Bank Improperly Accessing Credit Reports for Power-of-Attorney Consumers
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF PENNSYLVANIA
____________________________________
Karen A. Barel, on behalf of herself )
and all others similarly situated, )
)
Plaintiff, ) C. A. No. 06-2372
)
v. )
)
CLASS ACTION
Bank of America, )
)
Defendant.
)
____________________________________)
ORDER
AND NOW, this _____ day of _____________, 2007, upon consideration of Defendant Bank of America’s Motion for Summary Judgment, and Plaintiff’s Response thereto, it is hereby ORDERED that said Motion is DENIED.
_____________________________
Surrick, J.
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF PENNSYLVANIA
____________________________________
Karen A. Barel, on behalf of herself )
and all others similarly situated, )
)
Plaintiff, ) C. A. No. 06-2372
)
v. )
) CLASS ACTION
Bank of America, )
)
Defendant. )
____________________________________)
PLAINTIFF KAREN A. BAREL’S RESPONSE IN OPPOSITION TO DEFENDANT BANK OF AMERICA’S MOTION FOR SUMMARY JUDGMENT
Plaintiff Karen A. Barel, by and through her undersigned counsel, hereby opposes Defendant Bank of America’s Motion for Summary Judgment. For the reasons set forth in the accompanying Memorandum of Law, Defendant’s Motion should be denied.
RESPECTFULLY SUBMITTED,
FRANCIS & MAILMAN, P.C.
BY: /S/James A. Francis JAMES A. FRANCIS
MARK D. MAILMAN
JOHN SOUMILAS
Land Title Building, 19th Floor
100 South Broad Street
Philadelphia, PA 19110
(215) 735-8600
DAVID A. SEARLES
DONOVAN SEARLES, LLC
1845 Walnut Street, Suite 1100
Philadelphia, PA 19103
(215) 732-6067
GLEN H. CHULSKY
LAW OFFICES OF GLEN H. CHULSKY
410 Route 10 West, Suite 210
Ledgewood, NJ 07852
Dated: July 9, 2007 Attorneys for Plaintiff and the Class
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF PENNSYLVANIA
____________________________________
Karen A. Barel, on behalf of herself )
and all others similarly situated, )
)
Plaintiff, ) C. A. No. 06-2372
)
v. )
) CLASS ACTION
Bank of America, )
)
Defendant.
)
____________________________________)
MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFF KAREN A. BAREL’S RESPONSE IN OPPOSITION TO DEFENDANT
BANK OF AMERICA’S MOTION FOR SUMMARY JUDGMENT
Plaintiff, Karen Barel, by and through her undersigned counsel, respectfully submits this Memorandum of Law in opposition to Defendant Bank of America’s (“BOA”) Motion for Summary Judgment (“Motion”).
I. INTRODUCTION
BOA’s Motion should be denied for the straightforward reason that virtually all of the material facts and issues in this case – why BOA obtained Plaintiff’s credit report, whether it falsely certified its reasons for doing so, whether its actions damaged class members’ credit ratings, and whether its conduct was willful — are seriously disputed. Most of these disputed issues present major credibility questions and determinations that are simply not appropriate for resolution at summary judgment.
Examples abound. BOA asserts that its reason for obtaining the credit reports of Plaintiff and the class members was for the purpose of assessing risk exposure and to prevent fraud. BOA’s branch bank employees, however, testified that they have no idea why BOA obtained Plaintiff’s credit reports, that they never see any credit reports, and know nothing about BOA’s reasons for pulling credit reports on non-customers who are merely acting as a power-of-attorney (“POA”) for another person. Importantly, the very BOA employees who are charged with preventing fraud admit that they do not use credit reports for fraud prevention, but rather use driver’s licenses and other forms of identification. Nor could any BOA witness explain how a POA’s credit score or detailed information concerning a POA’s payment history on personal loans was a legitimate business need for the bank. Even BOA’s designated Rule 30(b)(6) corporate representative was completely unaware of the reasons underlying BOA’s practice of pulling the credit reports of non-customer and non-account holder individuals.
In defending this case, BOA now asserts that its permissible purpose for obtaining the credit reports of POAs was in connection with a “legitimate business need for the information in connection with a business transaction that [was] initiated by the consumer.” (Def. Mem. of Law at 12). Well before this lawsuit was filed, however, and at the time that BOA was required to certify to the Trans Union credit bureau what its actual lawful purposes were for obtaining Plaintiff’s and the class members’ credit reports, BOA gave Trans Union completely different reasons. Specifically, BOA falsely certified to TU that it was going to use the reports for the specific purposes of extending credit, collecting on a delinquent account from a customer, the underwriting of insurance or for employment purposes. That none of these situations apply here is one of the few truly undisputed issues.
BOA contends that there is no evidence that it acted willfully in violation of the Fair Credit Reporting Act (“FCRA”). But the true record reveals that when Ms. Barel sought clarification from BOA as to why it obtained her credit report after being asked by her ailing mother to act as her power-of-attorney, BOA deliberately misrepresented and attempted to conceal its reasons for doing so, as well as the impact that its actions would have on her credit rating. Moreover, after months and months into this litigation in which witness after witness testified that BOA’s practice of pulling and using the credit reports of POA individuals was ongoing, BOA just recently amended its discovery responses to inform Plaintiff that it has ceased the practice of pulling credit reports on POAs. Conscious and systemic corporate practices, especially ones predicted upon false certifications and concealments, can certainly be found to be willful by a reasonable jury.
BOA’s Motion also neglects to inform this Court that Plaintiff has proffered unrebutted expert opinion from one of the country’s fair credit reporting experts who opines that BOA’s true reason for accessing the credit reports of Plaintiff and the class was to save money through automating its credit practices, notwithstanding its longstanding awareness of the importance of financial privacy.
The question of whether Plaintiff and the class consented to BOA’s practice is also highly disputed. BOA’s sole support for its consent argument rests upon a standard form document which by definition only applied to BOA’s customers, and thus, it did not apply to Plaintiff and the class as they were not customers of BOA. There is also serious question as to whether the form document was provided to Plaintiff and the class members at all.
BOA also tries to convince this Court that its practice exacted no harm on Plaintiff or any class member. But this also is highly disputed. Even BOA’s own witnesses testified that the type of inquiry resulting from BOA’s access of the class’ credit reports was a “hard” inquiry that can negatively impact a consumer’s credit score.
It is understandable why BOA would like this Court to believe this case presents a singular legal issue as to whether a bank may use credit reports to prevent fraud to its customers, but that is simply not the record or the case before this Court.
II.
FACTS PERTINENT TO BOA’S MOTION
To be sure, there are several undisputed facts.
