United States District Court, D. Minnesota
Gregg A. Tusen, Plaintiff,
M&T Bank, Trans Union, LLC, and FD Holdings, LLC Defendants.
MEMORANDUM AND ORDER
A. Magnuson, United States District Court Judge
matter is before the Court on Defendant M&T Bank's
(“M&T”) Motion to Dismiss. For the following
reasons, the Motion is granted in part and denied in part.
November 2012, Plaintiff Gregg A. Tusen filed for Chapter 13
bankruptcy. (4th Am. Compl. (Docket No. 54) ¶
His bankruptcy petition included real property with an
estimated value of $65, 000, secured by a $103, 225 mortgage
with Bank of America. (Id. ¶ 12.) His
bankruptcy plan also included a $1, 560 delinquency owed to
Bank of America. (Id. ¶ 13.) During the
bankruptcy proceedings, Bank of America filed a Notice of
Postpetition Mortgage Fees, Expenses, and Charges, seeking
$150. (Id. ¶ 14.) On July 25, 2013, M&T
notified Tusen by letter that it was now servicing his
mortgage on behalf of Bank of America. (Id. ¶
15.) There is no dispute that Tusen voluntarily made his
mortgage payments during the bankruptcy proceedings.
(Id. ¶ 18.) However, M&T reported “no
data” on these payments to credit reporting agencies
because of the bankruptcy stay. (Id. ¶ 26.)
Tusen received his Chapter 13 discharge on December 22, 2015.
(Id. ¶¶ 17-18.)
January 4, 2016, M&T sent Tusen a mortgage statement that
sought $650 as a “recoverable corporate advance,
” in addition to his regular $688.85 mortgage payment.
(Id. ¶ 19.) Tusen disputed the extra charge and
requested additional information. (Id. ¶¶
20, 22.) M&T clarified that $500 of the $650
“recoverable corporate advance” was for
attorney's fees, and the remaining $150 was for a
bankruptcy filing in connection with the Notice of
Postpetition Mortgage Fees, Expenses, and Charges originally
filed by Bank of America. (Id. ¶ 21, Ex. 2.)
M&T then withdrew its $500 demand for attorney's fees
because it concluded that the amount was not recoverable from
Tusen. (Id. ¶ 24.) M&T continues to seek
$150 related to Bank of America's notice, and although he
disputes that he owes this amount, Tusen conceded at oral
argument that his claims relate only to the $500 demand for
attorney's fees. (Id. ¶¶ 21, 24.)
receiving the bankruptcy discharge, Tusen attempted to
refinance his mortgage to lower his monthly mortgage
payments. (Id. ¶ 25.) He requested a credit
report from Defendant FD Holdings, LLC, which reported that
he was delinquent on mortgage payments between August 2014
and February 2015. (Id. ¶ 28.) The next day, he
requested a credit report from Defendant Trans Union, LLC,
which reported “no data” during the same time
period. (Id. ¶ 30.) It appears that both credit
reporting agencies interpreted M&T report of “no
data” as delinquent payments. (Id.
then mailed disputes to FD Holdings and Trans Union,
challenging the “no data” reporting.
(Id. ¶ 32.) M&T responded to Tusen's
disputes twice; the second time M&T stated that, after
careful review, it had determined that Tusen's
“account is reporting accurately in accordance with the
bankruptcy laws and guidelines.” (Id.
¶¶ 33, 35.) About three months later, Tusen again
mailed disputes to FD Holdings and Trans Union, which
included bank statements showing on-time mortgage payments.
(Id. ¶ 36.) Instead of updating his payment
history to “ok” as requested, Trans Union updated
Tusen's payment history to show “x, ” meaning
no data, from September 2013 to December 2015. (Id.
¶ 38.) On September 13, 2016, Tusen received his credit
report from a different credit reporting agency reporting
that he was current on all mortgage payments, and he
successfully refinanced his mortgage. (Id.
three-count Fourth Amended Complaint includes the following
allegations against M&T. The first count alleges that
M&T violated the Fair Debt Collection Practices Act
(“FDCPA”), 15 U.S.C. §§ 1692e, 1692f,
by attempting to collect a fee to which M&T was not
entitled and communicating that he was delinquent on mortgage
payments to credit reporting agencies. (Id.
¶¶ 42-47.) The second count claims that M&T
violated the Fair Credit Reporting Act (“FCRA”),
15 U.S.C. §§ 1681n, 1681o, 1681s-2(b), by reporting
misleading and inaccurate information to credit reporting
agencies. (Id. ¶¶ 48-53.) The third count
alleges that M&T's actions also violate the Minnesota
Deceptive Trade Practices Act (“MDTPA”), Minn.
Stat. § 325D.44. (Id. ¶¶ 62-65.)
M&T moves for dismissal of the Fourth Amended Complaint
pursuant to Fed.R.Civ.P. 12(b)(6).
evaluating a motion to dismiss under Rule 12(b)(6), the Court
assumes the allegations in the Fourth Amended Complaint to be
true and construes all reasonable inferences from those facts
in the light most favorable to the non-moving party.
Morton v. Becker, 793 F.2d 185, 187 (8th Cir. 1986).
The Court need not accept as true wholly conclusory
allegations, Hanten v. Sch. Dist. of Riverview
Gardens, 183 F.3d 799, 805 (8th Cir. 1999), or legal
conclusions that the plaintiff draws from the facts pled.
Westcott v. City of Omaha, 901 F.2d 1486, 1488 (8th
complaint must contain “enough facts to state a claim
to relief that is plausible on its face” to survive a
motion to dismiss. Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007). Although a complaint need not contain
“detailed factual allegations, ” it must contain
facts with enough specificity “to raise a right to
relief above the speculative level.” Id. at
555. “Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, ” will
not pass muster under Twombly. Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citing
Twombly, 550 U.S. at 555). This standard
“calls for enough fact[s] to raise a reasonable
expectation that discovery will reveal evidence of [the
claim].” Twombly, 550 U.S. at 556.
FDCPA prohibits debt collectors from using a “false,
deceptive, or misleading representation” or
“unfair or unconscionable means” in the
collection of any debt. 15 U.S.C. §§ 1692e, 1692f.
Tusen claims that M&T violated the FDCPA “by
attempting to collect a fee from [him] that it was not
entitled and by communicating with credit reporting agencies
that [he] was delinquent paying his mortgage.” (4th Am.
Compl. ¶ 47.) M&T moves to dismiss this claim,
arguing that it is not a debt collector.
collector is any person (1) “who uses any
instrumentality of interstate commerce or the mails in any
business the principal purpose of which is the collection of
any debts” or (2) “who regularly collects or
attempts to collect, directly or indirectly, debts owed or
due or asserted to be owed or due another.” 15 U.S.C.
§ 1692a(6). A person who satisfies either definition
triggers the statutory definition under the FDCPA. The Fourth
Amended Complaint alleges only that M&T is a debt
collector because “[a]t the time Bank of America
transferred its mortgage servicing rights to M&T, [Tusen]