Flow Sciences V D&B Amended Complaint 031315 PDF

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 1 of 27
THE HONORABLE THOMAS S. ZILLY
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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
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AT SEATTLE
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FLOW SCIENCES INC., Individually and on )
12 Behalf of All Others Similarly Situated,
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Plaintiff,
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vs.
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15 DUN & BRADSTREET CREDIBILITY
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CORPORATION, et al.,
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Defendants.
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No. 2:14-cv-01404-TSZ
CLASS ACTION
FIRST AMENDED CLASS ACTION
COMPLAINT
JURY TRIAL DEMAND
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FIRST AMENDED CLASS ACTION COMPLAINT

(2:14-cv-01404-TSZ)
Robbins Geller Rudman & Dowd LLP

655 West Broadway, Suite 1900, San Diego, CA 92101
Telephone: 619/231-1058 Fax: 619/231-7423
Now comes plaintiff Flow Sciences Inc. (Plaintiff or FSI), individually and on behalf of
2 all others similarly situated, through counsel, and, pursuant to Fed. R. Civ. P. 15(a)(1)(B), for its
3 amended complaint against defendants Dun & Bradstreet Credibility Corporation (DBCC), and
4 Dun & Bradstreet Corporation and Dun & Bradstreet, Inc. (collectively, D&B), states and alleges
5 as follows:
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INTRODUCTION
1.
Small businesses are the heart of this nations economy. Access to credit is the
8 lifeblood of small businesses. D&B is the most powerful and prominent reporter on small business
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credit. Thus, the truthfulness and accuracy of a small businesss D&B credit profile, ratings, and
scores are of critical concern to the continued health of the small business. And small businesses are
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sensitive to inquiries by others (e.g., potential customers) into their D&B credit profiles. DBCC is a
telesales company that markets and sells expensive internet-based credit-on-self products under the
14 brand CreditBuilder.
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2.
D&B and DBCC are separate companies, but both profit from the sale of
16 CreditBuilder, which they cloak in the Dun & Bradstreet name, brand, and tradition. And DBCC
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represents CreditBuilder as a D&B solution to credit report problems. And small business are led
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to believe that they are working with Dun & Bradstreet the company who reports on credit, has
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databases, investigates trade experiences, and so on when in fact they are speaking with a DBCC
21 telesales agent.
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3.
D&B defames small businesses by placing false and inaccurate information on small
23 business credit reports. D&B conducts no due diligence to determine whether information reported
24 to it is accurate, and removes false information when challenged by an aggrieved small business
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without ascertaining the accuracy of that information in the first instance, despite advising
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complaining businesses that it is conducting an actual investigation of the false information.
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4.
D&B sends to DBCC a list of false and inaccurate negative entries and score changes
2 on small business credit reports, which DBCC uses to leverage sales of CreditBuilder.
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D&B also manipulates credit scores without any regard for the actual financial
condition of a given small business, oftentimes publicizing that a business is high risk or at risk of
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financial collapse when, in reality, the business is healthy and financially sound.
6.
D&B also inflates the number of inquiries made about small businesses by generating
8 inquiries itself and by not de-duplicating multiple requests for information from the same subscriber
9 on the same day. Not only do these inflated inquiries have a negative effect on certain D&B credit
10 scores publicized to the world, but D&B sends the inflated inquiries to DBCC (without disclosing
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that they are inflated), which DBCC uses to solicit small businesses to purchase CreditBuilder.
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7.
DBCC markets and solicits sales for CreditBuilder through deceptive and misleading
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statements which confuse reasonable persons regarding the affiliation of D&B to DBCC and to
15 CreditBuilder.
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8.
DBCC also makes promises about what CreditBuilder can do for a small business
17 solve certain D&B problems that the product cannot do.

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9.
DBCC also inflates the number of inquiries made about a small business, claiming
that there have been more unique companies making inquiries than there really have been. This
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inflation is in addition to D&Bs inflation.
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PARTIES & JURISDICTION
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10.
Plaintiff FSI is a North Carolina corporation with its principal place of business at
24 2025 Mercantile Drive in Leland, North Carolina 28451.

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11.
Defendant DBCC is a Delaware limited liability company with its principal place of
26 business at 22761 Pacific Coast Highway in Malibu, California 90265. At all relevant times, DBCC
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1 marketed, solicited, and sold CreditBuilder products in the stream of interstate commerce throughout
2 the state of North Carolina.
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12.
Defendants D&B are publicly-traded Delaware corporations with their principal
places of business at 103 John F. Kennedy Parkway in Short Hills, New Jersey 07078. At all
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relevant times, D&B licensed, distributed, sold, and published small business credit reports
throughout the state of North Carolina.
13.
This Court has original subject matter jurisdiction pursuant to 28 U.S.C. 1332(d)(2),
9 because the matter in controversy (exclusive of interest and costs) exceeds the sum of $5,000,000,
10 and this case is a class action in which the members of the class of plaintiffs are citizens of a state
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(North Carolina) different from that of the defendants (California/New Jersey).
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This Court is a proper venue pursuant to 28 U.S.C. 1404.
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FACTUAL ALLEGATIONS
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THE POWER OF DUN & BRADSTREET

