Jones v. Experian Information Solutions, Inc.

Background

Wesley Jones brought claims under the Fair Credit Reporting Act and the New York Fair Credit Reporting Act against Equifax Information Services LLC, Experian Information Solutions, Inc., and Trans Union (of Delaware), LLC. Jones alleged that the defendants reported two inaccurate 30-day late payments on his Experian credit report and failed to correct them after he disputed the entries. The opinion states that Jones settled his claims against Equifax and TransUnion; the motion addressed Experian’s answer.

Experian’s answer denied many allegations because it lacked enough information to admit or deny them, stated that cited outside sources spoke for themselves, characterized some allegations as legal conclusions, admitted certain facts, and asserted twelve affirmative defenses. Those defenses included failure to state a claim, statute of limitations, truth, failure to mitigate, laches, contributory or third-party negligence, estoppel, unclean hands, arbitrability, lack of legal capacity to sue, intervening cause, and constitutional objections to punitive damages. Experian also reserved the right to assert additional defenses based on discovery and later factual developments.

Jones’s Motion

Jones moved to strike portions of the answer under Federal Rule of Civil Procedure 12(f). He argued that Experian’s responses to paragraphs 155–215 and 328–377 of the complaint were deficient and should result in admissions; that Experian improperly characterized his claims in its response to paragraph 20; that Experian’s reservation of the right to add defenses was improper; and that all twelve affirmative defenses were conclusory and unsupported.

Legal Standard

Rule 8 requires a party responding to a complaint to admit or deny allegations and to state affirmative defenses. A response that says the responding party lacks enough knowledge to form a belief about an allegation generally has the effect of a denial. Rule 12(f) allows a court to strike an insufficient defense or redundant, immaterial, impertinent, or scandalous matter.

Under the three-part test described in GEOMC Co. v. Calmare Therapeutics Inc., the party seeking to strike an affirmative defense must show that no possible facts could make the defense plausible, that no legal theory could allow the defense to succeed, and that including the defense would prejudice the moving party. Courts apply a lower, context-specific plausibility standard to affirmative defenses because defendants have less time to investigate and prepare them before filing an answer.

Court’s Analysis

The court rejected Jones’s challenge to Experian’s responses to paragraphs 155–215 and 328–377. It found that Experian appropriately lacked sufficient information to admit or deny certain allegations and appropriately denied allegations that were legal conclusions. Although the court said it disfavored responses stating that an external source “speaks for itself,” it declined to strike the responses at issue.

The court also denied Jones’s challenge concerning paragraph 20 because the answer did not contain the statement Jones attributed to Experian—that his claims were “frivolous and an abuse of the legal process.” Instead, Experian had stated that it lacked sufficient knowledge to admit or deny the allegations in that paragraph, which the court found appropriate.

The court declined to strike Experian’s reservation of the right to assert additional defenses. It explained that Experian retained the right to ask the court for permission to amend its answer if later-discovered facts supported another defense, but Experian would need to seek the court’s permission to do so.

The court further held that Jones did not satisfy the three-part test for striking the affirmative defenses. Jones did not adequately show prejudice, particularly because the case was at an early stage and discovery had not begun. The court also could not conclude that the challenged defenses were legally insufficient or lacked the minimum factual plausibility required at that stage. The court noted that the failure-to-state-a-claim defense can function like a general denial, that some defenses depended on facts concerning Jones’s conduct or the timing of his lawsuit, and that lack of causation essentially challenged the factual basis of his claims rather than operating as a separate affirmative defense.

Disposition

The court denied Jones’s Motion to Strike. It also warned Jones’s counsel about obligations under Federal Rule of Civil Procedure 11 and related authorities, while stating that the record did not contain clear and convincing evidence warranting sanctions. The Clerk was directed to close the motion docket entry, and the case was to proceed toward an initial case-management conference.