Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_18-cv-00454/USCOURTS-casd-3_18-cv-00454-0/pdf.json

Nature of Suit Code: 480
Nature of Suit: Consumer Credit
Cause of Action: 15:1681 Fair Credit Reporting Act

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FILEl) 

JUL 1 G 2019 

CLERK, IJ.S n1~:rr11('"t COURT 

SOUTHERN,. ':i1R1C'I or CtiUFORNIA 

lJkl"l)TY BY . -

UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF CALIFORNIA 

DON NEABORS, 

Plaintiff, 

v. 

EQUIFAX INFORMATION SERVICES 

LLC, et al., 

Defendants. 

Case No.: 3:18-cv-0454-BEN-KSC 

ORDER GRANTING DEFENDANT'S 

MOTION FOR JUDGMENT ON THE 

PLEADINGS 

(Doc. 10] 

Defendant Equifax Information Services LLC moves under Federal Rule of Civil 

16 Procedure 12(c) for judgment on the pleadings. The motion is GRANTED. 

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BACKGROUND 

Plaintiff Don Neabors brings two claims against Defendant Equifax for its alleged 

19 violations of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681 et seq. 

20 Specifically, Neabors brings claims for (1) Equifax's negligent failure to conduct a 

21 reasonable reinvestigation, as required by 15 U.S.C. §§ 1681i and 1681e(b) and (2) for 

22 Equifax's willful violation of§§ 1681i and 1681e(b ). 1 

23 Neabors's claims against Equifax arise out of his tradeline with Navy Federal Credit 

24 Union, which was discharged in bankruptcy on January 8, 2013. In October of 2017, 

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27 1 Neabors also brought claims against Defendant Navy Federal Credit Union. 

Those claims were dismissed, however, when the Court granted the parties' joint motion 

28 to dismiss Navy Federal. (Doc. 12.] 

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1 Neabors obtained his Equifax credit file. Neabors pleads that the credit file "inaccurately 

2 failed to report that the account was discharged." [Doc. 1, ,i,i 6-7.] As reflected in the 

3 October 2017 credit file attached to Equifax's motion, the file listed Neabors's Navy 

4 Federal tradeline account status as "Closed" with a payment status of "Included in 

5 Bankruptcy" and blanks for the balance, amount past due, and other fields. 2 See [Doc. 10-

6 2 (October 2017 Credit File)]. 

7 On November 28, 2017, Neabors submitted a letter to Equifax disputing the Navy 

8 Federal tradeline listing and explaining that the tradeline was discharged in bankruptcy. 

9 On February 6, 2018, Neabors again obtained his Equifax credit file, which still did not 

10 report the Navy Federal tradeline as "discharged." Instead, the report reflected the same 

11 information as before, including a "Closed" designation and a payment status of"Included 

12 in Bankruptcy." 

13 DISCUSSION 

14 Equifax argues judgment on the pleadings is warranted because Neabors cannot state 

15 a prima facie case for either of his FCRA claims. The Court agrees. Under Federal Rule 

16 of Civil Procedure 12(c), "[a]fter the pleadings are closed-but early enough not to delay 

17 trial-a party may move for judgment on the pleadings." In evaluating Equifax's Rule 

18 12(c) motion, the Court applies the same standard as on a motion to dismiss under Rule 

19 12(b)(6). See Cafasso, US. ex rel. v. General Dynamics C4 Systems, Inc., 637 F.3d 1047, 

20 1055, n. 4 (9th Cir. 2011) ("Rule 12(c) is functionally identical to Rule 12(b)(6) and ... 

21 the same standard of review applies to motions brought under either rule.") (internal 

22 citations omitted)). Thus, in reviewing the motion, the Court must accept the Complaint's 

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2 Equifax requests that the Court take judicial notice of the October 2017 and 

December 2017 credit files referenced in Neabors's Complaint. Neabors does not object. 26 Accordingly,judicial notice is GRANTED. See Harris v. Cty. of Orange, 682 F.3d 1126, 

1132 (9th Cir. 2012) (explaining that courts may take judicial notice of documents 

referenced in the Complaint "if no party questions their authenticity and the complaint 

relies on those documents"). 28 

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1 allegations as true and construe all reasonable inferences in favor of the nonmoving party. 

2 Ashcroft v. Iqbal, 556 U.S. 662, 664 (2009). To avoid dismissal, Neabors's Complaint 

3 must plead "enough facts to state a claim to relief that is plausible on its face." Bell At!. 

4 Corp. v. Twombly, 550 U.S. 544, 570 (2007). 

5 To state a claim under both §§ 168le(b) and 168li, Neabors must plead that 

6 Equifax's credit reports about him contained a factual inaccuracy. See Guimond v. Trans 

7 Union Credit Info. Co., 45 F.3d 1329, 1333 (9th Cir. 1995) ("In order to make out a prima 

8 facie violation under § 1681 e(b ), a consumer must present evidence tending to show that a 

9 credit reporting agency prepared a report containing inaccurate information."); Carvalho 

10 v. Equifax Info. Servs., LLC, 629 F.3d 876, 890 (9th Cir. 2010) (concluding that for a 

11 plaintiff to state a claim under § 168li, the plaintiff must allege an actual inaccuracy). 