15.
The Dun & Bradstreet name has been synonymous with small business credit for
17 over 150 years. Dun & Bradstreet occupies a unique institutional role in American and international
18 business and D&B has a virtual monopoly over small business credit reporting. Dun & Bradstreet
19 carries the imprimatur of the federal government, which requires a small business to have a D&B20 assigned Data Universal Number System (DUNS) number in order to apply to do work on a
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government contract. (A DUNS number is a unique ID recognized, recommended, and often
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required by global corporations, governments, industry and trade associations. They are similar to
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federal tax ID numbers, but only D&B distributes DUNS numbers. When applying for credit, loans,
25 or government bids, small businesses must submit a DUNS number, which vendors or others use to
26 pull financial and credit information.)
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16.
Given the age, size, reputation, and unique importance attached to Dun &
2 Bradstreet and D&Bs profiles, reports, scores, and ratings, small businesses are understandably
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sensitive to negative information on their reports or profiles, reductions in their scores and ratings,
and email alerts regarding their D&B information.
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DUN & BRADSTREETS CREDIT-ON-SELF LINE OF BUSINESS

17.
Some years ago, D&B sought to capitalize on the importance given to its reports and
small businesses concerns about monitoring and improving their credit profile. It developed an
9 internet-based credit-on-self product called Self Awareness Solutions (SAS), which was supposed
10 to provide customers with an opportunity to monitor their reports, dispute inaccurate information in
11 their reports, and submit positive information to help improve their scores and ratings.
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18.
Although the SAS line of business was profitable, by April 2009, customer criticism
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had become so vocal that D&B planned killing off the products because customer complaints were
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driving down its internal Voice of the Customer score, and dissatisfaction with the products was
16 resulting in high rates of customer attrition. Customers complained that D&B was using high17 pressure, bait-and-switch tactics to sell SAS products, and that the products did not perform as
18 promised.
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In order to avoid further scrutiny and litigation over the SAS products but while
continuing to reap profits from the credit-on-self line of business D&B transferred the rights to sell
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the product line (which was re-named CreditBuilder) to a new company, DBCC, in August 2010,
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for $10 million in cash and annual royalties; a deal estimated at $100 million.
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1 DBCC DRESSES ITSELF UP AS DUN & BRADSTREET

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20.
D&B granted to DBCC a unique license to use the Dun & Bradstreet name, brand,
3 logo, and trade dress. DBCC employs these elements, as well as email and website addresses that
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are similar to D&B email and website addresses: http://www.dandb.com and http://www.dnb.com
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21.
When small businesses call D&B directly about a problem on their credit report, they
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are uniformly and seamlessly routed to a DBCC sales representative who tries to sell them
CreditBuilder, rather than attempt to fix the problem itself.
22.
Although DBCC was created in August 2010, it represents to potential customers that
15 it help[s] businesses establish their credit with a D&B DUNS number, and that it offers D&B
16 solutions. It describes its sales force (which it calls credit advisors) as modern day Credit
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Reporters.
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23.
DBCC describes itself as a component of D&Bs legacy and another chapter in its
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long and storied history. DBCC represents to potential customers that its roots can be traced back
21 to the beginning of the credit industry. DBCC further represents: For over 170 years, millions of
22 businesses have relied on these credit services to pave their path to business success. By 2010, Dun
23 & Bradstreet Credibility Corp. launched a new chapter in this storied history as the company began
24 to offer products to help businesses monitor, manage and build their credit and credibility. In that
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respect, we consider Dun & Bradstreet Credibility Corp. a 175 year-old startup.
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24.
DBCC represents to potential customers that they should Protect Your Business
2 Credit with Dun & Bradstreet Credibility Search Our Database of Over 29 Million Businesses
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Now. The database referred to is the D&B database, which DBCC has no ownership or control
over.
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DBCC uses marketing materials which bear both a DBCC logo and a D&B logo and
makes no distinction between the two companies.

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DBCC represents to potential customers that [a]t D&B Credibility Corp., we make
9 over 1.5 million updates to our database on a daily basis. It could be major transactions like paying
10 vendors or making lease or mortgage payments, but it could also be seemingly smaller transactions
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like equipment leasing, advertising, shipping packages or underwriting insurance. . . . With all this
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information flooding into D&B, its critical that you keep on top of your profile and credit score to
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help ensure you keep your reputation solid . . . . D&B makes these updates to its databases, not
15 DBCC. DBCC does not play a single role, direct or indirect, in the updating of D&Bs database.
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27.
DBCC sales representatives uniformly refer to the D&B databases as our
17 databases. DBCC sales representatives uniformly advise small businesses that companies are
18 coming to us for credit reports. DBCC sales representatives uniformly describe credit reporting
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functions (e.g., checking for liens) as something we do. In truth, DBCC does not have databases,
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D&B does; DBCC does not have companies coming to it for reports, D&B does; and DBCC does
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not engage in credit reporting functions, D&B does.

28.
In sum, DBCC makes representations which confuse, mislead, deceive, or outright
24 misrepresent the affiliation of DBCC to D&B and the affiliation of CreditBuilder to D&B. DBCC
25 fails to disclose the nature of the relationship between DBCC and D&B and the relationship between
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CreditBuilder and D&B.
That is, DBCC misleads potential customers with deceptive

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1 misrepresentations or omissions which conflate DBCC with D&B or Dun & Bradstreet and
2 position CreditBuilder as bearing the sponsorship or approval of D&B or Dun & Bradstreet.
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On February 20, 2014, DBCC sued D&B in the Supreme Court of the State of New
York. Although DBCCs complaint is heavily redacted, the unredacted portions allege how
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critically important the confusion caused by the shared name, logo, trade dress, and conflated
websites is to DBCC[s business model. DBCC says these elements are essential to DBCCs
8 business. For example, as part of the falling out between the two companies, D&B made
9 significant changes to its [website] links including . . . a pop-up box . . . which ha[s] steered
10 customers away from DBCC, by telling them that they are Now Leaving D&B. Previously, there
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was no such notification, allowing DBCC to profit off potential customers believing that they were
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still on D&Bs website or on a D&B-affiliated website. As another example, DBCC alleges that
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D&B changed its websites search functions. Previously, when a business name was typed into the
15 D&B search box, the inquiring party was taken directly to DBCCs website and presented options
16 for learning more information regarding purchasing D&B COS [credit-on-self] Products.
17 (CreditBuilder is a COS product.) Now, a pop-up directly interferes with the search flow,
18 according to DBCC.
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DBCC also misrepresents to potential customers their need for CreditBuilder by
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telling them that there have been inquiries on their profiles, when no such inquiries have been
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made, and that there is negative information on their reports, when such information either does not
23 exist or is false. Furthermore, DBCC misrepresents to potential customers the capabilities of

