E.D.N.C.: Myrick v.  Equifax- Duty to Investigate Credit Report Dispute and Bankruptcy Discharge

Mr.  Myrick brought suit against Equifax under the FCRA for willfully failing to verify the discharge of a debt in his Chapter 7 bankruptcy.   In light of Daughterty v.  Ocwen Loan Servicing, the district court reconsidered its previous grant of summary judgment and instead found that Equifax had in its possession “records that would have enabled it to confirm the status of the … account through an identified source, i.e., PACER.”   Instead, there was a factual issue of “whether Equifax conducted a reasonable investigation by limiting its efforts to confirming the disputed information” with the creditor and not checking PACER or elsewhere.… Read More

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4th Circuit: Daughtery v.  Ocwen Loan Servicing- Evidence and Excessive Damages for FCRA Violations4th Circuit: Daughtery v.  Ocwen Loan Servicing- Evidence and Excessive Damages for FCRA Violations

The Daughterys purchased their home in 1999, with a 15-year balloon note payable in July 2014 in the amount of $82,666.36.  In 2012, the Daughterys had fallen $6,128.39 behind on the regular payments and Ocwen, who had become the mortgage servicer after the first default by the Daughterys, commenced foreclosure, reporting accurately the delinquency and foreclosure proceeding.  Using retirement savings, the Daughters brought the mortgage current within one month with the foreclosure be discontinued.
During this period, Ocwen had discovered that its predecessor had inaccurately reported the origination date of the note and submitted information to correct this error.  Equifax  mistook this for a separate account, creating a new, duplicate trade line for Mr.… Read More

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E.D.N.C.: Myrick v.  Equifax- FCRA Dispute Resolution and Bankruptcy Discharge


Following the entry of a discharge in 2011 of his Chapter 13 case, First Federal Bank (“FFB”) continued to report on Mr.  Myrick’s credit report with Equifax that he owed an outstanding balance of $41,603 that was past due by $2,000.  In November 2014, Mr.  Myrick submitted a dispute with Equifax regarding this balance, raising his bankruptcy discharge.  Equifax sent a Automated Consumer Dispute Verification (“ACDV”) to FFB, which responded that the balance information was correct.  Later in February 2015, Mr.  Myrick again disputed the FFB trade line, this time attaching a copy of his discharge order.  As the discharge order does not specifically list discharged claims, Equifax requested additional details regarding the account names, numbers and nature of the dispute.  … Read More

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4th Cir.: Kingery v. Quicken Loans- Use of Credit Score in Denial of Loan


Ms. Kingery applied to Quicken Loans for a loan to refinance her home mortgage and gave permission for it to retrieve her credit reports. On May 3, 2010, Quicken Loan retrieved her tri-merge credit reports, which showed her credit scores and also that foreclosure had been commenced against her home. Based on the pending foreclosure, as shown by manually entered notes, Quicken Loans denied her refinance request. Subsequently, Quicken Loans transferred Ms. Kingery to its credit repair program. When that was unsuccessful, Quicken Loans sent Ms. Kingery a final denial letter on May 24, 2010, which, among other information, gave Ms.… Read More

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M.D.N.C.: Nance v. Citimortgage- Causes of Action following Illegal Foreclosure


Despite being provided with evidence in the form of cancelled checks and insurance policies showing that they were not delinquent in their mortgage payments, Citimortgage commenced foreclosure against the Nances.  After refinancing their house, the Nances brought suit against Citimortgage alleging, among other causes of action,  unfair and deceptive trade practices, negligent and/or intentional infliction of emotional distress, defamation and negligent and/or intentional damage to credit report.  Citimortgage moved to dismiss.

As to the unfair and deceptive trade practices claim, the district court restated the requirements to state a claim as:

(1) the obligation owed must be a debt;

(2) the one owning the obligation must be a consumer;

(3) the one trying to collect the obligation must be a debt collector;

(4) an unfair or deceptive act;

(5) in or affecting commerce; and

(6) proximately causing injury.… Read More

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E.D.N.C.: Fritz v. Duke Energy- FCRA Does Not Preempt State Debt Collection Protections


Fritz closed his account with Duke Energy when he moved, but was one week late in paying the final bill, so it was referred to a debt collector. He did pay the balance to Duke Energy, who applied the amount to the balance on his new utility bill. The debt collector was not informed of the payment and two months later, reported Fritz as delinquent to the three major credit bureaus, resulting in a 77 point decline in his credit score. Fritz brought suit against Duke Energy (as well as the debt collector under other bases) under N.C.G.S. § 75-54, alleging that Duke Energy had falsely represented to the debt collector the status of the debt.… Read More

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E.D.N.C.: Owens v. Dixie Motors- FCRA, Improperly Obtaining Credit Report; Emotional Distress; Direct and Vicarious Liability; Pre-emption


Nina Owens purchased an automobile from Dixie Motors in 2007, providing information including her home address, date of birth, social security number, phone number, insurance agent, insurance company, employment information, monthly mortgage payment. Ashley Owens, the daughter of Nina Owens, considered purchasing a vehicle from Dixie Motors in 2011, supplying similar credit information and personal identifiers. The credit application by Ashley Owens was declined, but at the same time Janet Pierce, the finance manager for Dixie Motors, completed an credit application in the name of Nina Owens. (It was disputed whether Nina Owens was aware and approved of the credit application or not.) Pierce subsequently inadvertently sent sensitive credit information and personal identifiers for both Nina and Ashley Owens when she included credit applications in a letter to Antwand Cherry, a.k.a.… Read More

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4th Circuit: Marachich v. Spears- Use of DMV Information for Solicitation of Potential Clients


Through requests submitted to the South Carolina Department of Motor Vehicles (DMV) under the state Freedom of Information Act, S.C. Code Ann. §§ 30-4-10 to -165 (FOIA), Michael E. Spears, Esq., Gedney M. Howe, III, Esq., Richard A. Harpootlian, Esq., and A. Camden Lewis, Esq. (“the Lawyers”) obtained “personal information”, viz., the names, addresses, telephone numbers, and car purchase information of thousands of car buyers, from which they identified potential named plaintiffs in the Dealers Act group action, mailing more than 21,000 solicitations to potential clients for participation in lawsuits pending against numerous South Carolina car dealerships. The personal information obtained is protected by the Driver’s Privacy Protection Act of 1994 (DPPA), 18 U.S.C.… Read More

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