United States Court of Appeals

For the First Circuit

No. 07-1844

OVIDIO A. DEANDRADE,

Plaintiff, Appellant,

v.

TRANS UNION LLC,

Defendant, Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF RHODE ISLAND

[Hon. William E. Smith, U.S. District Judge]

Before

 Boudin, Chief Judge,

Torruella, Circuit Judge,

and Stahl, Senior Circuit Judge.

Christopher M. Lefebvre with whom Law Offices of Claude

Lefebvre & Sons was on brief for appellant.

Timothy P. Creech with whom Mark E. Kogan, Bruce S. Luckman,

and Kogan, Trichon & Wertheimer, P.C., were on brief for

appellee.

April 15, 2008
The complaint also alleged a defamation claim against 1

KeyBank. Trans Union is the only defendant remaining in this

action; the claims against Equifax and KeyBank were dismissed after

DeAndrade reached settlements with those parties.

-2-

STAHL, Senior Circuit Judge. Plaintiff-appellant Ovidio

A. DeAndrade brought an action against Trans Union, LLC ("Trans

Union"); Equifax Information Services, LLC ("Equifax"); and KeyBank

USA ("KeyBank") in Rhode Island federal district court, alleging

various violations of the Fair Credit Reporting Act, 15 U.S.C. §§

1681-1681x ("FCRA"). The suit followed a dispute over a loan 1

repayment between DeAndrade and KeyBank, and the credit bureaus'

alleged failure to reinvestigate properly and delete the disputed

debt from DeAndrade's credit report. Trans Union moved for summary

judgment, and the district court accepted the magistrate judge's

recommended decision granting the motion. DeAndrade now appeals.

Finding that the material facts are undisputed and establish no

FCRA violation, we affirm the district court's grant of summary

judgment in favor of Trans Union.

I. Background

DeAndrade purchased new windows for his home from a

company called NESCOR in July of 2001. At DeAndrade's request,

NESCOR agreed to arrange mortgage financing for the windows,

although it did not specify the identity of the lender. DeAndrade

and his wife signed documents in connection with this financing,
The record is somewhat unclear as to what documents the 2

DeAndrades attest to signing and when they signed them. There is

a contract with NESCOR for the installation of the windows, dated

July 21, 2001, which both DeAndrade and his wife admit to signing.

DeAndrade also recalled signing five or six documents proffered by

a NESCOR representative, some of which may have related to a loan.

His wife recalled signing blank sheets of paper at the request of

that same representative.

After two months, KeyBank replaced the invoices with a 3

payment coupon book for monthly payments in the same amount.

-3-

which created a lien on their home. NESCOR initially organized 2

the financing through Conseco Finance ("Conseco"). When DeAndrade

received notice of the first payment owed to Conseco, however, the

bill was greater than the amount that he had indicated to NESCOR

that he would be willing to pay. DeAndrade complained, and NESCOR

promised to remedy the situation, sending DeAndrade a check for

$11,722.30 with instructions to use the funds to pay the balance

due Conseco. Shortly thereafter, DeAndrade received an invoice

from KeyBank for approximately $121, an amount consistent with the

original terms of his agreement with NESCOR.3

DeAndrade made twenty-two monthly payments to KeyBank,

from September 2001 until June 2003. The DeAndrades had never

received copies of the loan documents, and at some point,

apparently after speaking with a consumer attorney, DeAndrade's

wife contacted KeyBank to obtain copies of the documents. The

DeAndrades were "shocked" to discover that the documents granted a

mortgage on their residence to KeyBank and that their signatures on

the documents appeared to have been forged. As a result, the
The state court complaint also lists "Barbara Andrade," 4

DeAndrade's wife, as a plaintiff, but she is not named as a

plaintiff in the federal case.

The letter stated, in part: 5

My clients has [sic] alleged that the mortgage

and the promissory note that was given in

favor of Key Bank was procured by fraud. . . .

I assume that you will do an investigation on

this matter. Please do not verify the

accuracy of the Key Bank trade-line until you

receive sufficient information to satisfy you

that the signatures on both the promissory

-4-

DeAndrades filed suit against KeyBank in Rhode Island Superior

Court on August 20, 2003, requesting declaratory relief as to the

validity of the KeyBank mortgage. In that complaint, DeAndrade 4

alleged that he and his wife never signed any documents granting a

mortgage on their home to KeyBank and never authorized NESCOR to do

so on their behalf. 