24 CreditBuilder by telling them that the product can effectively remove false information from their
25 report and improve their scores.
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1 D&B PLACES FALSE INFORMATION ON CREDIT REPORTS TO FOSTER DBCCS

SALES OF CREDITBUILDER
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31.
One of D&Bs credit scores is called the Supplier Evaluation Risk (SER) Rating,
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which purports to evaluate the risk to a supplier of doing business with the subject small business.
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5 Many large government agencies (e.g., the U.S. Department of Veterans Affairs) and corporations
6 (e.g., Wal-Mart Stores, Inc. (Wal-Mart)) require that a small business maintain a certain SER
7 Rating to do business with them. (The SER Rating is an integer ranging from 1 to 9, with 1 being
8 the lowest risk and 9 being the highest risk. Wal-Mart, for example, requires a small business to
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have an SER Rating of, at most, 6.)
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D&B artificially raises the SER Ratings of a swath of small businesses, assigning
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them a rating of 7-9, which indicates high risk of financial stress, despite the fact that D&B has no
13 basis whatsoever to identify a small business as being so close to financial collapse. D&B then
14 submits through a batch communication computer program these artificial changes in the SER
15 Rating to DBCC.
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Then, as part of a marketing and sales campaign designed to position
CreditBuilder as the solution to the change in SER Rating, DBCC solicits the swath of small
businesses to purchase the product to enable them to improve their SER Rating.
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33.
Another one of D&Bs scores is called the PAYDEX Score, which purports to
reflect the payment history of a small business and its current re-payment capabilities, as reported by
21 its business associates. D&B claims it must have at least three reports of trade experiences by a
22 subject small businesss associates to prepare a PAYDEX Score.
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34.
D&B issues inaccurate PAYDEX Scores because it fails to keep accurate and
current records of the current re-payment capabilities of swaths of small businesses. Also, for
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swaths of small businesses about whom D&B only had two reports of trade experiences, D&B
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manufactures a third fictitious trade experience so that it can give the subject small business a
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1 PAYDEX Score. In both cases, D&B transmits via batch computer communication these
2 inaccurate changes to the PAYDEX Scores to DBCC. Then, as part of a marketing and sales
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campaign designed to position CreditBuilder as the solution to a low or inaccurate PAYDEX Score,
DBCC solicits the swath of small businesses to purchase the product to enable them to improve their
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PAYDEX Score.
35.
Another one of D&Bs scores is called the Commercial Credit Score, which purports
8 to represent the likelihood of a small business falling delinquent in its payments to its business
9 associates within the next 12 months.
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36.
D&B issues inaccurate Commercial Credit Scores because it fails to keep current
records of the current financial outlook of swaths of small businesses. D&B submits the inaccurate
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Commercial Credit Scores to DBCC. Then, as part of a marketing and sales campaign designed to
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position CreditBuilder as the solution to a low or inaccurate Commercial Credit Score, DBCC
15 solicits the swath of small businesses to purchase the product to enable them to improve their
16 Commercial Credit Score.
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37.
D&B also enters false negative payment experiences on the credit reports of swaths of
18 small businesses. These entries include slow pay entries (that a small business did not pay its bills
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or service its debts within industry time-frames), delinquency entries (that a small business was
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delinquent in a payment), and cash account entries (that a small business was on a cash-basis with
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a certain vendor). D&B submits the entries of these false negative payment experiences to DBCC.
23 Then, as part of a marketing and sales campaign designed to position CreditBuilder as the solution to
24 a negative payment experience, DBCC solicits the swath of small businesses and offers
25 CreditBuilder as the way to repair the small businesses credit report.
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38.
D&B also manufactures inquiries into the profiles of small businesses. An
2 inquiry means an entity has pulled D&Bs report about a small business. D&B inflates the number
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of inquiries by generating its own inquiries, and by failing to de-duplicate multiple inquiries by the
same subscriber. D&B then submits the internal inquiries and the duplicate inquiries to DBCC
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without disclosing that they were internal or duplicates. Then, as part of a marketing and sales
campaign designed to position CreditBuilder as the solution to a negative payment experience,
8 DBCC solicits small businesses by telling them there have been a high number of inquiries into their
9 D&B credit report.
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39.
Prior to the annual renewal date of a CreditBuilder customers subscription to the
product, D&B manipulates the customers credit profile in one or more of the foregoing ways to
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enable DBCC to solicit the customer for renewal.
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40.
D&B profits off the sale of each individual CreditBuilder product.
15 PLAINTIFF FSIS EXPERIENCE

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41.
FSI produces containment systems for pharmaceutical laboratory, pilot plant, and
17 manufacturing areas. Its products are designed to protect operators from exposure to hazardous
18 particulates and vapors while performing delicate operations. Ruth Ryan is an officer of FSI. FSI
19 purchased a CreditBuilder product on November 14, 2012.
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42.
Prior to purchase, D&B artificially changed one or more of FSIs credit scores
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without taking into account any actual change in the creditworthiness or financial stress of the
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business. The manipulation of the score(s) was intended to make FSI susceptible to a CreditBuilder
24 solicitation.
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43.
For example, D&B artificially harmed FSIs Financial Stress Score by including in its
26 calculation of that score inquiries D&B had made of itself.
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44.
Prior to purchase, D&B placed false negative payment experiences on FSIs credit
2 report without exercising any due diligence to determine whether the experiences were true; D&B
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did not have any documentation supporting the experiences and it did not request any information
from FSI to confirm or dispute the experiences. The placement of false negative payment
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experiences was intended to make FSI susceptible to a CreditBuilder solicitation.

