In a consumer loan agreement that went south, Citibank wins dismissal of Fair Credit Reporting Act (“FCRA”) allegations levied by pro se Plaintiffs, the Solis’s.   Solis v. Citibank, N.A., No. 19-24042-Civ-WILLIAMS/TORRES, 2020 U.S. Dist. LEXIS 63191 (S.D. Fla. Apr. 8, 2020).   As explained below, the Solis’s failed to meet basic notice pleading metrics in at least three ways, but first, what caused all the commotion? 

The Solis’s defaulted on a loan held by Citibank.  In 2005, the Solis’s obtained a $104,000 home equity line of credit from Citibank.  In time, the Solis’s defaulted and Citibank initiated two separate foreclosure actions in 2010 and 2018.  Citibank reported Solis’s default to multiple consumer reporting agencies (“CRAs”) beginning in 2011.  Over the course of an eight year period, Solis sent several letters to Citibank allegedly disputing the debt.  The Solis’s also claimed that they mailed a letter to CRAs notifying the CRAs of “negative reporting” without detailing how Citibank furnished the CRAs with inaccurate information.  While Solis’s attached letters they sent to Citibank to their amended complaint, they failed to include the alleged letter it sent to CRAs and instead filled their complaint with conclusory allegations – – so why did these allegations fail?

First, under the FCRA it is fundamental that the CRA trigger a furnisher’s (Citibank) duty to investigate, not the consumer.  Solis at *7; see also 15 U.S.C. § 1681s-2.  That is, a furnisher cannot be held liable when a consumer makes a direct dispute to the furnisher—they have to first poke the CRA for action. This makes sense because the FCRA is directed at the CRAs’ responsibility to ensure accurate credit reporting (see 15 U.S.C. § 1681), and because the Solis’s did not plead that Citibank received notice of the Solis’s dispute from a CRA, they punted this element.   

Second, a mere consumer allegation of “negative reporting” is legally insufficient. Solis at *8.  This is interesting. The Solis’s did alert the CRA regarding Citibank’s reporting, but only to tell the CRA that negative reporting was taking place. Seems kind of obvious and it had no legal impact. The Solis’s had duty to notify the CRAs that Citibank was furnishing inaccurate information, not just negative information. As such, Solis’s failed to plead how any duty arose for Citibank to investigate when the Solis’s merely alleged they sent a negative report to CRAs without more.

Third, kitchen sick approach to naming multiple defendants without clear factual nexus ripe for dismissal.  Solis at fn. 2.  The Solis’s directed allegations at both Citibank, N.A., and CitiMortgage, where the later had “little connection to most of the pled facts” and that “alone could possible by grounds for dismissal.”  Id.  At a minimum, allegations at multiple defendants should “include allegations as to which credit bureaus notified which Defendants of the consumer dispute, when, and after which how the receiving Defendant failed to comply with the FCRA.” Collins v. BSI Fin. Servs., No. 2:16-CV-262-WHA, 2016 U.S. Dist. LEXIS 157803, at *12-14 (M.D. Ala. Nov. 15, 2016).

In all, the Solis is a good case to keep in mind when considering the basics of a FCRA claim against a furnisher. Remember that a direct claim for inaccuracy against a furnisher is not possible under FCRA. Hoops must first be jumped through. The Solis Plaintiffs didn’t get through the first one—they failed to allege a valid dispute to the CRA. As such the Court quite properly dismissed the FCRA count. What remains to be seen is whether the Solis’s can even cure their defective complaint and whether the mysterious letter from Solis’s to CRAs will appear.