United States District Court, D. Minnesota
JEFFREY A. BEAUBIEN, Plaintiff,
EXPERIAN INFORMATION SOLUTIONS, INC., Defendant.
Thomas J. Lyons, Jr., CONSUMER JUSTICE CENTER P.A., for plaintiff.
Sergio A. Tostado, JONES DAY; Gregory J. Myers, LOCKRIDGE GRINDAL NAUEN P.L.L.P., for defendant.
PATRICK J. SCHILTZ, District Judge.
In early 2012, plaintiff Jeffrey Beaubien discovered incorrect information on his credit report. He notified defendant Experian Information Solutions, Inc. ("Experian"), a creditreporting agency, of the error. Experian contacted the furnisher of the information, and the furnisher verified that the information was correct. Experian then informed Beaubien that it would continue to report the information. In fact, the information was not correct, and the furnisher erred when it verified the information.
Beaubien now brings claims against Experian under the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681 et seq. This matter is before the Court on Experian's motion for summary judgment and Beaubien's motion for partial summary judgment on liability. For the reasons stated below, Experian's motion is granted in part and denied in part and Beaubien's motion is denied. Specifically, the Court denies both parties' motions insofar as they seek judgment on Beaubien's claim that Experian's reinvestigation of Beaubien's dispute was negligent. The Court grants Experian's motion in all other respects.
Beaubien's son, Joseph Cairl, took out a series of eleven student loans from Bremer Bank. The total principal amount of these loans was approximately $87, 660. Scott Dep. Ex. 4. Beaubien co-signed four of the loans, making him jointly liable for approximately $29, 000 of the principal amount. Scott Dep. Ex. 4.
At some point after Cairl graduated, Bremer Bank sold the loans to ACS. Cairl Dep. 11. Cairl later discovered that ACS's records wrongly treated Beaubien as being liable for all eleven loans, rather than for only the four loans that he had co-signed. Cairl Dep. 14-15. At that point, the total amount of principal and interest on the eleven loans was over $100, 000. Beaubien Dep. 20, 29-30. Cairl informed Beaubien, who reviewed his Experian credit report and discovered that it listed a loan debt of over $100, 000. Beaubien Dep. 160; Scott Dep. Ex. 4. On January 12, 2012, Beaubien sent a letter to Experian disputing the amount of the debt being reported by ACS. Scott Dep. Ex. 4. Beaubien explained that the loans had been taken out by his son, Joseph Cairl, and that Beaubien had co-signed only some of Cairl's loans. Scott Dep. Ex. 4. Beaubien also attached copies of the Bremer Bank promissory notes showing that he had cosigned only four of the eleven loans. Scott Dep. Ex. 4.
Experian scanned Beaubien's letter (including the attachments) into an electronic imaging system. Scott Dep. 37. An Experian employee then reviewed the letter and prepared an "automated consumer dispute verification" form (or "ACDV"). An ACDV is an electronic form that a credit-reporting agency uses to notify a furnisher of information that a consumer has disputed the accuracy of that information. Scott Dep. 38; Hughes Aff. ¶ 11, June 30, 2014 [hereinafter "Hughes Aff."]. An ACDV generally contains (1) information identifying the consumer; (2) a "dispute code" that indicates the nature of the consumer's dispute; and, in some cases, (3) a free-form narrative with additional information. Hughes Aff. ¶¶ 47, 49. The dispute codes used on ACDVs are widely known and accepted throughout the credit-reporting industry. Hughes Aff. ¶ 49.
Under "Dispute Reason, " the ACDV for Beaubien's dispute stated:
111 - Claims company will delete. Verify all account information. RCVD DOCUMENTS DTD FROM 06/2003 TO 08/2007 FROM BREMER EDU SHOWING JEFFREY BEAUBIEN AS BORROWER ONLY IN SOME OF THEM.
Scott Dep. Ex. 6. The number "111" is the dispute code corresponding to "Claims company will delete. Verify all account information." Scott Dep. 44-46, 48-49; Hughes Aff. ¶ 51. The additional information - that is, the information typed in capital letters - was entered manually by an Experian employee. Scott Dep. 49-50. At the time that Experian created this ACDV, employees could use no more than 120 characters (including spaces) to provide additional information to the creditor. Scott Dep. 50, 57.
On February 10, 2012, Experian received a response from ACS indicating that the information that ACS had reported to Experian was accurate. Scott Dep. 57, 61; Hughes Aff. ¶ 22. Specifically, under the heading "SUBSCRIBER RESPONSE" on the ACDV form, ACS stated that the balance of the loan was $106, 360. Scott Dep. Ex. 4; Scott Dep. 63-64. The nature of ACS's response did not trigger any human review. Scott Dep. 57-59, 77. Instead, Experian's computer system generated an automated letter to Beaubien. The letter told Beaubien that ACS continued to report Beaubien as liable for a loan of $106, 360 and that the information in his credit report had been "updated." Beaubien Dep. Ex. 15. (Presumably the "updated" status simply reflected that the balance had decreased slightly since the date of Beaubien's January 12 letter.) Beaubien did not contact Experian again. Experian ...