Soberri v. Great Lakes Law Firm, LLC

Summary

The United States District Court for the Eastern District of Wisconsin granted Great Lakes Law Firm, LLC’s motion to dismiss claims under the Credit Repair Organizations Act and related Wisconsin law. The court held that Great Lakes was not a credit repair organization because its debt-resolution agreement expressly disclaimed credit-repair services, and dismissed the CROA claim with prejudice. The court dismissed the state-law claims without prejudice after relinquishing supplemental jurisdiction.

Holdings

1. Great Lakes was not a credit repair organization within the meaning of CROA because its debt-resolution program was directed at negotiating and resolving debt, not at improving or repairing plaintiffs' credit records, histories, or ratings. An alleged statement that participation might improve credit scores described only an incidental or collateral consequence and was insufficient to bring Great Lakes within CROA's definition.
2. The court could consider the retainer agreement and related presentation because plaintiffs referred to them and attached them to the amended complaint, and the documents were central to the claims. Where the documents contradicted the complaint's allegations, the documents controlled.
3. After dismissing the sole federal claim, the court relinquished supplemental jurisdiction over the state-law claims and dismissed them without prejudice.

Questions Presented

1. Whether the complaint plausibly alleged that Great Lakes was a credit repair organization under the Credit Repair Organizations Act.
2. Whether the retainer agreement and related documents could be considered on a Rule 12(b)(6) motion and controlled over a conflicting allegation that Great Lakes promised to improve plaintiffs' credit scores.
3. Whether the court should retain supplemental jurisdiction over plaintiffs' state-law claims after dismissing the sole federal claim.

Disposition

dismissed