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March 6, 2026 Get Citation Alerts Download PDF Add Note

Jonathan Hatch v. College Ave Student Loans and Equifax Information Services, LLC

District Court, N.D. Illinois

• Citations: None known
• Docket Number: 1:25-cv-05710

• Precedential Status: Unknown Status

• Opinion

• Authorities (15)

• Cited By (0)

• Summaries (0)

• Similar Cases (9.6K)

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Trial Court Document

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

JONATHAN HATCH,

Plaintiff,

v. Case No. 25-cv-05710

COLLEGE AVE STUDENT LOANS Judge Mary M. Rowland

and EQUIFAX INFORMATION

SERVICES, LLC

Defendants.

          MEMORANDUM OPINION AND ORDER                               
Plaintiff Jonathan Hatch sues Defendants College Ave Student Loans and 

Equifax Information Services, LLC (“Equifax”). Plaintiff alleges negligent and willful
violations of the Fair Credit Reporting Act (“FCRA”) under 15 U.S.C. § 1681i(a) and
1681e(b). Defendant Equifax moves to dismiss the Complaint pursuant to Federal
Rules of Civil Procedure 12(b)(6).

For the reasons stated herein, Equifax’s Motion to Dismiss [19] is granted.
I. Background

The following factual allegations are taken from the operative complaint [15]
and accepted as true for the purposes of the motion to dismiss. See Lax v. Mayorkas, 20 F.4th 1178, 1181 (7th Cir. 2021). Additionally, because Defendants raise this
motion under Rule 12(b)(6), the Court takes facts from “documents attached to the
complaint, documents that are critical to the complaint and referred to in it, and
information that is subject to proper judicial notice.” Geinosky v. City of Chicago, 675
F.3d 743, 745 n.1 (7th Cir. 2012).

On December 27, 2019, Plaintiff Jonathan Hatch opened a student loan

account with College Ave Loans. [15] at ¶ 15. On October 31, 2022, Plaintiff filed a
petition for Chapter 7 bankruptcy in the U.S. Bankruptcy Court for the District of
Idaho. Id. at ¶ 16. According to Plaintiff, the College Ave account (“the account”) was
discharged under Chapter 7 by the Bankruptcy Court on February 6. 2023. Id. at ¶¶
19-20. After Plaintiff’s bankruptcy discharge, Equifax began publishing inaccurate
credit data on his report: (1) stating that the account was open and delinquent, (2)

containing late payments from between November 2022 and January 2023, and (3)
failing to include the account in bankruptcy on the Equifax consumer report. Id. at
¶¶ 22-23.

On November 22, 2024, Plaintiff disputed the account with Equifax, which
responded with a stall letter requesting documents it had already received. Id. at ¶¶
24-25. Plaintiff resent the dispute with Equifax on January 24, 2025, with all
supporting documents, but Equifax responded again requesting documentation

previously provided. Id. at ¶¶ 27-28. On July 24, 2025, College Ave sent Plaintiff a
letter stating payment would resume on August 11, 2025. Id. at ¶ 30. That same day,
Plaintiff obtained consumer reports from the three credit reporting agencies,
including Equifax. Id. at ¶ 31. Experian and TransUnion reported the account as
closed or discharged, whilst Equifax continued to report the account as open and
delinquent. Id. at ¶¶ 32-33.

Equifax attached Plaintiff’s November 2024 dispute letter that attached the
Bankruptcy Court’s discharge document (Exhibit A, 19-2, Bankruptcy Discharge
Order) to its Motion to Dismiss [19]. The letter states “[Equifax is] reporting late

payments and a balance owed on [Plaintiff’s] student loan account. This is inaccurate
because [Plaintiff has] been discharged through a Chapter 7 Bankruptcy from this
account.” Id. at 2. Attached to the dispute letter, the Bankruptcy Order states “[m]ost
debts are covered by the discharge, but not all”, and lists examples of debts that are
not discharged, including “debts for most student loans.” Id. at 7. (emphasis added).
Plaintiff submitted two other identical dispute letters, which Equifax also attached.

See also (Exhibit B); (Exhibit C).

Equifax moves to dismiss pursuant to Federal Rule of Civil Procedure Rule
12(b)(6), arguing that Plaintiff’s disputes to Equifax proffered a claim of inaccuracy
that is not cognizable under the FCRA because it hinges on the application of the law
of bankruptcy as it concerns student loans, which are outside the purview of a
consumer reporting agency. [19].

