Pearson v. Security Finance Corporation of Alabama, Inc. (JOINT ASSIGN)(MAG+)
1:17-cv-00522
M.D. Ala.Nov 6, 2017Background
- Plaintiff (pro se) sued Security Finance and others under the FCRA, alleging failure to provide an adverse-action notice under 15 U.S.C. § 1681m and seeking money damages.
- Plaintiff was allowed to proceed in forma pauperis and the court screened the complaint under 28 U.S.C. § 1915(e)(2).
- Defendants moved to dismiss under Rule 12(b)(6), arguing § 1681m contains no private right of action.
- The Magistrate Judge considered statutory text and prior decisions interpreting § 1681m(h)(8), concluding the statute limits enforcement to federal agencies.
- Plaintiff also moved for sanctions and to deny a discovery stay; the Magistrate recommended those motions be denied as moot because the dismissal recommendation disposes of the case.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 1681m permits a private right of action for failure to provide adverse-action notice | Plaintiff contends § 1681m permits a private suit for lack of notice | Defendants contend § 1681m(h)(8) bars private suits and limits enforcement to federal agencies | Court: § 1681m provides no private right of action; dismissal recommended |
| Whether related motions (sanctions, deny stay) remain | Plaintiff sought sanctions and to deny the stay of discovery | Defendants relied on the stay pending dismissal resolution | Court: Motions denied as moot given dismissal recommendation |
Key Cases Cited
- Lamie v. United States, 540 U.S. 526 (2004) (courts enforce unambiguous statutory text)
- Perry v. First Nat’l Bank, 459 F.3d 816 (7th Cir. 2006) (interpreting § 1681m(h)(8) as precluding private causes of action)
- McDonald v. Southern Farm Bureau Life Ins. Co., 291 F.3d 718 (11th Cir. 2002) (dismissing suit where statute provided no private right of action)
- Alexander v. Sandoval, 532 U.S. 275 (2001) (private rights of action to enforce federal law must be created by Congress)