First, neither party disputes that BOA obtained Plaintiff’s credit report from the Trans Union credit reporting agency on November 15, 2004 in connection with her appointed by her mother Rita Adler to act as Ms. Adler’s power-of-attorney. (See BOA’s Responses to Plaintiff Requests for Admissions, numbers 2 and 3, attached to Plaintiff’s Appendix of Exhibits as Exhibit A).
Second, there is no dispute that, as a matter of policy and practice for the relevant time period covered by this case and up until very recently, BOA would obtain and use the consumer reports of consumers who had no banking relationship with BOA if they were given POA by an existing BOA customer. (See BOA’s Responses to Plaintiff’s Requests for Admissions, numbers 5 and 6, at Exhibit A).
Third, there is no doubt that Plaintiff and the Class members were consumers who entitled to the protection of the FCRA, and that BOA is a bank whose activities are regulated by the FCRA. The undisputed facts end there.
A. BOA’s True Purpose for Obtaining the Credit Reports of POAs is Highly Disputed
In its Motion, BOA argues that its purpose for obtaining the credit report on Ms. Barel and other POAs was a “legitimate business need for the information in connection with a business transaction that [was] initiated by the consumer.” (Def. Mem. of Law at 14). This “legitimate business need” was assessment of a POA’s credit risk by looking at their credit score and using the report to guard against identity theft. But the evidentiary record tells a different story.
First, BOA gave the Trans Union credit reporting agency (“CRA”) completely different reasons for why it was obtaining credit reports on POAs. As required under the FCRA, and as explained in more detail below, any user of consumer reports, whether it be a bank, car dealership or employer, is required to certify to the CRA the lawful permissible purpose(s) under FCRA section 1681b(f) for which it will be using the consumer report. See 15 U.S.C. §1681b(f)(2). This requirement assists the CRA in releasing consumer reports in situations like the case at bar where is no permissible purpose under the FCRA.
While BOA asserts now that it obtained the credit reports of POAs in connection with their legitimate business need regarding a business transaction that those consumers initiated, BOA gave Trans Union entirely different reasons for obtaining their credit reports. Rather, BOA certified to Trans Union that it would use Trans Union consumer reports for four specific purposes, and no others: to assess the credit ratings of consumers who were applying for new or continued credit, for collection of delinquent accounts, for the underwriting of insurance and for employment eligibility. (See paragraph 3 of Schedule A to the Master Credit Services Agreement between Bank of America and Trans Union, attached to Plaintiff’s Appendix of Exhibits as Exhibit B). At her deposition, Trans Union’s witness made it clear that BOA had no other permissible purpose for obtaining consumer reports other than situations involving an application for credit, collection of an account, insurance underwriting or employment:
22 Q And as far as you know the permissible
23 purposes listed in that master service
24 agreement are the permissible purposes of Bank
43
1 of America has for pulling credit reports from
2 TransUnion?
3 MR. LUCKMAN: Objection to the form.
4 THE WITNESS: They are the permissible
5 purposes, yes.
6 BY MR. SOUMILAS:
7 Q Those are the ones and no other, correct?
8 A Right, the ones certified in the contract.
9 Q Are the only ones?
10 A Yes.
(See Deposition of Kathy Savage taken on February 28, 2007, at pp. 42-43, attached to Plaintiff’s Appendix of Exhibits as Exhibit C). BOA never once informed Trans Union that it would be using the consumer reports of the POA Class members in connection with a legitimate business need involving a business transaction that was initiated by that consumer. Certainly, BOA never informed TU that it would use credit reports for the purpose of screening non-customers who were merely being added to another person’s account as a POA.
Second, if BOA’s true permissible purpose for obtaining the credit reports on POAs was to assess their credit risk and guard against fraud, how is it that its own banking branch employees who interacted with Ms. Barel and who routinely process POA requests know nothing about this practice? At deposition, BOA’s employees testified that they had no idea how or why BOA used credit reports in POA situations, and testified that they never even see the credit reports:
10 Q. Do you know why the bank pulls credit
11 reports for Powers of Attorney?
12 A. No.
13 Q. Do you know how the bank uses information
14 from credit reports for Powers of Attorney?
15 A. No.
16 Q. Are you familiar with the basic
17 procedures that the bank has and how to create a
18 Power of Attorney for someone who wants one?
19 A. Yes.
*****************************************
5 When the account holder is not present
6 and just the Power of Attorney comes in, then we
7 need to see a general Power of Attorney.
8 Q. And is that just part of your training as
9 a banking center manager to know that process?
10 A. Yes.
11 Q. I asked you do you know actually why the
12 bank uses credit reports. This question is a little
13 different. Do you just know whether they pull
14 credit reports for Power of Attorney?
15 A. No.
16 Q. Do you know that they do it or you don’t
17 know what the policy is whether to pull it or not
18 pull it?
19 A. Well, we don’t necessarily pull it, if
20 that’s what you’re asking me, on the system. We
21 just follow whatever system, the system that we have
22 on Merlin, we follow screen by screen.
******************************************
18 Q. Do you know what happens to the credit
19 report that is pulled for any customer?
20 A. We don’t see a credit report.
21 Q. Okay. You personally at the branch don’t
22 see it on your computer screen?
23 A. Correct.
24 Q. And you don’t see a paper copy of it?
25 A. No.
1 Q. Do you ever see a copy of it?
2 A. No.
3 Q. Do you know what happens to the data?
4 A. No.
5 Q. Do you know if it’s stored by Bank of
6 America?
7 A. No, I do not know.
8 Q. As part of the training that you say you
9 received earlier in some of your experience with the
10 banks, have you received any training on credit
11 reports?
12 A. No.
13 Q. Any training on the Fair Credit Reporting
14 Act?
15 A. No.
(See Deposition of Rosellina Iacono, at pages 18-19, and 25-26, attached to Plaintiff’s Appendix of Exhibits as Exhibit D. But Ms. Iacono is not the only BOA witness who was unaware of why Defendant pulled the credit reports of POAs.
Rather, the very BOA employee who met with Mrs. Barel and processed her POA paperwork testified not only that she did not know why BOA obtained her credit report, but that she never used a consumer’s credit report to open an account or process a POA request:
23 Q. Okay. Do you know why, you can just tell
24 me yes or no, the bank accesses credit reports for
25 Powers of Attorney?
1 A. No.
(See Deposition of Helen Raulerson taken on February 8th, 2007, at pp. 14-15, attached to Plaintiff’s Appendix of Exhibits as Exhibit E). In fact, Ms. Raulerson testified that a credit report is not used to verify the identity of an individual in the case of POA situation to prevent fraud, but rather, BOA employees use the driver’s license and some other form of photo I.D.:
8 Q. Okay. As far as you know, the Check
9 Systems information is not what you use to identify
10 whether Miss Barel is actually the person who she
11 claims she is?
