On October 22, the U.S. District Court for the Central District of California denied a credit reporting agency’s renewed partial   to dismiss and motion to strike the CFPB’s second amended complaint (covered by InfoBytes here) in ongoing litigation over alleged FCRA violations. As previously covered by InfoBytes, the court had earlier dismissed the CFPB’s claims as time-barred but granted leave to amend, allowing the Bureau to allege that a mutual mistake led to the omission of the defendant from a tolling agreement intended to suspend the statute of limitations.

In its latest order, the court found the Bureau’s amended complaint sufficiently alleged mutual mistake under the heightened pleading standard of Rule 9. The court held that, under federal common law and the Restatement (Second) of Contracts, reformation of a contract to reflect the parties’ actual intent is an available remedy in cases of mutual mistake. The court rejected the defendant’s arguments that the tolling agreement could not be reformed to add a party, and that California contract law precluded such relief, emphasizing that federal law governs the issue.

The court concluded that the Bureau’s allegations, if true, stated a claim for reforming the tolling agreement, and that dismissal at this stage would be inappropriate. The defendant was ordered to file an answer by November 3. The defendant filed its answer to the Bureau’s second amended complaint on November 3, wherein it asserted nine affirmative defenses, denied the CFPB’s allegations and any wrongdoing under the FCRA, and demanded a jury trial.