Glover v. American Credit Acceptance

Background

Wilbert Glover, proceeding without a lawyer, sued American Credit Acceptance (ACA) and its employee, Keith Kulas. Glover alleged that he had an automobile loan with ACA and had not made a late payment. He claimed that ACA nevertheless reported a missed payment, causing his credit score to fall and contributing to the denial of a mortgage application.

Glover also alleged that a woman in ACA’s executive office told him that “You Black people Wilbert Glover hate to pay bills” and that Kulas later said, “you Black people make up a excuse not to pay your bill.” He claimed that ACA blocked his phone number and that ACA employees lied about his payment history. His complaint invoked 42 U.S.C. § 1981, a federal law protecting the right to make and enforce contracts without racial discrimination. The complaint also mentioned age discrimination once, but alleged no facts supporting that theory.

Motion to Dismiss and Audio Recordings

ACA and Kulas moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint states a legally sufficient claim. They argued that recordings of phone calls showed that no racial comments were made. They also argued that, even if the comments occurred, the employees who made them were not involved in the alleged false reporting of Glover’s payment history.

The court held that it could not consider the recordings at the motion-to-dismiss stage. Although the complaint referred to recorded calls, the recordings were submitted to dispute Glover’s allegations and provided evidence beyond what the complaint itself said. The court therefore treated them as matters outside the pleadings.

Section 1981 Claim

The court nevertheless granted the motion to dismiss because Glover’s complaint did not plausibly allege a violation of Section 1981. For a direct-discrimination theory, discriminatory statements generally must be attributed to people involved in the challenged decision. Glover alleged that Kulas and the executive-office employee made racial comments, but he did not allege that either person had decision-making authority or caused ACA to falsely report his payment history. The court therefore concluded that the comments, as pleaded, did not plausibly establish direct discrimination.

The court also considered indirect discrimination under the burden-shifting framework commonly known as McDonnell Douglas. At the pleading stage, Glover needed factual allegations supporting an inference that the defendants intended to discriminate because of race and interfered with his contractual rights. The court found that he did not identify any similarly situated person of another race whose payment history was treated more favorably. His allegation that ACA lied “because of race” was treated as a legal conclusion unsupported by sufficient facts.

Age Discrimination

The court interpreted Glover’s reference to being denied “public services because of race and age” as referring to payment-history reporting. Because the complaint mentioned age discrimination only once and included no facts supporting it, the court dismissed any related age-discrimination claim as well.

Disposition

Judge John R. Tunheim granted the defendants’ Motion to Dismiss. The order dismissed Glover’s complaint without prejudice, meaning the opinion expressly states that Glover may refile after correcting the pleading defects identified by the court. The court entered judgment accordingly.