Nayab v. Capital One Bank, No. 17-55944 (9th Cir. 2019)
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A consumer suffers a concrete injury in fact when a third-party obtains her credit report for a purpose not authorized by the Fair Credit Reporting Act (FCRA); a consumer-plaintiff need allege only that her credit report was obtained for a purpose not authorized by the statute to survive a motion to dismiss; and the defendant has the burden of pleading it obtained the report for an authorized purpose.
The Ninth Circuit reversed the district court's dismissal of plaintiff's claim under the FCRA for lack of standing and failure to state a claim. The panel held that plaintiff pleaded facts sufficient to give rise to a reasonable inference that the Bank obtained her credit report for an unauthorized purpose. In this case, she pleaded that she did not have a credit relationship with the Bank of the kind specified in 15 U.S.C. 1681b(a)(3)(A)–(F), the Bank submitted numerous credit report inquires to Experian, and plaintiff put forth factual assertions which negative each permissible purpose for which Capital One could have obtained her credit report and for which she could possibly have personal knowledge.
Court Description: Fair Credit Reporting Act / Standing. The panel reversed the district court’s dismissal of a Fair Credit Reporting Act claim for lack of standing and failure to state a claim and remanded the case to the district court. Plaintiff alleged that Capital One Bank (USA), N.A., obtained her credit report for a purpose not authorized by the FCRA, in violation of 15 U.S.C. § 1681b(f). The panel held that plaintiff had Article III standing because a consumer suffers a concrete injury in fact when a third party obtains her credit report for an unauthorized purpose, regardless of whether the credit report is published or otherwise used by that third party. The panel held that plaintiff stated a claim because a consumer-plaintiff need allege only that her credit report was obtained for a purpose not authorized by the statute to survive a motion to dismiss, and the defendant bears the burden of pleading it obtained the report for an authorized purpose. The plaintiff does not have the burden of pleading the actual purpose behind the defendant’s procurement of her credit report, and she need allege only facts giving rise to a reasonable inference that the defendant obtained the credit report in violation of § 1681b(f)(1). NAYAB V. CAPITAL ONE BANK 3 Judge Rawlinson concurred in part and dissented in part. Judge Rawlinson agreed that plaintiff had standing to pursue her action under the FCRA but disagreed that she stated a plausible claim. Judge Rawlinson wrote that, under the Twombly/Iqbal standard and Federal Rule of Civil Procedure 8(a), the pleading was inadequate.
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