On November 9, a magistrate judge in the Northern District of Georgia issued a Report & Recommendation to grant a motion to dismiss because the plaintiff’s Fair Debt Collection Practices Act (FDCPA) claims were time-barred and the cause of action under the Fair Credit Reporting Act (FCRA) failed to state a claim.
In Marion v. Commercial Services Group, Inc., the plaintiff claimed that she viewed her credit reports in January 2021 and noticed an open account reported by the defendant. The plaintiff requested that the defendant validate the debt. The defendant responded by providing documentation, but not providing the requested verification information. In June 2021, the plaintiff attempted to negotiate a “pay to delete” settlement with the defendant and offered to pay 30% of the balance of the reported debt in exchange for deletion of all information related to the debt. The defendant rejected the proposed settlement, noting, however, that the original creditor was open to alternate repayment arrangements. The defendant further stated that it had investigated the plaintiff’s disputes and that the account would be reported as paid once the obligation was resolved.
On February 24, 2022, the plaintiff submitted a complaint to the Consumer Financial Protection Bureau (CFPB). The defendant responded stating that it had partnered with the original creditor to obtain repayment and that the debt had not been sold or transferred. The defendant further indicated that the debt was for educational assistance and was not a duplicate. In April and June of 2022, the plaintiff sent dispute letters to a consumer reporting agency (CRA) alleging inaccuracies in her credit report. The CRA communicated these disputes to the defendant who verified the credit reporting and made no modifications. The plaintiff contacted the defendant in October 2022 again requesting verification information, which the defendant provided. The plaintiff contacted the defendant again in November 2022 regarding her dispute and again requested information and corrections to the alleged inaccuracies in the credit reporting on the account. The plaintiff subsequently brought this lawsuit alleging violations of the FDCPA and FCRA.
The defendant moved to dismiss the complaint, arguing that the FDCPA and FCRA claims were time-barred and that the FCRA claims failed to state a claim upon which relief can be granted. The motion was referred to the magistrate for consideration.
Regarding the FDCPA claims, the defendant contended that the statute of limitations had run. The plaintiff conceded this point. The court agreed, noting that the while the alleged FDCPA violations occurred in January 2021, the action was not brought until February 2023. As such, the court determined that the one-year statute of limitations provided for by 15 U.S.C. § 1692k(d) had run, and accordingly recommended dismissal of the claims.
The defendant next contended that the FCRA claims should also be dismissed as time-barred, arguing that January 2023 was the latest the plaintiff could have timely filed a FCRA claim. The plaintiff disagreed, arguing that since she first disputed her account with the CRA in February 2023, the latest she could timely file a complaint was February 2024.
The court considered the statute of limitations imposed by § 1681p and held that any violations the plaintiff learned of prior to February 21, 2021, were time-barred as they occurred more than two years prior to the filing of this case. However, the court further found that any claims based on the defendant’s investigations that occurred after February 21, 2021, were not time-barred, even if those disputes did not involve new information. Accordingly, the court found that three disputes the plaintiff submitted in October and November 2022 were not time-barred.
The defendant finally argued that the remaining FCRA claims that were not time barred should still be dismissed for failure to state a claim. The court noted that a § 1681s-2(b) claim in the Eleventh Circuit must allege facts showing that a reasonable investigation would have, in fact, revealed inaccuracies. The court concluded that the plaintiff had not satisfied the pleading standard because the defendant verified multiple times that the plaintiff’s account was correctly reported as a collections account with an “open” status. Finding that this reporting was accurate, the court indicated that the plaintiff never alleged the debt was resolved. Rather, the plaintiff argued only that she owed no debt to the defendant, which, the court explained, had no bearing on the accuracy of the reporting as the defendant partnered with the original creditor to collect the debt. The court elaborated on its rejection of the plaintiff’s argument, noting that the defendant established they were acting on behalf of the original creditor, and the plaintiff’s claims of not owing the defendant specifically any debt did not constitute alleging an inaccuracy that a reasonable investigation would have revealed as required to sustain a claim under § 1681s-2(b). For these reasons, the court recommended that the defendant’s motion to dismiss the FCRA claims for failure to state a claim be granted.