II. Standard

“To survive a motion to dismiss under  Rule 12(b)(6), the complaint must 

provide enough factual information to state a claim to relief that is plausible on its
face and raise a right to relief above the speculative level.” Haywood v. Massage Envy
Franchising, LLC, 887 F.3d 329, 333 (7th Cir. 2018) (quoting Camasta v. Jos. A. Bank
Clothiers, Inc., 761 F.3d 732, 736 (7th Cir. 2014)); see also Fed. R. Civ. P. 8(a)(2)
(requiring a complaint to contain a “short and plain statement of the claim showing
that the pleader is entitled to relief”). A court deciding a Rule 12(b)(6) motion
“construe[s] the complaint in the light most favorable to the plaintiff, accept[s] all
well-pleaded facts as true, and draw[s] all reasonable inferences in the plaintiff’s

favor.” Lax, 20 F.4th at 1181. However, the court need not accept as true “statements
of law or unsupported conclusory factual allegations.” Id. (quoting Bilek v. Fed. Ins.
Co., 8 F.4th 581, 586 (7th Cir. 2021)). “While detailed factual allegations are not
necessary to survive a motion to dismiss, [the standard] does require ‘more than mere
labels and conclusions or a formulaic recitation of the elements of a cause of action to
be considered adequate.’” Sevugan v. Direct Energy Servs., LLC, 931 F.3d 610, 614 (7th Cir. 2019) (quoting Bell v. City of Chicago, 835 F.3d 736, 738 (7th Cir. 2016)).
Dismissal for failure to state a claim is proper “when the allegations in a
complaint, however true, could not raise a claim of entitlement to relief.” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 558 (2007). Deciding the plausibility of the claim is
“a context-specific task that requires the reviewing court to draw on its judicial
experience and common sense.” McCauley v. City of Chicago, 671 F.3d 611, 616 (7th
Cir. 2011) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009)).

III. Analysis

Plaintiff’s alleged inaccuracy does not state a cognizable claim against
Equifax under the FCRA

Equifax argues that determining whether Plaintiff’s College Ave account was 

discharged in bankruptcy requires application of law to fact, which is outside its
purview as a credit reporting agency (“CRA”). [19] at 5-10. Plaintiff responds that
whether Equifax’s reinvestigation met the statutory threshold is a fact-intensive
inquiry not suited for adjudication at the pleading stage. [29] at 3-6. The Court agrees
with Equifax.

The FCRA was enacted “to ensure fair and accurate credit reporting, promote

efficiency in the banking system, and protect consumer privacy.” Safeco Ins. Co. of
Am. v. Burr, 551 U.S. 47, 52, 127 S.Ct. 2201, 167 L.Ed.2d 1045 (2007); see also 15
U.S.C. § 1681 (b). The statute therefore imposes distinct obligations on Credit
Reporting Agencies (CRAs) such as Equifax. See id. at § 1681e(b) (requiring CRAs to
follow “reasonable procedures to assure maximum possible accuracy” of information
when preparing consumer reports); see also § 1681i (when a consumer disputes the

accuracy of information with a credit reporting agency, that agency must “conduct a
reasonable reinvestigation to determine whether the disputed information and record
the current status of the disputed information, or delete the item from the file” within
30 days). To state a claim under either provision, a plaintiff must show his file
contains factually inaccurate information. Chuluunbat v. Equifax Info. Sols., Inc., 4
F.4th 562, 566–67 (7th Cir. 2021) (“A threshold requirement for claims under both
sections is that there must be an inaccuracy in the consumer's credit report.”)

(referring to both § 1681e(b) and § 1681i).

Not all allegations of inaccuracy are cognizable under the FCRA’s provisions.
Denan v. Trans Union LLC, 959 F.3d 290, 292, 297 (7th Cir. 2020). The central
question is “whether the alleged inaccuracy turns on applying law to facts or simply
examining the facts alone.” Chuluunbat, 4 F.4th at 568 (emphasis in original).
Questions that “constitute legal determinations [are] solely within the purview of
courts, not CRAs.” Grenadyor v. Discovery Fin. Servs., 2024 WL 1254572, at *2 (N.D.
Ill. Mar. 25, 2024) (citing Chuluunbat, 4 F.4th at 568 and Denan, 959 F.3d at 297).

A student loan is not discharged through Chapter 7 bankruptcy unless the

debtor can show that its repayment would cause an undue hardship. 11 U.S.C. §
523 (a)(8). A bankruptcy court must first make an undue hardship determination in
an adversary proceeding. Fed. R. Bankr. P. 7001(6); see also Tenn. Student Assistance
Corp. v. Hood, 541 U.S. 440, 450, 124 S.Ct. 1905, 158 L.Ed.2d 764 (2004) (“Unless the
debtor affirmatively secures a hardship determination, the discharge order will not
include a student loan debt”).