DeAndrade maintains that when he commenced the state

lawsuit, he stopped sending the monthly payments to KeyBank and

instead deposited them into an escrow account pending the

resolution of that action. KeyBank notified the three major credit

bureaus--Trans Union, Experian, and Equifax--of the alleged

delinquent payments, and the bureaus updated DeAndrade's credit

report accordingly. Through an attorney, DeAndrade then sent a

letter dated July 16, 2004 to those three credit bureaus, advising

them that the mortgage underlying the negative item reported by

KeyBank had been fraudulently obtained and urging the bureaus to

investigate the transaction. Attached to the letter were forty- 5
note and mortgage are valid.

-5-

nine pages of documentation, including the Rhode Island Superior

Court complaint, provided in support of DeAndrade's allegations of

fraud. Experian deleted the KeyBank item after receiving

DeAndrade's letter, but Trans Union and Equifax did not. 

On August 2, 2004, Trans Union sent a letter to DeAndrade

indicating receipt of his request to investigate the disputed item.

Trans Union then contacted KeyBank to verify the accuracy of the

item. Trans Union did not forward the documents it had received

from DeAndrade to KeyBank, but rather sent KeyBank an automated

dispute verification form ("ACDV"). The ACDV stated that the

customer "[d]isputes present/prev Acct Status" and believed the

account to be "not his/hers." KeyBank's response verified

DeAndrade's name, address, social security number, month and year

of birth, telephone number, and delinquent payment history. Trans

Union then sent DeAndrade a notice, dated August 11, 2004,

informing him that KeyBank had confirmed the item's accuracy and

advising him of his further rights under the FCRA. Trans Union

continued to publish the KeyBank debt on DeAndrade's credit report,

but DeAndrade did not contact Trans Union again before initiating

this lawsuit.

On December 21, 2004, DeAndrade filed suit in the United

States District Court for the District of Rhode Island, claiming
Trans Union also put forward an argument regarding 6

DeAndrade's "defamation" claim; however, as the magistrate judge

noted, DeAndrade did not allege a defamation claim against Trans

Union.

 

-6-

that Trans Union had violated a provision of the FCRA, 15 U.S.C. §

1681i, by "failing to conduct a lawful reinvestigation" of the

disputed debt and failing to delete the allegedly inaccurate item

from DeAndrade's credit report. DeAndrade maintained that Trans

Union's refusal to delete the disputed item harmed him by

negatively impacting his ability to obtain needed credit, such as

a home refinancing.

Trans Union moved for summary judgment, arguing that the

suit was an impermissible collateral attack on the validity of the

KeyBank loan through the FCRA, that DeAndrade had in any case

ratified the loan and therefore the information published on his

credit report was accurate, and that DeAndrade had failed to adduce

evidence of negligent or willful noncompliance with the FCRA.6

Considering the ratification issue to be dispositive, the

magistrate judge addressed that issue only and found that DeAndrade

had ratified the KeyBank debt, rendering Trans Union's report of

that debt accurate. Noting that inaccuracy is a necessary element

of an FCRA claim, the magistrate judge recommended granting Trans

Union's summary judgment motion. The district court accepted the
In its order adopting the magistrate judge's report and 7

recommendation, the district court noted that during the hearing on

plaintiff's objection to the magistrate judge's report, DeAndrade

for the first time raised an argument predicated on the Federal

Truth in Lending Act ("TILA"), 15 U.S.C. §§ 1601-1667f. DeAndrade

argued that another factor militating against ratification was

KeyBank's alleged failure to comply with TILA disclosure

requirements. The district court ruled that argument was waived

because it was not raised before the magistrate judge. See

Fireman's Ins. Co. of Newark, N.J. v. Todesca Equip. Co., 310 F.3d

32, 38 (1st Cir. 2002). While a TILA violation may have provided

grounds for rescission of the mortgage agreement, DeAndrade waived

that argument below and makes no serious effort to press it on

appeal; accordingly, we will not consider it. United States v.

Zannino, 895 F.2d 1, 17 (1st Cir. 1990) ("[I]ssues adverted to in

a perfunctory manner, unaccompanied by some effort at developed

argumentation, are deemed waived.").

-7-

magistrate judge's recommended decision and granted summary

judgment to Trans Union.7

II. Discussion

We review the district court's grant of summary judgment

de novo, with all reasonable inferences resolved in favor of the

nonmoving party. Fenton v. John Hancock Mut. Life Ins. Co., 400

F.3d 83, 87 (1st Cir. 2005). Summary judgment is appropriate where

there is no genuine issue of material fact, and the moving party is

entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c).