45.
For example, in November 2012, D&B published approximately seven separate false
8 entries that FSI was past due on amounts of $1000, $750, $250, or $50, when, in truth, FSI had not
9 failed to timely pay bills and had no out-standing debts. These false entries remained on FSIs report
10 for an extended period of time despite FSIs disputing their truth and D&B continued to publish
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them in subsequent reports to its subscribers.
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46.
For another example, D&B published reports that FSI was between 30 and 90 days
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late in making payment to vendors when, in truth, FSI had not been slow in making payments and
15 had not had any vendors take issue with its payment habits. These false entries remained on FSIs
16 report for an extended period of time despite FSIs disputing their truth and D&B continued to
17 publish them in subsequent reports to its subscribers.
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47.
For another example, D&B published reports that there were 43 UCC filings against
FSI when, in truth, there were 10 or fewer filings. In fact, Ms. Ryan confirmed with the Secretary of
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States website that D&Bs information was false. These false entries remained on FSIs report for
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an extended period of time despite FSIs disputing their truth and D&B continued to publish
23 them in subsequent reports to its subscribers.

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48.
For another example, D&B published reports that the highest credit available to FSI
25 was $25,000 when, in truth, it was $1 million.

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49.
In August 2013, D&B published a Credit Recommendation about FSI to a global
2 logistics company, Expeditors. The publication said, Currently, there is a record of open
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bankruptcy, receivership, liquidation, discontinuance with unpaid obligations or equivalent in D&B

files. Not approved for credit. In truth, FSI went through reorganization in 1996 and the
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proceeding was closed in 1998. As a result of the false publication, FSI was denied credit.
50.
In August 2013, D&B published reports that FSI had slow pays and was past due
8 on amounts, including (but not limited to) a slow pay entry reported in May 2012 for $100 for a
9 Lease Agreement. This false entry continued to appear on FSIs published D&B report.
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51.
Prior to purchase, D&B included in its inquiry rate calculation inquiries D&B itself
had made under one or more of its subscriber numbers, which wrongfully inflated the rate; since the
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rate is used to calculate certain credit scores, it wrongfully harmed one or more of FSIs scores. The
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inclusion of D&B inquiries was intended to make FSI susceptible to a CreditBuilder solicitation.
52.
For example, D&B included internal inquiries in its calculation of FSIs Financial
16 Stress Score, which harmed that score.

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53.
Prior to purchase, D&B sent to DBCC a list of inquiries, which included D&Bs own
18 inquiries, without disclosing to DBCC that D&Bs own inquiries were included. The inclusion of
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the D&B inquiries but without identifying and disclosing them was intended to provide DBCC
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leverage to sell FSI a CreditBuilder product.
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54.
For example, D&B generated its own inquiries about FSI on April 27, 2011, February
23 11, 2011, March 27, 2012, April 17, 2012, April 20, 2012, July 6, 2012, September 4, 2012,
24 September 19, 2012, September 20, 2012, and November 12, 2012. D&Bs generation of its own
25 inquiries was a consistent and uniform practice. For example, on November 12, 2012, D&B made
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1 an inquiry itself; and it sent that inquiry to DBCC, who sent FSI an email alert on November 14,
2 2012, that a new inquiry had been made.
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55.
Prior to purchase, D&B sent to DBCC a list of inquiries, which included duplicate
inquiries, without disclosing to DBCC that they were nothing more than multiple types of requests
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by the same subscriber on the same day. The inclusion of the duplicate inquiries but without
identifying them as such was intended to provide DBCC leverage to sell FSI a CreditBuilder
8 product. D&Bs non-de-duplication was a consistent and uniform practice.

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56.
For example, D&B did not de-duplicate inquiries by the same subscriber on the same
10 day on November 12, 2012; and it sent those duplicates to DBCC, who sent FSI an email alert that
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counted the duplicates as separate inquiries.
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57.
As a result of D&B generating its own inquiries and failing to de-duplicate other
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inquiries, both D&B and DBCC told FSI that there had been a high number of inquiries to D&B
15 over the last 12 months, and that high number was a factor for why FSI had a negative Financial
16 Stress Score. Both D&B and DBCC advised FSI that its Financial Stress Score indicated that it was
17 a moderate to high risk of severe financial stress, such as bankruptcy, over the next 12 months.
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58.
Prior to purchase, DBCC held itself out as D&B and CreditBuilder as a D&B-
affiliated product. FSI was confused by DBCCs representations. This confusion was designed to
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leverage the power of Dun & Bradstreet to sell a CreditBuilder product.
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59.
For example, DBCC sent FSI form marketing materials that bore the Dun &
23 Bradstreet logo and which positioned CreditBuilder as a unique D&B-related product.

