Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-03403/USCOURTS-cand-3_05-cv-03403-1/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 15:1681 Fair Credit Reporting Act

---

U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

U

nite

d

States District C

o

u

rt

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

STEPHEN C. YEAGLEY,

Plaintiff,

 v.

 WELLS FARGO & COMPANY et al.,

Defendant.

 /

No. C 05-03403 CRB

MEMORANDUM AND ORDER

This is a Fair Credit Reporting Act (“FCRA”) class action. Plaintiff seeks damages,

attorneys’ fees, declaratory relief, and injunctive relief. Defendant Wells Fargo moves to

dismiss the claims for declaratory and injunctive relief on the ground that such relief is not

available under the FCRA. After carefully considering the papers submitted by the parties,

the Court concludes that oral argument is unnecessary, see Local Rule 7-1(b), and GRANTS

defendant’s motion.

ALLEGATIONS OF THE COMPLAINT

Under the FCRA a person may not obtain a credit report for any purpose unless – “(1)

the consumer report is obtained for a purpose for which the consumer report is authorized to

be furnished under this section.” 15 U.S.C. § 1681b(f). See Complaint ¶ 17. The

permissible purposes generally arise only in connection with transactions initiated by the

consumer (the subject of the credit report). Id. ¶ 18. However, the FCRA does permit a 

Case 3:05-cv-03403-CRB Document 21 Filed 01/23/06 Page 1 of 5
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

2

person to obtain a credit report in the absence of a consumer-initiated transaction when the

recipient of the credit report “undertakes to extend to the consumer a ‘firm offer of credit.’” 

Id. ¶ 19 (citing 15 U.S.C. § 1681b(c)(1)(B)).

Wells Fargo “regularly obtains consumer reports on large numbers of individuals

without their knowledge or consent by purchasing ‘prescreening’ lists from consumer

reporting agencies.” Id. ¶ 23. Wells Fargo subsequently mails written solicitations to

individuals on the prescreening reports. Id. ¶ 24. Plaintiff alleges that these solicitations do

not satisfy the “firm offer of credit” requirement of section 1681b(c)(1)(B), and therefore

Wells Fargo’s use of the credit reports to make the solicitations violates the FCRA. Id.

¶¶ 32-37.

The First Claim for Relief makes a claim for damages. The Second makes a claim for

declaratory relief, and the Third a claim for injunctive relief. Wells Fargo moves to dismiss

the Second and Third Claims for Relief on the ground that declaratory and injunctive relief

are not available in a private action under the FCRA.

DISCUSSION 

“Absent the clearest command to the contrary from Congress, federal courts retain

their equitable power to issue injunctions in suits over which they have jurisdiction.”

Califano v. Yamasaki, 442 U.S. 682, 705 (1979). The Fifth Circuit (the only Circuit to have

addressed the issue), and all of the district courts to have reached the issue during the past six

years, have held that Congress did not give the federal courts the power to issue equitable

relief in private FCRA suits. This Court agrees.

Sections 1681n and 1681o create a private right of action under the FCRA. See

Nelson v. Chase Manhattan Mortgage Corp., 282 F. 3d 1057, 1059 (9th Cir. 2002). Section

1681n, entitled “Civil liability for willful noncompliance,” provides that any person who

willfully violates the FCRA shall be liable to the consumer for actual damages or damages of

not less than $100 or more than $1000, punitive damages, and attorneys’ fees. 15 U.S.C.

§ 1681n(a). Thus, it creates a private right of action for willful violations. The available

remedies do not include injunctive or declaratory relief. Section 1681o, entitled “Civil

Case 3:05-cv-03403-CRB Document 21 Filed 01/23/06 Page 2 of 5
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3

liability for negligent noncompliance,” provides that any person who negligently fails to

comply with the FCRA may be liable to the consumer for actual damages and attorneys’ fees. 

Again, the section does not mention injunctive or declaratory relief. 

By limiting the remedies for private right of actions to damages and attorneys’ fees

Congress demonstrated that it did not intend for private litigants to obtain injunctive or

declarative relief. See Transamerica Mortgage Advisors, Inc. v. Lewis, 444 U.S. 11, 19

(1979) (“[I]t is an elemental canon of statutory construction that where a statute expressly

provides a particular remedy or remedies, a court must be chary of reading others into it.”). 

This conclusion is buttressed by the FCRA’s affirmative grant of injunctive relief to the

Federal Trade Commission. In 15 U.S.C. section 45 Congress “empowered” the FTC to

prevent certain persons from violating the FCRA. It later adopted section 1681s which

provides that “[c]ompliance with the requirements imposed under this subchapter shall be

enforced under the Federal Trade Commission Act by the Federal Trade Commission with

respect to consumer reporting agencies and all other persons subject thereto, except to the

extent that enforcement of the requirements imposed under this subchapter is specifically

committed to some other government agency.” 15 U.S.C. § 1681s(a)(1). This section thus

reads as an exclusive grant of the injunctive remedy to the FTC and other delineated

government agencies.

