James v. Westlake Financial Services et al

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
A NGELIQUE J AMES, 	§
Plaintiff, 	§
§
v. 	§ 	CIVIL A CTION N O. 4:25-CV-05563
§
WESTLAKE FINANCIAL SERVICES 	§
AND E QUIFAX I NFORMATION 	§
SERVICES, LLC, 	§
Defendants. 	§
MEMORANDUM AND RECOMMENDATION
Before 	the 	Court 	is 	Defendant 	Westlake 	Financial 	Services, 	LLC’s
(“Westlake”) Motion to Dismiss.1 ECF 15. Defendant seeks dismissal for failure to
state a claim. 	For the reasons discussed below, the Court RECOMMENDS that
Defendant’s Motion be GRANTED and Plaintiff’s claims against Westlake be
DISMISSED.
I. 	Factual and Procedural Background.
Plaintiff brings claims against Westlake under the Fair Credit Reporting Act
(“FCRA”), 15 U.S.C. § 1691 et seq. “Congress enacted the FCRA to ensure fair and
accurate credit reporting that protects consumers while meeting the needs of
commerce.” 	Hammer v. Equifax Info. Servs., L.L.C., 974 F.3d 564, 567 (5th Cir.
1 The District Judge referred this case to the undersigned Magistrate Judge pursuant to 28 U.S.C.
§ 636(b)(1)(A) and (B), the Cost and Delay Reduction Plan under the Civil Justice Reform Act,
and Federal Rule of Civil Procedure 72. ECF 5.
United States District Court
Southern District of Texas
ENTERED
July 24, 2026
Nathan Ochsner, Clerk
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2020). 	To achieve this goal, FCRA regulates consumer reporting agencies and
furnishers of credit information. See Reyes v. Equifax Info. Servs., L.L.C., 140 F.4th
279, 284–85 (5th Cir. 2025). FCRA allows consumers to bring a civil action against
a consumer reporting agency or furnisher for willful or negligent noncompliance
with its obligations under the Act. 15 U.S.C. §§ 1681n, 1681o.
Plaintiff alleges that in May 2025, she lodged a formal dispute with Defendant
Equifax contending Defendant Westlake furnished inaccurate information about her
car loan. ECF 1 ¶ 13. Plaintiff alleges Westlake provided a response,2 but violated
the FCRA by failing to conduct a reasonable investigation into the disputed
information, review Plaintiff’s dispute materials, and report and correct accurate
information. Id. ¶¶ 17, 18, 24-33.
II. 	Legal Standards.
To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must plead “enough
facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly,
2 Plaintiff alleged Westlake responded with the following:
‘The vehicle associated with this loan was sold at auction on May 12, 2021, with
proceeds posted to your [Plaintiff’s] account on May 14, 2021. The account was
subsequently charged off on September 1, 2021, resulting in a deficiency balance
of $8,685.26. 	We have previously responded to your disputes and conducted
appropriate investigations in accordance with FCRA guidelines. Your [Plaintiff’s]
claims of noncompliance and violation are unfounded. Under federal law, a charge-
off does not eliminate the debt. 	You remain legally obligated to repay the
outstanding balance unless it is paid in full or settled for less than the full amount.
As outlined in the FCRA, negative account information may remain on your credit
report for up to seven years from the Date of First Delinquency (DOFD), which in
this case is October 21, 2020.’
ECF 1 ¶ 16.
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550 U.S. 544, 570 (2007). “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 conduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009); Gonzalez v. Kay, 577 F.3d 600, 603 (5th Cir. 2009). In reviewing a motion
to dismiss under Federal Rule of Civil Procedure 12(b)(6), this Court “accepts all
well-pleaded facts as true, viewing them in the light most favorable to the plaintiff.”
Alexander v. AmeriPro Funding, Inc., 848 F.3d 698, 701 (5th Cir. 2017) (citing
Martin K. Eby Constr. Co. v. Dallas Area Rapid Transit, 369 F.3d 464, 467 (5th Cir.