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60.
For another example, in an early November 2012 phone call, a sales representative,
25 Sandy Gilliam, led Ms. Ryan to believe she was communicating with Dun & Bradstreet. In truth,
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61.
For another example, FSI received a November 13, 2012 email from a DBCC Expert
2 Credit Advisor, which referred to FSIs profile with Dun & Bradstreet Credibility Corp. There is
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no such profile; there is only the D&B profile. The email also said, we get your companys profile
updates and that it is us completing the necessary background checks on your company. Only
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D&B updates profiles, and only D&B performs background checks.

62.
During the early November 13, 2012 sales call, Ms. Gilliam told Ms. Ryan there had
8 been over 100 inquiries by separate companies. The November 13 email contained the same
9 statement. These representations were false; there had only been 24 companies who had made
10 inquiries. Ms. Gilliam told Ms. Ryan the high number of inquiries was driving FSIs scores
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negatively, and it was urgent the FSI address this and improve its credibility and that CreditBuilder
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was the only solution.
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63.
During the early November 13, 2012 sales call, Ms. Gilliam also told Ms. Ryan there
15 were a large number of UCC filings. This was also false.

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64.
By November 14, 2012, FSI believed it had no choice but to enroll in one of the
17 credit building solutions offered in the letters in order to repair its credit and the false information
18 reported on its D&B profile. So it purchased a CreditBuilder product for $1,599.00 and a $149.00
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activation fee.
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65.
Had D&B not seeded FSIs credit report with false information, FSI would not have
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purchased the product.

66.
Had D&B not given DBCC the internal and duplicate inquiries for use in the
24 solicitation, FSI would not have purchased the product.

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67.
Had DBCC not held itself out as D&B and CreditBuilder out as a D&B solution, FSI
would not have purchased the product.

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68.
Had DBCC not represented that CreditBuilder was the solution to false entries
2 appearing on FSIs report, FSI would not have purchased the product. In truth, there was a free
3
4
method of disputing false entries.

69.
Despite having purchased CreditBuilder, false items continued to appear on FSIs
5
6
7
D&B credit report.

70.
On February 1, 2013, FSI again received an email alert which indicated that there
8 were new inquiries into FSIs record with D&B. In truth, there had been only one. The other was
9 manufactured by D&B in one of two ways: it sent DBCC its own inquiry; or it sent DBCC a
10 duplicate inquiry.
11
71.
In June 2014, D&B published a false report that FSI had slow pays and was past
12
due on amounts, including (but not limited to) the May 2012 slow pay of $100.
13
CLASS ALLEGATIONS
14
15
72.
This action is brought on behalf of the named plaintiff as well as on behalf of the
16 following class members (Class Members or the Class), pursuant to Federal Rule of Civil
17 Procedure 23(b)(2)-(3): All purchasers of a CreditBuilder product in the State of North Carolina.
18
73.
The number of Class Members is so numerous and geographically diverse that their
19 joinder is impracticable. There are thousands of small businesses within the state of North Carolina
20
that meet the Class definition.
21
74.
The questions of law and fact arising from the named plaintiffs claims are questions
22
23
common to each member of the Class, and these common questions predominate over any individual
24 questions. These common questions include the following:

25
(a)
Did DBCCs representations or omissions create a likelihood of confusion
26 about the affiliation between itself and CreditBuilder with D&B?
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(b)
Were DBCCs representations or omissions about itself, D&B, and
2 CreditBuilder misleading to potential customers, and, if so, was it objectively reasonable to rely on
3
4
those representations or omissions when a potential customer decided whether to purchase

CreditBuilder?
5
(c)
6
7
Did D&B institute a process by which false information was placed on small
business credit reports?
(d)
Is the publication of false credit information by D&B defamatory?
(e)
Did D&B breach a duty to report accurate, current, and truthful information
10 owed to small businesses? and

11
(f)
How does negative information on a small businesss credit report impact
12
access to credit?
13
14
75.
The named plaintiffs claims are typical of those of the Class Members. And the
15 named plaintiff will fairly and adequately protect the interests of the Class, and has retained
16 experienced counsel to do so.
17
76.
This case can easily be managed as a class action because the defendants keep
18 electronic databases containing data about each Class Member, which are readily searchable. Notice
19
can be sent to virtually every Class Member by their DUNS number.
20
77.
Given that the damage to individual Class Members would likely be dwarfed by the
21
22
expense of litigating a claim on an individual basis, a class action is the most efficient way to
23 adjudicate this matter.

24
78.
In addition, a Class may be certified because: (a) the prosecution of separate actions
25 by individual Class members would create a risk of inconsistent or varying adjudication with respect
26
1009929_1
to individual Class members that would establish incompatible standards of conduct for defendants;
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Telephone: 619/231-1058 Fax: 619/231-7423
1 (b) the prosecution of separate actions by individual Class members would create a risk of
2 adjudications with respect to them that would, as a practical matter, be dispositive of the interests of
3
4
other Class members not parties to the adjudications, or substantially impair or impede their ability
to protect their interests; and/or (c) defendants have acted or refused to act on grounds generally
5
6
7
applicable to the Class thereby making appropriate final declaratory and/or injunctive relief with
respect to the members of the Class as a whole.
COUNT I
UNFAIR TRADE PRACTICES

CLAIM AGAINST DBCC
10
79.
This cause of action incorporates all of the allegations in the other parts of this
11
12
complaint. This cause of action is brought against DBCC only. This cause of action is brought
13 under North Carolinas Unfair Trade Practice Act, N.C. Gen. Stat. 75.1.1, et seq. (the Act).
80.
14
DBCCs marketing, solicitations, and other representations regarding itself, D&B,
15 and CreditBuilder constitute unfair or deceptive acts or practices in or affecting commerce and
16 which have injured FSI and the Class. The unfair or deceptive acts are set forth in this complaint
17
and include (but are not limited to): (a) passing off goods or services as those of another; (b) causing
18
a likelihood of confusion or misunderstanding as to the source, sponsorship, approval, or
19
20
certification of goods or services; (c) causing a likelihood of confusion or misunderstanding as to the
21 affiliation, connection, or association with, or certification by another; and (d) representing that
22 goods or services have sponsorship, approval, characteristics, uses, or benefits that they do not have
23 or that a person has a sponsorship, approval, status, affiliation, or connection that the person does not
24
25
have.
81.
The acts or practices had a capacity or tendency to deceive or created a likelihood of
26
deception.
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82.
DBCC engaged in unfair or deceptive acts willfully, and has refused to take
2 responsibility for them.