12 A. That’s right.
13 Q. You use the driver’s license or the photo
14 I.D. or some other type of the I.D.s you explained?
15 A. Correct. That’s all entered on Merlin
16 before you even get to that process where you hit
17 “okay” and it pulls up her Check Systems.
18 Q. So you see if the person looks like their
19 photo?
20 A. Yes.
Id. at p. 31. Ms. Raulerson’s testimony comports with common sense. Since the POA individual has come into the bank, the BOA employees use photo identification, the most effective means of verifying the person’s identity and preventing fraud.
Even BOA’s own designated Rule 30(b)(6) witnesses were in the dark as to why BOA obtains credit reports on POAs:
9 Q. In the case of a power of attorney
10 situation as opposed to where somebody is being
11 added to an account and has the rights and benefits
12 of the account, why does BOA pull their credit
13 reports?
14 MS. MCDERMOTT: Objection, outside the
15 scope of this witness’ testimony.
16 MR. FRANCIS: You can answer.
17 THE WITNESS: I don’t know.
18 BY MR. FRANCIS:
19 Q. Do you know if there is any good reason?
20 A. Do I personally know of a good reason?
21 Q. Yes.
22 MS. MCDERMOTT: Objection, outside the
23 scope of this witness’ testimony.
24 THE WITNESS: I can only guesstimate.
(See Deposition of Nalan Karakaya Mulder, at p. 85, attached to Plaintiff’s Appendix of Exhibits as Exhibit F).
Given Ms. Iacono’s and Ms. Mulder’s lack of knowledge concerning BOA’s purpose for using the consumer reports of POAs, BOA’s Motion relies heavily on another of its corporate representatives, Rob Markiewitz , another BOA risk management employee. (Def. Mem. at p. 7). But when pressed on the subject, even Mr. Markiewitz, who was not at all involved in the enactment of BOA’s credit policy regarding the use of credit reports for deposit accounts and POA situations, nor who knew anybody who was, had absolutely no knowledge regarding BOA’s purpose for using the credit reports of POA consumers:
22 Q. So is it fair for me to state that you
23 have not had any involvement in the development of
24 BOA’s policies for obtaining and using credit?
25 A. For the decision to go get a FICO. I
1 have been involved in decisions on where a FICO
2 score is set.
3 Q. Okay, I’m not just saying FICO. I’m
4 saying a score or a report over the years.
5 A. No.
12
10 A. I have not been involved in those sort of
11 decisions.
15
7 You were not involved in the bank’s
8 enactment of the policy to pull credit in
9 connection with the opening of a savings or
10 checking account, correct?
11 A. That’s correct.
12 Q. You weren’t on a team or part of the
13 people who decided, hey, look, when somebody opens
14 a savings or checking account, we are going to pull
15 their credit score, correct?
16 A. That’s correct.
17 Q. And you would agree with me that in
18 connection with depository accounts, new deposit
19 accounts that are being opened, a credit score is
20 obtained, correct?
21 A. For a new deposit customer.
22 Q. Correct, new deposit customer, new credit
23 scores are obtained, correct?
24 A. Correct.
25 Q. But is it fair for me to say you don’t
16
1 know why the bank put that policy in place,
2 correct?
3 A. I do not know why.
************************************************
24 Q. You mentioned before that it would be
25 your guess that the reason that BOA treats POA
17
1 situations the same as it does with joint account
2 holders because of same risk, but have you seen any
3 studies or any data to suggest that the people who
4 made that policy believe that?
5 A. No.
18
17 Q. Is that why the bank does it, what you
18 just testified to?
19 A. Is that why the bank does what?
20 Q. Uses credit scores in connection with POA
21 requests?
22 A. We use credit requests against our new
23 deposit customers that are coming in. Why on POA,
24 I don’t know. I can answer as far as a new
25 customer.
(See Deposition of Rob Markiewitz at pp. 7-8, 10-18, 20, [“Markiewitz Dep. at ___”], attached to Plaintiff’s Appendix of Exhibits as Exhibit G). In addition to having no direct or indirect knowledge as to the original actual reasons for BOA’s access of POAs’ credit reports (as opposed to those which may sound like plausible ones in retrospect), Mr. Markiewitz was not even aware as to whether there was a solid rationale for BOA’s practice:
12 Q. Have you seen any data which suggests
13 that a person with a low FICO score is not able to
14 act effectively as a power of attorney for another
15 individual?
16 A. No.
17 Q. Are you aware of any studies that the
18 bank has conducted or any statistics the bank has
19 compiled which suggests that a person with a low
20 credit score is likely to violate the power of
21 attorney responsibility that they have?
22 A. No.
23 Q. Do you know whether in enacting the
24 policies for adding new deposit customers, whether
25 the power of attorney situation was even
21
1 considered?
2 A. I don’t know.
30
9 Q. I guess my question is, one of my
10 questions is, I think you testified, and I think I
11 understand that why the bank obtains credit
12 information on new customers who open depository
13 accounts in their name, and I think understand
14 that.
15 I guess my question is, do you know why
16 any of that same criteria applies to the power of
17 attorney situation?
18 A. No.
(See Markiewitz Dep. at pp. 20-21, and 30). Certainly, if the POA situation was not even considered when BOA began pulling credit reports on such individuals, it cannot assert that it had a legitimate business purpose for doing so. To date, BOA has not presented any reliable evidence or testimony from a witness with knowledge as to what its actual and true purpose was for accessing the credit reports of POAs.
B. BOA’s True Reason for Accessing the Credit Reports of POAs Was the Financial Benefit Gained Through Automating the Opening of Deposit Accounts
While BOA has consistently obscured its true reasons for accessing the credit reports of Plaintiff and other POA Class Members, Plaintiff has produced evidence demonstrating that BOA’s true purpose behind its POA credit policy was the financial benefit it achieved through automating its process for the opening of deposit accounts according to a “one size fits all” policy.
In addition to obtaining deposition testimony from BOA’s own witnesses, Plaintiff has proffered the unrebutted expert opinion of Evan Hendricks regarding BOA’s actual motivation for using POAs’ credit reports. Citing the deposition testimony of BOA’s witness Ms. Mulder and other evidence, Mr. Hendricks has opined that BOA’s policy of pulling credit reports on POAs was tied to its purpose of automating the process for the opening of deposit accounts. (See Expert Witness Report of Evan Hendricks, at pp. 1, and 3-5, attached to Plaintiff’s Appendix of Exhibits as Exhibit H).
Rather than incur the cost of creating a separate procedure to treat POA situations differently, BOA designed its computer system to treat the opening of a new deposit account by a prospective new customer (where it presumably may have a permissible purpose to assess whether to allow someone to become a banking customer) identically to the situation where an existing customer simply informs the bank know they have given another individual power-of-attorney. (Id.; see also Mulder Dep. at pp. 42-43, 47, 55-56 and 78).