The bankruptcy order attached to Plaintiff’s dispute letters explicitly cautions 

that not all debts are included in bankruptcy, specifically highlighting student loan
debt. Importantly, here, there is no indication that Plaintiff’s student loan debt was
discharged, nor that Plaintiff sought an undue hardship determination during his
bankruptcy proceeding in the first instance. Tenn. Student Assistance Corp., 541 U.S.
at 450. Whether Plaintiff’s student loan debts were discharged during his bankruptcy
proceedings is an unresolved “legal question regarding the application of section

523(a)(8)(A)(i)”. Mader v. Equifax Info. Sols., Inc., 56 F.4th 264, 270 (2d Cir. 2023)
(plaintiff failed to allege an inaccuracy within the plain meaning of section 1681(e)(b)
and the unresolved legal question rendered his claim non-cognizable under the
FCRA). This determination about Plaintiff’s student loan debt is outside the purview
of Equifax. Chuluunbat, 4 F.4th at 568; see also Denan, 959 F.3d at 297; Williams v.
Equifax, 2025 WL 1733183, at *5 (N.D. Ga. June 17, 2025), report and
recommendation adopted, No. 1:24-CV-04152-LMM-RDC, 2025 WL 2146367 (N.D.

Ga. July 15, 2025) (granting defendant’s motion to dismiss because the purported
inaccuracy regarding the status of the plaintiff’s student loan debts would require the

CRA to “step into the court’s shoes to interpret section 523(a)(8)(A)(i))”); Johnson v.
TransUnion, No. 122CV02533JPBJKL, 2023 WL 6035573, at *4 (N.D. Ga. Aug. 11,
2023), report and recommendation adopted, No. 1:22-CV-02533-JPB, 2023 WL
9315262 (N.D. Ga. Nov. 30, 2023) (“[T]he problem for Plaintiff is the accuracy of the
[disputed student loan debt] hinges entirely on whether the debt was discharged in
bankruptcy, which, under the circumstances of his case, presents a legal issue and,

therefore, is not actionable under either § 1681e(b) or § 1681i.”).

Put another way, to determine whether Plaintiff’s College Ave account was
discharged through bankruptcy proceedings, Equifax would have to delve into the
dischargeability of student loans in bankruptcy. This application of law to facts is
outside the competency of a CRA like Equifax. Chuluunbat, 4 F.4th at 568.
Additionally, because the bankruptcy court did not find an undue hardship as to
Plaintiff’s student loans, “no reasonable procedures could have uncovered an

inaccuracy in [plaintiff’s] credit report” Denan, 959 F.3d at 296 (quoting DeAndrade
v. Trans Union LLC, 523 F.3d 61, 68 (1st Cir. 2008) (“If a court had ruled the [loans]
invalid and Trans Union had continued to report it as a valid debt, then [plaintiffs]
would have grounds for a potential FCRA claim.”)) (emphasis in original). Absent an
inaccuracy, Plaintiff cannot bring a claim under the FCRA. Chuluunbat, 4 F.4th at
566-67.

Accordingly, the FCRA claims (Count III-VI) are dismissed with prejudice.

IV. Conclusion

For the stated reasons, Defendant’s Motion to Dismiss [19] is granted. Counts

III (negligent violation of 15 U.S.C. § 1681i(a)), IV (willful violation of 15 U.S.C. §
1681i(a)), V (negligent violation of 15 U.S.C. § 1681e(b)), and VI (willful violation of
15 U.S.C. § 1681e(b)) are dismissed with prejudice. Separately, the Court orders
Plaintiff’s counsel, Attorney Heather Hersh, to show cause on April 9, 2026 at 1:30
p.m. on why she should not be sanctioned pursuant to (1) Rule 11(b)(2), (2) 28 U.S.C.
§ 1927, and (3) the inherent power of the Court, for citing potentially non-existent

cases to the Court in her opposition brief [29] and sur-reply [31]. Indeed, the Court is
concerned that counsel has misled the Court in citing cases that are nonexistent, or
at a minimum, has failed to diligently cite check her submissions. In the event that
the Court has simply been unable to find the cited cases in its research, Plaintiff’s
counsel shall provide the Court with a true and accurate copy of Horan v. Equifax
Info. Servs., LLC, No. 8:20-cv-02187-PWG, 2022 WL 2190906 (D. Md. June 17, 2022)
and Jones v. TransUnion, LLC, No. 1:15-cv-00489, 2015 WL 7566685 (N.D. Ill. Nov.

24, 2015). If counsel is unable to do so, Plaintiff’s counsel shall submit a sworn
declaration explaining to the Court how the opposition brief and sur-reply were
generated and how counsel came to locate Horan and Jones, by April 3, 2026. Show-
cause hearing set for April 9, 2026, at 1:30 pm via Webex (https://us-
courts.webex.com/join/mary_rowlandilnd.uscourts.gov).

ENTER:

                                     /4f 

Dated: March 6, 2026 Mug Vf bt L/
MARY M. ROWLAND
United States District Judge