Woods v. LVNV Funding, LLC

KEVIN WOODS, Plaintiff, v. LVNV FUNDING, LLC, and RESURGENT CAPITAL SERVICES, L.P., Defendants.

Case No. 1:19-cv-03451-TWP-MJD

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION

May 4, 2021

ENTRY ON CROSS-MOTIONS FOR SUMMARY JUDGMENT

This matter is before the Court on a Motion for Summary Judgment filed pursuant to Federal Rule of Civil Procedure 56 by Plaintiff Kevin Woods ("Woods") (Filing No. 68), and a Cross-Motion for Summary Judgment filed pursuant to Federal Rule of Civil Procedure 56 by Defendants LVNV Funding, LLC ("LVNV") and Resurgent Capital Services, L.P. ("Resurgent") (collectively, "Defendants") (Filing No. 73). Woods initiated this action against Defendants under the Fair Credit Reporting Act ("FCRA") and the Fair Debt Collection Practice Act ("FDCPA"), alleging that they purportedly "continued to disseminate inaccurate statements and information despite [Woods] informing LVNV [ ] that he does not owe the debt that Defendants are reporting." (Filing No. 29 at 5, 9-11.) Following discovery, Woods moved and Defendants cross-moved for summary judgment. For the following reasons, the Court denies Woods' Motion for Summary Judgment (Filing No. 68) and grants Defendants' Cross-Motion for Summary Judgment (Filing No. 73).

I. BACKGROUND

In March 2018, a Citibank, N.A. American Airlines credit card account was opened in Woods' name (the "Account") (Filing No. 74-4 at 6). Shortly thereafter, a one-way airline ticket from Dallas, Texas to Los Angeles, California was purchased using the Account (Filing No. 74-1 at 25). In December 2018, LVNV purchased the now-delinquent Account, and it was placed with Resurgent for collection since no payments had been made on it. Id. at 7-8, 10. Early the next year, on February 21, 2019, Resurgent sent Woods a letter, informing him that he had thirty days to dispute the debt, or Resurgent would assume it was valid. Id. at 68. That same day, Resurgent also sent Woods an account summary that verified the Account and included borrower and account information. Id. at 70-71.

Woods called Resurgent a week later, on February 28, 2019, to inform them that he disputed the Account (Filing No. 74-3 at 8). Resurgent noted the dispute and asked Woods to send in documentation and details that could help resolve the matter. Id. The next month, on March 13, 2019, Woods sent Resurgent a completed Federal Trade Commission ("FTC") form letter he "pulled off the Internet" titled "Identity Theft Letter to a Debt Collector". (Filing No. 74-4 at 7; Filing No. 69-10 at 2.) In his signed, notarized letter, Woods wrote that he was "a victim of identity theft." (Filing No. 69-10 at 2.) He included a copy of his driver's license, and referred to an (apparently missing) "identity [t]heft report" for details. Id. When Resurgent received the letter, the documents concerning Woods—including account statements and documents that assigned the Citibank account to LVNV—were reviewed. (Filing No. 74-2 at 9.) As both sets of documents matched Woods' personal information, and Woods' letter lacked any corroborative support for his assertion of fraud, Resurgent sent a letter on April 3, 2019, to Woods informing him that it had verified the Account and enclosed an account summary. Id.; Filing No. 74-1 at 73. Beginning at this time—April 2019—Resurgent started credit reporting the Account but indicated that it was "disputed." (Filing No. 74-3 at 7.)

When Woods called Resurgent to dispute that confirmatory resolution less than a week later on April 9, 2019, Resurgent again reviewed the Account, determining once more that Woods had not provided sufficient support for his claim (Filing No. 74-2 at 10). On May 1, 2019, Resurgent sent Woods a list of five documentary options that would help in any further investigation: (1) a copy of a filed police report about the fraud; (2) a completed and notarized identify theft affidavit; (3) letter(s) from the original creditor or other previous owner of this account supporting the claim; (4) court documents showing that the perpetrator has been prosecuted for using the account; or (5) any other documents supporting the claim (Filing No. 75-2 at 2). Resurgent also provided Woods a blank identity theft affidavit to complete, but he never returned that form. Id. at 4-5.