The automation purpose also explains why BOA’s own employees were unaware as to its reasons for using credit reports in POA situations. Clearly, if BOA’s employees were going to use the reports to prevent fraud, it would be the employees “on the ground” who had the POA in front of them who would be using the credit reports to screen for fraud.
C.
Neither the Plaintiff Mrs. Barel Nor Other POA Class Members Were Customers of BOA at Any Time
For the purposes of its Motion, BOA wants to convince the Court that POAs stood in the same shoes as the BOA customers they agreed to assist. Yet, the evidentiary record is clear that, in reality, they were not customers of BOA, not account holders and never treated as such, no different than an attorney representing a client is treated as her client.
While she had POA for her mother Rita Adler, Ms. Barel was not a customer of BOA. (See Deposition of Ruta Karlson, at pp. 57-58 [“Karlson Dep. at ___”], attached to Plaintiff’s Appendix of Exhibits as Exhibit I). Across the board, while BOA obtained and used their credit reports in a way that could harm their credit score, POAs were not entitled to any of the benefits of being an account holder, and were not considered customers. (Markiewitz Dep. at p. 44).
D. BOA’s Conduct Was Intentional, Deceptive and Damaging
There is little question that BOA’s conduct at issue in obtaining and using Plaintiff’s credit report was willful. Discovery has revealed that BOA’s conduct in obtaining her consumer report was no accident. Rather, it was part of a uniform policy and practice to obtain the consumer reports of all individuals who were added as a POA to one of its customers’ accounts. In response to Plaintiff’s Requests for Admissions, BOA admitted that its “practice is to pull a credit report on POAs who do not have a prior relationship with the bank.” (See Defendant’s Responses to Plaintiff’s Requests for Admissions numbers 5, 15, and 16, at Exhibit A).
The willful and intentional nature of BOA’s conduct and policy is further demonstrated by BOA’s conduct after this litigation was commenced. Notwithstanding the allegations and claims set forth in the Complaint, BOA continued with its practice of obtaining and using POAs’ credit reports. Even months after the case was filed, discovery had been exchanged, and depositions had begun, BOA’s corporate representatives testified that, not only had BOA not ceased its unlawful practice, it had not even taken any steps whatsoever to modify or change the way it handled POA situations:
13 Q. Is it currently Bank of America’s
14 practice to obtain the consumer reports of
15 individuals who are added to an existing account
16 holder’s account as a power of attorney?
17 A. If they don’t have existing deposit
18 relationship already with the bank, yes.
19 Q. So the process that was followed with Ms.
20 Barel, the plaintiff in this case, is still being
21 followed today, correct?
22 A. Yes.
23 Q. To your knowledge, has there been any
24 attempt to change, modify or alter the process by
25 which credit reports are obtained and accessed for
56
1 non-customer individuals who are added to an
2 account as a POA?
3 A. Can you state that once more.
4 Q. Sure. I’m just trying to be precise. To
5 your knowledge, has Bank of America made any
6 modifications or changes to the way it processes
7 requests by existing account holders who add
8 another individual as a power of attorney to their
9 account?
10 A. No.
11 Q. So if Ms. Barel were added today to her
12 mother’s account, Ms. Adler’s, as she was before
13 this litigation was commenced, it would still be
14 the bank’s practice to pull her credit report,
15 correct?
16 A. Yes, if she at that point still doesn’t
17 have Bank of America relationship, but if
18 subsequently she has opened a deposit account for
19 her name or if a second POA request comes in on
20 other accounts, then, no, because then she will be
21 treated as existing deposit relationship.
22 Q. So do I understand correctly that it’s
23 the bank’s position and understanding that that
24 practice complies with the Fair Credit Reporting
25 Act?
57
1 A. That’s my understanding.
2 Q. Do you know if there have been any
3 attempts to add a process to the MERLIN system
4 where in the case of a power of attorney addition,
5 a branch employee could override the credit pull?
6 A. No.
(Mulder Dep. at pp. 55-57).
In addition to acting intentionally, BOA was also deceptive. After finding out that BOA had obtained her credit report in connection with being given POA by her mother Ms. Adler, Ms. Barel did not run out and file a lawsuit. Rather, she wrote to BOA, informed it that she had discovered the credit inquiry, and wanted it removed from her credit report because it was lowering her credit score. (See letter from Karen Barel to Rosellina Iacono dated February 28, 2006, attached to Plaintiff’s Appendix of Exhibits as Exhibit K) In response to Ms. Barel’s question, Ms. Iacono, among other things, misrepresented to Plaintiff that the type of credit inquiry BOA made was only a “soft hit”, one that would not affect her credit score. (See letter from Roselina Iacono to Karen Barel, dated March 1, 2006, [“Iacono Letter”], attached to Plaintiff’s Appendix of Exhibits as Exhibit K).
The record is clear that the type of inquiry made on Mrs. Barel’s and other class members’ credit reports was a hard inquiry, meaning one that is seen by all third party creditors who would review the report, and which typically causes a reduction in the consumer’s credit score. (See Hendricks Report at pp. 1, 5; Mulder Dep. at 73-75). Even BOA’s own witness Ms. Mulder confirmed that the Iacono Letter was untrue:
20 Q. You never saw that letter? There was a
21 letter that was sent to Ms. Barel from the bank
22 manager of the Wayne, New Jersey branch and it
23 informed Ms. Barel that it was actually a soft pull
24 that was made on her credit inquiry. Is that
25 false? Do you know, in fact, that this was
1 actually a hard pull?
2 A. That’s what we confirmed with the
3 systems.
4 Q. So if you saw a letter that said that it
5 was only a soft pull, that would be wrong, correct?
6 A. Yes.
(Mulder Dep. at 76-77). Thus, after Plaintiff discovered BOA’s secretive practice, and inquired about it, BOA attempted to mislead her about the impact that its action would have on her credit rating.
In addition to the fact that BOA’s credit inquiries resulted in a hard hit or hard pull on Plaintiff’s and Class members’ credit files, the fact that BOA accessed and used their credit reports alone, without their consent, damaged these consumers in and of itself through the unwarranted invasion of privacy. (See Hendricks Report at pp. 1, and 2-3).
E. Neither Plaintiff Nor the Class Members Consented to BOA’s Access of Their Credit Reports
BOA invests a considerable part of its Motion trying to convince the Court that, even if it otherwise had no permissible purpose to access Plaintiff’s consumer report, it should be granted summary judgment because Plaintiff consented to BOA’s acquisition and use of her consumer report. BOA is factually wrong and the record contradicts its argument. Plaintiff never consented to BOA’s use of her consumer report.