3
4
83.
Pursuant to 75-16 of the Act, judgment shall be for treble the amount fixed by the
verdict. And pursuant to 75-16.1 of the Act, a reasonable attorney fee should be allowed as part of
5
6
the court costs.

COUNT II
NEGLIGENT MISREPRESENTATION
CLAIM AGAINST DBCC
8
9
84.
10
complaint. This cause of action is brought against DBCC only.
11
12
85.
DBCC had a duty to exercise reasonable care in communicating information to others
13 who it intended would rely on the information it supplies.

14
86.
DBCC breached this duty by making representations, as set forth in this complaint,
15 that it knew, or should have known, were likely to mislead members of the Class. Those
16 representations include, but are not limited to:
17
(a)
That DBCC was D&B or a part of D&B in a way that it was not;
(b)
That CreditBuilder was a D&B solution, when it was not;
(c)
That DBCC had credit reporting databases, had companies coming to it to pull
18
19
20
21 information, or that DBCC conducted credit reporting activities (e.g., checking public records for
22 liens), which it did not;
23
24
25
(d)
That there had been a certain number of unique companies making
inquiries, when there had been fewer;

(e)
That there had been a certain number of unique companies making
26
inquiries, when in fact inquiries were duplicates or were D&Bs inquiries;
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(f)
That a potential customers credit profile was incomplete, when it was not;
(g)
That a potential customers SER rating indicated high risk when it did not;
(h)
That a potential customers credit report contained a delinquency or
3
4
inaccuracy, when it did not;
5
(i)
6
7
That a customer would be able to dispute, in a meaningful way, inaccurate
information on its credit profile after purchasing CreditBuilder, or that the product would improve
8 credit scores, when it would not;

9
(j)
That a potential customers DS Status exposed them to risk, when it did not;
10
(k)
That DBCC had accurate, up-to-date information relevant to a potential
11
customers business, when it did not;
12
(l)
That a customer would be able to submit trade references through
13
14
CreditBuilder, when, in fact, there were restrictions on the references that could be submitted;
(m)
15
That CreditBuilder would help a customer, when, in fact, non-renewal of the
16 product could harm a customers credit score; and

17
(n)
That CreditBuilder provided a meaningful process for disputing negative trade
18 experiences, when, in fact, no investigation takes place, and negative items re-appear after a month.
19
87.
Each of the misrepresentations or concealments of fact were material to the
20
transaction at hand (i.e., the purchase of a CreditBuilder product), and were related to the sale of the
21
22
23
product, not the use of any website.

88.
Each of the misrepresentations or concealments was made negligently or with
24 recklessness as to their falsity.

25
26
1009929_1
89.
Class Members reasonably relied on DBCCs misrepresentations in deciding whether
to purchase CreditBuilder.
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Telephone: 619/231-1058 Fax: 619/231-7423
90.
As a direct and proximate result of DBCCs negligent misrepresentations, Plaintiff
2 and Class Members sustained damages, including money spent purchasing CreditBuilder.
3
COUNT III
DECEPTIVE TRADE PRACTICES

CLAIM AGAINST D&B
5
6
91.
7 complaint. This cause of action is brought against D&B only. This cause of action is brought under
8 the Act.
9
92.
The following practices by D&B are unfair and deceptive under the Act:
10
(a)
Generating inquiries itself and sending them to DBCC for use in solicitations,
11
12
but without disclosing that the inquiries were by D&B itself;

(b)
13
Generating duplicate inquiries for requests by the same subscriber on the same
14 day for information about the same subject company, and sending them to DBCC for use in
15 solicitations, but without disclosing that the inquiries were duplicates;
16
17
(c)
Failing to conduct real investigations of trade disputes that require the supplier
to provide substantiation of any negative trade experience reports; and
18
(d)
Returning properly-disputed negative trade experiences to a subjects report
19
20
21
after one month, forcing the subject to dispute the item again.
93.
D&Bs unfair and deceptive conduct is undertaken willfully.
22
COUNT IV
23
DEFAMATION
CLAIM AGAINST D&B
24
94.
25
26
1009929_1
complaint. This cause of action is brought against D&B only.