2004)). However, the court does not apply the same presumption to conclusory
statements or legal conclusions. Iqbal, 556 U.S. at 678-79.
Generally, the court may consider only the allegations in the complaint and
any attachments thereto in ruling on a Rule 12(b)(6) motion. If a motion to dismiss
refers to matters outside the pleading, it is more properly considered as a motion for
summary judgment. See FED. R. CIV. P. 12(d). However, the court may take judicial
notice of public documents and may also consider documents a defendant attaches
to its motion to dismiss under 12(b)(6) if the documents are referenced in the
plaintiff’s complaint and central to the plaintiff’s claims. See Norris v. Hearst
Trust, 500 F.3d 454, 461 n.9 (5th Cir. 2007); Collins v. Morgan Stanley Dean Witter,
224 F.3d 496, 498-99 (5th Cir. 2000); King v. Life Sch., 809 F. Supp. 2d 572, 579
n.1 (N.D. Tex. 2011).
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III. 	Analysis.
Plaintiff brings claims against Westlake for violations of Section 1681s-
2(b)(1).3 	ECF 1 ¶¶ 24-33. Section 1681s-2(b)(1) governs the obligations of a
furnisher of information after receiving notice of a consumer dispute from a credit
reporting agency. 15 U.S.C. § 1681s-2(b)(1); Young v. Equifax Credit Info. Servs.,
Inc., 294 F.3d 631, 639–40 (5th Cir. 2002). To state a claim under Section 1681s–
2(b)(1), a plaintiff must allege: (1) that the consumer notified a credit reporting
agency of disputed information; (2) that the credit report agency notified the
furnisher of the information pursuant to the statute (15 U.S.C. § 1681i(a)(2)); and
(3) that the furnisher violated an obligation set forth in Section 1681s–2(b)(1). See
Robinson v. EMC Mortg. Corp., No. 3:10-CV-2140-L, 2013 WL 1245863, at *7
(N.D. Tex. Mar. 26, 2013) (discussing Young, 294 F.3d at 639)). A claim under this
section also requires a showing that the information contains an inaccuracy. Ostiguy
v. Equifax Info. Servs., LLC, No. 5:16-CV-790-DAE, 2017 WL 1842947, at *5
(W.D. Tex. May 4, 2017), aff'd, 738 F. App'x 281 (5th Cir. 2018).
No party controverts Plaintiff’s allegation that she filed a dispute with Equifax
and Equifax notified Westlake of the dispute. See ECF 1 ¶¶ 13-16. Plaintiff alleges
3 Because Plaintiff fails to state a claim for a FCRA violation, the Court does not fully analyze
whether Plaintiff properly pleaded willfulness. See 15 U.S.C. § 1681n; Landrum v. Harris Cnty.
Emergency Corps, 122 F. Supp. 3d 617, 625 (S.D. Tex. 2015) (explaining willfulness under
FCRA).
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Westlake violated FCRA by failing, after receiving notice of the dispute, to fulfill
its obligations to: conduct a reasonable investigation into the disputed information
(15 U.S.C. § 1681s-2(b)(1)(A)); review all relevant information Plaintiff provided
regarding the dispute (15 U.S.C. § 1681s-2(b)(1)(B)); and properly report, correct,
delete, or block inaccurate information (15 U.S.C. § 1681s-2(b)(1)(C)-(E).
A. Plaintiff failed to plead an inaccuracy.
Information is inaccurate for the purposes of FCRA if it is either patently
incorrect or misleading in such a way and to such an extent that it can be expected
to negatively impact credit decisions. Reyes v. Equifax Info. Servs., L.L.C., 140 F.4th
279, 285 (5th Cir. 2025). 	Plaintiff alleges several inaccuracies. 	First, Plaintiff
claims the credit report is inaccurate because it lists the date of first delinquency as
October 21, 2020, the date of last payment as May 1, 2021, and a final payment on
November 24, 2021, in the amount of $3,484.00. ECF 1 ¶ 17. Plaintiff asserts these
entries are contradictory and do not align with the explanation provided by Westlake.
