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Veal v. Portfolio Recovery, Inc.

United States District Court, D. Massachusetts

April 9, 2015

JAMES MICHAEL VEAL, Plaintiff,
v.
PORTFOLIO RECOVERY, INC., et al., Defendants.

MEMORANDUM AND ORDER

ALLISON D. BURROUGHS, District Judge.

I. Introduction

Plaintiff James Michael Veal ("Mr. Veal") filed this action pro se against eight defendants: Portfolio Recovery, Inc. and Portfolio Recovery Associates, LLC (together, "Portfolio Recovery"); Kenneth Wilson ("Mr. Wilson"); Lustig, Glaser & Wilson, P.C. ("LGW"); Dean A. Heinold ("Mr. Heinold"); IC System, Inc. ("IC System"); Credit One Bank; and Capital One. Mr. Veal alleges that Portfolio Recovery, LGW, IC System, Credit One Bank, and Capital One pulled his consumer credit report without his consent and without a permissible purpose. Based on this allegation, Mr. Veal asserts claims for violations of the federal Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681 et seq. (Counts I-III); the Massachusetts Attorney General's debt collection regulations, 940 C.M.R. § 7.00 et seq. (Count IV); and the federal Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. (Count V).

Before the Court are two motions to dismiss filed by (1) LGW, Mr. Wilson, and Mr. Heinold [ECF No. 25] and Portfolio Recovery [ECF No. 29]. Both sets of moving defendants argue that the FCRA counts should be dismissed because the complaint alleges that the defendants pulled Mr. Veal's credit report in connection with their attempt to collect a debt, which is a "permissible purpose" under the statute. [ECF Nos. 26, 30.] They also argue that the FDCPA count should be dismissed because the complaint does not allege specific actions by the defendants to support the alleged violations of the FDCPA, and that the alleged violation of the Attorney General's debt collection regulations should be dismissed because there is no private right of action under these regulations. [Id.] Portfolio Recovery additionally argues that the FDCPA count should be dismissed because the complaint does not allege the existence of a consumer debt under the statute. [ECF No. 30, at 7.] LGW, Mr. Wilson, and Mr. Heinold additionally argue that the alleged violation of the Attorney General's debt collection regulations should be dismissed because the complaint does not include any factual support for this claim. [ECF No. 26, at 7-8.] Mr. Veal opposes both motions to dismiss by advancing a statutory construction argument about the FCRA. He suggests that the section of the statute setting forth "[p]ermissible purposes of consumer reports" applies only to consumer reporting agencies, and not to debt collectors. [ECF No. 32, at 2-3.] He also disputes the notion that there is no private right of action under the Attorney General's debt collection regulations. [Id. at 3.]

For the reasons explained in this Memorandum and Order, both motions to dismiss are GRANTED, and Mr. Veal's complaint is DISMISSED.

II. Summary of Relevant Factual Allegations

In his complaint [ECF No. 1], Mr. Veal makes the following factual allegations, which the Court accepts as true for purposes of a motion to dismiss.

Mr. Veal is a Massachusetts resident and a consumer. [Id. ¶¶ 16, 33.] Mr. Wilson and Mr. Heinold are attorneys at LGW, a law firm that regularly collects defaulted debts on behalf of its clients. [Id. ¶¶ 2-4.] Portfolio Recovery is a debt collector and a debt buyer that regularly collects defaulted debts. [Id. ¶¶ 5-6.] Portfolio Recovery Associates, LLC is the parent company of Portfolio Recovery, Inc. [Id. ¶ 6.] IC System is a debt collection agency and a debt collector. [Id. ¶ 7.]

In June 2014, Mr. Veal checked his consumer credit report and determined that Portfolio Recovery, LGW, IC System, Credit One Bank, and Capital One pulled his credit report on multiple occasions, without his consent, and without ever making a firm offer of credit to him. [Id. ¶¶ 18-21, 59.] He never applied for a line of credit or insurance from any of the defendants. [Id. ¶ 58.] The credit pulls were conducted on various dates from 2012 through 2014. [Id. ¶¶ 49-53.] They were conducted for the sole purpose of collecting a debt. [Id. ¶ 25.] Mr. Veal also alleges that in pulling his credit report, the defendants "misrepresented to Experian that they had a permissible purpose and that they were a consumer reporting agency...." [Id. ¶ 32.] Mr. Veal does not provide any further detail or facts in support of this allegation, but he states that he "plans to propound discovery to bring all violation [ sic ] to light." [Id.]

III. Discussion

A. Legal Standard - Motion to Dismiss

On a motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure ("Rule 12(b)(6)"), the Court accepts as true all well-pleaded facts in the light most favorable to the plaintiff and draws all reasonable inferences from those facts in favor of the plaintiff. United States ex rel. Hutcheson v. Blackstone Med., Inc., 647 F.3d 377, 384 (1st Cir. 2011). Although detailed factual allegations are not required to survive a motion to dismiss, "more than labels and conclusions" are required. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). A "formulaic recitation of the elements of a cause of action" is not enough. Id. The facts alleged must "raise a right to relief above the speculative level." Id. The plaintiff must "nudge[] [the] claims across the line from conceivable to plausible, " or the claims will be dismissed. Id. at 570. "The make-or-break standard... is that the combined allegations, taken as true, must state a plausible, not a merely conceivable, case for relief." Sepulveda-Villarini v. Dep't of Educ. of P.R., 628 F.3d 25, 29 (1st Cir. 2010) (citing Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009); Twombly, 550 U.S. at 555, 570). The plausibility standard "asks for more than a sheer possibility" of actionable conduct. Id.

In this case, the Court construes Mr. Veal's complaint liberally because it was filed pro se. See Erickson v. Pardus, 551 U.S. 89, 94 (2007). "However, pro se status does not insulate a party from complying with procedural and substantive law." Ahmed v. Rosenblatt, 118 F.3d 886, 890 (1st Cir. 1997). Dismissal of a pro se complaint is appropriate when the complaint fails to state an actionable claim. Muller v. Bedford VA Admin. Hosp., Civ. No. 11-10510, ...


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