The opinion of the court was delivered by: Debevoise, Senior District Judge
Plaintiff Robert Burrell is a victim of identity theft. The individual who committed that theft used Mr. Burrell‟s Discover credit card account, which was administered by Defendant DFS Services, LLC ("Discover"), to purchase almost $10,000 in goods and services. The thief also used Mr. Burrell‟s identity to incur charges of approximately $1,000 from Defendant Helio, LLC ("Helio"), a wireless telephone company. Mr. Burrell alleges that he repeatedly informed Discover and Helio that his identity had been stolen, but the companies did nothing.*fn1 Instead, they transmitted information to various credit reporting agencies stating that Mr. Burrell was delinquent in paying his bills. By doing so, Mr. Burrell argues that the companies violated the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681s-2. Additionally, Mr. Burrell contends that Discover and Helio violated Fair Credit Billing Act ("FCBA"), 15 U.S.C. § 1666, by not responding to his inquiries and failing to make appropriate corrections to his accounts after he informed them that his identity had been stolen. Finally, Mr. Burrell asserts state law claims for intentional infliction of emotional distress, defamation, and the tort of negligence.
Defendants now move to dismiss Mr. Burrell‟s claims pursuant to Federal Rule of Civil Procedure 12(b)(6). In doing so, they do not dispute that Mr. Burrell‟s identity was stolen and the charges at issue were incurred by the thief. Instead, Defendants rely on technicalities buried in the almost incomprehensibly complex provisions of the FCRA and FCBA, and argue that Mr. Burrell‟s state law claims are either preempted by the FCRA or are not pled with sufficient particularity.
Though the Court is loath to reward their effort to hide behind the esoteric strictures of the FCRA to defeat claims by a layperson like Mr. Burrell -- who could not possibly have been expected to comply with the procedural requirements of that statute and who attempted to address the theft of his identity in a manner that most similarly-situated consumers would consider reasonable -- Defendants‟ arguments relating to Mr. Burrell‟s FCRA claims are legally, if not morally, correct. Similarly, Defendants are correct in their assertion that Mr. Burrell‟s state law claims are preempted by the FCRA. Therefore, for the reasons set forth more fully below, Defendants‟ Motion to Dismiss will be granted as to Mr. Burrell‟s FCRA and state law claims. Defendants‟ Motion will be denied, however, with respect to Mr. Burrell‟s claims under the FCBA.
Mr. Burrell first discovered that his identity had been stolen in April 2008. When he did not receive that month‟s bill for his Discover credit card, Mr. Burrell contacted the company and was told by a customer service representative that his statements were being sent to his new address. He informed the customer service representative that he had not moved, and was told that the company would correct the error and forward his bills to his home address.
But Mr. Burrell never received his April 2008 bill. In fact, he heard nothing from Discover until September 1, 2008, when he received a statement showing several fraudulent charges, along with accumulated late fees and penalties for non-payment. At that point, Mr. Burrell contacted Discover again, and was told by a customer service representative that the individual to which the company had been sending his bills had stopped making payments. The customer service representative identified that person as "Sarah Foster" -- presumably an alias used by the identity thief. Mr. Burrell reiterated that his identity had been stolen and that he was not affiliated with anyone named Sarah Foster, and the customer service representative stated that the Discover would "look into" the disputed charges.
Approximately one month later, in October 2008, Mr. Burrell again informed representatives of Discover that his identity had been stolen and received a similar assurance that the company would investigate. Finally, on or about May 18, 2009, he submitted a written Affidavit of Fraud provided by Discover in which he detailed the various fraudulent charges posted to his account.
Yet Discover apparently did nothing. To the contrary, it allowed the identity thief to continue making charges using Mr. Burrell‟s card, all while assessing late fees and penalties for non-payment. That bears repeating: despite having been informed on four separate occasions -- three times orally and once in writing -- that an identity thief was making charges using Mr. Burrell‟s card, Discover failed to stop the fraudulent purchases, and then charged Mr. Burrell extra fees for refusing to pick up the thief‟s tab.
On June 16, 2009, almost a month after he submitted the Affidavit of Fraud, Mr. Burrell received a bill from Discover for $9,706.68. The following month, he received a letter stating that his account would soon exceed its credit limit of $10,300. Apparently at a loss for how to proceed, Mr. Burrell once again contacted a Discover customer service representative, who told him to file a police report. When he went to his local police station, however, he was referred to the post office, which then advised him that it was unable to process his complaint.
Mr. Burrell‟s dealings with Helio paint a similar picture -- a frustrated consumer pitted against a faceless and unresponsive company. Unlike Discover, however, Mr. Burrell did not maintain an account with Helio prior to the theft of his identity. It appears that the identity thief opened such an account and charged wireless services using Mr. Burrell‟s name and address.
