Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_15-cv-05544/USCOURTS-cand-5_15-cv-05544-0/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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Case No. 15-CV-05544-LHK 

ORDER GRANTING CREDIT RECOVERY ASSOCIATE, INC.'S MOTION TO DISMISS WITH LEAVE TO 

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

RAQUEL BLAKENEY,

Plaintiff,

v.

EXPERIAN INFORMATION SOLUTIONS, 

INC., et al.,

Defendants.

Case No. 15-CV-05544-LHK 

ORDER GRANTING CREDIT 

RECOVERY ASSOCIATE, INC.'S 

MOTION TO DISMISS WITH LEAVE 

TO AMEND

Re: Dkt. No. 47

Before the Court is Defendant Credit Recovery Associates, Inc.’s (“Credit Recovery 

Associates”) motion to dismiss Plaintiff Raquel Blakeney’s (“Plaintiff”) complaint. ECF No. 47. 

Pursuant to Civil Local Rule 7-1(b), the Court finds this matter appropriate for resolution without 

oral argument and VACATES the motion hearing set for April 21, 2016, at 1:30 p.m. The case 

management conference scheduled for that date and time remain as set. Having considered the 

submissions of the parties, the relevant law, and the record in this case, the Court GRANTS Credit 

Recovery Associate’s motion to dismiss with leave to amend.1

 

1 Credit Recovery Associates additionally has requested that the Court take judicial notice of the 

First Amended Chapter 13 Plan filed in Plaintiff’s bankruptcy case at the United States 

Bankruptcy Court for the Eastern District of California and the docket for Plaintiff’s bankruptcy 

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I. BACKGROUND

A. Factual Background

On November 7, 2014, Plaintiff filed for Chapter 13 bankruptcy. ECF No. 1 (“Compl.”) 

¶ 5. “Chapter 13 of the Bankruptcy Code affords individuals receiving regular income an 

opportunity to obtain some relief from their debts while retaining their property. To proceed under 

Chapter 13, a debtor must propose a plan to use future income to repay a portion (or in the rare 

case all) of his debts over the next three to five years.” Bullard v. Blue Hills Bank, 135 S. Ct. 

1686, 1690 (2015). “If the bankruptcy court confirms the plan and the debtor successfully carries 

it out, he receives a discharge of his debts according to the plan.” Id. at 1690. In the instant case, 

Plaintiff’s bankruptcy plan was confirmed on May 30, 2015. Compl. ¶ 5. The complaint provides 

no details on Plaintiff’s bankruptcy plan. See generally Compl. Plaintiff does not allege that 

Plaintiff has successfully paid her debt according to the plan, or that Plaintiff’s debt has been 

discharged. 

On September 3, 2015, Plaintiff ordered a three-bureau credit report from Equifax, Inc.

(“Equifax”). Id. ¶ 6. In the report, Plaintiff allegedly “noticed several tradelines all reporting a 

misleading and or inaccurate balance, past due balance, and or monthly payment owed on the 

account and or listing of the account as in collections and or charged off rather than included in 

[b]ankruptcy.” Id. ¶ 7. In response to the report, Plaintiff disputed the allegedly inaccurate 

tradelines with the three credit reporting bureaus: Equifax, Experian Information Solutions, Inc. 

(“Experian”), and TransUnion, LLC (“TransUnion”).

2

 Id. ¶ 8. According to Plaintiff, each credit 

reporting bureau sent Credit Recovery Associates a notification that Plaintiff was disputing the 

accuracy of the credit report. Id. ¶ 9. 

On November 24, 2015, Plaintiff ordered a three-bureau credit report from Equifax. Id.

 

case. ECF No. 47-1. The Court GRANTS Credit Recovery Associates’ request for judicial 

notice. See Reyn’s Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006) 

(holding that “court filings and other matters of public record” are subject to judicial notice).

2

In Plaintiff’s opposition, Plaintiff asserts that Plaintiff sent these dispute letters on or about 

October 18, 2015. Opp. at 2. However, no date is alleged in the complaint.

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¶ 14. Plaintiff allegedly learned that the credit report still reported “the misleading and or 

inaccurate statements.” Id. ¶ 15. Plaintiff alleges that Credit Recovery Associates failed to 

conduct a “reasonable investigation” into Plaintiff’s dispute and again “reported falsely” to 

Experian, Equifax, and TransUnion a “misleading and or inaccurate balance or past due balance.” 

