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Woman's Lawsuit Against Credit Reporting Agency Gets Second Chance

Credit cards gold, platinum, AmEx.jpgA federal trial court has granted a Maryland woman a second chance to file her lawsuit against a credit reporting agency. The United States District Court for the District of Maryland dismissed Chevera D. Brown's claims but also gave her permission to file a second amended complaint against Experian Credit Reporting.

In a civil action, the complaint is the first pleading. It details the allegations being made in the lawsuit. An amended complaint or pleading is one where information has been added or subtracted. The first time a complaint is changed, it is called a "First Amended Complaint," the second time a complaint is changed, it is called a "Second Amended Complaint."

Brown filed suit against Experian in Maryland state court in 2012. She said the credit reporting agency "had persistently reported derogatory and inaccurate statements and information relating to [her] credit history to third parties." Brown alleged violations of the Fair Credit Reporting Act (FCRA), defamation, negligence and invasion of privacy. Brown said Experian failed to correct the problems in spite of her attempts to bring the inaccuracies to Experian's attention. Experian had the case moved to the federal court system. Then, the credit reporting agency asked that the case be dismissed for insufficient service of process, lack of personal jurisdiction and for failure to state a claim upon which relief could be granted.

A defendant may move to dismiss for insufficient service of process. In cases moved into the federal court system, state law determines whether service of process was properly effected before the case was moved from state to federal court. Under Maryland law, service is made upon a corporation by serving its resident agent or an executive or someone impliedly or expressly authorized to receive service of process. When service is challenged, the plaintiff must prove that it was valid. In this instance, because Brown's opposition brief failed to address the issue, the court ruled that Brown had failed to properly serve the company

The court said Brown had failed to state a claim for which relief can be granted because she failed to identify any false or inaccurate statements that Experian had made about her. While Brown had identified the accounts with which the information was associated, her amended complaint failed to allege facts sufficient to support the allegations. The FCRA imposes civil liability on any person or corporation or other entity that willfully or negligently fails to comply with its requirements. In order to state a claim for failure to comply with the sections of the FCRA that Brown claimed were violated, she should have alleged that her credit report contained inaccurate information - Brown did not do this, the court said. As to the other claims; under Maryland law, a claim for defamation requires "that the defendant made a defamatory statement to a third person and that the statement was false." The same is true for an invasion of privacy claim. Brown's failure to identify the allegedly false statements made by Experian about her rendered her claims for defamation, invasion of privacy and negligence insufficient, the court observed. The court did point out in a footnote that the more specific allegations in Brown's original complaint could be sufficient to survive a motion to dismiss.

Thus, the federal trial court granted Experian's request to throw the case out of court; however, because Brown had asked for permission to file a second amended complaint in response to Experian's motion to dismiss and because her original complaint contained more detailed allegations, the court granted Brown an opportunity to file a second amended complaint.

The court granted Brown a break because she was proceeding without an attorney (pro se). An experienced bankruptcy/consumer law attorney may very well have prevented the case from being dismissed.

Chevera D. Brown v. Experian Credit Reporting was released December 17.

Baltimore, Maryland-based Belsky, Weinberg & Horowitz has represented consumers in mortgage, bankruptcy and debt collection cases for many years. Call our bankruptcy attorneys at 410-234-0100 or email us for a free consultation and let us help you to resolve your credit and debt problems.

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