BOA’s consent argument is premised upon the fact that when Plaintiff went into the BOA branch to be added to her mother’s account as her POA, she signed the signature card that was already on file which contained a form acknowledgement that the account would be governed by the Deposit Agreement and Disclosures (“DAD”). (Def. Mem. at 5-6, 15-16). BOA then points to language in the DAD which states that BOA may make inquiries, including the verification of credit reports, to help it determine if it should close “your account.” (Id. at Def. Mem., Ex. E).
The reason Plaintiff did not consent to BOA’s use of her credit report is that she was never provided with the DAD before BOA accessed her credit report, and even if she had been, the DAD would not apply to her because she was neither a customer nor account holder of BOA. Thus, the DAD would not apply to her in any event.
BOA cites the deposition testimony of Ms. Raulerson who assisted in processing the POA for Mrs. Barel to support its incorrect contention that Mrs. Barel was given the DAD at when she was in the bank. However, the problem is that BOA cites the wrong part of Ms. Raulerson’s testimony. BOA cites the portion of Ms. Raulerson’s testimony where she is discussing the process when new deposit accounts are opened for new customers, not the POA situation:
2 Q. Okay. And do you tell customers who want
3 to open a regular account that you had been
4 accessing their Check Systems report as part of
5 opening the report?
6 A. No.
7 Q. And I take it at this point, there’s
8 really no paperwork, you’re just entering data
9 straight into the computer?
10 A. Well, when they first sit down, there’s a
11 sales process we go through, like, we have an
12 interview to see what kind of products would fit
13 their needs. So we don’t just sit right down and
14 start typing.
15 Q. I understand.
16 A. So I have a conversation, ask them a few
17 questions and see what we can offer them. And then
18 at that point, we have kind of a starter kit. It’s
19 a folder that contains disclosures and documents.
20 It’s also sales, saying here’s all the things we can
21 take advantage of at Bank of America. It also has a
22 privacy policy or fee schedules and a deposit
23 agreement and disclosures. So I have that on the
24 table for them to basically give them something to
25 review while I start entering their information.
(Raulerson Dep. at 18)(emphasis supplied). It is clear from counsel’s question, the “starter kit,” and the “sales” pitch notion that Ms. Raulerson testified about that she was referring to the documents and process that would have been followed when Mrs. Barel’s mother Ms. Adler opened her account. Plaintiff does not contest that when BOA opens accounts for new customers that it provides them with the DAD and a starter kit and gives them a sales pitch, but that process was not followed with her.
Later in her deposition, Ms. Raulerson did address the process that is followed with POAs, and made it very clear that BOA does not obtain consent or give any disclosures to the individual being added as a POA:
14 Q. And in none of those cases are the people
15 or their customers or people submitting an
16 application told that a Check Systems report will be
17 used as part of a process?
18 A. No. They’re told if they ask, you know.
19 So if somebody asks, why do you need this
20 information or what do you need my I.D. for, that
21 kind of thing.
22 Q. But as part of the standard process, that
23 information is not volunteered by Bank of America?
24 A. Not verbally. But it is posted on our,
25 you know, we have disclosures in the lobby, HMDA
22
1 requirements, and fair credit housing, there’s a
2 couple of legal documents that we have to post.
3 Q. So you say disclosures in the lobby, is
4 that something that you put up on a bulletin board
5 some place?
6 A. Yeah. It’s posted permanently on our
7 wall.
8 Q. Do you send all of those people to the
9 bulletin board to read those as part of the process?
10 A. No. I mean they’re free to walk around
11 the lobby while they’re waiting for help, so it’s
12 there.
(Id. at 21-22)(emphasis supplied).
Moreover, even if Mrs. Barel were provided with the DAD, it would still not amount to a consent for BOA to use her credit report because its terms only apply to “each account owner.” (See DAD at p. 1, attached to Def. Mem. of Law at Exhibit E)(“Throughout this agreement, the words “you, “your and “yours refer to each account owner.”). Clearly the signature card that Mrs. Barel signed (and which other POAs sign) is the signature card originally used to open the account holder’s account, and refers to the DAD that is provided in connection with the opening of the account. As testified to by BOA’s representatives, neither Mrs. Barel nor any other POA class member were customers or account owners.
Mrs. Barel’s testimony also creates a genuine issue of material fact that BOA as to whether BOA obtained her consent. Ms. Barel testified that she was not provided with any documents (other then the signature card) in either her first or second visit to the bank to be added as a POA. (See Deposition of Karen Barel, at pp. 38-39, attached to Plaintiff’s Appendix of Exhibits as Exhibit L). When defense counsel showed Ms. Barel a copy of a form Deposit Agreement and asked her if that refreshed her recollection, it did not. (Id. at 45-47). This is consistent with the Raulerson testimony that BOA’s policy is to provide the document to the bank’s customers, which Mrs. Barel was not.
The fact that Mrs. Barel did not authorize or consent to BOA’s acquisition and use of her credit report is further reinforced by the fact that in response to her February 28, 2006 letter, Ms. Iacono sent her a copy of the DAD. (See Exhibit K).
III. APPLICABLE STANDARD
A. General
Pursuant to Federal Rule of Civil Procedure 56(c), a motion for summary judgment will only be granted:
if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to a judgment as a matter of law.
Fed. R. Civ. P. 56(c). In other words, summary judgment may only be granted if the movant shows, by admissible evidence, that there exists no genuine issue of material fact that would permit a reasonable jury to find for the nonmoving party. Wetzel v. Tucker, 139 F.3d 380, 383 n.2 (3d Cir. 1998); Miller v. Indiana Hosp., 843 F.2d 139, 143 (3d Cir.), cert. denied, 488 U.S. 870 (1988).
The party opposing the motion for summary judgment is entitled to have his/her allegations taken as true, to receive the benefit of the doubt when his/her assertions conflict with those of the movant, and to have inferences from the underlying facts drawn in his/her favor. Big Apple, BMW, Inc. v. BMW of North America, Inc., 974 F.2d 1358, 1362-63 (3d Cir. 1992), cert. denied, 507 U.S. 912 (1993). In analyzing the moving party’s burden under Rule 56(c), the Third Circuit has stated that “[i]f there is any evidence in the record, from any source, from which a reasonable inference in the respondent’s favor may be drawn, the moving party simply cannot obtain a summary judgment, no matter how many affidavits are filed (citations omitted) . . . . The ‘burden’ then is insurmountable.” In re Japanese Electronic Prods. Antitrust Litig., 723 F.2d 238, 258 (3d Cir. 1983), reversed on other grounds, 475 U.S. 574 (1986); see also Boyle v. County of Allegheny, Pennsylvania, 139 F.3d 386, 393 (3d Cir. 1998).