Id. Plaintiff also alleges that the report shows 90-day late payments in May and June
2024, despite the account having been charged off. Id. ¶ 18. Furthermore, Plaintiff
claims that the lack of data for 2023 reflects missing account history. Id.
The copy of the report, attached to the Complaint, undercuts Plaintiff’s alleged
inaccuracies. 	ECF 1-1. 	As Plaintiff claims, the report identifies a date of first
delinquency of October 21, 2020, and a date of last payment of May 1, 2021. 	Id.
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Plaintiff fails to provide any facts demonstrating that this timeline is inaccurate, even
if the car was sold at auction and the amount credited to her account later in May
2021 as she alleged. ECF 1 ¶ 16. That a late payment was made while the account
was charged off does not demonstrate a contradiction or inaccuracy. Plaintiff does
not allege the 2024 payments were not made and a charged-off account can still carry
a legally valid balance to be paid. 	See Burris v. JPMorgan Chase Bank, N.A., No.
3:25-CV-2570-B-BK, 	2026 	WL 	1690084, 	at 	*3 	(N.D. 	Tex. 	May 	15, 	2026)
(explaining a charge-off is an accounting decision by a lender that treats the debt as
a loss even though the debt is still owed), report and recommendation adopted, No.
3:25-CV-2570-B-BK, 2026 WL 1688325 (N.D. Tex. June 10, 2026). 	Finally,
Plaintiff fails to identify how a lack of account history for certain periods is
inaccurate or misleading, particularly since she fails to allege any account activity
occurred and should be displayed. 	In short, Plaintiff fails to allege inaccurate or
misleading information appeared in the report.
B. Plaintiff fails to state a claim for failure to investigate under §
1681s-2(b)(1)(A).
When a credit reporting agency notifies a furnisher of a dispute, Section
1681s-2(b)(1)(A) requires the furnisher to conduct an investigation with respect to
the disputed information. 15 U.S.C. § 1681s-2(b)(1)(A). The investigation must be
reasonable. Robinson, 2013 WL 1245863, at *8; Robertson v. J.C. Penney Co., No.
CIV.A. 2:06CV3KSMTP, 2008 WL 623397, at *8 (S.D. Miss. Mar. 4, 2008)
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(collecting cases). 	Plaintiff alleges that Westlake conducted an investigation, but
that the investigation was not reasonable. ECF 1 ¶¶ 24-27.
Plaintiff’s fails to state a claim because her Complaint is devoid of any facts
regarding the investigation itself. Plaintiff merely claims that Westlake responded
with 	“conclusory 	statements, 	refused 	to 	provide 	documentation 	clarifying
inconsistencies, and failed to properly investigate the . . . events.” 	Id. ¶ 26. These
allegations are conclusory and lack facts that would demonstrate the investigation
itself was unreasonable. 	See Shaunfield v. Experian Info. Sols., Inc., 991 F. Supp.
2d 786, 806 (N.D. Tex. 2014) (dismissing a § 1681s-2(b) claim because plaintiff’s
assertions were akin to a recital of the elements than specific allegations of
wrongdoing).
C. Plaintiff fails to state a claim for failure to review all relevant
information under § 1681s-2(b)(1)(B).
Section 	1681s-2(b)(1)(B) 	requires 	the 	furnisher 	to 	review 	all 	relevant
information provided by the credit reporting agency as part of the dispute. 15 U.S.C.
§§ 1681s-2(b)(1)(B), 1681i(a)(2)(B) (explaining that the consumer reporting agency
is required to transmit the consumer’s documents to the furnisher). Plaintiff alleges
Westlake failed to review “relevant dispute materials . . . including requests for a
full validation and clarification of payment dates and repossession status.” ECF 1 ¶
29.
