In Prosser v. Navient Solutions, Inc., 2015 WL 5168635 (N.D. Cal. 2015), Judge Conti found that a student loan lender conducted a reasonable re-investigation under FCRA after the Plaintiff claimed to be a victim of identity theft.

Parties agree that there is only a private right of action to pursue claims pursuant to 15 U.S.C. § 1681s–2(b), under §§ 1681n & o. See Nelson v. Chase Manhattan Mortgage Corp., 282 F.3d 1057, 1060 (9th Cir.2002). Pursuant thereto, there is a duty to investigate when a CRA receives notice directly from a consumer or reseller that a consumer disputes the accuracy of the reporting. 15 U.S.C. § 1681s–2(b). If the investigation finds that the information is “incomplete or inaccurate,” those results must be shared with other consumer reporting agencies and compiled. Id. at § 1681s–2(b)(1)(D). If information is found to be “inaccurate or incomplete or [it] cannot be verified after any reinvestigation,” the information must be modified or deleted, or reporting of that item must be permanently blocked. Id. at § 1681s–2(b)(1)(E).  An element considered as to the requirement to conduct a reasonable investigation is that Plaintiff identifies a factual inaccuracy in Defendants’ reporting. See Carvalho, 629 F.3d at 890. Parties both admit Defendants conducted an investigation. Thus, the core disagreements between the parties are whether that investigation was not “unreasonable” and whether the information garnered from that investigation showed that there was inaccurate or misleading information being reported. See Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1157 (9th Cir.2009) (a furnisher’s investigation per § 1681s–2(b)(1)(A) “may not be unreasonable.”). Here, both sides seem to agree that the loan application was made by Plaintiff’s parents, that the loan was made without Plaintiff’s express consent, that Plaintiff benefitted from the loans, that Plaintiff at some point learned of the loans, that the loan was not fully paid on time, and that Plaintiff made payments on the loan. Mot. at 2–3, Opp’n at 4–5. Parties disagree as to where to assign the blame—to Plaintiff or to Plaintiff’s parents—but it is unclear what fact is in error.  Yet even were the Court to assume Plaintiff sufficiently cited a fact in error (a topic discussed below in connection with ratification), Plaintiff still bears the burden of showing the investigation was unreasonable. Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1154 (9th Cir.2009); O’Connor v. Capital One, N.A., No. CV 14–00177–KAW, 2014 WL 2215965, at *7 (N.D.Cal. May 29, 2014).5 A formulaic recitation of the elements of a cause of action are insufficient to survive a motion to dismiss.Twombly, 550 U.S. at 555. Here, the Court may or may not ultimately agree with the legal conclusion reached by Defendants, but that does not belie the reasonableness of the investigation or compliance with the statutory duties at issue. See Landini v. FIA Card Servs., Nat’l Ass’n, No. C13–01153 HRL, 2014 WL 587520, at *4 (N.D.Cal. Feb. 14, 2014). The Ninth Circuit has summarized this idea: “As Gorman explains, an FCRA violation is tied to the reasonableness of an investigation rather than the accuracy of its results. In Gorman, over a furnisher’s objection, we held that upon receiving notice of a dispute from a CRA, a furnisher’s investigation must be “reasonable.” 584 F.3d at 1155–57. In so concluding, we did not hold the furnisher to an impossible standard that rendered it liable anytime its investigation did not reach the correct result. We recognized that factors beyond a furnisher’s control may doom the most conscientious investigation to an erroneous result: for example, we noted that in Gorman, a CRA had provided the furnisher with “scant information,” to carry out the investigation. Id. We therefore concluded that the furnisher’s inaccurate reporting after an investigation was not dispositive proof that its investigation was unreasonable, as despite reasonable efforts, it may not have been given sufficient information to reach the correct conclusion despite reasonable efforts. Id. at 1157. In short, “[a]n investigation is not necessarily unreasonable because it results in a substantive conclusion unfavorable to the consumer, even if that conclusion turns out to be inaccurate.” Id. at 1161. Thus, Gorman imposes fault, not for an investigation that produces incorrect results, but for an unreasonable investigation.”  Drew v. Equifax Info. Servs., LLC, 690 F.3d 1100, 1110 (9th Cir.2012).  The idea behind Carvalho and Gorman is to ensure that investigations are real, meaningful tools used by (both investigating agencies and) furnishers, but also to keep legal decisions in the hands of the Court without turning other bodies into courts. See Carvalho, 629 F.3d at 890–92; Gorman, 584 F.3d at 1155–57. Here, there is no question that the Defendants tried to investigate and in fact found information that confirmed there may have been fraud. But Defendants also found information that, on its face, looks very much like the proper legal grounds for ratification and assumption of a loan by a third party (a topic the Court addresses further below). See Mot. Ex. 4 (incorporated above into the complaint by reference). On those grounds, it was not unreasonable for the Defendants to arrive at their conclusion that the Plaintiff was in fact responsible for the loan. This may not be sufficient for a legal ruling on ratification of the loan by a court, but it does show that Defendants engaged in a reasonable investigation pursuant to its responsibilities under the FCRA.  As Plaintiff fails to show how the investigation was unreasonable, he fails to carry his burden, and his claims accordingly fail as a matter of law. The claims are therefore DISMISSED WITHOUT PREJUDICE. As there is no remedy requested by Plaintiff to address the potentially fraudulent nature of the loan—and based on information the Court presently has available such remedies may be time-barred—the Court does not reach an analysis of whether the loan would be fraudulent if challenged directly.