Hunt v. True Sky Federal Credit Union

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
ROOSEVELT HUNT, JR.,
Plaintiff,
v. 	Case No. 25-1209-JWB
TRUE SKY FEDERAL CREDIT UNION,
Defendant.
MEMORANDUM AND ORDER
This matter is before the court on Defendant’s motion to dismiss. (Doc. 18.) The motion
has been fully briefed and is ripe for decision. (Docs. 19, 20, 22.) The motion is GRANTED IN
PART and TAKEN UNDER ADVISEMENT IN PART for the reasons stated herein.
I. 	Facts
The facts set forth herein are taken from the amended complaint and the exhibits attached
thereto. 	(Doc. 15.) 	Plaintiff obtained a car loan from Defendant for his 2020 Toyota Camry.
Plaintiff also had deposit accounts with Defendant in excess of $28,000 during the relevant time
period. 	(Id. ¶ 11.) 	On December 8, 2023, Plaintiff traded in his vehicle to CarMax. 	CarMax
agreed to pay off the loan balance with Defendant. On January 5, 2024, CarMax issued a check
to Defendant on the loan. The check, however, did not cover the entire balance owed and there
was a shortfall of $45.77. (Id. ¶ 7.) In February, Plaintiff contacted Defendant who told Plaintiff
that the account was late. On March 25, CarMax issued a supplemental payment of $290.65. This
was deposited on April 2 and it was sufficient to cover the loan in full. (Id. ¶ 10.)
Although the loan was paid off in April 2024, Defendant began reporting to TransUnion
credit bureau that Plaintiff’s account was 30-days delinquent. (Id. ¶ 14.) In January 2025, Plaintiff
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discovered the derogatory tradeline during a mortgage application. 	He then gathered records
regarding the payoff amounts. Plaintiff alleges that he was denied credit from multiple banks as a
result. These actions occurred in January, April, and June 2025. (Docs. 15-3, 15-4, 15-5.) Plaintiff
repeatedly complained to Defendant that the loan was paid off and the reporting was inaccurate
but it was not corrected. On July 3, Plaintiff submitted a written dispute to TransUnion. (Doc. 15
¶ 17.) On or about August 12, the tradeline was corrected.
Plaintiff filed this action asserting a violation of the Fair Credit Reporting Act (“FCRA”),
15 U.S.C. § 1681s-2(b), a claim for breach of contract, and a claim for breach of the duty of good
faith. Defendant now moves to dismiss.
II. 	Standard
In order to withstand a motion to dismiss for failure to state a claim under Rule 12(b)(6), a
complaint must contain enough allegations of fact to state a claim to relief that is plausible on its
face. 	Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th Cir. 2008) (citing Bell Atl. Corp. v.
Twombly, 550 U.S. 544 (2007)). All well-pleaded facts and the reasonable inferences derived from
those facts are viewed in the light most favorable to Plaintiff. Archuleta v. Wagner, 523 F.3d 1278,
1283 (10th Cir. 2008). 	Conclusory allegations, however, have no bearing upon the court’s
consideration. Shero v. City of Grove, Okla., 510 F.3d 1196, 1200 (10th Cir. 2007).
Because Plaintiff is proceeding pro se, the court is to liberally construe his filings. United
States v. Pinson, 584 F.3d 972, 975 (10th Cir. 2009). However, liberally construing filings does
not mean supplying additional factual allegations or constructing a legal theory on Plaintiff’s
behalf. Whitney v. New Mexico, 113 F.3d 1170, 1173-74 (10th Cir. 1997).
III. 	Analysis
A. FCRA Claim
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Defendant argues that Plaintiff has not plausibly stated a claim under the FCRA. 	The
FCRA obligates furnishers of information like Defendant to provide accurate information to
consumer reporting agencies, like TransUnion. 15 U.S.C. § 1681s–2(a). After receiving notice of
a dispute from TransUnion, a furnisher is to “(1) investigate the disputed information; (2) review
all relevant information provided by the CRA; (3) report the results of the investigation to the
CRA; (4) report the results of the investigation to all other CRAs if the investigation reveals that
the information is incomplete or inaccurate; and (5) modify, delete, or permanently block the
reporting of the disputed information if it is determined to be inaccurate, incomplete, or
unverifiable.” 	Pinson v. Equifax Credit Info. Servs., Inc., 316 F. App'x 744, 750–51 (10th Cir.
2009) (quoting § 1681s–2(b)). 	Once receiving such a notice, furnishers must “complete all
investigations, reviews, and reports . . . before the expiration of the period under section
1681i(a)(1)” which is 30 days. § 1681s-2(b)(2). Notably, these duties only arise after furnishers
like Defendant receive notice from a CRA and not notice directly from the consumer. Pinson, 316
F. App’x at 751. 	As such, Defendant’s failure to take action after receiving verbal notice from
Plaintiff is not actionable under the FCRA.