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Plaintiff’s pleading fails to state a claim. She fails to allege she provided any
relevant information to Equifax that was required to be provided to Westlake, who
in turn would be required to review the information. Plaintiff further fails to specify
the additional information, if any, she provided directly to Westlake. 	What she
characterizes as “relevant dispute materials” (i.e., the requests for validation and
clarification) are not relevant information, but the dispute requests themselves.
Plaintiff also fails to allege facts demonstrating what information Defendant failed
to review or how it failed to consider it. See Reeves v. Nelnet Loan Servs., No. 4:17-
CV-3726, 2018 WL 2200112, at *4 (S.D. Tex. May 14, 2018) (dismissing claim
under § 1681s-2(b)(1)(B) because plaintiff failed to allege what information, if any,
she provided to the consumer reporting agency in connection with the dispute and
failed to allege what information the furnisher received from the agency but failed
to consider).
D. Plaintiff fails to state a claim for failure to properly report, correct,
delete, or block information under § 1681s-2(b)(1)(C)-(E).
Subsections (C), (D), and (E) of § 1681s-2(b)(1) require furnishers to:
(C) report the results of the investigation to the consumer reporting
agency;
(D) if the investigation finds that the information is incomplete or
inaccurate, report those results to all other consumer reporting agencies
to which the person furnished the information that compile and
maintain files on consumers on a nationwide basis; and
(E) if an item of information disputed by a consumer is found to be
inaccurate or incomplete or cannot be verified after any reinvestigation
under paragraph (1), for purposes of reporting to a consumer reporting
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agency only, as appropriate, based on the results of the reinvestigation
promptly—
(i) modify that item of information;
(ii) delete that item of information; or
(iii) permanently block the reporting of that item of information.
15 U.S.C. § 1681s-2(b)(1)(C)-(E).
Although Plaintiff cited subsections (C)-(E), she styles her claim as “Failure
to Correct, Delete, or Block Inaccurate Information” (ECF 1 at 6) and pleaded no
facts showing Westlake violated its duty to report the results of the investigation to
Equifax or any other consumer reporting agency. In support of her subsection (E)
claim, Plaintiff merely states: “Westlake failed to correct or delete inaccurate
tradeline data after receiving multiple disputes, despite the inconsistencies in the
reported charge-off and payment history.” ECF 1 ¶ 29.
Plaintiff fails to state a claim under subsection (E) because she fails to allege
facts showing the obligation to correct, delete, or block inaccurate information
applies in this situation. The text of the statute clearly states that the obligation to
remedy the disputed information arises “if an item of information . . . is found to be
inaccurate . . . after any reinvestigation.” 15 U.S.C. § 1681s-2(b)(1)(E) (emphasis
added). In this case, Westlake conducted an investigation, which Plaintiff failed to
plead was unreasonable, and concluded the information was accurate, so Westlake
has no obligation to correct, delete, or block the information despite the fact Plaintiff
alleges it is inaccurate. See Elsady v. Rapid Glob. Bus. Sols., Inc., No. 09-11659,
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2010 WL 2740154, at *6 (E.D. Mich. July 12, 2010) (noting that the obligation arises
if a furnisher concludes it reported inaccurate information after conducting an
investigation).
IV. 	Conclusion and Recommendation.
For the reasons stated above, the Court RECOMMENDS that Defendant
Westlake’s Motion to Dismiss (ECF 15) be GRANTED and Plaintiff’s claims
against Westlake be DISMISSED.
The 	Clerk 	of 	the 	Court 	shall 	send 	copies 	of 	the 	memorandum 	and
recommendation to the respective parties, who will then have fourteen days to file
written objections, pursuant to 28 U.S.C. § 636(b)(1)(C). 	Failure to file written
objections within the time period provided will bar an aggrieved party from attacking
the factual findings and legal conclusions on appeal. Douglass v. United Servs. Auto.
Ass’n, 79 F.3d 1415, 1428-29 (5th Cir. 1996) (en banc), superseded by statute on
other grounds.
Christina A. Bryan
United States Magistrate Judge
Signed on July 24, 2026, at Houston, Texas.
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