(2:14-cv-01404-TSZ)
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Telephone: 619/231-1058 Fax: 619/231-7423
95.
D&B published to third persons false and defamatory matters about the Plaintiff and
2 Class Members. The defamatory material includes:

3
4
(a)
False negative trade experiences, e.g., slow pay entries;
(b)
Statements that a company is in or near bankruptcy; and
(c)
Statements that a company has a lien or open lawsuit against it.
5
6
7
8
96.
These publications were unprivileged, and they were made with actual malice.
97.
These publications were defamatory per se in that they contained negative
9 information about the Plaintiffs and Class Members businesses and creditworthiness.
10
11
98.
As a direct and proximate result of D&Bs defamation, the Plaintiff and Class
Members suffered damages, including general (presumed) damages and actual damages (e.g., loss of
12
credit opportunities). As for FSI, its lender refused to refinance its line of credit due, in whole or in
13
14
part, to the false and inaccurate information and faulty scores and ratings D&B had placed on its
15 credit report.
16
99.
As a further direct and proximate result of D&Bs defamation, the Plaintiff and each
17 Class Member purchased CreditBuilder in order to address the false and defamatory information on
18 their credit reports; therefore, each member of the Class incurred the same special damage: the cost
19
of CreditBuilder.
20
100.
Given D&Bs actual malice, the imposition of punitive damages is warranted.
21
COUNT V
22
NEGLIGENCE
CLAIM AGAINST D&B
23
24
25
101.
complaint. This cause of action is brought against D&B only.
26
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Telephone: 619/231-1058 Fax: 619/231-7423
102.
D&B owes a duty to those small businesses about whom it has information to make
2 sure that the information is accurate when it transmits that information to DBCC. D&B breaches
3
this duty by:
(a)
Sending internal inquiries to DBCC without disclosing that they are internal;
(b)
Sending duplicate inquiries to DBCC without disclosing that they are
5
6
and
7
8 duplicates.
9
103.
D&B also owes a duty to those small businesses about whom it formulates scores to
10 make sure that the scoring is commercially reasonable. D&B breaches this duty by:
11
(a)
Changing small businesses scores and rating without taking into account the
12
actual financial condition of the individual business.
13
14
104.
D&B also owed a duty to those small businesses who dispute items on their credit
15 reports to engage in a reasonable and meaningful dispute resolution process. D&B breaches this
16 duty by:
17
(a)
Failing to conduct an investigation into the disputes items, and failing to
18 require the reporting supplier to produce any substantiation;

19
(b)
Failing to audit suppliers who have high dispute rates; and
(c)
Automatically removing items without conducting any investigation, only to
20
21
22
23
have them return again, forcing the subject to dispute them again.
105.
As a direct and proximate result of D&Bs negligence, Plaintiff and Class members
24 have sustained damages, including money spent purchasing CreditBuilder to attempt to remedy the
25 inaccurate and untimely information.
26
1009929_1

(2:14-cv-01404-TSZ)
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Telephone: 619/231-1058 Fax: 619/231-7423
PRAYER FOR RELIEF
WHEREFORE, Plaintiff demands judgment against each defendant, including:
A.
Certifying this action as a Class Action, appointing Plaintiff as Class Representative,
4 and appointing Plaintiffs counsel as Class Counsel;

5
6
B.
An injunction ordering DBCC to fully disclose the nature of its relationship to D&B
in all marketing literature, sales calls, and other forms of solicitation;
7
8
9
C.
An injunction ordering D&B to fully disclose to each Class Member the identities of
each person or entity that purportedly made an inquiry or report to D&B regarding that Class
10 Member and upon which D&B relied in publishing its credit reports and ratings;
11
D.
Actual damages in amounts to be proven at the trial of this matter;
12
E.
Attorneys fees and costs;
F.
Punitive damages; and
G.
Pre- and post-judgment interest, as appropriate.
13
14
15
JURY DEMAND
16
17
18
Plaintiff demands a trial by jury.

DATED: March 13, 2015
19
By: s/Christopher Collins
20
21
22
23
24
25
FRANK J. JANECEK, JR. (admitted pro hac vice)

CHRISTOPHER COLLINS (admitted pro hac vice)
ROBBINS GELLER RUDMAN & DOWD LLP
655 West Broadway, Suite 1900
San Diego, CA 92101-3301
Telephone: 619/231-1058
619/231-7423 (fax)
E-mail: frankj@rgrdlaw.com
chrisc@rgrdlaw.com
26
1009929_1

(2:14-cv-01404-TSZ)
- 23 -

Telephone: 619/231-1058 Fax: 619/231-7423
1
2
3
4
STUART A. DAVIDSON (admitted pro hac vice)

ROBBINS GELLER RUDMAN & DOWD LLP
120 East Palmetto Park Road, Suite 500
Boca Raton, FL 33432
Telephone: 561/750-3000
561/750-3364 (fax)
E-mail: sdavidson@rgrdlaw.com
5
6
7
8
BRAD J. MOORE, WSBA #21802

STRITMATTER KESSLER WHELAN
200 Second Avenue West
Seattle, WA 98119
Telephone: 206/448-1777
206/728-2131 (fax)
E-mail: brad@stritmatter.com
9
10
11
12
ROSS E. SHANBERG (admitted pro hac vice)

SHANBERG, STAFFORD & BARTZ LLP
19200 Von Karman Avenue, Suite 400
Irvine, CA 92612
Telephone: 949/622-5444
949/622-5448 (fax)
E-mail: rshanberg@ssfirm.com
13
14
15
16
17
JACK LANDSKRONER (admitted pro hac vice)

DREW LEGANDO (admitted pro hac vice)
LANDSKRONER GRIECO MERRIMAN, LLC
1360 West 9th Street, Suite 200
Cleveland, OH 44113
Telephone: 216/522-9000
216/522-9007 (fax)
E-mail: jack@lgmlegal.com
drew@lgmlegal.com
18
Attorneys for Plaintiff Flow Sciences Inc.
19
20
21
22
23
24
25
26
1009929_1

(2:14-cv-01404-TSZ)
- 24 -

Telephone: 619/231-1058 Fax: 619/231-7423
1
2
CERTIFICATE OF SERVICE
I hereby certify that on March 13, 2015, I authorized the electronic filing of the foregoing
3 with the Clerk of the Court using the CM/ECF system which will send notification of such filing to
4 the e-mail addresses denoted on the attached Electronic Mail Notice List, and I hereby certify that I
5 caused to be mailed the foregoing document or paper via the United States Postal Service to the non6 CM/ECF participants indicated on the attached Manual Notice List.
7
I certify under penalty of perjury under the laws of the United States of America that the
8 foregoing is true and correct. Executed on March 13, 2015.

