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David Farkash v. Rjm Acquisitions Funding

May 29, 2012

DAVID FARKASH,
PLAINTIFF,
v.
RJM ACQUISITIONS FUNDING, INC., DEFENDANT.
DAVID FARKAS,
PLAINTIFF,
v.
CAVALRY PORTFOLIO SERVICES, DEFENDANT.
DAVID FARKASH,
PLAINTIFF,
v.
MIDLAND CREDIT MANAGEMENT, INC., DEFENDANT.
DAVID FARKAS,
PLAINTIFF,
v.
FREDERICK J. HANA & ASSOCIATES, P.C., DEFENDANT.
DAVID FARKAS,
PLAINTIFF,
v.
MAIN STREET ACQUISITION CORP., DEFENDANT.
DAVID FARKAS,
PLAINTIFF,
v.
NATIONAL ENTERPRISE SYSTEMS, INC., DEFENDANT.
DAVID FARKAS,
PLAINTIFF,
v.
ENHANCED RECOVERY CO., LLC, DEFENDANT.
DAVID FARKAS,
PLAINTIFF,
v.
NORTHSTAR LOCATION SERVICES, LLC, DEFENDANT.



The opinion of the court was delivered by: Ramos, D.J.:

OPINION AND ORDER

Pro se Plaintiff David Farkas has filed ten in forma pauperis lawsuits against various debt collection agency Defendants, alleging violations of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681 et seq., and the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. Two of these cases have settled. See Farkas v. Stuart Allan & Assoc., No. 12-cv-598 (ER); Farkas v. Capital Management Serv., No. 12-cv-1016 (ER).

Eight of Mr. Farkas's cases remain pending. Five of these cases-Farkas v. Frederick J. Hana & Associates, No. 12-cv-1110 (ER)("Hana"), Farkas v. Main Street Acquisition Corp., No. 12-cv-1310 (ER) ("Main Street"), Farkas v. National Enterprise Systems, No. 12-cv-1456 (ER) ("National Enterprise"), Farkas v. Enhanced Recovery Co., No. 12-cv-2212 (ER)("Enhanced Recovery"), and Farkas v. Northstar Location Services, No. 12-cv-2360 (ER) ("Northstar")-are one count complaints alleging that the Defendants obtained Mr. Farkas' consumer credit report with no permissible purpose in violation of FCRA, 15 U.S.C. § 1681b.

In the three other cases-Farkash v. RJM Acquisition Funding, No. 12-cv-735 (ER) ("RJM"), Farkas v. Cavalry Portfolio Services, No. 12-cv-935 (ER) ("Cavalry"), and Farkash v. Midland Credit Management, No. 12-cv-1017 (ER) ("Midland")*fn1 -Mr. Farkas brings the same FCRA count against the Defendants, but he also alleges that each of these Defendants violated two FDCPA provisions. Specifically, Mr. Farkas claims that the three Defendants attempted collect a debt after being notified that the debt was disputed in violation of 15 U.S.C. § 1692g and sent him communications that misrepresented a debt in violation of 15 U.S.C. § 1692e.

This order addresses all eight cases. This Court concludes that Mr. Farkas has failed to state a claim upon which relief can be granted in his FCRA claims and therefore sua sponte DISMISSES without prejudice the entire complaints in Hana, Main Street, National Enterprise, Enhanced Recovery, and Northstar, and Counts 1 of RJM, Cavalry, and Midland. The Court also sua sponte DISMISSES with prejudice Count 2 in Midland.

DISCUSSION Procedural Standard

The Court has the authority to screen sua sponte an in forma pauperis complaint at any time pursuant to 28 U.S.C. § 1915(e)(2)(B). The Court may dismiss such a complaint, or portion thereof, if it fails to state a claim upon which relief could be granted. § 1915(e)(2)(B)(ii). Even though the law authorizes dismissal on that ground, courts "remain obligated to construe pro se complaints liberally." E.g., DiPetto v. U.S. Postal Serv., 383 Fed. Appx. 102, 103 (2d Cir. 2010); Johnson v. J.P. Morgan Chase Bank, N.A., et al., No. 11 Civ. 662 (DLC), 2011 WL 497923, at *1 (S.D.N.Y. Feb.10, 2011). Thus, pro se complaints should be read with "special solicitude" and should be interpreted to raise the "strongest claims that they suggest." E.g., DiPetto, 383 Fed. Appx. at 103 (internal punctuation omitted); see also Johnson, 2011 WL 497923, at *1.

