Feller v. First Interstate Bancsystem, 2013 MT 90 (April 9, 2013) (5-0) (Cotter, J.)
Issue: (1) Whether the district court erred in granting summary judgment to the bank on the basis of preemption by the Fair Credit Reporting Act; (2) whether the district court erred in granting the bank summary judgment on Feller’s conversion claim; and (3) whether the district court erred in dismissing Fellers’ emotional distress claims.
Short Answer: (1) No; (2) no; and (3) no.
Facts: Marilyn Feller was a bank customer for many years, and had her home mortgage though the bank. Her primary contact with the bank was Diane Becker, who was married to Feller’s ex-husband. Becker was sent to federal prison in December 2009 for embezzlement; she booked phony loans or liens of credit in friends’ names and appropriated the money for her personal use. Becker was suspended from the bank in late 2007. The FBI questioned Feller in April 2008 about Becker, and told her not to talk about the investigation. Soon after, Becker helped Feller obtain a loan from a lender unrelated to the bank, and Feller paid off her home mortgage. Her escrow account balance at the bank was $449.60. When Feller asked a bank employee in late 2008 about withdrawing the balance, she was referred to the bank president. Feller chose not to speak with him, or anyone else at the bank, even after Becker was sent to prison. In April 2011, Feller filed a complaint against the bank alleging several tort and contract claims, and alleging her financial standing and credit reputation were damaged, and that she suffered extreme physical and emotional distress. On May 13, 2011, the bank sent a check to Feller for $582.13, which represented her escrow balance plus 10% interest.
Procedural Posture & Holding: The bank moved for summary judgment, and Feller filed a cross-motion for summary judgment on the conversion claim. After a hearing on all of the motions, the court granted the bank’s motion and denied Feller’s. The district court held that Feller’s state law claims were preempted by the FCRA, Feller had failed to provide any evidence of severe emotional distress, and she had failed to establish that the bank had unauthorized control over her funds, thereby defeating her conversion claim. Feller appeals, and the Supreme Court affirms.
Reasoning: (1) FCRA establishes standards for the collection, communication, and use of consumer information for business purposes. It preempts all state laws attempting to regulate the responsibilities of persons who furnish information to consumer reporting agencies. 15 USC § 1681t(b)(1)(F). Feller attached her credit report to the complaint and alleged that it contained incorrect information. The district court held that FCRA preempted all of Feller’s claims except for her conversion claim and her claim for emotional distress. The Supreme Court agrees. (2) Feller made no attempt to obtain the funds in her escrow account before filing suit against the bank. She therefore cannot prove unauthorized control, an element of conversion. Moreover, she failed to show any damages from the alleged conversion. She claims she suffered emotional distress, but she never made that allegation before the district court. Summary judgment on her conversion claim was proper. (3) Sacco requires a plaintiff to have suffered “severe” or “serious” emotional distress to bring an independent claim for negligent or intentional emotional distress. Feller proffered no evidence of emotional distress. She stated that “it is likely that plaintiff will see a forensic psychologist to provide expert testimony and an opinion” that she meets the Sacco standard. But she cannot defeat summary judgment by predicting what future evidence she may produce. In the absence of proof of Feller’s emotional distress, her emotional distress claims cannot survive. Summary judgment was proper.