"A dispute is genuine if the evidence about the fact is such that

a reasonable jury could resolve the point in the favor of the nonmoving party. A fact is material if it carries with it the

potential to affect the outcome of the suit under the applicable
15 U.S.C. § 1681i(a) states, in relevant part: 8

(a) Reinvestigations of disputed information

(1) Reinvestigation required.--

(A) In general.--Subject to subsection (f) of this

section, if the completeness or accuracy of any

item of information contained in a consumer's file

at a consumer reporting agency is disputed by the

consumer and the consumer notifies the agency

directly, or indirectly through a reseller, of such

dispute, the agency shall, free of charge, conduct

a reasonable reinvestigation to determine whether

the disputed information is inaccurate and record

the current status of the disputed information, or

delete the item from the file in accordance with

paragraph (5), before the end of the 30-day period

beginning on the date on which the agency receives

the notice of the dispute from the consumer or

reseller.

-8-

law." Sánchez v. Alvarado, 101 F.3d 223, 227 (1st Cir.

1996)(citations omitted).

If a consumer disputes the accuracy or completeness of

any item contained in his or her consumer report, 15 U.S.C. §

1681i(a) requires consumer reporting agencies to "conduct a

reasonable reinvestigation to determine whether the disputed

information is inaccurate." The magistrate judge reasoned that 8

"[a] necessary element of Plaintiff's [§ 1681i] claim is that the

information Trans Union reported was inaccurate." Deandrade v.

Trans Union, LLC, No. 1:04-cv-00534, slip op. at 9 (D.R.I. Nov. 29,

2006)(unpublished). This court has yet to opine on the question

whether a plaintiff must show that the disputed information
At the hearing on plaintiff's objection to the magistrate 9

judge's report, counsel for DeAndrade appeared to concede the

issue, stating "I think [the magistrate judge's] approach was

correct in that once he found that the debt was ratified, it was a

valid debt, that we don't have to get to the reinvestigation

issue." However, DeAndrade asserts in his reply brief on appeal

that he has not conceded this issue, although his appellate briefs

offer no developed argumentation on the subject. Nevertheless,

because this is an important threshold question of law and the

magistrate judge's treatment of it warrants clarification, we will

discuss it here.

-9-

contained in a consumer report is inaccurate in order to prevail on

a § 1681i FCRA claim. The magistrate judge's recommended decision 9

and Trans Union's brief on appeal cite a string of cases in support

of the proposition that a showing of inaccuracy is essential. The

relevant language in those cases, however, largely addresses claims

brought under § 1681e(b), not § 1681i; indeed, in most of the cases

cited, either no § 1681i claim was asserted or the question of

accuracy is not addressed directly. See, e.g., Dalton v. Capital

Associated Indus., 257 F.3d 409, 415 (4th Cir. 2001)(holding that

"a consumer reporting agency violates § 1681e(b) if (1) the

consumer report contains inaccurate information and (2) the

reporting agency did not follow reasonable procedures to assure

maximum possible accuracy"); Spence v. TRW, 92 F.3d 380, 382 (6th

Cir. 1996)(holding that plaintiff could not prevail on his §

1681e(b) claim "without proving the information in question was

inaccurate"); Henson v. CSC Credit Servs., 29 F.3d 280, 284 (7th

Cir. 1994)(holding that "[i]n order to state a claim under 15

U.S.C. § 1681e(b), a consumer must sufficiently allege that a
-10-

credit reporting agency prepared a report containing 'inaccurate'

information")(emphasis added)(citations omitted); Wadley v. Ford

Motor Credit Co., 397 F. Supp. 2d 781, 783 (E.D. Va.

2005)(plaintiff alleged claim under § 1681s-2(a), "which prohibits

an entity from furnishing information relating to a consumer to a

consumer reporting agency if "(i) the [entity] has been notified by

the consumer . . . that specific information is inaccurate; and

(ii) the information is, in fact, inaccurate.")(emphasis in

original); Dauster v. Household Credit Servs., Inc., 396 F. Supp.

2d 663, 664 (E.D. Va. 2005)(where plaintiff had conceded

information reported by credit agency was accurate, plaintiff

failed to state claim under FCRA § 1681e(b)); see also Wantz v.

Experian Info. Solutions, 386 F.3d 829, 833-34 (7th Cir.