Id. ¶ 10. Specifically, Plaintiff alleges that Credit Recovery Associates “supplied inaccurate and 

misleading information to the Credit Reporting Agencies by reporting, after Plaintiff’s [C]hapter 

13 filing and confirmation of the repayment plan, that the account was in collections, charged off, 

and that both a balance and past due balance were owed to Defendant Credit Recovery Associates, 

despite the treatment of its claims under the terms of Plaintiff’s confirmed [C]hapter 13 repayment 

plan.” Id. ¶ 26.

B. Procedural History

On December 3, 2015, Plaintiff filed the instant complaint against Credit Recovery 

Associates as well as against Defendants Experian; Equifax; TransUnion; Ascension Services; 

L.P. (“Ascension Services”); Regional Finance Corporation (“Regional Finance”); and Capital 

One, National Association (“Capital One”). ECF No. 1. Plaintiff asserts that all seven defendants 

violated the federal Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681s-2(b). Id. ¶¶ 20–27. 

Plaintiff also asserts that Credit Recovery Associates, Ascension Services, Regional Finance, and 

Capital One violated California’s Consumer Credit Reporting Agencies Act (“CCRAA”), Cal. 

Civ. Code § 1785.25(a), and California’s Unfair Competition Law (“UCL”), Cal. Bus. & Prof. 

Code §§ 17200 et seq. Id. ¶¶ 28–42. 

On December 29, 2015, Equifax and Experian answered Plaintiff’s complaint. ECF Nos. 

15, 18. TransUnion answered Plaintiff’s complaint on December 30, 2015. ECF No. 22. Capital 

One answered Plaintiff’s complaint on February 23, 2016. ECF No. 45. 

The Court granted a stipulation of dismissal with prejudice as to TransUnion on February 

11, 2016. ECF No. 36. The Court granted a stipulation of dismissal with prejudice as to Equifax 

on April 1, 2016. ECF No. 60. Plaintiff filed a notice of settlement as to Capital One on March 

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25, 2016. ECF No. 59.

Credit Recovery Associates filed the instant motion to dismiss on February 24, 2016. ECF 

No. 47 (“Mot.”). Plaintiff opposed the motion on March 9, 2016. ECF No. 55 (“Opp.”). Credit 

Recovery Associates replied on March 16, 2016. ECF No. 58 (“Reply”). 

II. LEGAL STANDARD

A. Rule 12(b)(6) Motion to Dismiss

Rule 8(a)(2) of the Federal Rules of Civil Procedure requires a complaint to include “a 

short and plain statement of the claim showing that the pleader is entitled to relief.” A complaint 

that fails to meet this standard may be dismissed pursuant to Rule 12(b)(6). Rule 8(a) requires a 

plaintiff to plead “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. 

Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial plausibility when the plaintiff 

pleads factual content that allows the court to draw the reasonable inference that the defendant is 

liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “The plausibility 

standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that 

a defendant has acted unlawfully.” Id.

For purposes of ruling on a Rule 12(b)(6) motion, the Court “accept[s] factual allegations 

in the complaint as true and construe[s] the pleadings in the light most favorable to the nonmoving 

party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). The 

Court, however, need not accept as true allegations contradicted by judicially noticeable facts, see 

Shwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000), and it “may look beyond the plaintiff’s 

complaint to matters of public record” without converting the Rule 12(b)(6) motion into a motion 

for summary judgment, Shaw v. Hahn, 56 F.3d 1128, 1129 n.1 (9th Cir. 1995). Nor must the 

Court “assume the truth of legal conclusions merely because they are cast in the form of factual 

allegations.” Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir. 2011) (per curiam). Mere 

“conclusory allegations of law and unwarranted inferences are insufficient to defeat a motion to 

dismiss.” Adams v. Johnson, 355 F.3d 1179, 1183 (9th Cir. 2004).

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B. Leave to Amend

If the court concludes that the complaint should be dismissed, it must then decide whether 

to grant leave to amend. Under Rule 15(a) of the Federal Rules of Civil Procedure, leave to 

amend “shall be freely given when justice so requires,” bearing in mind “the underlying purpose 

of Rule 15 . . . [is] to facilitate decision on the merits, rather than on the pleadings or 

technicalities.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (en banc) (ellipsis in 

original). Nonetheless, a district court may deny leave to amend a complaint due to “undue delay, 

bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by 

amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of 

the amendment, [and] futility of amendment.” See Leadsinger, Inc. v. BMG Music Publ’g, 512 

F.3d 522, 532 (9th Cir. 2008) (brackets in original).