In order to state a claim under § 1681s–2(b)(1), Plaintiff must plausibly allege: (1) he
notified a credit reporting agency (“CRA”) of a dispute; (2) the CRA notified Defendant, who was
the furnisher of the information of the dispute; and (3) after notification, Defendant failed to
adequately investigate. Keller v. Bank of Am., N.A., 228 F. Supp. 3d 1247, 1255 (D. Kan. 2017).
Plaintiff has alleged that he notified a CRA of the dispute on July 3, 2025. Plaintiff also alleged
that Defendant failed to adequately investigate by failing to delete the tradeline within 30 days.
Defendant first argues that Plaintiff has failed to plausibly allege that it was notified of the
dispute and the contents of that notification. 	In response, Plaintiff asserts that Defendant was
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notified by July 6. (Doc. 20 at 2.) Reviewing Plaintiff’s exhibits to his complaint, he has attached
emails from TransUnion reflecting that he submitted a dispute on July 3. On July 6, TransUnion
informed him that they had contacted Defendant regarding the dispute. (Doc. 15-9.) Therefore,
at this stage of the proceedings the court finds that Plaintiff has plausibly alleged a violation of the
FCRA. Plaintiff’s complaint and exhibits reflect that Defendant was notified of Plaintiff’s dispute
challenging the negative tradeline on or before July 6 and Defendant did not investigate the
tradeline within 30 days as required by the FCRA.
Finally, Defendant asserts that Plaintiff has failed to sufficiently allege an injury that
occurred during the time frame at issue: July 3 to August 12. Plaintiff must have an injury in fact
to have standing to bring his claim. 	TransUnion LLC v. Ramirez, 594 U.S. 413, 423 (2021).
Plaintiff has alleged that he was injured due to the denial of credit, credit score deduction, increased
loan interest rates, and loss of favorable credit terms. (Doc. 15 ¶ 31.) Plaintiff’s factual allegations
and exhibits, however, relate to a time period prior to July 3. (Id. ¶ 24, Doc. 15-3, 15-4, 15-5.) In
his response to the motion to dismiss, Plaintiff asserts that he has suffered injuries during the
requisite time period. 	(Doc. 20 at 2.) 	Therefore, the court will allow Plaintiff to amend his
complaint to allege injuries that occurred in the time period relevant to his FCRA claim. Should
he fail to file an amended complaint, his complaint will be dismissed without prejudice for lack of
standing.
B. Breach of Contract and Breach of the Duty of Good Faith
Plaintiff has also alleged breach of contract and a separate claim of breach of the duty of
good faith. The court will address these claims together as a claim of breach of duty of good faith
is simply another theory of breach of contract. To determine what law applies to Plaintiff’s state
law breach of contract claim, the court applies the substantive law of the forum state, including its
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conflict-of-laws rules. Emps. Mut. Cas. Co. v. Bartile Roofs, Inc., 618 F.3d 1153, 1170 (10th Cir.
2010). Kansas “follows the general rule that the law of the state where the [ ] contract is made
controls.” 	Safeco Ins. Co. of America v. Allen, 941 P.2d 1365 (1997). 	However, “[w]here the
parties to a contract have entered an agreement that incorporates a choice of law provision, Kansas
courts generally effectuate the law chosen by the parties to control the agreement.” 	Brenner v.
Oppenheimer & Co., 44 P.3d 364, 375 (Kan. 2002). 	Here, the agreement states that the law of
Defendant’s headquarters will apply. 	(Doc. 15-7 at 3.) 	Both parties agree that Defendant’s
headquarters are in Oklahoma and that Oklahoma law applies. Therefore, the court will look to
Oklahoma law.1
To prevail on his claim of breach of contract, Plaintiff must show “(1) formation of a
contract; (2) breach of the contract; and (3) damages as a result of that breach.” Morgan v. State
Farm Mut. Auto. Ins. Co., 488 P.3d 743, 748 (Okla. 2021). Here, Plaintiff alleges that Defendant
breached the loan agreement by failing to apply the funds in his deposit account to his outstanding
car loan. In moving to dismiss, Defendant argues that it does not have a duty under the agreement
to apply the deposit funds to the outstanding loan balance; rather, the provisions at issue are
discretionary. 	(Doc. 19 at 7–8.) 	Plaintiff acknowledges that the duties he referred to in his
amended complaint are discretionary and fails to otherwise respond to Defendant’s argument in
support of dismissal.2 	(Doc. 20 at 3.) 	Plaintiff also fails to identify a provision in the loan
agreement that Defendant has allegedly breached. 	Therefore, his claim of breach of contract is
subject to dismissal as Plaintiff has not plausibly alleged that Defendant breached the loan
agreement.