Mr. Burrell first learned of that development on May 7, 2009, when he received a bill from Helio for $1,010.16. When Mr. Burrell telephoned Helio‟s customer service representatives to dispute the charge, they instructed him to submit a written complaint. Mr. Burrell did so, and it appeared for the time being that the matter was resolved. But on September 9, 2009, he received a letter from Helio‟s legal counsel demanding payment for the debt.
After searching for options to combat the theft of his identity for roughly two years, on March 17, 2010 Mr. Burrell stumbled on the one that Defendants contend he should have pursued from the start. On that date, he filed a complaint with the three main companies that track consumer credit ratings in the United States -- Experian Information Solutions, Inc. ("Experian"), Equifax, Inc. ("Equifax"), and TransUnion, LLC ("TransUnion")*fn2 -- disputing the debts incurred by the identity thief.
Unfortunately, it appears that Mr. Burrell‟s complaint to the credit rating agencies came too late to do him much good. By March 2010, Defendants had submitted information to the credit rating agencies stating that he had not paid his debts for almost two years. His consumer credit rating was ruined, and he was beset by debt collectors, some of whom allegedly continue to harass Mr. Burrell and his family by repeatedly calling his house at inconvenient hours. The stress of dealing with the debts incurred in his name by the identity thief has rendered him irritable and unable to sleep. In short, Mr. Burrell has lost more than the monetary amount of the charges incurred by the thief -- gone also is his peace of mind.
In an attempt to redress the harm done by the theft of his identity, Mr. Burrell filed this action on May 17, 2010. His Complaint asserts two federal claims and three state law causes of action against Discover and Helio.*fn3 In the first of his federal claims, Mr. Burrell contends that Defendants violated the FCRA by (1) telling the credit rating agencies that he was delinquent in paying his bills when they knew or should have known that the charges at issue were fraudulent, and (2) failing to investigate and correct the erroneous charges after he informed them that his identity had been stolen. Mr. Burrell‟s second federal claim alleges that the latter of those actions was also a violation of the FCBA. In his state claims, Mr. Burrell argues (1) that Defendants‟ actions constituted intentional infliction of emotional distress, (2) that Discover and Helio defamed his reputation by transmitting information they knew or should have known was false to the credit rating agencies, and (3) that both companies are liable in tort for their negligent behavior with respect to his accounts.
Defendants now move to dismiss Mr. Burrell‟s claims pursuant to Federal Rule of Civil Procedure 12(b)(6). As discussed above, Defendants do not dispute Mr. Burrell‟s factual allegations; they do not assert, for instance, that Mr. Burrell failed to inform them in a timely fashion that his identity had been stolen or contend that they properly addressed the fraudulent charges to his account. Rather, Defendants premise their request for dismissal of Mr. Burrell‟s FCRA and FCBA claims on technical requirements within those statutes that they argue bar recovery. Similarly, Defendants contend that Mr. Burrell‟s state law claims fail not because they lack a foundation in the factual circumstances of this case, but because they are either preempted by the FCRA or are not pled with sufficient particularity.
Defendants‟ arguments with respect to the FCRA claim take two parts. First, they contend that Mr. Burrell may not maintain a cause of action under 15 U.S.C. § 1681s-2(a) for their alleged failure to furnish accurate information to the credit rating agencies because that subsection of the FCRA does not include a private right of action. Defendants admit that there is a private right of action to enforce § 1681s-2(b) -- another subsection of the FCRA that requires companies, such as themselves, that furnish information to credit rating agencies to conduct an investigation of any disputed charges and correct those that are erroneous. They contend, however, that Mr. Burrell‟s complaints about the charges to his accounts were not legally sufficient to trigger that obligation. Rather, Defendants assert that notice of a dispute must come directly from a credit reporting agency in order to invoke the protections of § 1681s-2(b). In other words, they argue that, instead of calling them directly to dispute the charges made to his accounts by the identity thief, Mr. Burrell should have known that he was required to contact the credit rating agencies -- obscure third-party organizations that were not involved in the administration of his accounts and with whom he, like most consumers, had most likely never been involved in any personal capacity.
Defendants argue that Mr. Burrell‟s state law claims should also be dismissed because they are preempted by the FCRA. In doing so, they note two sections of that statute, 15 U.S.C. §§ 1681h(e) and 1681t(b)(1)(F), that contain language preempting virtually all state law causes of action.
Finally, Discover contends that the FCBA claim asserted against it must be dismissed because Mr. Burrell did not comply with the technical requirements of that statute.*fn4 Specifically, Discover notes that 15 U.S.C. § 1666(a)(1)-(3) requires credit card users to provide written notice to their credit card provider of any charges they believe to be erroneous within 60 days after the issuance of the statement including those charges in order to trigger the requirement, embodied in § 1666(a)(B), that the credit card provider investigate such charges and correct any errors. Discover asserts that, despite orally ...