2004)(affirming summary judgment for defendant on § 1681i(a) claim

not on grounds that disputed information was accurate, but rather

on grounds that disputed information was never reported to

potential creditor and therefore plaintiff failed to show actual

damages). But see Cahlin v. Gen. Motors Acceptance Corp., 936 F.2d

1151, 1160 (11th Cir. 1991)("[A] section [1681i] claim is properly

raised when a particular credit report contains a factual

deficiency or error that could have been remedied by uncovering

additional facts that provide a more accurate representation about

a particular entry.")(emphasis in original).
In fact, courts have been careful to draw distinctions 10

between the burdens imposed by § 1681e(b) and § 1681i in other

contexts. See, e.g., Cushman v. Trans Union Corp., 115 F.3d 220,

225 (3d Cir. 1997)(holding that because § 1681i's reinvestigation

requirement may mandate a more thorough investigation than that

contemplated by § 1681e(b), "[j]udgment as a matter of law, even if

appropriate on a § 1681e(b) claim, thus may not be warranted on a

§ 1681i claim"); Henson, 29 F.3d 280 at 286-87 (affirming motion to

dismiss plaintiff's § 1681e(b) claim but remanding for

consideration of plaintiff's § 1681i claim).

-11-

It is thus clear that to prevail on a § 1681e(b) claim,

a plaintiff must demonstrate that his or her credit report sports

an actual inaccuracy. Looking at the statutory language, however,

it is not immediately obvious that § 1681e(b) and § 1681i should be

interpreted identically in this regard. See Kaiser Aluminum & 10

Chem. Corp. v. Bonjorno, 494 U.S. 827, 835 (1990)(The "starting

point for interpretation of a statute is the language of the

statute itself.")(citations omitted). 15 U.S.C. § 1681e(b) states:

"Whenever a consumer reporting agency prepares a consumer report it

shall follow reasonable procedures to assure maximum possible

accuracy of the information concerning the individual about whom

the report relates." This language is not ambiguous; it creates an

obligation on the part of the consumer reporting agency to ensure

the preparation of accurate reports independent from § 1681i's

reinvestigation requirement. Section 1681i requires consumer

reporting agencies to "reinvestigate free of charge" if "the

completeness or accuracy of any item of information contained in a

consumer's file at a consumer reporting agency is disputed by the
-12-

consumer and the consumer notifies the agency directly of such

dispute." 15 U.S.C. § 1681i(a)(1)(A). It is thus not necessarily

apparent, on the face of the statute, that a § 1681i plaintiff must

also adduce sufficient evidence to show that the disputed

information was in fact inaccurate, as opposed to merely showing

that the plaintiff disputed its accuracy and had informed the

agency accordingly. 

Nevertheless, the weight of authority in other circuits

indicates that without a showing that the reported information was

in fact inaccurate, a claim brought under § 1681i must fail. See

Dennis v. BEH-1, LLC, ___ F.3d ___, 2008 WL 795378, at *2 (9th

Cir. Mar. 27, 2008)(§ 1681i creates no duty to reinvestigate where

"the credit report accurately reflect[s] the status of the

information contained in the public records") (citing Williams v.

Colonial Bank, 826 F. Supp. 415, 418 (M.D. Ala. 1993)); Kuehling v.

Trans Union, LLC, 137 F. App'x 904, 908 (7th Cir. July 6, 2005)

(unpublished) ("Without evidence of some inaccuracy in the Trans

Union report or reinvestigation, Kuehling cannot establish that

Trans Union violated the FCRA--either § 1681e(b) or §

1681i(a)(1)(A)"); Cahlin, 936 F.2d at 1160. But see Wadley v.

Experian Info. Solutions, Inc., 241 F. App'x 132, 136 (4th Cir.

July 17, 2007)(unpublished)(vacating and remanding grant of summary

judgment to defendant credit agency where district court found

plaintiff failed to establish that credit report contained
-13-

inaccurate information but did not address plaintiff's § 1681i

claim, and plaintiff argued that agency "had a duty to

reinvestigate the credit report . . . regardless of whether the []

report was accurate."); Dickens v. Trans Union Corp., 18 F. App'x

315, 319 (6th Cir. Aug. 23, 2001)(unpublished)("Although a showing

of inaccuracy is an essential element of a § 1681e(b) claim . . .

it is unclear whether a showing of inaccuracy is required for §

1681i liability . . . .") (citations omitted).

We find the reasoning of the majority of other appellate

courts persuasive. The FCRA is intended to protect consumers

against the compilation and dissemination of inaccurate credit

information. See Equifax v. Fed. Trade Comm'n, 678 F.2d 1047, 1048

(11th Cir. 1982)(noting stated purpose of FCRA is "to prevent

consumers from being unjustly damaged because of inaccurate or

arbitrary information in a credit report")(citations omitted); S.