12 Under the FCRA, a credit entry is "inaccurate" where "it is patently incorrect, or because 

13 it is misleading in such a way and to such an extent that it can be expected to adversely 

14 affect credit decisions." Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1163 (9th 

15 Cir. 2009). 

16 In support of its motion, Equifax contends that Neabors' s claims must fail as a matter 

17 of law because he has not and cannot plead that Equifax's reports contained any such 

18 factual inaccuracy. Equifax further argues that nothing in its reports is inaccurate or 

19 misleading because they correctly reflect that Neabors's Navy Federal tradeline was 

20 "Included in Bankruptcy" and designate the account as "Closed" with no identified 

21 balances or past due amounts. 

22 Neabors responds that a factual inaccuracy exists because Equifax's report must 

23 specifically provide "discharged in bankruptcy," and Equifax's use of "Included in 

24 Bankruptcy," instead, could be understood to mean the bankruptcy is "still pending" and 

25 that no discharge has been granted. The Court disagrees. First, Neabors offers no authority 

26 showing its preferred phrase, "discharged in bankruptcy," is required by the FCRA. 

27 Further, the Court finds implausible Neabors's unsupported assertion that creditors would 

28 view "Included in Bankruptcy" to mean the bankruptcy was anything but discharged, 

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1 particularly when reviewed within the context of the report's other information, including 

2 designating the tradeline's status as "Closed" and including only blanks for the balance, 

3 amount past due, and other fields. Indeed, other courts to consider arguments like 

4 Neabors's have rejected them, finding instead that the "Included in Bankruptcy" verbiage 

5 complies with the FCRA by sufficiently communicating that a credit line was discharged 

6 by bankruptcy. See, e.g., Fleming v. Trans Union, LLC, 2019 WL 2498940, *3 (C.D. Cal. 

7 March 8, 2019) (finding plaintiff failed to state a claim under§§ 168le(b) and 168li where 

8 defendant's credit reports used the phrase "included in bankruptcy" rather than "discharged 

9 in bankruptcy"); Johnson v. Equifax, Inc., 510 F. Supp. 2d 638, 646 (S.D. Ala. 2007) 

10 (concluding that an "included in bankruptcy" notation on the plaintiffs account was not 

11 misleading and was accurate); Blanch v. Trans Union, LLC, 333 F. Supp. 3d 789, 793-94 

12 (M.D. Tenn. 2018) (finding not misleading or inaccurate the credit report's "included in 

13 bankruptcy" notation accompanied by a $0 account balance and "account closed by credit 

14 grantor" designation); see also White v. Experian Info. Sols., Inc., 8:05-cv-0170-DOC15 MLG, Doc. 338 (C.D Cal. Aug. 19, 2008) (approving FCRA settlement agreement under 

16 which tradelines would be coded "to indicate that the account is discharged in the 

17 Consumer's Chapter 7 bankruptcy ( e.g., by use of the terminology 'included in 

18 bankruptcy') and ... [by] reflect[ing] a zero-dollar or blank account balance and past due 

19 balance") (emphasis added). 

20 Accordingly, the Court finds that Equifax's designation of"Included in Bankruptcy" 

21 coupled with the tradeline' s status as "Closed" and the blanks for the balance, amount past 

22 due, and other fields reflects factually accurate information, which is neither "patently 

23 false" nor "misleading in such a way and to such an extent that it can be expected to 

24 adversely affect credit decisions." Gorman, 584 F.3d at 1163. Because Neabors cannot 

25 allege Equifax's reports contained the requisite factual inaccuracy, his claims must fail. 3 

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3 Because the Court finds that Neabors's claims fail on this ground, it need not 

address Equifax's additional arguments in support of its motion. 

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• • j ... 

1 Moreover, the Court finds that granting Neabors leave to amend would be futile because 

2 the requisite factual inaccuracy does not exist. See Fed. R. Civ. P. 15(a) (providing that 

3 the district court may exercise its discretion to deny leave to amend due to futility of 

4 amendment, among other grounds); see also Carvalho v. Equifax Info. Servs., LLC, 629 

5 F.3d 876, 892-93 (9th Cir. 2010) (affirming district court's holding that amendment would 

6 be futile because plaintiff's claims were "clearly foreclosed by the inaccuracy requirement 

7 of§ 1681i"). Accordingly, Neabors's claims are DISMISSED with prejudice. 

8 CONCLUSION 

9 For the previous reasons, Equifax's motion is GRANTED, and Neabors's 

10 remaining claims against it are DISMISSED with prejudice. 

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IT IS SO ORDERED. 

13 Date: July p'o19 

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NITEZ 

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