III. DISCUSSION

A. Plaintiff’s FCRA Claim

The Court first addresses Plaintiff’s FCRA claim, and then turns to Plaintiff’s CCRAA and 

UCL claims. Congress enacted the FCRA “to ensure fair and accurate credit reporting, promote 

efficiency in the banking system, and protect consumer privacy.” Gorman v. Wolpoff & 

Abramson, LLP, 584 F.3d 1147, 1153 (9th Cir. 2009) (quoting Safeco Ins. Co. of Am. v. Burr, 551 

U.S. 47, 52 (2007)). To ensure that credit reports are accurate, “the FCRA imposes some duties 

on the sources that provide credit information to [consumer reporting agencies], called ‘furnishers’ 

in the statute.” Id. Certain obligations are triggered “upon notice of dispute”—that is, when a 

person or entity who furnished information to a consumer reporting agency receives notice from 

the consumer reporting agency that the consumer disputes the information. Id.at 1154. 

Subsection 1681-2(b) of the FCRA provides that, after receiving a notice of dispute, the furnisher 

shall: 

(A) conduct an investigation with respect to the disputed information;

(B) review all relevant information provided by the consumer reporting agency . . .;

(C) report the results of the investigation to the consumer reporting agency;

(D) if the investigation finds that the information is incomplete or inaccurate, report 

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those results to all other consumer reporting agencies to which the person furnished 

the information . . .; and

(E) if an item of information disputed by a consumer is found to be inaccurate or 

incomplete or cannot be verified after any reinvestigation under paragraph (1) . . . 

(i) modify that item of information; 

(ii) delete that item of information; or 

(iii) permanently block the reporting of that item of information.

15 U.S.C. § 1681s-2(b)(1). The FCRA creates a private right of action for willful or negligent 

noncompliance with this subsection. Gorman, 584 F.3d at 1154 (citing 15 U.S.C. §§ 1681n, o).

Plaintiff asserts that Credit Recovery Associates is a “furnisher” under the FCRA and that 

Credit Recovery Associates received from the credit reporting bureaus “notification that [P]laintiff 

was disputing the accuracy of what it was reporting.” Compl. ¶ 9. After receiving notice of 

Plaintiff’s dispute, Credit Recovery Associates allegedly violated the FCRA in two ways: (1) 

failing to conduct a reasonable investigation, in violation of § 1681s-2(b)(1)(A); and (2) failing to 

correct Credit Recovery Associates’ reporting of inaccurate information, in violation of § 168s2(b)(1)(C)–(E). Credit Recovery Associates does not dispute that these are cognizable FCRA 

claims, but contends that Plaintiff fails to sufficiently plead facts to support these claims. See Mot.

at 6-8; Reply at 2-6. The Court addresses Plaintiff’s two theories of FCRA liability in turn.

As a preliminary matter, the Court notes that Plaintiff’s complaint fails to allege that Credit 

Recovery Associates acted either willfully or negligently, as required for Plaintiff to have a private 

right of action. See Gorman, 584 F.3d at 1154; 15 U.S.C. §§ 1681n, o. Nor does Plaintiff provide 

any factual allegations to support that Credit Recovery Associates acted willfully or negligently. 

See generally Compl. As this Court has recently held with respect to the virtually identical 

complaint in Abbot v. Experian, No. 15-CV-05541-LHK, 2016 WL 1365950, at *3 (N.D. Cal. 

April 6, 2016), Plaintiff can not bring any claims under the FCRA without alleging that the alleged 

violations of the FCRA were willful or negligent. Because Plaintiff fails to allege that Credit 

Recovery Associates violated the FCRA willfully or negligently, Plaintiff can not bring any claims 

under the FCRA. See id. (dismissing FRCA claim based on virtually identical allegations when 

the plaintiff failed to allege that the defendant acted either willfully or negligently); see also

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Thompson v. Bank of Am., N.A., 2015 WL 355707, at *2 (N.D. Cal. Jan. 27, 2015) (dismissing 

FCRA claim when plaintiff alleged the defendant acted “knowingly and willfully” without 

providing any factual basis for the allegation).