Rep. No. 108-166, 108th Cong., 1st Sess. 5-6 (2003)("The driving

force behind the [1996 amendments to the FCRA] was the significant

amount of inaccurate information that was being reported by

consumer reporting agencies and the difficulties that consumers

faced getting such errors corrected."). At the very least, it is

difficult to see how a plaintiff could prevail on a claim for

damages under § 1681i without a showing that the disputed

information disclosed by the credit agency was, in fact,

inaccurate. See Wantz, 386 F.3d at 829 (holding that plaintiff
-14-

could not demonstrate a violation of § 1681i absent evidence that

defendant credit agency "disclosed incorrect information . . . to

a third party"); cf. Salei v. Am. Exp. Travel Related Servs. Co.,

134 F.3d 372 (Table), 1997 WL 809956, at *3 (6th Cir. Dec. 19,

1997) (unpublished) ("Even if a showing of inaccuracy is not a

predicate to liability, damages would be almost impossible to prove

without it . . . ."). Thus, if there is no genuine issue as to

whether the KeyBank debt reported by Trans Union was inaccurate,

DeAndrade's claim fails as a matter of law.

The magistrate judge reasoned that the KeyBank item

reported by Trans Union was accurate because DeAndrade ratified the

KeyBank loan, and the district court accepted the magistrate

judge's recommended decision. However, "[w]e are not committed to

the district court's reasoning, but, rather, may affirm its order

on any independent ground made apparent by the record." United

States v. Cabrera-Polo, 376 F.3d 29, 31 (1st Cir. 2004); see also

InterGen N.V. v. Grina, 344 F.3d 134, 141 (1st Cir. 2003).

To determine whether a consumer has identified a factual

inaccuracy on his or her credit report that would activate §

1681i's reinvestigation requirement, "[t]he decisive inquiry" is

whether the defendant credit bureau could have uncovered the

inaccuracy "if it had reasonably reinvestigated the matter."

Cushman, 115 F.3d at 226 (citations omitted). The KeyBank debt

reported by Trans Union does not fall under this rubric. Here,
-15-

there is no dispute that DeAndrade received windows financed by a

mortgage on his home; what DeAndrade is attacking is the mortgage's

validity. Whether the mortgage is valid turns on questions that

can only be resolved by a court of law, such as whether DeAndrade

ratified the loan. This is not a factual inaccuracy that could

have been uncovered by a reasonable reinvestigation, but rather a

legal issue that a credit agency such as Trans Union is neither

qualified nor obligated to resolve under the FCRA. See Cahlin, 936

F.2d at 1160 ("No reasonable reinvestigation on the part [of the

credit agency] could have uncovered an inaccuracy in Cahlin's

report because there was never any factual deficiency in the

report.").

We therefore find it unnecessary to reach the question of

ratification. The information reported by Trans Union was accurate

not because DeAndrade had ratified the loan (although that may also

be true), but because it did not state any factual deficiency that

could have been resolved by a reasonable reinvestigation conducted

by the credit bureau. KeyBank did in fact have documentation

granting it a mortgage on the residence of one DeAndrade who was in

fact the same DeAndrade that had been making the loan payments and

is the plaintiff in this case. Determining whether DeAndrade was

entitled to stop making those payments is a question for a court to

resolve in a suit against KeyBank--and DeAndrade did file a state

suit against KeyBank--not a job imposed upon consumer reporting
-16-

agencies by the FCRA. If a court had ruled the mortgage invalid

and Trans Union had continued to report it as a valid debt, then

DeAndrade would have grounds for a potential FCRA claim. In

essence, DeAndrade has crossed the line between alleging a factual

deficiency that Trans Union was obliged to investigate pursuant to

the FCRA and launching an impermissible collateral attack against

a lender by bringing an FCRA claim against a consumer reporting

agency. See Wadley, 396 F. Supp. 2d at 679-680 ("The FCRA does not

provide a cause of action to collaterally attack an accurate credit

report."); Williams, 826 F. Supp. at 418 ("A credit reporting

agency has no duty, as a part of its reinvestigation, to go behind

public records to check for accuracy or completeness when a

consumer is essentially collaterally attacking the underlying

credit information."). The Williams court noted that the FCRA

provides an alternative remedy for consumers in cases such as this:

pursuant to § 1681i(c), they may submit a statement detailing their

version of the dispute to be included in their credit report. Id.

It is no fault of Trans Union that DeAndrade apparently chose not

to avail himself of that option.

III. Conclusion

For the foregoing reasons, we affirm the summary judgment

order of the district court.

Affirmed.