credit. Sigler contends that these establishments denied him credit because of information RBC Bank had furnished to credit reporting agencies about the loan. In February of 2009, RBC Bank contacted Sigler about a late payment on the loan. This caused Sigler to begin investigating the matter to determine when and if his identity had been stolen. In March of 2009, Sigler submitted a formal written demand to RBC Bank in which he disputed the debt and requested validation of it. RBC Bank failed or refused to provide Sigler with the information he had demanded. Sigler then visited Davis in an attempt to resolve the matter. Davis told Sigler that Brown had represented that she was authorized to sign Sigler's name on the loan documents. Sigler believes that some sort of personal relationship exists between Davis and Brown and that Davis has loaned Brown some of his own money.

On June 30, 2009, Sigler filed suit against RBC Bank, Brown, Equifax Information Services, LLC (“Equifax”), Trans Union LLC (“Trans Union”). The original complaint (Doc. # 1) sought damages, injunctive relief, and declaratory relief for alleged violation of the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq. (“FCRA”). Additionally, Sigler sought relief pursuant to Alabama law for invasion of privacy, defamation, fraudulent misrepresentation, intentional infliction of emotional distress, civil identity theft, felonious injury, civil conspiracy, and negligence or wantonness. RBC Bank filed a motion to dismiss the federal statutory claims and the state law claims. Sigler responded to RBC's motion both by arguing against it and by filing the First Amended Complaint (Doc. # 20) against Brown and RBC Bank. RBC Bank filed a motion to dismiss some of the claims set forth in the First Amended Complaint. In response, Sigler sought and received leave to file a Second Amended Complaint (Doc. # 28). RBC Bank once again sought dismissal of some of the claims. Again, Sigler sought and received leave to amend his complaint. Consequently the Third Amended Complaint (Doc. # 42) now sets forth the claims in this action.

By the allegations of the Third Amended Complaint, Sigler seeks damages, injunctive relief and declaratory relief against RBC Bank, Brown, and Davis. ² In addition to adding Davis as a defendant, Sigler also changed the nature of his claims. Sigler no longer alleges violations of the FCRA, but instead he now alleges violations of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., (“TILA”). Sigler persists, however, in alleging numerous claims under Alabama law, including invasion of privacy (Count Two) and defamation (Count Three).

On October 30, 2009, RBC Bank moved this Court to dismiss the invasion of privacy and defamation counts from the Third Amended Complaint arguing that these claims are barred by the FCRA and that the FCRA preempts state law claims arising in circumstances such as those alleged in this action. The Court directed Sigler to respond to the substance of this motion rather than to seek to once again amend his complaint. Davis filed a motion similar to that RBC Bank had filed in November of 2009. Sigler opposes RBC Bank's motion, but he has advised the Court that he does not object to the granting of Davis' motion.

JURISDICTION AND VENUE

This Court has subject matter jurisdiction over this case pursuant to 28 U.S.C. §§ 1331 and 1367. Additionally, Defendants have not argued that the Court does not have personal jurisdiction over them. Pursuant to 28 U.S.C. § 1391(b), venue is appropriate in this district because a substantial part of the events or omissions giving rise to the claims occurred in this judicial district.

LEGAL STANDARD

A Rule 12(b)(6) motion tests the legal sufficiency of the complaint. Prior to the Supreme Court's decision in Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), a motion to dismiss could only be granted if a plaintiff could prove “no set of facts ... which would entitle him to relief.” See Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957); see also Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984); Wright v. Newsome, 795 F.2d 964, 967 (11th Cir.1986). Now, “[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, ---U.S. ----, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)); Sinaltrainal v. Coca-Cola Co., 578 F.3d 1252, 1268 (11th Cir.2009). A complaint states a facially plausible claim for relief “when the plaintiff pleads factual content that allows the court to draw a reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, --- U.S. ----, 129 S.Ct. at 1949. A complaint does not state a facially plausible claim for relief if it shows only “a sheer possibility that the defendant acted unlawfully.” Id. While a complaint need not contain detailed factual allegations to survive a motion pursuant to Federal Rule of Civil Procedure 12(b)(6), “[a] pleading that offers labels and conclusions or a formulaic recitation of the elements of a cause of action will not do.” Id. (quotation marks and citations omitted). Absent the necessary factual allegations, “unadorned, the-defendant-unlawfully-harmed-me accusation[s]” will not suffice. Id. In considering a defendant's motion to dismiss, a district court will accept as true all well-pleaded factual allegations and view them in a light most favorable to the plaintiff. See Am. United Life Ins. Co. v. Martinez, 480 F.3d 1043, 1057 (11th Cir.2007). Accord, Nelson v. Campbell, 541 U.S. 637, 640, 124 S.Ct. 2117, 158 L.Ed.2d 924 (2004) (where a court is considering dismissal of a complaint at the pleading stage, it must assume the allegations of the complaint are true).

DISCUSSION

RBC Bank and Davis contend that the FCRA preempts Sigler's state law causes of action for defamation and invasion of privacy for allegedly publishing inaccurate information to credit reporting agencies. Sigler disputes this contending that these claims are within a recognized exception within the FCRA. Resolution of this dispute logically begins with an examination of the FCRA.

When Congress enacted the FCRA, it recognized that the banking system is dependent upon fair and accurate credit reporting which is completed in large part by consumer reporting agencies. 15 U.S.C. § 1681(a). Consequently, it established an elaborate regulatory structure intended to require that consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner which is fair and equitable. 15 U.S.C. § 1681(b). In addition, Congress devised a regulatory structure which imposes duties upon commercial entities which furnish information to credit reporting agencies.³ These duties are set out in 15 U.S.C. § 1681s-2. Generally speaking, the duties require furnishers of information to credit reporting agencies to provide accurate information, to correct and update information, to provide notice of a dispute, to provide notice of closed accounts, and to investigate and report on any disputed information. See 15 U.S.C. § 1681s-2(a). Additionally, the statutory provisions set out the duties upon notice of a dispute from a credit reporting agency, including the duties to investigate and to report the result. See 15 U.S.C. § 1681s-2(b). With respect to enforcement of these duties, the

FCRA provides two individual rights of action: willful noncompliance id. § 1681n, and negligent noncompliance id. § 1681o. These private rights of action, however, are limited to violations of Subsection (b) (post-notice duties) and are explicitly precluded from use in enforcing Subsection (a) (general duties). Id. 1681s-2(c). Instead, Subsection (a) is to be enforced by federal and state officials. Id. § 1681s-2(d); Gordon v. Greenpoint Credit, 266 F.Supp.2d 1007, 1009-10 (S.D.Iowa 2003) (Pratt, J.).

Islam v. Option One Mortgage Corp., 432 F.Supp.2d 181, 185 (D.Mass.2006).

By its terms, 15 U.S.C. § 1681t(b)(1)(F) explicitly preempts all state laws in the areas covered by § 1681s-2:

No requirement or prohibition may be imposed under the laws

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