Huggins v. FedLoan Servicing

Huggins v. FedLoan Servicing

Opinion

Salas, District Judge

Plaintiff Vaton Huggins asserts violations of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681 et seq., against defendants Pennsylvania Higher Education Assistance Agency, Inc., s/h/a FedLoan Servicing ("FedLoan"), Equifax Information Services, LLC ("Equifax"); and TransUnion, LLC ("TransUnion") (collectively, "Defendants"). (D.E. 1, Ex. 1 ("Compl.").) Presently before the Court is FedLoan's motion to dismiss the Complaint for lack of jurisdiction under Fed. R. Civ. P. 12(b)(1) and failure to state a claim under Fed. R. Civ. P. 12(b)(6). (D.E. 5.) Having considered the parties' submissions, the Court decides this matter without oral argument. See Fed. R. Civ. P. 78(b). As set forth below, the motion is denied.

I. [*2]  Background

A. Facts

As alleged in the Complaint, in August 2018, Huggins transferred a student loan debt originally held by FedLoan to another lender. (Compl. ¶ 8.) At the time of transfer, Huggins alleges that all payment obligations he had with FedLoan ceased. (Id.) After the transfer, FedLoan reported his "tradeline" to reflect a $0 balance but also a "current pay status of 'Late 120 days'" to at least two credit reporting agencies, Equifax and TransUnion. (Id. ¶¶ 9-10, 13-14.) Huggins claims that this reporting is "nonsensical" because it leads "lenders [to] believe the consumer is currently late," thus "negatively reflecting on the [consumer's] credit worthiness" and in turn negatively impacting the consumer's "credit score[]." (Id. ¶ 11 (emphasis added).) Huggins disputed the alleged error with Equifax and TransUnion. (Id. ¶¶ 12, 14.) Equifax and TransUnion, Huggins alleges, responded to the dispute by "mail[ing] [him] his results showing the erroneous trade line being verified." (Id. ¶¶ 13-14.) Huggins claims that FedLoan failed to conduct a reasonable investigation because "[h]ad it done so, it would have recognized that the tradeline is nonsensical and wrong." (Id.) FedLoan, [*3]  according to Huggins, "continues to report . . . a pay status indicating that the debt is currently late." (Id. ¶ 15 (emphasis added).) As a result of Defendants' actions, Huggins alleges that he has suffered "actual damages, mental anguish, humiliation, and embarrassment." (Id. ¶¶ 21, 28; see also id. ¶ 38.) And as a result of FedLoan's actions specifically, Huggins claims he suffered the additional "injury to credit worthiness." (Id. ¶ 38.)

B. Procedural Background

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