Nonetheless, a pro se complaint must still provide a defendant with fair notice of what the plaintiff's claims are and each of the grounds upon which they rest. See Valenzuela v. Riverbay Corp., No. 06 Civ. 903 (DLC), 2007 WL 414487, at *2 (S.D.N.Y. Jan. 31, 2007); see generally Dura Pharms., Inc. v. Broudo, 544 U.S. 336, 346 (2005). A pleading that offers only "labels and conclusions or a formulaic recitation of the elements of a cause of action will not do." Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949 (2009) (internal quotation marks omitted).

"Even though all allegations contained in the complaint are assumed to be true" on a motion to dismiss, that "tenet is 'inapplicable to legal conclusions.'" Zapolski v. Fed. Republic of Germany, 425 Fed. Appx. 5, 6 (2d Cir. 2011) (quoting Iqbal, 129 S.Ct. at 1949) (affirming sua sponte dismissal of pro se, in forma pauperis complaint). Rather, "[t]he complaint must plead 'enough facts to state a claim [for] relief that is plausible on its face.'" Zapolski, 425 Fed. Appx. at 6 (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)); accord DiPetto, 383 Fed. Appx. at 103 ("pro se complaints must contain sufficient factual allegations to meet the plausibility standard"). A claim has "'facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'" Zapolski, 425 Fed. Appx. at 6 (quoting Iqbal, 129 S.Ct. at 1949).

FCRA Counts (All Eight Cases)

Mr. Farkas' purported FCRA causes of action each rest upon the Defendants' alleged violation of Section 1681b. That section protects consumer privacy by limiting access to consumer credit reports. To state a claim for civil liability based on Section 1681b, a plaintiff must allege both that the defendant used or obtained the plaintiff's credit report for an impermissible purpose, see 15 U.S.C. § 1681b(f); see also Stonehart v. Rosenthal, No. 01-cv-651 (SAS), 2001 WL 910771, at *3 (S.D.N.Y. Aug.13, 2001), and that the violation was willful or negligent, see 15 U.S.C. §§ 1681n, 1681o; see also, e.g., Casella v. Equifax Credit Info. Servs., 56 F.3d 469, 473 (2d Cir. 1995).

In a recent decision dismissing similar claims, Perl v. American Express, No. 11-cv-7374 (KBF), 2012 WL 178333 (S.D.N.Y. Jan. 19, 2012), the district court held that plaintiffs must allege specific facts to satisfy the state of mind element.

In each of the instant cases, Mr. Farkas adequately alleges that his report was obtained for an impermissible purpose by alleging that he "never had any business dealings or any accounts with, made application for credit from, made application for employment with, applied for insurance from, or received a bona fide offer of credit from," Defendants. Compl. at ¶ 18, Hana; Compl. at ¶ 18, Main Street; Compl. at ¶ 16, National Enterprise; Compl. at ¶ 16, Enhanced Recovery; Compl. at ¶ 16, Northstar; Compl. at ¶ 24, RJM; Compl. at ¶ 26, Cavalry; Compl. at ¶ 27, Midland. But he fails adequately to allege willfulness or negligence.

While Mr. Farkas asserts that each Defendant's FCRA violation was willful, he does so in a conclusory manner in all eight of the complaints. See generally Iqbal, 129 S.Ct. at 1949 ("A pleading that offers labels and conclusions or a formulaic recitation of the elements of a cause of action will not do." (internal quotation marks omitted)). Willfulness as used in the relevant provision of the FCRA, Section 1681n, means knowledge or recklessness. See, e.g., Safeco Ins. Co. of America v. Burr, 551 U.S. 47, 56--60 (2007); see generally 15 U.S.C. ...


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