NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS DEC 23 2022 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT
ERIC T. MITCHELL, an individual, on No. 22-55107 behalf of himself and all others similarly situated, D.C. No. 2:20-cv-10455-SB-PD Plaintiff-Appellant,
v. MEMORANDUM*
SPECIALIZED LOAN SERVICING LLC, a Delaware limited liability company,
Defendant-Appellee.
Appeal from the United States District Court for the Central District of California Stanley Blumenfeld, Jr., District Judge, Presiding
Argued and Submitted November 14, 2022 Pasadena, California
Before: WARDLAW and W. FLETCHER, Circuit Judges, and KORMAN,** District Judge.
* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The Honorable Edward R. Korman, United States District Judge for the Eastern District of New York, sitting by designation. Eric T. Mitchell appeals from an order granting summary judgment to
Specialized Loan Servicing, LLC (“SLS,” the defendant-appellee), dismissing
Mitchell’s complaint arising out of SLS’s alleged inaccurate credit reporting, and
denying his motion for class certification as moot. We have jurisdiction under 28
U.S.C. § 1291. We affirm.
On April 7, 2020, Mitchell sought forbearance relief from the servicers of
his two residential loans, one of which was SLS. Through an automated
interactive voice response (“IVR”) telephone system, Mitchell “indicate[d] that he
sought the forbearance agreement due to the negative economic impact of the
Covid-19 pandemic.” SLS approved the forbearance plan in early April 2020 and
extended it for an additional three months in June 2020 at Mitchell’s request.
During the forbearance plan, SLS reported Mitchell’s account status as
current with no reported date of first delinquency and no past due balance. On the
same reporting form, however, SLS used the code “D” in Mitchell’s payment
history profile (“PHP”). The “D” code means no payment history, no data, or
unknown. By contrast, a “0” code in the PHP field indicates “0 payments past due
(current account).”
Mitchell argues that SLS’s use of the “D” code rather than the “0” code in
his PHP field during the period of forbearance violated the Fair Credit Reporting
Act (“FCRA”). Specifically, Mitchell bases his principal argument on the March
2 2020 Coronavirus Aid, Relief, and Economic Security Act (“CARES”) amendment
to the FCRA. This amendment required furnishers to “report [a consumer’s] credit
obligation or account as current” if the furnisher agreed to provide forbearance or
other relief on a consumer’s loan. 15 U.S.C. § 1681s-2(a)(1)(F)(ii)(I). Mitchell
also alleges violations of the California Consumer Credit Reporting Agencies Act
(“CCRAA”), California’s Unfair Competition Law (“UCL”), and a claim for
breach of contract.
The district court granted summary judgment for SLS, dismissed Mitchell’s
claims, and denied Mitchell’s motion for class certification. We review a grant of
summary judgment de novo. Pavoni v. Chrysler Grp., LLC, 789 F.3d 1095, 1098
(9th Cir. 2015). “Viewing the evidence in the light most favorable to the
nonmoving party . . . and drawing all reasonable inferences in its favor, we must
determine whether the district court correctly applied the relevant substantive law
and whether there are any genuine issues of material fact.” Clicks Billiards, Inc. v.
Sixshooters, Inc., 251 F.3d 1252, 1257 (9th Cir. 2001).
1. The district court did not err in granting summary judgment for SLS
on each of Mitchell’s causes of action. The fact that SLS reported Mitchell’s
“account status” as “current account” shows that SLS complied with the FCRA
requirement to “report [a consumer’s] credit obligation or account as current.” 15
U.S.C. § 1681s-2(a)(1)(F)(ii)(I). The use of “D” rather than “0” in the PHP field
3 does not change that conclusion. We agree with the district court that guidance
from the Consumer Data Industry Association (“CDIA”) supports the inference
that using the “D” character “is an acceptable option” when reporting the account
status as current. While a nonbinding Compliance Aid issued by the Consumer
Financial Protection Bureau (“CFPB”) says that a furnisher “should consider all of
the trade line information they furnish that reflects a consumer’s status as current
or delinquent,” it does not specifically mention the PHP. The CFPB guidance does
not persuade us that reporting the PHP as “D” violates the FCRA’s requirement to
report the account as current. We therefore agree with the district court that SLS’s
“investigation and response to [Mitchell’s] complaints of inaccuracies . . . were not
unreasonable.” Mitchell also cannot “make a prima facie showing that” SLS’s
reporting was inaccurate, as he must to state a FCRA claim. Gross v.
CitiMortgage, Inc., 33 F.4th 1246, 1251 (9th Cir. 2022).
While the district court did not reach several issues raised on summary
judgment, even if we assumed some inaccuracy in SLS’s reporting, the facts
highlighted by Mitchell do not show that SLS acted willfully or negligently in
conducting its investigation after receiving the notice of dispute. Gorman v.