A court may not, at the summary judgment stage, weigh evidence or make credibility decisions. These tasks are left to the factfinder. Petruzzi’s IGA Supermarkets, Inc. v. Darling-Delaware Co., Inc., 998 F.2d 1224, 1230 (3d Cir.), cert. denied, 510 U.S. 994 (1993). To raise a genuine issue of material fact, the respondent need not match, item for item each piece of evidence proffered by the movant. Big Apple, BMW, Inc., 974 F.2d at 1362-63. As the Third Circuit has explained:
In practical terms, if the opponent has exceeded the “mere scintilla” threshold and has offered a genuine issue of material fact, then the court cannot credit the movant’s version of events against the opponent, even if the quality of the movant’s evidence far outweighs that of its opponent. It thus remains the province of the factfinder to ascertain the believability and weight of the evidence.
In re Unisys Savings Plan Litigation, 74 F.3d 420, 433 n. 10 (3d Cir. 1996) (citing Big Apple, BMW). If there are gaps in the pertinent materials submitted by the movant, without explanation, that justifies denial of the motion. O’Donnell v. United States, 891 F.2d 1079, 1082 (3d Cir. 1989). In the case at bar, genuine issues of material fact as to the pertinent and pivotal facts. As such, BOA is not entitled to judgment as a matter of law.
B. Summary Judgment Standard Applied to Expert Opinion Evidence
It is clear within the Third Circuit that unrebutted expert opinion evidence by itself may create a genuine issue of disputed fact sufficient to defeat motion for summary judgment. See Nicini v. Morra, 212 F.3d 798, 817 (3d Cir. 2000) (Rendell, J., dissenting) (quoting Thomas v. Newton Int’l Enters., 42 F.3d 1266, 1270 (9th Cir.1994); see also Paton v. LaPrade 524 F.2d 862 (3d Cir.1975) (opinion evidence is appropriately considered to support the existence of a disputed issue of fact). Since a court must consider all evidence in the light most favorable to the non–moving party, a movant who fails to rebut evidence provided by its opponent’s expert testimony is not entitled to summary judgment. Miller v. Rinker Boat Co., Inc., 815 N.E.2d 1219, 1238 (Ill. App. 2004); accord Arslanian v. Volkswagen of America, Inc., 113 A.D.2d 858 (N.Y. App. Div. 1985) (movant’s failure to produce expert evidence regarding faulty brake system to counter non-moving party’s expert report was enough to defeat summary judgment motion).
As outlined above and below, Plaintiff has proffered the expert opinion of Evan Hendricks, a respected expert witness in the areas of fair credit reporting and financial privacy litigation who has rendered eight separate opinions in this case. Defendant has identified Patrick Culhane as a proposed expert whom it may call to testify at trial. However, Mr. Culhane’s report addresses only the first of Mr. Hendricks’ opinions. As such, and assuming that Mr. Culhane survives a Daubert challenge (which Plaintiff highly doubts), Mr. Hendricks’ seven remaining opinions remain unrebutted and must be accepted as true for the purposes of examining the evidence in the light most favorable to the Plaintiff, the non-moving party.
IV. ARGUMENT
As outlined in the Complaint and Plaintiff’s class certification motion, Plaintiff brings this case under the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. §§ 1681 et seq., based upon BOA’s unlawful access and use of her credit report without a permissible purpose. Plaintiff asserts that BOA violated the FCRA willfully and negligently, and seeks actual, statutory and punitive damages.
Plaintiff alleges that BOA violated section 1681b by impermissibly accessing Mrs. Barel’s credit report from Trans Union and falsely certifying its purposes for using the report when she sought to become a power of attorney for her mother on November 15, 2005.
A. There is a Genuine Issue Of Material Fact Whether BOA Violated FCRA Section 1681b(f)(1) by Obtaining and Using Mrs. Barel’s Credit Report From Trans Union Without A Permissible Purpose
FCRA section 1681b(f) provides as follows:
(f) Certain use or obtaining of information prohibited
A person shall not use or obtain a consumer report for any purpose unless—
(1) the consumer report is obtained for a purpose for which the consumer report is authorized to be furnished under this section; and
(2) the purpose is certified in accordance with section 1681e of this title by a prospective user of the report through a general or specific certification.
15 U.S.C. § 1681b(f). A violation of subsection “(1)” of section 1681b(f) occurs when a person such a BOA either “obtains” or “uses” a consumer credit report for any purpose other than those specifically enumerated purposes set forth earlier in section 1681b. 15 U.S.C. § 1681b(f)(1).
BOA claims that of the specific enumerated “permissible purposes” outlined in the FCRA, its sole permissible purpose was the “legitimate business need” purpose arising in connection with a business transaction initiated by a consumer, set forth at 15 U.S.C. § 1681b(a)(3)(F)(i). BOA cites no authority whatsoever in support of its position that this permissible purpose under the FCRA applies in connection with a bank obtaining a credit report for a third party power of attorney.
Curiously, our Circuit has examined the FCRA’s legitimate business transaction purpose, but BOA makes no mention of it. In Houghton v. New Jersey Manufacturers Insurance Company, 795 F.2d 1144 (3d Cir. 1986), the Third Circuit addressed the very question of when the FCRA’s legitimate business transaction purpose would permit a party to access a consumer report. The Court held that in order for a party to have a permissible purpose under this subsection of section 1681b, the business transaction at issue has to relate to a transaction involving credit, insurance eligibility, employment or licensing. Houghton, 795 F.2d at 1149. Eliminating any doubt as to its holding in Houghton, the Third Circuit clarified its ruling by stating that in order for the FCRA’s legitimate business transaction purpose to apply, a “consumer relationship must exist between the party requesting the report and the subject of the report.” Id.
Thus, in our Circuit, it is clear that the absence of a consumer relationship between the requesting party and the subject of the credit report requires a finding that the requesting party did not have a permissible purpose to obtain a consumer report. Daley v. Haddonfield Lumber, Inc., 943 F. Supp. 464 (D. N.J. 1996). For the FCRA’s legitimate business transaction purpose to apply, a consumer relationship must exist, meaning that the party obtaining to the consumer report must have a relationship with the subject of the report that involves the extension of credit, insurance eligibility, employment or licensing. Id.
It is clear from the evidence of record that, at a minimum, there is a genuine issue of material fact as to whether BOA accessed Plaintiff’s consumer report without a permissible purpose.
First, the record is crystal clear that Plaintiff has never had a consumer relationship with BOA. She has never applied for, or held any relationship with BOA that involved the extension of credit, insurance underwriting, employment or licensing. BOA has not even asserted as much. Pursuant to the plain reading of the FCRA’s language found at section 1681b(f), and our Circuit’s guidance in Houghton, this fact alone rendered BOA without a permissible purpose to access her consumer report from Trans Union.
