United States District Court, D. New Mexico
ALVIN C. FREDRICKSON, Plaintiff,
CANNON FEDERAL CREDIT UNION, Defendant.
MEMORANDUM OPINION AND ORDER
C. BRACK, UNITED STATES DISTRICT JUDGE
reputation is worth more than silver or gold. In today's
world, a good reputation for creditworthiness can mean the
difference between being employed and searching for work,
between feeling secure and enduring anxiety, and between
owning a home and not.
the importance of one's credit reputation, Congress
enacted the Fair Credit Reporting Act (FCRA) to regulate
credit reporting. Like common law principles of defamation,
the FCRA empowers individuals to vindicate their credit
reputations by suing those who make false allegations against
them. Like common law principles of defamation, however,
truth is always a defense against FCRA claims.
March 2010, Alvin Fredrickson and his wife, Donna
Fredrickson, refinanced the mortgage on their home with
Cannon Federal Credit Union (Cannon). (Doc. 1 at 3.) In
refinancing their home mortgage, Mr. and Mrs. Fredrickson
both signed a note dated March 22, 2010 (Original Note).
(Id.) According to the terms of the Original Note,
the Fredricksons agreed to pay $290 monthly,  with a final
“balloon” payment of $11, 255.26 in March of
2022. (Doc. 97, Ex. A.) The annual interest rate was seven
percent, the principal was $59, 556.07, and the total payment
would be $86, 365.26. (Id.)
Original Note stated that “modification of amortization
of the sums secured by this Mortgage . . . shall not operate
to release, in any manner, the liability of the original
borrower . . . .” (Doc. 97, Ex. B.) The Original Note
Any Borrower who co-signs this Mortgage, but does not execute
the Note, (a) is co-signing this Mortgage only to mortgage,
grant and convey that Borrower's interest in the Property
to Lender under the terms of this Mortgage, (b) is not
personally liable on the Note or under this Mortgage . . . .
Mrs. Fredrickson later divorced, and in 2014, Ms. Fredrickson
renegotiated the mortgage with Cannon. (Doc. 1 at 4.) The
terms of the new agreement were memorialized in the
“2014 Note.” (Id.) The 2014 Note
required weekly payments of $100 instead of regular payments
of $290, and a balloon payment of $39, 986.97 in March of
2020 instead of an $11, 255.26 payment in March of 2022.
(Id.) The collateral, interest rate, and principal
balance remained unchanged. (See Doc. 109 at 9.) The
2014 Note contained the same contractual provisions as the
Original Note regarding modification of amortization and
borrowers who do not execute the note. (See Doc. 1
at 4-5.) Although Mr. Fredrickson was listed as a borrower on
the 2014 Note, he was not involved with the negotiation of
the 2014 Note, did not sign it, and was not notified of the
modification. (Id. at 4-5; Doc. 102 at 16 n.10.)
2015, Ms. Fredrickson and Cannon modified the 2014 Note,
again “without Mr. Fredrickson's knowledge, consent
or signature.” (Doc. 102 at 6.) The 2015 modification
(2015 Note) lowered the interest rate from seven percent to
3.25 percent and changed the payments from $100 a week to
$400 a month. (Id. at 6-7.)
2016, Mr. Fredrickson learned that credit reporting agencies
(CRAs) Equifax, Experian, and TransUnion were reporting that
he was obligated to pay on the 2015 Note with Cannon.
(See Id. at 6; Doc. 1 at 6.) Mr. Fredrickson
believed that, because he was not consulted when Ms.
Fredrickson modified the Original Note, he was released from
his obligations when the 2014 Note was created. (See
Doc. 1 at 6-7.) Concerned about his financial reputation, Mr.
Fredrickson sent a dispute letter to each of the three CRAs,
explaining that he had not signed the 2014 Note, so he should
be released from the 2014 Note and any subsequent note.
(See Id. at 7.) With his letter to each CRA, Mr.
Fredrickson attached a copy of the 2014 Note, highlighting a
section that read, “If more than one person signs this
Note, each of us is fully and personally obligated to pay the
full amount owed and to keep all of the promises made in this
Note.” (Id.) The CRAs, in turn, asked Cannon
to investigate the debt. (Id.)