Wolpoff & Abramson, LLP, 584 F.3d 1147, 1154 (9th Cir. 2009). Moreover, the
language of this provision of the FCRA is “‘less than pellucid’” and no appellate
court has interpreted the language of the FCRA at issue here, so “[u]nder either the
4 negligence or willfulness standard . . . a defendant will nearly always avoid
liability.” Marino v. Ocwen Loan Servicing LLC, 978 F.3d 669, 673–74 (9th Cir.
2020) (quoting Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 70 (2007)). And even
if SLS did act negligently, Mitchell has not provided admissible evidence of actual
damages.
Mitchell’s failed effort in August 2020 to finance the purchase of a Range
Rover for $96,000, just a few months after requesting forbearance from SLS, does
not evidence that he was damaged. Two banks declined to provide Mitchell with
an auto loan for the purchase of the Range Rover. The record reflects, however,
that the denials were for reasons unrelated to SLS’s credit reporting or late
mortgage payments. Instead, the denials appear to be related, at least in part, to
Mitchell’s prior bankruptcy, for which he filed in December 2013.
We also affirm the district court’s holding that the CCRAA and UCL claims
fail because SLS’s reporting was accurate and complied with the FCRA. See
Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876, 890 (9th Cir. 2010)
(assuming that “California courts would interpret the FCRA and CCRAA
consistently”); Aleksick v. 7-Eleven, Inc., 140 Cal.
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NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS DEC 23 2022 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT
ERIC T. MITCHELL, an individual, on No. 22-55107 behalf of himself and all others similarly situated, D.C. No. 2:20-cv-10455-SB-PD Plaintiff-Appellant,
v. MEMORANDUM*
SPECIALIZED LOAN SERVICING LLC, a Delaware limited liability company,
Defendant-Appellee.
Appeal from the United States District Court for the Central District of California Stanley Blumenfeld, Jr., District Judge, Presiding
Argued and Submitted November 14, 2022 Pasadena, California
Before: WARDLAW and W. FLETCHER, Circuit Judges, and KORMAN,** District Judge.
* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The Honorable Edward R. Korman, United States District Judge for the Eastern District of New York, sitting by designation. Eric T. Mitchell appeals from an order granting summary judgment to
Specialized Loan Servicing, LLC (“SLS,” the defendant-appellee), dismissing
Mitchell’s complaint arising out of SLS’s alleged inaccurate credit reporting, and
denying his motion for class certification as moot. We have jurisdiction under 28
U.S.C. § 1291. We affirm.
On April 7, 2020, Mitchell sought forbearance relief from the servicers of
his two residential loans, one of which was SLS. Through an automated
interactive voice response (“IVR”) telephone system, Mitchell “indicate[d] that he
sought the forbearance agreement due to the negative economic impact of the
Covid-19 pandemic.” SLS approved the forbearance plan in early April 2020 and
extended it for an additional three months in June 2020 at Mitchell’s request.
During the forbearance plan, SLS reported Mitchell’s account status as
current with no reported date of first delinquency and no past due balance. On the
same reporting form, however, SLS used the code “D” in Mitchell’s payment
history profile (“PHP”). The “D” code means no payment history, no data, or
unknown. By contrast, a “0” code in the PHP field indicates “0 payments past due
(current account).”
Mitchell argues that SLS’s use of the “D” code rather than the “0” code in
his PHP field during the period of forbearance violated the Fair Credit Reporting
Act (“FCRA”). Specifically, Mitchell bases his principal argument on the March
2 2020 Coronavirus Aid, Relief, and Economic Security Act (“CARES”) amendment
to the FCRA. This amendment required furnishers to “report [a consumer’s] credit
obligation or account as current” if the furnisher agreed to provide forbearance or
other relief on a consumer’s loan. 15 U.S.C. § 1681s-2(a)(1)(F)(ii)(I). Mitchell
also alleges violations of the California Consumer Credit Reporting Agencies Act
(“CCRAA”), California’s Unfair Competition Law (“UCL”), and a claim for
breach of contract.
The district court granted summary judgment for SLS, dismissed Mitchell’s
claims, and denied Mitchell’s motion for class certification. We review a grant of
summary judgment de novo. Pavoni v. Chrysler Grp., LLC, 789 F.3d 1095, 1098
(9th Cir. 2015). “Viewing the evidence in the light most favorable to the
nonmoving party . . . and drawing all reasonable inferences in its favor, we must
determine whether the district court correctly applied the relevant substantive law
and whether there are any genuine issues of material fact.” Clicks Billiards, Inc. v.
Sixshooters, Inc., 251 F.3d 1252, 1257 (9th Cir. 2001).
