A District Court judge in Virginia has rejected the terms of a potential settlement in a Fair Credit Reporting Act class action because of “troublesome terms” that are tied to a “plan of action that the Court dimly understands.”
A copy of the ruling in the case of Solomon v. Equifax Information Services can be accessed by clicking here.
The plaintiff filed for Chapter 13 bankruptcy protection, which was converted to a Chapter 7 bankruptcy when she could not comply with the terms of her original repayment plan. The defendant reported the debts under the Chapter 13 filing correctly as no longer existing, but did not catch some new debt that was incurred after the plaintiff filed for Chapter 13 but before the filing was converted to Chapter 7. The defendant still reported the new debt as being owed to creditors instead of reporting it as discharged through bankruptcy.
The parties reached a settlement in the case, and presented portions of it to Judge John Gibney, Jr. from the District Court for the Eastern District of Virginia. The portions were presented included the terms of a settlement in a similar case in California, in which a defendant — another credit reporting agency — agreed to make changes to its computer code to catch this issue in the future. The problem, Judge Gibney explained, is that he does not understand the code and the settlement in the other case includes language that is too vague for his liking.
Also irking Judge Gibney is a requirement in the settlement that would preclude the plaintiff’s attorney from representing plaintiffs in similar suits for the duration of the consent decree. The plaintiff’s attorney, Leonard Bennett “has a limitless stable of clients with credit problems, an encyclopedic knowledge of consumer law, and endless creativity in finding new ways to sue credit bureaus. It is small wonder Equifax wants him out of play,” Judge Gibney wrote. The judge said he would not consent to an order that “limits the areas of practice of a lawyer.”