Apart from the private right of action, the Court identifies additional reasons to dismiss 

Plaintiff’s FCRA claim. As to Plaintiff’s first theory of liability, the FCRA requires a furnisher to 

“conduct an investigation with respect to the disputed information” after the furnisher receives 

notice of a dispute from a consumer reporting agency. 15 U.S.C. § 1681s-2(b)(1). The Ninth 

Circuit has held that such an investigation must be “reasonable.” Gorman, 584 F.3d at 1157. 

“[W]hether a reinvestigation conducted by a furnisher in response to a consumer’s notice of 

dispute is reasonable depends in large part on the allegations provided to the furnisher by the 

credit reporting agency.” Id. at 1160 (ellipses omitted). Plaintiff’s only allegation related to this 

theory of liability is that Credit Recovery Associates “failed to conduct a reasonable 

investigation.” Compl. ¶ 10; see also id. ¶ 24. Plaintiff does not allege any facts in support of 

this assertion. Nor is this theory explained in Plaintiff’s opposition to the instant motion, even 

though the opposition notes that Plaintiff “received a reinvestigation report indicating what 

attempts had been made to correct the perceived inaccuracies.” Opp. at 2-3. 

Instead, Plaintiff seems to assume that Credit Recovery Associates’ investigation must 

have been unreasonable if Credit Recovery Associates reported inaccurate information after the 

investigation. However, the Ninth Circuit has explicitly rejected this argument. In Gorman, the 

Ninth Circuit explained that “the requirement that furnishers investigate consumer disputes is 

procedural. An investigation is not necessarily unreasonable because it results in a substantive 

conclusion unfavorable to the consumer, even if that conclusion turns out to be inaccurate.” 

Gorman, 584 F.3d at 1161. Accordingly, Plaintiff’s conclusory allegation that Credit Recovery 

Associates “failed to conduct a reasonable investigation” is insufficient to plausibly allege that 

Credit Recovery Associates conducted an unreasonable investigation in violation of the FCRA. 

See Iqbal, 556 U.S. at 678; see also Abbot, 2016 WL 1365950, at *4 (dismissing virtually identical 

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FCRA claim for failure to conduct a reasonable investigation).

As to Plaintiff’s second theory of liability, the FCRA requires a furnisher, upon receiving 

notice of a dispute, to report the results of the investigation and “if the investigation finds that the 

information is incomplete or inaccurate, report” and correct those results. 15 U.S.C. § 1681s2(b)(1)(C)–(E); see also Drew v. Equifax Info. Servs., LLC, 690 F.3d 1100, 1106 (9th Cir. 2012) 

(“Upon being notified of a dispute by a [credit reporting agency], a furnisher must investigate and, 

if necessary, correct the information it reports.”). Information can be “incomplete or inaccurate” 

within the meaning of the FCRA “because it is patently incorrect, or because it is misleading in 

such a way and to such an extent that it can be expected to adversely affect credit decisions.” 

Gorman, 584 F.3d at 1163. Accordingly, omitting the disputed nature of a debt, if the dispute 

could materially alter how the reported debt is understood, may be “incomplete or inaccurate” 

reporting. See id. at 1163–64.

In the instant case, Plaintiff alleges that Credit Recovery Associates reported “that the 

account was in collections, charged off, and that both a balance and past due balance were owed to 

Defendant Credit Recovery Associates, despite the treatment of its claims under the terms of 

Plaintiff’s confirmed [C]hapter 13 repayment plan.” Compl. ¶ 26. Plaintiff does not assert that the 

account was not in collection or charged off, that the balance on the account was not past due, or 

that no balance was owed. Rather, Plaintiff explains that “Plaintiff is specifically alleging that 

despite the treatment under the terms of the confirmed [C]hapter 13 plan, [Credit Recovery 

Associates] continued to report Plaintiff’s account as owing a current and past due balance, that the 

account was in collection, and charged off without making any mention or reference to a 

bankruptcy filing.” Opp. at 5. Thus, according to Plaintiff, Credit Recovery Associates’ reporting 

inaccurately indicates that Plaintiff’s account is subject to collection even though Plaintiff is 

absolved “from any legal requirement to pay on the debts separate from the treatment under the 

terms of the [C]hapter 13 plan.” Id. at 3. 

