ZANDER v. SAXON MORTGAGE SERVICE, INC.
1:13-cv-01141
M.D.N.C.Aug 26, 2014Background
- Plaintiff Karin Kirksey Zander, pro se, asserts FCRA and state-law claims in the Middle District of North Carolina.
- Ocwen Financial Corp. and Saxon Mortgage Service, Inc. are defendants; Saxon was the original loan servicer and foreclosing creditor.
- Saxon refinanced the mortgage in 2006, extinguishing Ocwen’s prior service on the loan.
- In August 2007, Saxon initiated (and later dismissed) a special proceeding foreclosure after payoff negotiations.
- Plaintiff alleges Saxon reported a false foreclosure to credit bureaus, which affected her 2013 loan applications.
- Court converts motion to a Rule 12(c) and grants FCRA claims, while declining supplemental jurisdiction over remaining state-law claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the FCRA claims are time-barred | Zander asserts the 2013 violation triggers the 2/5-year limits. | Ocwen/Saxon contend limitations may bar claims tied to 2007 events. | Statute not barred for 2013 violation; limitation issues depend on when reporting occurred. |
| Whether private right of action exists under 1681s-2(a) | Private actions allowed for all FCRA duties. | Private rights are limited to 1681s-2(b) disputes; 1681s-2(a) enforcement is governmental. | No private right of action under 1681s-2(a). |
| Whether § 1681s–2(b) duties were triggered by consumer-initiated notices | Plaintiff’s direct disputes should trigger 1681s–2(b) duties. | Duties are triggered by CRA-notified disputes, not direct consumer notices. | Direct notices to Saxon did not trigger § 1681s–2(b) private actions. |
| Whether the FCRA claims survive pleading | Plaintiff alleged misreporting and inadequate investigation. | Complaint fails to plead plausible facts of unreasonable investigation or inaccurate reporting. | FCRA claims dismissed for lack of plausible facts. |
| Whether to allow amendment or exercise supplemental jurisdiction | Plaintiff seeks leave to amend and conduct discovery. | Amendment would be futile; discovery denied; state-law claims should be remanded. | Leave to amend denied; decline to exercise supplemental jurisdiction; remand state-law claims. |
Key Cases Cited
- Simms-Parris v. Countrywide Fin. Corp., 652 F.3d 355 (3d Cir. 2011) (private right of action under 1681s–2(a) not available to consumers)
- Johnson v. MBNA Am. Bank, NA, 357 F.3d 426 (4th Cir. 2004) (§ 1681s–2(b) duties require CRA notice and reasonable investigation)
- Banks v. Stoneybrook Apartment, 232 F.3d 888 (4th Cir. 2000) (private rights under FCRA furnishers’ duties limitations)