1. The district court did not err in granting summary judgment for SLS
on each of Mitchell’s causes of action. The fact that SLS reported Mitchell’s
“account status” as “current account” shows that SLS complied with the FCRA
requirement to “report [a consumer’s] credit obligation or account as current.” 15
U.S.C. § 1681s-2(a)(1)(F)(ii)(I). The use of “D” rather than “0” in the PHP field
3 does not change that conclusion. We agree with the district court that guidance
from the Consumer Data Industry Association (“CDIA”) supports the inference
that using the “D” character “is an acceptable option” when reporting the account
status as current. While a nonbinding Compliance Aid issued by the Consumer
Financial Protection Bureau (“CFPB”) says that a furnisher “should consider all of
the trade line information they furnish that reflects a consumer’s status as current
or delinquent,” it does not specifically mention the PHP. The CFPB guidance does
not persuade us that reporting the PHP as “D” violates the FCRA’s requirement to
report the account as current. We therefore agree with the district court that SLS’s
“investigation and response to [Mitchell’s] complaints of inaccuracies . . . were not
unreasonable.” Mitchell also cannot “make a prima facie showing that” SLS’s
reporting was inaccurate, as he must to state a FCRA claim. Gross v.
CitiMortgage, Inc., 33 F.4th 1246, 1251 (9th Cir. 2022).
While the district court did not reach several issues raised on summary
judgment, even if we assumed some inaccuracy in SLS’s reporting, the facts
highlighted by Mitchell do not show that SLS acted willfully or negligently in
conducting its investigation after receiving the notice of dispute. Gorman v.
Wolpoff & Abramson, LLP, 584 F.3d 1147, 1154 (9th Cir. 2009). Moreover, the
language of this provision of the FCRA is “‘less than pellucid’” and no appellate
court has interpreted the language of the FCRA at issue here, so “[u]nder either the
4 negligence or willfulness standard . . . a defendant will nearly always avoid
liability.” Marino v. Ocwen Loan Servicing LLC, 978 F.3d 669, 673–74 (9th Cir.
2020) (quoting Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 70 (2007)). And even
if SLS did act negligently, Mitchell has not provided admissible evidence of actual
damages.
Mitchell’s failed effort in August 2020 to finance the purchase of a Range
Rover for $96,000, just a few months after requesting forbearance from SLS, does
not evidence that he was damaged. Two banks declined to provide Mitchell with
an auto loan for the purchase of the Range Rover. The record reflects, however,
that the denials were for reasons unrelated to SLS’s credit reporting or late
mortgage payments. Instead, the denials appear to be related, at least in part, to
Mitchell’s prior bankruptcy, for which he filed in December 2013.
We also affirm the district court’s holding that the CCRAA and UCL claims
fail because SLS’s reporting was accurate and complied with the FCRA. See
Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876, 890 (9th Cir. 2010)
(assuming that “California courts would interpret the FCRA and CCRAA
consistently”); Aleksick v. 7-Eleven, Inc., 140 Cal. Rptr. 3d 796, 801 (Ct. App.
2012) (holding that if “a statutory claim fails, a derivative UCL claim also fails”).
As with the FCRA claim, even if Mitchell could show some inaccuracy in SLS’s
credit reporting, he has not provided admissible evidence of damages.
5 2. The district court also did not err in dismissing Mitchell’s breach of
contract claim. We agree with the district court that, under these circumstances,
the forbearance plan was not an enforceable contract because it lacked
consideration. Mitchell’s case is unlike Sutcliffe v. Wells Fargo Bank, N.A., 283
F.R.D. 533 (N.D. Cal. 2012) and Ansanelli v. JP Morgan Chase Bank, N.A., No. C
10-03892, 2011 WL 1134451 (N.D. Cal. Mar. 28, 2011), where “plaintiffs
expended time and energy and made financial disclosures in furtherance of the
agreement, which they would not have been required to do under the original
contract.” Ansanelli, 2011 WL 1134451, at *4; accord Sutcliffe, 283 F.R.D. at
553. Mitchell secured the forbearance plan by calling SLS and choosing options
through its IVR system. SLS did not request any additional information or
documents before entering into the forbearance plan. Mitchell’s action does not
amount to consideration because it did not confer a benefit or cause Mitchell to
suffer prejudice; nor was there a bargained-for exchange. See Steiner v. Thexton,
226 P.3d 359, 366 (Cal. 2010). It was substantially less effort than the time and
energy at issue in Sutcliffe and Ansanelli. Once more, even if there were an
enforceable contract here, SLS likely did not breach it because SLS appropriately
reported the account. Nor did Mitchell prove damages from SLS’s conduct.
Nor did the district court err in declining to address the merits of Mitchell’s
promissory estoppel argument. Mitchell did not separately allege a count for
6 promissory estoppel in his Amended Complaint. Mitchell only mentions
promissory estoppel in one line of the joint summary judgment briefing and in his
Reply in Support of Motion for Class Certification. We decline to address an issue
that Mitchell failed to raise sufficiently for the trial court to rule on it. Broad v.
Sealaska Corp., 85 F.3d 422, 430 (9th Cir. 1996).1
3. The district court did not err in denying Mitchell’s class certification
motion as moot because it properly dismissed all claims against SLS.
AFFIRMED.
1 We assume, without deciding, that the contract claim is not preempted by the FCRA. See Gorman, 584 F.3d at 1167 (“In the end, we need not decide this issue. As we conclude below, even if Gorman could bring a state law libel claim under § 1681h(e), and such a claim were not preempted by § 1681t(b)(1)(F), he has not introduced sufficient evidence to survive summary judgment on this claim.”).