On May 22, and June 1, 2019, Woods received letters from the American Airlines Security Operations department indicating that, following an investigation, it had determined that he was responsible for the Account (Filing No. 74-6 at 2; Filing No. 74-7 at 2). On June 20, 2019, Woods sent a dispute letter to LVNV and the three major credit reporting agencies (Equifax, Experian, and TransUnion) that challenged the Account (Filing No. 74-8 at 2-6). In the letter, Woods wrote that the Account did not belong to him, and he enclosed a police report from the Tipton County Sheriff's Office. Id. at 2, 6. In its narrative, the attached police report indicated that Woods had provided the two letters from American Airlines stating that it had determined that Woods was responsible for the Account. Id. at 6. When Resurgent received this dispute as an automated credit dispute verification ("ACDV") on June 28, 2019, it again examined the matter, first through its internal ACDV team and then by its disputes team (Filing No. 74-2 at 13). On August 15, 2019, Resurgent informed Woods that their investigations again established that the information provided—including the adverse police report—did not suffice to support Woods' claim of fraud.Id. at 13, 51. Again, Resurgent encouraged Woods to provide additional documentation that could assist the investigation, but again Woods did not immediately respond to this invitation. Id.

Meanwhile, on July 15, 2019, Woods received a letter from Equifax indicating that an investigation had determined that the disputed information had been verified (Filing No. 74-9 at 2-3). On August 28, 2019, however, Woods—two weeks after filing this action on August 14, 2019 under the FCRA and FDCPA—received a letter from American Airlines indicating that it had completed another investigation, but this time concluded that he was not responsible for the Account (Filing No. 69-18 at 2). After receiving this letter in September 2019, Resurgent requested that the three credit reporting agencies delete all Account information (Filing No. 74-2 at 14). Woods moved for summary judgment on September 3, 2020 (see Filing No. 68). A month later, on October 2, 2020, Defendants cross-moved for summary judgment (see Filing No. 73).

II. LEGAL STANDARD

Federal Rule of Civil Procedure 56 provides that summary judgment is appropriate if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Hemsworth v. Quotesmith.Com, Inc., 476 F.3d 487, 489-90 (7th Cir. 2007). In ruling on a motion for summary judgment, the court reviews "the record in the light most favorable to the nonmoving party and draw[s] all reasonable inferences in that party's favor." Zerante v. DeLuca, 555 F.3d 582, 584 (7th Cir. 2009) (citation omitted). However, "[a] party who bears the burden of proof on a particular issue may not rest on its pleadings, but must affirmatively demonstrate, by specific factual allegations, that there is a genuine issue of material fact that requires trial." Hemsworth, 476 F.3d at 490 (citation omitted). "In much the same way that a court is not required to scour the record in search of evidence todefeat a motion for summary judgment, nor is it permitted to conduct a paper trial on the merits of a claim." Ritchie v. Glidden Co., 242 F.3d 713, 723 (7th Cir. 2001) (citation and internal quotations omitted). Finally, "neither the mere existence of some alleged factual dispute between the parties nor the existence of some metaphysical doubt as to the material facts is sufficient to defeat a motion for summary judgment." Chiaramonte v. Fashion Bed Grp., Inc., 129 F.3d 391, 395 (7th Cir. 1997) (citations and internal quotations omitted).

These tenets apply equally where, as here, opposing parties each move for summary judgment in their favor pursuant to Rule 56. I.A.E., Inc. v. Shaver, 74 F.3d 768, 774 (7th Cir. 1996). Indeed, the existence of cross-motions for summary judgment does not necessarily mean that there are no genuine issues of material fact. R.J. Corman Derailment Serv., Inc. v. Int'l Union of Operating Eng'rs., 335 F.3d 643, 647 (7th Cir. 2003). Rather, the process of taking the facts in the light most favorable to the nonmovant, first for one side and then for the other, may reveal that neither side has enough to prevail without a trial. Id. at 648. "With cross-motions, [the Court's] review of the record requires that [the Court] construe all inferences in favor of the party against whom the motion under consideration is made." O'Regan v. Arbitration Forums, Ins., 246 F.3d 975, 983 (7th Cir. 2001) (quoting Hendricks-Robinson v. Excel Corp., 154 F.3d 685, 692 (7th Cir. 1998)).

III. DISCUSSION

In their respective briefings on summary judgment, the parties argue that they are entitled to judgment as a matter of law. For his part, Woods argues that "Defendants did not conduct a reasonable investigation into [his] dispute as required by the [FCRA]" and that Defendants violated the FDCPA when they "continued to report the alleged debt to [Woods'] credit report after [he]disputed the debt." (Filing No. 69 at 16, 20.)¹ Defendants, on the other hand, maintain that LVNV is not liable under the FCRA because it is not a "furnisher" and that "Resurgent conducted reasonable investigations into [Woods'] disputes" required by that statute (Filing No. 74 at 10). As for the FDCPA claim, Defendants contend that Woods "has no evidence that the debt sought to be collected arose from a transaction incurred primarily for...