JPMorgan Chase & Co. sign. Photo: lentamart/Shutterstock.com.

The U.S. Court of Appeals for the Eleventh Circuit revived a case that closed three years ago. It found some claims from a pro se litigant against JPMorgan Chase Bank N.A. over an alleged false entry on a credit report should not have been dismissed.

U.S. District Judge William Zloch had dismissed the lawsuit in 2016, agreeing with a magistrate judge's findings that West Palm Beach resident John Pinson had failed to state a claim. But that was the wrong move, according to the Eleventh Circuit, which said the plaintiff should have had the chance to prove three plausible allegations under the Fair Credit Reporting Act.

"All a plaintiff must do to survive a motion to dismiss is state a plausible claim on which relief can be granted," the opinion said. "Not a surefire claim, not one likely to succeed. A plausible claim, supported by enough factual allegations for a 'court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'"

The plaintiff spent years trying to correct what he claimed was misinformation on his credit report, according to the appellate opinion, which said Pinson's problems began in May 2012 with a credit report from TransUnion. That report showed a past-due account with Chase Home Finance LLC, but Pinson claimed he had no such account with that company. He alleged JPMorgan Chase had used a false corporate name to report a $207,000 mortgage loan on which he'd allegedly defaulted.

When TransUnion refused to remove the entry from the report, Pinson sent multiple letters to Chase, which went unanswered. By April 2016, Pinson felt he'd exhausted his options and filed suit.

Bank's pleadings 'more hyperbole than substance'

The appellate panel found Pinson had standing as he "alleged actual, concrete and particularized injuries," which included the time and money he'd lost communicating with Chase and TransUnion, instances he'd paid higher car insurance premiums, was denied credit and experienced mental anguish.

Chase argued the complaint was a shotgun pleading, meaning it was disorganized, rambling and riddled with irrelevancies, but the appeals court said that argument was "more hyperbole than substance."

Although Pinson's complaint was repetitive and longer than it need to be, the panel found it "does what complaints must do."

"We have no trouble understanding Mr. Pinson's allegations that JPMorgan Chase violated federal law by providing a false name to TransUnion, failing to investigate the accuracy of the information it provided, and obtaining Mr. Pinson's credit report for an improper purpose," the opinion said. "We've seen no indication that JPMorgan Chase had trouble understanding them either."

The panel also noted that although the shotgun-pleading rule applies to everyone, pro se litigants should get more leeway.

Assuming Pinson's allegations were true, the panel ruled his lawsuit fits under the Fair Credit Reporting Act umbrella, because Chase's failure to investigate "not once but three times" was a plausible indication of reckless disregard of the investigation it was required to do. The court also gave credence to Pinson's allegations that Chase unlawfully obtained his credit report to use in litigation 20 times in 2013 and 2014.

"All we have at this stage in the litigation are the allegations of Mr. Pinson's complaint, which we must credit," the opinion said.

Contrary to what Chase argued, the panel found Pinson will be entitled to compensation if he can prove his allegations.

Dismissed in part

Pinson also sued under the Fair Debt Collection Practices Act, which says debt collectors can't use false representations. But the Eleventh Circuit agreed those claims should be dismissed, because Pinson hadn't adequately alleged that Chase is a debt collector and because it was unlikely anyone would think the alleged false name was an unrelated third party.

"Standing in Mr. Pinson's shoes, even the least sophisticated consumer would understand that JPMorgan Chase and Chase Home Finance were related entities collecting his mortgage with JPMorgan Chase Bank," the opinion said.

Pinson declined to comment.

Leon Cosgrove attorneys Andrew Boese and Jeremy Kahn in Coral Gables are handling the case for JPMorgan. They deferred comment to their client, who declined to comment.

Judge Beverly B. Martin wrote the opinion for the panel with Judges Jill Pryor and Julie Carnes.

 

Read the court opinion:

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