1 The court notes that application of Kansas law in this case would also result in dismissal of the breach of contract
claims.
2 Although Plaintiff’s argument section is titled “Plaintiff’s contract claims are properly pled,” Plaintiff only addresses
his claim of breach of the implied duty of good faith. (Doc. 20 at 3.)
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Next, Plaintiff alleges that Defendant breached the contract by failing to act in good faith
in performing the loan agreement. Defendant argues that this claim is subject to dismissal because
the provisions at issue are discretionary and it cannot breach the duty of good faith by not
undertaking an action it did not agree to take.
Oklahoma courts have recognized that “[e]very contract in Oklahoma contains an implied
duty of good faith and fair dealing.” Wathor v. Mutual Assur Adm'rs, Inc., 2004 OK 2, ¶ 5, 87
P.3d 559, 561. 	A party may not act in a way that would injure the other party’s reasonable
expectations or impair the right of the other to receive the contractual benefits. First Nat'l Bank
& Trust Co. of Vinita v. Kissee, 1993 OK 96, ¶ 24, 859 P.2d 502. However, “the obligation of
good faith cannot be employed to override express contract terms or to obligate a party to accept
additional terms or a material change in the contract's terms.” Walker v. First Nat'l Bank of Med.
Lodge, 129 F. App'x 411, 414 (10th Cir. 2005). 	Further, “the concept of good faith becomes
irrelevant in the interpretation of a contractual provision which grants ‘uncontrolled discretion’ to
one of the parties.” Devery Implement Co. v. J.I. Case Co., 944 F.2d 724, 729 (10th Cir. 1991).
In response to Defendant’s motion, Plaintiff agrees that Defendant was not required to use
the deposit funds for payment of his car loan. 	Plaintiff asserts that Oklahoma “courts hold that
when a contract grants one party discretionary authority, that discretion must be exercised in good
faith and not in a manner that frustrates the justified expectations of the other party.” (Doc. 20 at
3.) 	Plaintiff cites to Hall v. Farmers Ins. Exchange, 713 P.2d 1027, 1029 (Okla. 1985). 	Hall
involved the termination of an employment contract and did not stand for the general proposition
that Plaintiff suggests.3 Rather, the Oklahoma Supreme Court held that the defendant in that case
could not terminate an agreement in bad faith to deprive its agent of fees. Hall, 713 P.2d at 1030.
3 Plaintiff also cites to a non-existent case in support of his arguments on the FCRA claim. (Doc. 20 at 1) (citing to
Howard v. CitiMortgage, Inc., 2019 WL 1401348 (D. Kan. Mar. 28, 2019)). There is no case with such a caption in
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Plaintiff’s remaining arguments are entirely conclusory. Plaintiff also fails to identify the
provisions at issue that were breached by Defendant’s conduct. 	The provisions allowing
Defendant to set off its losses when Plaintiff defaults are discretionary, i.e. “we may apply these
shares and deposits to the payment of all sums due at the time of default.” 	(Doc. 15-7 at 3.)
Moreover, they are for the benefit of Defendant and not Plaintiff. 	Plaintiff makes no colorable
argument as to how Defendant’s actions here breached the agreement by failing to act in good
faith. 	In the absence of Oklahoma law in support of his claim that Defendant’s actions were a
violation of its duty to act in good faith, the court will not read the agreement to require Defendant
to set off funds from Plaintiff’s deposit account to pay the outstanding balance on his car loan.
IV. 	Conclusion
Defendant’s motion to dismiss (Doc. 18) is GRANTED IN PART and TAKEN UNDER
ADVISEMENT IN PART. 	Plaintiff’s claims of breach of contract are dismissed. Defendant’s
motion is taken under advisement as to Plaintiff’s FCRA claim. 	Plaintiff may file an amended
complaint setting for his FCRA claim on or before March 1, 2026 to address the deficiencies
identified herein. Failure to do so will result in a dismissal without further notice.
IT IS SO ORDERED. Dated this 25th day of February, 2026.
__s/ John W. Broomes __________
JOHN W. BROOMES
CHIEF UNITED STATES DISTRICT JUDGE
Westlaw and Plaintiff has not provided a case number for the court to locate the case in its records. Since the filing
of Plaintiff’s brief, this court has entered a standing order on the use of Artificial Intelligence (“AI”) in court filings.
Standing Order 26-01 (In Re: Use of Artificial Intelligence In Preparing Court Filings). This order requires a litigant
to review and verify the accuracy of all content filed with the court that was drafted or assisted using an AI tool.
Should Plaintiff violate this standing order in subsequent filings, he can be subject to sanctions as set forth in the
standing order.
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