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Adeseye v. FedLoan Servicing

United States District Court, D. Delaware

June 27, 2018

ADETAYO ADESEYE, Plaintiff,
v.
FEDLOAN SERVICING, et al., Defendants.

          Adetayo Adeseye, Newark, Delaware; Pro Se Plaintiff.

          Douglas D. Herrmann, Esquire, Pepper Hamilton LLP, Wilmington, Delaware, Counsel for Defendant Fed Loan Servicing.

          Blake A. Bennett, Esquire, and Heather M. Shumaker, Esquire, Cooch and Taylor, Wilmington, Delaware, Counsel for Defendant Trans Union.

          Karen M. Grivner, Esquire, Clark Hill PLC, Wilmington, Delaware, Counsel for Defendant Equifax.

          Travis S. Hunter, Esquire, and Mark C. Zheng, Esquire, Richards Layton & Finger, PA, Wilmington, Delaware, Counsel for Defendant Experian.

          MEMORANDUM OPINION

          ANDREWS, U.S. DISTRICT JUDGE:

         Plaintiff Adetayo Adeseye, who proceeds pro se, and has paid the filing fee, filed this action on August 11, 2017. (D.I. 2). Before the Court is Defendant Pennsylvania Higher Education Assistance Agency, d/b/a FedLoan Servicing's motion to dismiss pursuant to Rule 12(b)(6). (D.I. 21). Briefing on the matter is complete. Also before the Court is Plaintiffs request for counsel. (D.I. 14).

         BACKGROUND

         Plaintiff has sued a number of entities for inaccurate reporting of his student loans to credit reporting agencies. Plaintiff's student loans were originally with Direct Loans and the loan was set up on automatic repayment so Plaintiff would receive a 0.25% reduction in the interest rate. Prior to refinancing all student loans and consolidating them, the loans were in forbearance. Plaintiff was informed by Direct Loans that the automatic payments were in effect and would continue after the forbearance period ended.

         The student loans were transferred from Direct Loans to the U.S. Department of Education. Plaintiff alleges he never received a notice or a phone call about the transfer, and there appears to have been a lack of communication across many handoffs during the transfer process to the Department of Education and FedLoan Servicing that violated the Fair Credit Reporting Act.

         Plaintiff alleges that, from 2012 until 2017, FedLoan Servicing and the Department of Education inaccurately reported his student loan status to credit reporting agencies, causing him actual damage. Plaintiff filed a complaint through CEPB (presumably the Consumer Financial Protection Bureau) and Federal Student Aid on June 14, 2017, and recently FedLoan Servicing updated Plaintiff's credit report to reflect a zero balance. However, some student loans are being reported by the Department of Education with a total remaining balance of $32.00.

         Plaintiff alleges that due to the erroneous reporting of a defaulted federal student loan on his credit report, he has been unable to refinance or obtain a new mortgage. He seeks compensatory damages.

         FedLoan Servicing moves for dismissal of the Fair Credit Reporting Act ("FRCA") claims pursuant to Rule 12(b)(6) on the grounds that it is not a consumer reporting agency and there is no private right of action against data furnishers.[1] (D.I. 23).

         LEGAL ...


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