Second, even if the Court were disinclined to follow Houghton for some reason, and reasoned that the FCRA permitted a bank under the legitimate business transaction purpose to use the consumer report of someone merely because they were a POA for someone else to prevent fraud and minimize risk, there is a serious factual dispute as to whether BOA in fact obtained and used Plaintiff’s credit report for this purpose. The actual BOA employees on the ground floor of its operations testified that they never see the credit reports, and were completely unaware of how and why BOA obtained them. Even BOA’s designated Rule 30(b)(6) representatives could only guess and surmise as to BOA’s purposes for obtaining the credit reports of Plaintiff and POAs. Ms. Raulerson herself testified that they only thing she uses to screen POAs is the photo identification that they present to her in person.
Moreover, if there is any evidence which conclusively establishes BOA’s purpose for accessing Plaintiff’s consumer report, it is the certification that BOA made to Trans Union. In its certification to Trans Union, BOA never identified the legitimate business transaction purpose it vamps on about in its Motion, but rather, BOA informed Trans Union that it was requesting credit reports for the purpose of a credit transaction, insurance underwriting, collection of an account and employment. Clearly, by its own admissions in its Motion, BOA did not use Plaintiff’s credit report for these purposes.
Further, Plaintiff has produced numerous unrebutted expert opinions from Evan Hendricks which challenge BOA’s permissible purpose argument. Among other things, Mr. Hendricks opines that BOA obtained Plaintiff’s consumer report without a permissible purpose, and did so pursuant to an intentional policy and practice that was carried out to minimize costs by automating the process relating to the opening deposit accounts. (See Exhibit H). As to these opinions, BOA has not produced any rebuttal expert testimony. As such, Mr. Hendricks’ opinions must be accepted as fact for the purposes of ruling on BOA’s Motion.
BOA’s only other argument for why it had a permissible purpose to obtain Plaintiff’s consumer report is its incorrect contention that Mrs. Barel consented to its use of her consumer report. But this contention is seriously contested, and the evidence Plaintiff has produced demonstrates that there is more than a genuine issue of material fact as to BOA’s consent argument. First, Plaintiff testified that she never received the DAD or any disclosure that BOA would obtain her credit report prior to BOA’s accessing her credit report. Second, it is clear from the language of the DAD itself that it only applied to BOA account owners and customers, which Plaintiff has never been. Third, even Ms. Raulerson, the very BOA employee who processed Mrs. Barel’s POA paperwork, testified that individuals who are added to accounts as POAs are not advised that their credit reports will be obtained. (See Exhibit E).
BOA relies upon James v. Interstate Credit and Collections, Inc., 2005 U.S. Dist. LEXIS 15494 (E.D. Pa. July 29, 2005), but that decision is inapposite. James involved a medical debt (not a power of attorney instrument) and a dispute between attorneys in litigation over access to a credit report. Unlike James, the case at bar involves a corporate-wide practice by a bank of obtain credit reports for power of attorney applicants, when the bank knows that such applicants are not its customers and are not engaging in any of the transactions that it has certified to Trans Union. Unlike the consumer in James, Plaintiff here has produced extensive discovery that BOA obtained her consumer report without a permissible purpose and through the use of false pretenses. The fact pattern and evidence before the Court in this case is simply not even close to James.
B. There is a Genuine Issue Of Material Fact Whether BOA Violated FCRA Section 1681b(f)(2) By Falsely Certifying its Permissible Purpose to Trans Union
In addition to violating the FCRA by failing to have a permissible purpose for using a consumer report, a user of a credit report may also separately violate FCRA section 1681b(f), at subsection “(2),” by failing to provide to the consume reporting agency that furnished the report a proper “certification” under FCRA section 1681e. 15 U.S.C. §1681b(f)(2).
FCRA section 1681e provides that prospective users of the information must “identify themselves, certify the purposes for which the information is sought, and certify that the information will be used for no other purpose.” 15 U.S.C. § 1681e(a) (emphasis added).
In the case at bar, regardless of how or why in fact BOA used Plaintiff’s consumer report, the evidence is clear that it obtained Plaintiff’s consumer using false pretenses. See Daley, supra. As testified to by Trans Union’s representative Kathy Savage, and as set forth in the document itself, the Master Credit Services Agreement BOA signed with Trans Union documented that BOA would use its consumer reports for four purposes and no others, for credit determinations, collection of an account, insurance underwriting and employment purposes. (See Exhibit B at paragraph 3). It is clear that BOA never used Plaintiff’s credit report for any of these purposes. Thus, Plaintiff has presented a genuine issue of material fact the BOA obtained Plaintiff’s consumer report through the use of a false certification and false pretenses.
C. There is a Genuine Issue of Material Fact that BOA Acted Willfully Under the FCRA
BOA also argues that Plaintiff has presented no evidence that it acted willfully under the FCRA, but there are few consumer cases where the evidence of willfulness is as solid as the case at bar.
Due to a recent Supreme Court ruling, the standard for willfulness in FCRA cases has become clear. Over the past 15 years, our Circuit has addressed the willfulness standard. But just recently, the U.S. Supreme Court had occasion for the first time to address the willful violation standard under the FCRA, and in doing so, endorsed our Circuit’s interpretation. See Safeco Ins. Co. of Am. v. Burr, 127 S. Ct. 2201, 75 USLW 4386, 2007 WL 1582951 (U.S. June 4, 2007). In Safeco, our Supreme Court held that proof of “reckless disregard” by a defendant (i.e. not a knowing violation of law, as the credit industry had urged and as BOA argues) is sufficient to establish a willful violation of the FCRA. Id. at 127 S.Ct. at 2208-2210. “Reckless disregard” is precisely the FCRA willfulness standard that has been used in this Circuit for many years, and the standard that the Court used in charging the jury. See Cushman v. Trans Union Corp., 115 F. 3d 220, 227 (3d. Cir. 1997). In fact, in Safeco, our Supreme Court cited our Circuit’s decision in Cushman as the correct standard.
As our Circuit and District have properly explained for years, in order to show “willfulness” under the FCRA, a consumer-plaintiff need not show a knowing violation of the law. Id. Rather, a consumer-plaintiff need only show that the defendant acted “in reckless disregard for whether the [a] policy contravenes [consumer] rights” or that the defendant “knowingly and intentionally committed an act in conscious disregard for the rights of others.” See Cushman, 115 F. 3d at 227 (emphasis added). This is a lower standard than the standard for punitive damages in common law torts. The case law has further held that neither malice nor evil motive need be established for a finding of a willful violation. Id.; see also Stevenson v. TRW, Inc., 987 F.2d 288, 294 (5th Cir.1993) (citing Fischl v. General Motors Acceptance Corp., 708 F.2d 143, 151 (5th Cir. 1983)).
