Summary
The United States Court of Appeals for the Eighth Circuit affirmed summary judgment for Freedom Mortgage Corporation in the Johnsons’ Fair Credit Reporting Act action. The court held that Freedom Mortgage reasonably investigated the disputed late-payment report based on the limited information provided by the consumer reporting agencies and declined to consider an ambiguity argument raised for the first time on appeal.
Topics
Practice areas
Questions Presented
- Whether Freedom Mortgage's investigation of the Johnsons' dispute under 15 U.S.C. § 1681s-2(b) was unreasonable.
- Whether Freedom Mortgage's late-payment report was inaccurate or incomplete under the Fair Credit Reporting Act.
- Whether the Johnsons could argue for the first time on appeal that Freedom Mortgage's payment instructions were ambiguous.
Holdings
- Freedom Mortgage's investigation was reasonable as a matter of law because the Johnsons' dispute letters were conclusory and provided little information, while Freedom Mortgage reviewed the account notes, account history, and payment history, confirmed when the payment was credited, and verified the reported information.
- The Johnsons did not establish an actionable inaccurate or incomplete report because the payment was credited more than 30 days after it was due, and Freedom Mortgage's reasonable investigation found no reporting deficiency.
- The court would not consider the argument that the payment instructions were ambiguous because the Johnsons did not raise it in the district court.
Key quotations
“Summary judgment is proper if, when viewing the evidence in the light most favorable to the nonmoving party, “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.”” (at 3)
“Because “[i]ts duties as a furnisher of information under the FCRA required no more,” id., no jury could find that the investigation was unreasonable.” (at 4)
Factual background
The Johnsons' mortgage was serviced by Freedom Mortgage after late 2019. They mailed a cashier's check for their May 2020 payment, but the check did not identify the mortgage loan number and did not match the amount due, so Freedom Mortgage could not determine which account to credit; the payment was ultimately credited on June 9, more than 30 days after it was due. After the Johnsons disputed the resulting late-payment report through consumer reporting agencies, Freedom Mortgage reviewed the account history, notes, and payment history, verified the late payment, and declined to modify its reporting.
Procedural history
The Johnsons sued Freedom Mortgage, alleging that it furnished inaccurate late-payment information to consumer reporting agencies and failed to conduct a reasonable investigation after receiving notice of their disputes. The United States District Court for the District of Minnesota concluded that the reported payment was accurate and that the investigation was adequate, then granted summary judgment to Freedom Mortgage. The Eighth Circuit affirmed.