Credit Recovery Associates argues that, as a matter of law, reporting historically accurate 

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balances during the pendency of a bankruptcy can not be inaccurate or incomplete under the 

FCRA. Mot. at 6–8. However, courts in this district have found that reporting delinquent 

payments during bankruptcy may be misleading depending on the circumstances, including 

whether the report fails to indicate that a charge is disputed or part of a bankruptcy. See Mortimer 

v. Bank of Am., N.A., 2013 WL 1501452, at *4 (N.D. Cal. Apr. 10, 2013) (finding that reporting 

delinquencies during the pendency of bankruptcy is not misleading so long as the creditor reports 

that the account was discharged through bankruptcy and the outstanding balance is zero); 

Venugopal v. Digital Fed. Credit Union, 2013 WL 1283436, at *3 (N.D. Cal. Mar. 27, 2013) 

(holding that reporting of historically accurate debt may violate the FCRA when the reporting did 

not include that the debt was discharged in bankruptcy or that the debt was in dispute). 

Accordingly, the Court turns to Plaintiff’s particular allegations.

In the instant case, Plaintiff asserts that Credit Recovery Associates’ reporting is inaccurate 

because it is inconsistent with Plaintiff’s Chapter 13 bankruptcy plan. However, Plaintiff does not 

allege the terms of the Chapter 13 bankruptcy plan; that the balance owed to Credit Recovery 

Associates was included in the bankruptcy plan; or that the debt has either been paid or discharged. 

Nor does Plaintiff indicate whether Credit Recovery Associates’ reporting included a notation 

about the pending bankruptcy or any disputes. Plaintiff seems to recognize these failures, as 

Plaintiff’s opposition asserts that Credit Recovery Associates failed to include a notation about the 

pending bankruptcy and disputes, and Plaintiff’s opposition attempts to explain—in general 

terms—Plaintiff’s bankruptcy plan. See Opp. at 2–3, 6. However, Plaintiff cannot avoid dismissal 

by alleging new facts in an opposition to a motion to dismiss. See Schneider v. Cal. Dep’t of 

Corr., 151 F.3d 1194, 1197 n.1 (9th Cir. 1998) (“In determining the propriety of a Rule 12(b)(6) 

dismissal, a court may not look beyond the complaint to a plaintiff’s moving papers, such as a 

memorandum in opposition to a defendant’s motion to dismiss.”). Accordingly, Plaintiff fails to 

allege that Credit Recovery Associates’ reporting was inaccurate or incomplete because it was 

inconsistent with Plaintiff’s Chapter 13 bankruptcy plan. See Abbot, 2016 WL 1365950, at *4 

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(holding that virtually identical allegations failed to allege that the defendant’s reporting was 

inaccurate or incomplete).

Plaintiff additionally asserts that Credit Recovery Associates’ reporting is inaccurate or 

incomplete because it violates the automatic stay put in place by the bankruptcy court. 

Alternatively, Plaintiff argues that Credit Recovery Associates’ reporting inaccurately indicates 

that Plaintiff’s debt involves a child support obligation, which, according to Plaintiff, is the only 

type of debt that Credit Recovery Associates could report without violating the automatic stay. 

Opp. at 8–9. The Court finds that these allegations are insufficient to show that Credit Recovery 

Associates’ reporting was incomplete or inaccurate. The complaint does not allege that Credit 

Recovery Associates violated the automatic stay. Further, Plaintiff provides no authority that any 

violation of an automatic stay is also a violation of the FCRA. Indeed, courts in this district have 

held that whether a defendant reports accurate information as required by the FCRA is separate 

from whether a defendant violates the bankruptcy code. See, e.g., Mortimer, 2013 WL 1501452, at 

*10 & n.3 (noting that “the question before the Court is whether [d]efendant reported accurate 

information, not whether [d]efendant violated the bankruptcy code”); see also Abbot, 2016 WL 

1365950, at *5 (holding that virtually identical claims failed to allege an FCRA violation based on 

violation of the automatic stay). Lastly, Plaintiff fails to allege the nature of the debt she owes to 

Credit Recovery Associates, and fails to allege that this debt is not a child support obligation. 

Because Plaintiff does not plausibly allege that any of the reported information was inaccurate or 

incomplete, Plaintiff does not state a FCRA claim for failing to correct reported information. See 

Drew, 690 F.3d at 1106; see also Abbot, 2016 WL 1365950, at *5 (dismissing virtually identical 

FCRA claim). 

Accordingly, the Court GRANTS Credit Recovery Associates’ motion to dismiss 

Plaintiff’s FCRA cause of action. The Court does so with leave to amend because the Court 

concludes that amendment would not necessarily be futile. See Lopez, 203 F.3d at 1127 (holding 

that “a district court should grant leave to amend . . . unless it determines that the pleading could 

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not possibly be cured by the allegation of other facts”).