Many other courts have also noted that willfulness under the FCRA is demonstrated by a showing of “knowingly and intentionally committed an act in conscious disregard for the rights of others.” See id. at 293 (citing Pinner v. Schmidt, 805 F.2d 1258, 1263 (5th Cir.1986), cert. denied, 483 U.S. 1022 (1987)); see also Reynolds v. Hartford Fin. Servs. Group, 435 F.3d 1081, 1097-99 (9th Cir. 2006) (discussing meaning of “willfully” with CRA and relying on Cushman).
Multiple cases within this District, examining the willfulness standard in FCRA cases have found that plaintiff may proceed to trial with their willfulness claims where the defendant’s conduct is not merely a result of a negligent act that was promptly cured. See Sheffer v. Experian Info. Solutions, Inc., Civ. No. 02-7407, 2003 WL 21710573 at *3 (E.D. Pa. July 24, 2003) (defendant’s conduct was willful, and not merely an “isolated instance of human error . . . promptly cure[d]”) (quoting Boris v. Choicepoint Servs., 249 F. Supp.2d 851, 862 (W.D. Ky. 2003)) (emphasis added); see also Lawrence v. Trans Union, LLC, Civ., 296 F.Supp. 2d. 582, 590, 2003 WL 22992081 at *5 (E.D. Pa. Dec. 11, 2003); Crane v. Trans Union, LLC, 282 F. Supp. 2d 311, 321 (E.D. Pa. 2003); Evantash v. G.E. Capital Mortgage Servs., Inc., Civ. No. 02-1188, 2003 WL 22844198 * 8 (E.D. Pa. Nov. 25, 2003)
However, this case does not depend upon what standard of willfulness is employed, for the evidence is clear that BOA practice of obtaining and using the credit reports of Plaintiff and the Class was the pursuant to an intentional policy of automating the account opening process to minimize costs. (See BOA’s Response to Plaintiff’s Requests for Admissions at Exhibit A and Hendricks Report at Exhibit H).
Even after Plaintiff filed this case, and depositions commenced, BOA’s employees testified that BOA was continuing its practice of pulling POAs’ consumer reports, and had made absolutely no efforts to modify or change its practice, (See Mulder Dep. at Exhibit F). The fact that BOA informed Plaintiff that it had ceased its practice a few days prior to the filing of its Motion calls BOA’s scienter into doubt even further. Thus, even if BOA were inclined to try to invoke the mistake of law defense as to Plaintiff’s willfulness claims, it cannot credibly do so based upon the facts of record in this case.
Further, BOA’s actions in trying to conceal its activities would present evidence of willfulness under any circuit standard, even prior to Safeco. First, BOA misrepresented to Trans Union why it was obtaining Plaintiff’s consumer report. Second, after Mrs. Barel discovered the inquiry on her credit report, BOA’s own corporate representatives misrepresented to her that its credit inquiry was a “soft hit” and would not impact her credit rating. (See Iacono Letter at Exhibit K). As its own Rule 30(b)(6) representative Ms. Mulder acknowledged under oath, this was patently false, as the type of credit inquiry BOA made to all POAs was a hard inquiry which would be viewed by all third party creditors looking at the consumer’s credit report. No matter what willfulness standard is employed, evidence of misrepresentations and concealment satisfy a consumer’s burden in an FCRA case at the summary judgment stage.
Moroever, Plaintiff’s expert Evan Hendricks has opined that BOA acted willfully and intentionally. As BOA has produced any expert opinion to the contrary, Mr. Hendricks’ opinion must be accepted as true.
D. There is a Genuine Issue of Material Fact that Plaintiff Suffered Actual Damages
Defendant contends there is a lack of evidence that Mrs. Barel incurred actual damages as a result of BOA’s negligent actions. (Def. Mem. at 18). To the contrary, Plaintiff testified concerning the violation of her federal rights and an invasion of her privacy, which are cognizable harms under the FCRA. (See Barel Dep. at pp. 80-81, 93, 98).
The FCRA permits recovery for “any actual damages” sustained by a consumer-plaintiff. 15 U.S.C. §1681n and o. Emotional and mental distress and anguish, damage to credit reputation, humiliation, embarrassment and frustration are all recognized as “actual damages” under the FCRA. Cushman v. Trans Union Corp., 115 F. 3d 220, 225-27 (3d. Cir. 1997) (actual damages may be emotional in nature); Philbin v. Trans Union Corp., 101 F.3d 957, 963 & n.3 (3d. Cir. 1996) (in reference emotional distress and other damages, finding that “we do not consider it necessary that Philbin state his damages with any great degree of particularity”) (emphasis added); Guimond v. Trans Union, 45 F.3d 1329, 1333 (9th Cir. 1995); Lawrence v. Trans Union, LLC, 296 F.Supp. 2d. 582, 588-89, 2003 WL 22992081 at * 3-5 (E.D. Pa. 2003); Evantash v. G.E. Capital Mortgage Servs., Inc., Civ. No. 02-1188, 2003 WL 22844198 * 5 (E.D. Pa. Nov. 25, 2003); Crane v. Trans Union, LLC 282 F. Supp. 2d 311, 321 (E.D. Pa. 2003) (citations and footnotes omitted); Sheffer v. Experian Info. Solutions, Inc., Civ. No. 02-7407, 2003 WL 21710573 at * 3 (E.D. Pa. July 24, 2003).
In addition, Plaintiff’s expert witness Evan Hendricks has opined that BOA’s conduct damaged Plaintiff and each Class member because its impermissible access and use of their consumer reports constituted an unwarranted invasion of their privacy, which is damage in and of itself. (See Hendricks Report at pp. 1, 2-3). Further, Mr. Hendricks has opined that BOA’s conduct generally caused a lower credit score for Plaintiff and the class members. As BOA has not proffered any expert opinion to the contrary, Mr. Hendricks’ opinions regarding the invasion of privacy to Mrs. Barel and the Class members must be accepted as true for the purposes of ruling upon BOA’s Motion.
V. CONCLUSION
For the reasons stated above, this Court should deny BOA’s Motion for Summary Judgment.
RESPECTFULLY SUBMITTED,
FRANCIS & MAILMAN, P.C.
BY: /S/James A. Francis
JAMES A. FRANCIS
MARK D. MAILMAN
JOHN SOUMILAS
Land Title Building, 19th Floor
100 South Broad Street
Philadelphia, PA 19110
(215) 735-8600
DAVID A. SEARLES
DONOVAN SEARLES, LLC
1845 Walnut Street, Suite 1100
Philadelphia, PA 19103
(215) 732-6067
GLEN H. CHULSKY
LAW OFFICES OF GLEN H. CHULSKY
410 Route 10 West, Suite 210
Ledgewood, NJ 07852
Dated: July 9, 2007 Attorneys for Plaintiff and the Class