Moreover, the FCRA gives federal courts jurisdiction to hear “an action to enforce

any liability created under this subchapter.” 15 U.S.C. § 1681p. The only actions to enforce

a “liability” that may be brought by a private litigant are those set forth in 1681n and 1681o,

that is, actions for damages and attorneys fees.

Under the private right of action statutes, a defendant is liable only if the private

litigant proves the defendant willfully or negligently violated the FCRA. Under plaintiff’s

reasoning, a private litigant could also pursue equitable relief for any violation of the Act,

even if not negligent or willful. Such an outcome would be contrary to Congress’s expressed

intent of limiting liability to private litigants to willful or negligent conduct.

//

Case 3:05-cv-03403-CRB Document 21 Filed 01/23/06 Page 3 of 5
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

4

The only Circuit to have addressed this issue held that a private litigant may not obtain

injunctive or declaratory relief under the FCRA. Washington v. CSC Credit Services, Inc.,

199 F.3d 263 (5th Cir. 2000). The court held that “the affirmative grant of power to the FTC

to pursue injunctive relief, coupled with the absence of a similar grant to private litigants

when they are expressly granted the right to obtain damages and other relief, persuasively

demonstrates that Congress vested the power to obtain injunctive relief solely with the FTC.”

Id. at 268.

The Fifth Circuit concluded that its holding was supported by Congress’s subsequent

enactment of section 1861u which requires consumer reporting agencies to disclose

consumer information to the FBI for counterintelligence purposes. 15 U.S.C. § 1681u. The

section also provides consumers with a damages remedy against the government that is

nearly identical to the private right of action provisions found in sections 1681n and 1681o. 

15 U.S.C. § 1681u(i). Unlike sections 1681n and 1681o, however, section 1681u has an

additional subsection that gives an aggrieved consumer the right to obtain injunctive relief. 

15 U.S.C. § 1681u(m). The Fifth Circuit reasoned that “where Congress intended to allow

private injunctive relief under the FCRA, it expressly stated that this relief was available. 

This language would be unnecessary if injunctive relief were otherwise available.” 199 F.3d

at 269; see also Howard v. Blue Ridge Bank, 371 F.Supp.2d 1139, 1145(N.D. Cal. 2005)

(finding the Fifth Circuit’s reasoning in Washington persuasive). 

Moreover, although the Fifth Circuit is the only Circuit to have addressed the

availability of a private right of action for equitable relief under the FCRA, the Third Circuit

has considered the availability of equitable relief under the Federal Debt Collection Practices

Act (“FDCPA”), a statute with a structure similar to the FCRA. The FDCPA, like the

FCRA, has a section giving private litigants the right to pursue damages, 15 U.S.C.

§ 1692k(a), and a section giving the FTC the right to pursue equitable remedies. 15 U.S.C.

§ 1692(i). In Weiss v. Regal Collections, 385 F.3d 337, 341-42 (3d Cir. 2004), the Third

Circuit held that a private litigant could not obtain equitable relief under the FDCPA. The

court cited the Fifth Circuit’s reasoning in Washington as support for its holding.

Case 3:05-cv-03403-CRB Document 21 Filed 01/23/06 Page 4 of 5
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

G:\CRBALL\2005\3403\orderredismissal1.wpd 5

The cases cited by plaintiff are not persuasive. In Andrews v. Trans Union Corp., 7

F.Supp.2d 1056 (C.D. Cal. 1998), for example, the court did not discuss the language and

structure of the FCRA. In Natale v. TRW, Inc., 1999 WL 179678 (N.D. Cal. March 30,

1999), the defendants did not argue that injunctive relief was not available; instead, all the

parties assumed that such relief was available to a private litigant. Plaintiff does not, and

cannot, cite a single case which addresses and then refutes the reasoning of the Fifth Circuit

in Washington.

Plaintiff’s contention with respect to the purpose behind the enactment of section

1681u is beside the point. Even assuming plaintiff’s argument is correct, it does not respond

to the fact that Congress created a private right of action which includes the right to recover

only damages and attorneys’ fees.

CONCLUSION

The language and structure of the FCRA compel the conclusion that a private litigant

may not maintain an action for injunctive relief or declaratory relief under the FCRA. 

Accordingly, defendants’ motion to dismiss the Second and Third Claims for Relief is

GRANTED. 

IT IS SO ORDERED.

Dated: January 23, 2006 

CHARLES R. BREYER

UNITED STATES DISTRICT JUDGE

Case 3:05-cv-03403-CRB Document 21 Filed 01/23/06 Page 5 of 5