In Modica v. American Suzuki Financial Services Co., 2013 WL 656495 (D.Ariz. 2013), Judge Campbell appeared to hold that a consumer need not prove inaccuracy in order to state a FCRA re-investigation claim, as the accuracy question goes only to the question of damages.
On December 8, 2005, Plaintiff and her daughter Jacklyn Modica executed an agreement for a lease of a Suzuki Grand Vitara with ASFS. Doc. ¶¶ 2, 6. The lease named Plaintiff and her daughter as co-lessees for a 30–month term, and ASFS as the assignee. Doc. ¶ 6. The lease was scheduled to end on June 8, 2008, and the lease document contained this provision: 29. LEASE END DAILY EXTENSION. At scheduled lease end, if you keep the vehicle and do not buy it, you elect to extend the lease and pay a daily extension charge beginning on the eighth day after the scheduled lease end date. The Charge is shown on the front [of the form]. We may limit the number of days you extend the lease. During the daily extension period, you agree to comply with the terms of this lease, other than terms that apply to monthly payments and early end. The total allowed mileage will not increase. ¶ Doc. 75 ¶ 8. ¶ The car was not returned to ASFS on the lease end date of June 8, 2008, but Plaintiff’s daughter had negotiated a lease extension with ASFS before that date. Doc. 70 ¶ 12; see Doc. 75–2. The new maturity date was advanced several times, first until July 8, 2008, then until August 8, 2008 (an extension for which two forms are attached), and finally until September 8, 2008. Doc. 75–2 at 2–5. The lease extension agreements state that they are available “only to the original lessee(s)” and that “[n]one of the terms or conditions of [the] existing lease, including but not limited to the payment amount or residual value, are modified by granting this extension.” Doc. 75–2 at 2–5. Plaintiff claims that she did not know about or authorize the lease extension agreements and her signature does not appear on them. Doc. 75 ¶ 30; Doc. 75–2 at 2–5. Plaintiff also claims that the lease was extended beyond the dates listed on the extension forms until January 2009, six months beyond the original end date, and that her daughter made all of scheduled payments during the six-month extension. Doc. 75 ¶¶ 31–32. Plaintiff maintains that her daughter returned the vehicle to a Suzuki dealership on January 8, 2009, the end of the six-month extension period. Doc. 75 ¶ 38. ¶ ASFS argues that it only extended the lease until September 8, 2008, and that Plaintiff and her daughter kept the car outside the terms of the lease and its extensions from that date until January 8, 2009. It claims that Plaintiff was in breach of contract during that time period and moves for summary judgment on that claim. ¶ Following the return of the vehicle, ASFS reported the incident to credit reporting agencies as a “current and paid/paying as agreed.” Doc. 75 ¶ 52. Plaintiff disputed the charge with the credit agencies several times, and each time the credit reporting agencies contacted ASFS to notify them of the dispute and confirm the charge. Doc. 75 ¶¶ 51–61. Eventually, ASFS changed the report to an unpaid balance with a loss (a “charge-off”). Doc. 75 ¶ 57. Plaintiff alleges that Defendants did not complete their duty to fully investigate the charges in violation of the federal and state Fair Credit Reporting Acts, 15 U.S.C. § 1681 s–2(b) and A.R.S. § 44–1694 and § 44–1695. Doc. 46 at 9–12. Defendant moves for summary judgment on those claims because they maintain that their charges were investigated and correct. Doc. 69 at 7–9.
Judge Campbell denied summary judgment, finding that the Defendant could not simply rely on the argument that its reporting was accurate. The question of accuracy goes to damages on a re-investigation claim; it is not an element of the claim itself:
ASFS also moves for summary judgment on Plaintiff’s claims under the Fair Credit Reporting Act (“FCRA”). 15 U.S.C. 1681s–2(b). The FCRA requires entities that furnish information to credit reporting agencies to investigate disputed charges upon notice of the dispute. The investigation must be reasonable. Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1157 (9th Cir.2009). Furthermore, the requirement to investigate consumer disputes is “procedural,” meaning that no particular outcome necessarily makes the investigation unreasonable even if that outcome turns out to be inaccurate. Id. at 1161. ¶ Plaintiff contends that ASFS did not engage in a reasonable investigation. She proffers the deposition of Kathleen Perry in which Ms. Perry states on behalf of ASFS that she did not know what steps ASFS took to investigate the disputed items on Plaintiff’s credit report. Doc. 75–6 at 12–14. The same deposition acknowledges ASFS’ receipt of Plaintiff’s complaints from the credit reporting agency and raises questions regarding the change in the account’s status from “closed” to “charged off.” Id. at 16–22. As noted above, Plaintiff has also introduced a letter sent to Plaintiff that said she had “$.00” in past due payments. Doc. 75–7 at 24. ASFS does not show how their investigation explained that letter, and, when asked about the letter in a deposition, Matthew Dickey, on behalf of ASFS, stated that he agreed with the questioner that the form indicates that the past due payments are $0. Doc. 75–5 at 19. ¶ Defendant moves for summary judgment on this claim because it engaged in an investigation and the item on Plaintiff’s credit report was correct. Under the statute Defendant had a duty to reasonably investigate the disputed charge even if it happened to be correct.FN2 Here, ASFS does nothing to show that its investigation was reasonable. Ms. Perry went so far as to say she did not know what the investigation entailed. Without more, the Court cannot conclude the investigation was reasonable. Accordingly, the Court will deny ASFS’ motion for summary judgment on the FCRA claim. [FN2. The accuracy of the charge may be relevant to Plaintiff’s ability to show actual damages, but 15 U.S.C. § 1681n contem-plates statutory damages against those who “willfully fail to comply with any requirement imposed under this subchapter.” Fur-thermore, as the contract claim is still in dispute, ASFS has not yet established that the charge was correct.]