B. Plaintiff’s Claim under Cal. Civ. Code § 1785.25(a)

Section 1785.25(a) of the CCRAA provides that “[a] person shall not furnish information 

on a specific transaction or experience to any consumer credit reporting agency if the person 

knows or should know the information is incomplete or inaccurate.” Cal. Civ. Code. § 1785.25(a). 

The CCRAA provides for a private right of action to enforce this provision. Id. §§ 1785.25(g), 

1785.31(a). “[B]ecause the CCRAA ‘is substantially based on the Federal Fair Credit Reporting 

Act, judicial interpretation of the federal provisions is persuasive authority and entitled to 

substantial weight when interpreting the California provisions.’” Carvalho v. Equifax Info. Servs. 

LLC, 629 F.3d 876, 889 (9th Cir. 2010) (quoting Olson v. Six Rivers Nat’l Bank, 111 Cal. App. 4th 

1, 12 (2003)).

Similar to Plaintiff’s FCRA claim, Plaintiff asserts that Credit Recovery Associates

violated the CCRAA by reporting “a misleading and or inaccurate balance, and or monthly 

payment owed on the account and or listing of the account as in collections and or charged off 

rather than included in [b]ankruptcy.” Compl. ¶ 29. The parties’ arguments about the accuracy 

and completeness of this information in the context of a CCRAA claim mirror the parties’ FCRA 

claim arguments. See Mot. at 9–10; Opp. at 9–10; Reply at 7. For the reasons stated above, 

Plaintiff has not sufficiently alleged that Credit Recovery Associates reported any inaccurate or 

incomplete information. Accordingly, the Court need not address Credit Recovery Associates’ 

argument that the CCRAA does not provide a private right of action against furnishers of credit 

information. See Mot. at 9; Reply at 6-7. Therefore, the Court GRANTS Credit Recovery 

Associates’ motion to dismiss Plaintiff’s CCRAA claim. The Court does so with leave to amend 

because the Court concludes that amendment would not necessarily be futile. See Lopez, 203 F.3d 

at 1127.

C. Plaintiff’s UCL Claim

California’s UCL provides a cause of action for business practices that are (1) unlawful, 

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United States District Court

Northern District of California

(2) unfair, or (3) fraudulent. Cal. Bus. & Prof. Code §§ 17200 et seq. Each of the three “prongs” 

of the UCL provides a “separate and distinct theory of liability” and an independent basis for 

relief. Rubio v. Capital One Bank, 613 F.3d 1195, 1203–04 (9th Cir. 2010). The unlawful prong 

of the UCL “‘borrows’ violations of other laws and treats them as unlawful practices,” which the 

UCL then “makes independently actionable.” Cel–Tech Commc’ns, Inc. v. Los Angeles Cellular 

Tel. Co., 20 Cal. 4th 163, 180 (1999). 

Plaintiff asserts that Credit Recovery Associates violated the unlawful prong of the UCL 

because of “unlawful practices” that violate the CCRAA, § 1785.25(a). Compl. ¶¶ 36–42. 

Because the Court concludes above that Plaintiff can not state a claim under the CCRAA, Plaintiff 

can not state a claim under the unlawful prong of the UCL. See Punian v. Gillette, 2016 WL 

1029607, at *17 (N.D. Cal. Mar. 15, 2016). Thus, the Court GRANTS Credit Recovery 

Associates’s motion to dismiss Plaintiff’s UCL claim. The Court does so with leave to amend 

because amendment would not necessarily be futile. See Lopez, 203 F.3d at 1127.

IV. CONCLUSION

For the foregoing reasons, the Court GRANTS Credit Recovery Associates’ motion to 

dismiss with leave to amend. Should Plaintiff elect to file an amended complaint curing the 

deficiencies identified herein, Plaintiff shall do so within thirty (30) days of the date of this Order. 

Failure to meet the thirty-day deadline to file an amended complaint or failure to cure the

deficiencies identified in this Order will result in a dismissal with prejudice of Plaintiff’s claims. 

Plaintiff may not add new causes of action or parties without leave of the Court or stipulation of 

the parties pursuant to Rule 15 of the Federal Rules of Civil Procedure.

IT IS SO ORDERED.

Dated: April 15, 2016

______________________________________

LUCY H. KOH

United States District Judge

Case 5:15-cv-05544-LHK Document 68 Filed 04/15/16 Page 12 of 12