King v. Equifax Information Services, LLC

Background

Aaron King, proceeding without a lawyer, sued four consumer reporting agencies: Equifax Information Services, LLC, LexisNexis Risk Solutions, Inc., Trans Union, LLC, and Experian Information Solutions, Inc. He alleged that the agencies associated his consumer and credit information with information belonging to another person named Aaron King. The alleged mix-up began nearly 30 years earlier. King also alleged that Equifax had entered into a 2008 settlement agreement requiring it to purge and separate the other person’s information from King’s file and prevent the information from being associated again.

King’s allegations concerning LexisNexis involved addresses that he said were not associated with him and an alleged refusal to provide his requested consumer-file disclosure. His allegations concerning Experian involved an August 2021 disclosure that included the name “Aaron J. King,” which he associated with the other person. His allegations concerning Equifax involved online identity-verification questions that he said contained information about the other person. King alleged that these events violated Sections 1681e, 1681g, 1681i, 1681b, and 1681t of the Fair Credit Reporting Act; the Equal Credit Opportunity Act; 42 U.S.C. § 1981; 42 U.S.C. § 2000d; and common-law fraud. He also alleged that Equifax breached the 2008 settlement agreement.

Equifax moved under Federal Rule of Civil Procedure 12(b)(6), which allows dismissal when a complaint does not state a legally sufficient claim. Experian and LexisNexis joined the motion. Trans Union did not join and had answered the complaint.

Court’s Analysis

The court held that the complaint did not plausibly allege an actionable Fair Credit Reporting Act violation. It distinguished between information kept in a consumer reporting agency’s internal file and a consumer report disseminated to third parties for purposes such as credit, insurance, or employment. The court concluded that King’s allegations primarily concerned internal information, disclosures made to him, or online identity-verification questions. The complaint did not explain how the verification process involved information in a consumer report disseminated to third parties or how that information adversely affected him. The court declined to supply those missing factual connections through speculation.

For Section 1681e, the court held that King had not alleged that the agencies prepared a consumer report containing inaccurate information. The allegedly inaccurate information in the LexisNexis and Experian file disclosures and the Equifax identity-verification questions were not consumer reports for purposes of that provision.

For Section 1681g, which concerns disclosures of information in a consumer’s file, the court found insufficient allegations as to each moving defendant. The allegations against LexisNexis were contradicted by facts showing that it provided King access to a consumer disclosure. The allegations against Experian did not show that the information it allegedly failed to disclose was information that had been or would be included in a consumer report. The allegations against Equifax were likewise insufficient because King had received other Equifax file disclosures that he considered accurate.

For Section 1681i, which requires a reasonable reinvestigation of disputed information, the court held that King had not plausibly alleged inaccurate reporting or an unreasonable investigation. The complaint instead described defendants’ attempts to understand the disputes or correspondence explaining why requests could not be processed. The court noted that the statute permits an agency to end a reinvestigation when it reasonably determines that a dispute is frivolous or irrelevant, including when the consumer has not provided enough information to investigate.

The court also rejected King’s claims against Experian under Sections 1681b and 1681t. It found no allegation showing that Experian’s compliance with both the Fair Credit Reporting Act and the California Consumer Privacy Act violated the Fair Credit Reporting Act. King also did not allege that Experian provided a consumer report for an impermissible purpose.

The discrimination claims under the Equal Credit Opportunity Act, Section 1981, and Section 2000d were based on the alleged Fair Credit Reporting Act violations and an assertion that information had been combined because of race. The court found the Fair Credit Reporting Act allegations insufficient and declined to consider theories that were not adequately pleaded, particularly where the people whose information was allegedly combined had the same name. The fraud claims also failed because they were based entirely on the alleged Fair Credit Reporting Act violations.

Finally, the court held that King had not plausibly alleged that Equifax breached the settlement agreement. The identity-verification questions did not necessarily show that information from the other person’s consumer file had been associated with King’s file. King also did not allege that he would have passed the questions by selecting the answers he believed related to the other person. The court declined to speculate and noted that King had received several Equifax disclosures that contained no inaccuracies.

Disposition

Judge William Alsup granted LexisNexis, Experian, and Equifax’s motion to dismiss all claims against them. The dismissal applied only to those three defendants; the action continued against Trans Union. The court allowed King to seek leave to file an amended complaint and gave him 21 calendar days from the date of the order to file a motion for that permission. The proposed amended complaint had to include all claims he wished to pursue and explain how it would cure the deficiencies identified in the order.