9
s/ CHRISTOPHER COLLINS
CHRISTOPHER COLLINS
10
13
ROBBINS GELLER RUDMAN

& DOWD LLP
655 West Broadway, Suite 1900
San Diego, CA 92101-8498
Telephone: 619/231-1058
619/231-7423 (fax)
14
E-mail: ChrisC@rgrdlaw.com
11
12
15
16
17
18
19
20
21
22
23
24
25
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1009699_1

(2:14-cv-01404-TSZ)

Telephone: 619/231-1058 Fax: 619/231-7423
WAWD CM/ECF Version 6.1Page 1 of 1

Mailing Information for a Case 2:14-cv-01404-TSZ Flow Sciences, Inc. v. Dun & Bradstreet, Inc. et al
Electronic Mail Notice List
The following are those who are currently on the list to receive e-mail notices for this case.
Mikael A. Abye
Mikael.Abye@shearman.com,ron.cheatham@shearman.com
Thomas Matthew Brennan
tmb@mckay-chadwell.com,akn@mckay-chadwell.com,snc@mckay-chadwell.com
Christopher Collins
chrisc@rgrdlaw.com,jwolsborn@rgrdlaw.com,kathryns@rgrdlaw.com,ldeem@rgrdlaw.com
Stuart A. Davidson
sdavidson@rgrdlaw.com,jdennis@rgrdlaw.com,e_file_sd@rgrdlaw.com,e_file_fl@rgrdlaw.com
Gretchen J. Hoog
hoogg@lanepowell.com,docketing-sea@lanepowell.com,koskinens@lanepowell.com
Charles C Huber
huberC@lanepowell.com,harrellh@lanepowell.com,rainesm@lanepowell.com,docketing-sea@lanepowell.com
Inyoung Hwang
sarah.hwang@shearman.com,rebecca.shieh@shearman.com,david.selesnick@shearman.com,christina.lee1@shearman.com,leng@shearman.com
Frank J Janecek , Jr
frankj@rgrdlaw.com,e_file_sd@rgrdlaw.com
Jack Landskroner
jack@lgmlegal.com,debra@lgmlegal.com
Gail E Lees
glees@gibsondunn.com,tloose@gibsondunn.com
Drew Legando
drew@lgmlegal.com,debra@lgmlegal.com
Timothy W Loose
tloose@gibsondunn.com,zperez@gibsondunn.com,kwelch@gibsondunn.com
Michael D McKay
mdm@mckay-chadwell.com,akn@mckay-chadwell.com,snc@mckay-chadwell.com
Bradley Jerome Moore
brad@stritmatter.com,pattis@stritmatter.com
Zathrina Zasell G Perez
zperez@gibsondunn.com,tloose@gibsondunn.com
Richard F Schwed
rschwed@shearman.com,stephen.kam@shearman.com,Sarah.Hwang@Shearman.com,Mariusz.Jedrzejewski@Shearman.com,Melissa.Godwin@Shearman.com,Matthew
Ross E Shanberg
rshanberg@ssbfirm.com
Manual Notice List

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to select and copy this list into your word processing program in order to create notices or labels for these recipients.
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3/13/2015

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Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 1 of 27

THE HONORABLE THOMAS S. ZILLY

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF WASHINGTON

JURY TRIAL DEMAND

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 2 of 27

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 3 of 27

17 solve certain D&B problems that the product cannot do.

24 2025 Mercantile Drive in Leland, North Carolina 28451.

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 4 of 27

Defendants D&B are publicly-traded Delaware corporations with their principal

(North Carolina) different from that of the defendants (California/New Jersey).

This Court is a proper venue pursuant to 28 U.S.C. 1404.

THE POWER OF DUN & BRADSTREET

government contract. (A DUNS number is a unique ID recognized, recommended, and often

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 5 of 27

DUN & BRADSTREETS CREDIT-ON-SELF LINE OF BUSINESS

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 6 of 27

1 DBCC DRESSES ITSELF UP AS DUN & BRADSTREET

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 7 of 27

makes no distinction between the two companies.

DBCC sales representatives uniformly refer to the D&B databases as our

not engage in credit reporting functions, D&B does.

In sum, DBCC makes representations which confuse, mislead, deceive, or outright

CreditBuilder and D&B.

That is, DBCC misleads potential customers with deceptive

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 8 of 27

DBCC also misrepresents to potential customers their need for CreditBuilder by

23 exist or is false. Furthermore, DBCC misrepresents to potential customers the capabilities of

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 9 of 27

1 D&B PLACES FALSE INFORMATION ON CREDIT REPORTS TO FOSTER DBCCS

have an SER Rating of, at most, 6.)

Then, as part of a marketing and sales campaign designed to position

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 10 of 27

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 11 of 27

D&B also manufactures inquiries into the profiles of small businesses. An

Prior to the annual renewal date of a CreditBuilder customers subscription to the

D&B profits off the sale of each individual CreditBuilder product.

15 PLAINTIFF FSIS EXPERIENCE

26 calculation of that score inquiries D&B had made of itself.

FIRST AMENDED CLASS ACTION COMPLAINT

Robbins Geller Rudman & Dowd LLP

Case 2:14-cv-01404-TSZ Document 73 Filed 03/13/15 Page 12 of 27