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Toler v. PHH Mortgage Corporation

United States District Court, W.D. Arkansas, Hot Springs Division

November 5, 2014

TERRY D. TOLER, DONNA R. TOLER, MARKETPLACE DEVELOPMENT CORPORATION and SUCCESS DYNAMICS, INC. d/b/a ALL PRO CLASSICS, Plaintiffs,
v.
PHH MORTGAGE CORPORATION and EXPERIAN INFORMATION SOLUTIONS, INC., Defendants.

MEMORANDUM OPINION

ROBERT T. DAWSON, District Judge.

Before the Court are Plaintiffs' Motion for Partial Summary Judgment (docs. 144-46, 157-63, 192), Experian's Response (docs. 173-74, 176), PHH's Response (docs. 180-81), Plaintiffs' Reply (docs. 186-91), PHH Mortgage Corporation's ("PHH") Motion for Summary Judgment Regarding Success Dynamics, Inc. and Marketplace Development Corporation ("corporate Plaintiffs")(docs. 147-48), PHH's Reply (doc. 184), PHH's Motion for Partial Summary Judgment Regarding Terry and Donna Toler ("the Tolers")(docs. 149-51), PHH's Reply (doc. 185), Experian Information Solutions, Inc.'s ("Experian") Motion for Summary Judgment as to Corporate Plaintiffs and Business Damages (docs. 152-53), Experian's Reply (doc. 193), and Experian's Motion for Summary Judgment as to the Tolers and All Other Damages (docs. 154-56, 164). Also before the Court is Plaintiffs' combined response to all of Defendants' Motions (docs. 167-72, 175, 177-79).

I. Background

Plaintiffs' Complaint was originally filed in the Circuit Court of Garland County, Arkansas, on January 31, 2012 by the Tolers against PHH, Experian and Federal National Mortgage Association ("Fannie Mae").[1] Defendants removed the action to this Court on March 1, 2012. (Doc. 1). An Amended Complaint (doc. 72) was filed on April 30, 2013, adding Plaintiffs' businesses, Success Dynamics, Inc. d/b/a All Pro Classics, and Marketplace Development Corporation as Plaintiffs and again naming Fannie Mae as a defendant.[2]

The Tolers allege claims against Defendants for violations of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681, et seq., and the corporate Plaintiffs allege claims against Defendants under Arkansas law for tortious interference with business expectancies.

The Tolers' FCRA claims stem from alleged inaccurate credit information reported by their mortgage company, PHH, to Experian, and Experian's furnishing of that information, specifically, that the Tolers were delinquent on their mortgage payments.

II. Standard of Review

A motion for summary judgment will be granted when "there is no genuine issue as to any material fact and... the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). A "material" fact is one "that might affect the outcome of the suit under the governing law...." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A "genuine" issue of material fact exists when there is sufficient evidence favoring the party opposing the motion for a jury to return a verdict for that party. Anderson, 477 U.S. at 248. In determining whether a genuine issue of material fact exists, the evidence is to be viewed in the light most favorable to the nonmoving party. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 (1970).

If the moving party meets the initial burden of establishing the nonexistence of a genuine issue, the burden then shifts to the opposing party to produce evidence of the existence of a genuine issue of fact for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). The opposing party "may not rest upon mere allegation or denials of his pleading, but must set forth specific facts showing that there is a genuine issue for trial, " and "must present affirmative evidence in order to defeat a properly supported motion for summary judgment." Anderson, 477 U.S. at 256-57 (citing Fed.R.Civ.P. 56(e)). In order to withstand a motion for summary judgment, plaintiffs must substantiate their allegations with "sufficient probative evidence [that] would permit a finding in [their] favor on more than mere speculation, conjecture, or fantasy." Gregory v. Rogers, 974 F.2d 1006, 1010 (8th Cir. 1992), cert. denied, 507 U.S. 913 (1993). A mere scintilla of evidence is insufficient to avoid summary judgment. Moody v. St. Charles County, 23 F.3d 1410, 1412 (8th Cir. 1994). Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial. Celotex, 477 U.S. at 322.

III. Discussion

In their Motion for Partial Summary Judgment, Separate Plaintiffs Terry and Donna Toler seek summary judgment on Defendants' liability under the FCRA. Having reviewed the pleadings and the evidence on file; viewing the evidence in the light most favorable to the non-moving party as required, the Court finds genuine issues of disputed material facts remain in connection with the Tolers' FCRA claims including, but not limited to, whether PHH and Experian failed to conduct reasonable investigations of the Tolers' disputes, and whether Experian failed to follow reasonable procedures to ensure the accuracy of the Tolers' credit information it reported, and, if so, what damages were proximately caused by Defendants' failures to do so. Accordingly, the Tolers' motion (doc. 144) should be DENIED. Additionally, Experian's motion (doc. 154) as to the Tolers' FCRA claims is DENIED to the extent it seeks a judgment as a matter of law on the issue of liability pursuant to the FCRA.

PHH moves for summary judgment on the corporate Plaintiffs' tortious interference claims contending they are preempted by the FCRA and, alternatively, that the corporate Plaintiffs failed to establish a prima facie case of tortious interference (doc. 147). The FCRA was enacted, in large part, to protect consumers by ensuring "fair and accurate credit reporting." 15 U.S.C. § 1681(a)(1). The FCRA's preemption provisions are as follows:

No requirement or prohibition may be imposed under the laws of any State with respect to any subject matter regulated under section 1681s-2 of this title, relating to the responsibilities of persons who furnish information to consumer reporting agencies, except that ...

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