Cannon employee, Erin Watson, investigated Mr.
Fredrickson's disputed debt. (Doc. 97 at 6.) Ms. Watson
reviewed the loan documents and loan history. (Id.)
She consulted with the vice president of lending and
Cannon's CEO, as well as Cannon's attorney.
(Id. at 6-7.) In consulting Cannon's attorney,
Ms. Watson sent an email to the attorney's office
summarizing the dispute and detailing the timeline of Mr.
Fredrickson's loan history. (Id., Ex. K.) In her
email, Ms. Watson also attached various relevant documents,
including Mr. Fredrickson's dispute letter, loan
documents over the years, and a part of Mr. Fredrickson's
divorce decree. (Id.) Cannon's attorney informed
Cannon that it was correctly reporting Mr. Fredrickson's
debt. (See Id. at 30:4-33:2.) At the conclusion of
its investigation, Cannon concluded that it was correctly
reporting Mr. Fredrickson's liability, and Cannon did not
change its reports to CRAs. (See Doc. 1 at 7-8.)
that his credit reputation was being unjustly maligned, Mr.
Fredrickson brought suit against Cannon under the Fair Credit
Reporting Act (FCRA), as well as various state law theories.
(Id. at 9-11.) Cannon moved for summary judgment on
Mr. Fredrickson's claims.
court shall grant summary judgment if the movant shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(a). In considering a summary judgment motion,
the Court views “the evidence and the reasonable
inferences to be drawn from the evidence in the light most
favorable to the nonmoving party.” See Parker
Excavating, Inc. v. Lafarge W., Inc., 863 F.3d 1213,
1220 (10th Cir. 2017) (citation omitted).
claims that Mr. Fredrickson has no Article III standing to
sue. (Doc. 97 at 23.) Article III of the U.S. Constitution
requires a plaintiff to have suffered a concrete and
particularized “injury in fact” before bringing
suit. See Spokeo, Inc. v. Robins, 136 S.Ct. 1540,
1548 (2016), as revised (May 24, 2016). Cannon
believes that Mr. Fredrickson's alleged injuries are too
nebulous because Mr. Fredrickson has refused to quantify his
emotional damages. (See Doc. 97 at 23-24.)
plaintiff asserting emotional damages may survive a motion
for summary judgment even without providing corroborating
evidence, as long as the plaintiff “reasonably and
sufficiently explains the circumstances surrounding the
injury and does not rely on mere conclusory
statements.” Llewellyn v. Allstate Home Loans,
Inc., 711 F.3d 1173, 1183 (10th Cir. 2013) (citation
omitted). In Llewellyn, the plaintiff alleged in his
affidavit that discovering the defendant's negative
reports about his creditworthiness caused him to experience
emotional distress, which manifested in “drenching
night sweats, panic attacks, ” “great stress and
anxiety, ” and the feeling that he “could not
recover.” Id. at 1182-83, 1183 n.3. The
Llewellyn Court ruled that the plaintiff's
alleged emotional damages survived summary judgment because,
“viewing Plaintiff's affidavit in the light most
favorable to him and drawing all reasonable inferences in his
favor, ” the plaintiff's claims were “not so
incredible or conclusory” that they could be ignored.
Id. at 1182-83.
case, Mr. Fredrickson explained that he takes pride in his
identity as an Air Force veteran because Air Force veterans
are held in high esteem and are characterized by excellence.
(See Doc. 102, Ex. J, at 86:13-18.) Mr. Fredrickson
goes on to say that Cannon's reports “portrayed
[him] as a deadbeat . . . contrary to [his] dignity and
respect and honor.” (Id. at 85:17-19.) Mr.
Fredrickson worried about the effect of Cannon's report
on his reputation, and this concern caused Mr. Fredrickson to
experience anxiety, difficulty sleeping, and loss of
appetite. (Id. at 85:12-16.) Mr. Fredrickson's
description of his symptoms is comparable in detail with the
Llewellyn plaintiff's description of his
symptoms, and Mr. Fredrickson's assertion that
Cannon's reporting caused those symptoms is not so
incredible or conclusory that it can be ignored. Viewing Mr.
Fredrickson's claims in the light most favorable ...