On Appeal from the United States District Court for the Eastern District of Pennsylvania (D.C. No. 09-cv-00699) District Judge: Hon. Legrome D. Davis
The opinion of the court was delivered by: Jordan, Circuit Judge.
Argued September 25, 2012
Before: McKEE, Chief Judge, JORDAN, and VANASKIE, Circuit Judges.
Marie Ann Fuges appeals from an order of the United States District Court for the Eastern District of Pennsylvania entering summary judgment in favor of Southwest Financial Services, Ltd. ("Southwest") with respect to Fuges‟s claim that Southwest willfully violated the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. §§ 1681-1681x. Fuges claims that Southwest willfully violated FCRA when it included inaccurate information in a report to Fuges‟s lender concerning potential encumbrances on her home. Southwest argues in response that it is not a "consumer reporting agency" ("CRA") governed by FCRA, and that the statute does not apply to the report that it provided to Fuges‟s lender. The District Court held that no reasonable jury could find that Southwest had willfully violated FCRA, because Southwest reasonably interpreted the statute as inapplicable to its activities and so, under the standard set forth in Safeco Insurance Co. of America v. Burr, 551 U.S. 47 (2007), Southwest could not be liable as claimed. For the following reasons, we will affirm.
Southwest sells current owner title reports, otherwise known as property search or limited property reports ("property reports" or "reports") to consumer lenders. The purpose of those reports is to confirm the identity of the current holder of title to the property and to determine whether the property is encumbered. All of the information thatSouthwest collects is available in public records.
Southwest‟s reports include the name and address of the property owner, the marital status of the property owner (if it appears on the deed), the amounts of any outstanding mortgages, and the amounts of any outstanding liens or judgments against the property.*fn1 The property reports do not include the owner‟s social security number, payment history, previous addresses, employment information, date of birth, or outstanding account balances all of which would typically be included in a consumer credit report prepared by one of the "Big Three" credit reporting agencies (Equifax, Experian, and Trans Union). Another point of distinction is that Southwest endeavors to include in its property reports only those judgment liens that remain unsatisfied at the time of the report, because only those liens encumber the property. A typical credit report, by contrast, shows judgment liens that have been satisfied, because they are part of a consumer‟s payment history.
Marie Ann Fuges had a $35,000 line of credit from PNC Bank ("PNC"), which she secured with the home she owned in Philadelphia. In 2008, she applied to PNC for payment protection insurance that would repay her line of credit in the event that she died or became disabled. PNC told Fuges that, in order to obtain the insurance, she needed to reapply for her line of credit.*fn2 She did so, and, after she submitted her loan application, PNC ordered a credit report generated by a credit reporting agency, as well as a property report on the home that she owned. Southwest prepared the latter and provided information concerning the ownership of the home that Fuges put up as collateral, as well as information on whether the property was subject to mortgages, judgment liens, unpaid taxes, or other encumbrances.
More specifically, that property report contained the following information: (1) Fuges‟s name and address; (2) a note concerning her marital status; (3) the amount of her mortgage ($35,000.00); (4) a reference to a $111.11 property tax delinquency; and (5) a reference to a $2,923.63 judgment lien filed by a merchant for a delinquency on the part of her son, Robert W. Fuges. The report was inaccurate in two respects. First, Fuges‟s property tax payments were arguably not delinquent because she had an agreement with the City of Philadelphia to pay her taxes in monthly installments. Second, the property report should not have reflected the judgment lien because inclusion of the lien wrongly assumed that the debt was owed by Fuges‟s deceased husband, Robert
E. Fuges, who had been an owner of the property at one time.
After PNC received the Fuges property report, it informed Fuges that it could not approve her loan application without proof that she had paid her property taxes. Later, however, PNC provided Fuges with the credit insurance, leaving her existing line of credit in place.*fn3
On February 18, 2009, Fuges filed a putative class action against Southwest, alleging that Southwest failed to comply with FCRA in preparing the property report that it had provided to PNC in connection with her credit application. She initially claimed damages for both willful and negligent ...