A District Court judge in Texas has granted a defendant’s motion for summary judgment in a Fair Credit Reporting Act case over a disagreement between the plaintiff and the defendant stemming from a settlement of a previous lawsuit that included details about how many of the tradelines in question would be closed.
The background: The dispute traces back to three delinquent credit accounts that the plaintiff had with the defendant, including a vehicle loan, a line of credit, and a credit card. After the defendant sued to recover missed payments, the parties reached a settlement in 2022.
- The settlement agreement itself was not provided as evidence in this case, but the plaintiff later claimed that the deal required the defendant to close the tradelines for all three accounts so the delinquencies would no longer negatively impact his credit report. The defendant countered that the agreement only required closure of one tradeline.
- The plaintiff sued alleging violations of the FCRA, along with state law claims for deceptive practices, fraud, and misrepresentation.
- Central to the case were a handful of emails exchanged around the time of settlement. The plaintiff argued those emails showed a promise to delete multiple tradelines and that continued reporting was inaccurate.
The ruling: Judge Andrew S. Hanen of the District Court for the Southern District of Texas granted summary judgment to the defendant on all claims, including the FCRA count.
- On the FCRA theory, the judge emphasized that the plaintiff failed to present evidence that the defendant received a dispute from a consumer reporting agency or failed to conduct a reasonable investigation. The judge also pointed out that conclusory allegations of inaccurate reporting are not enough to survive summary judgment without evidence of the statutory process being triggered.
- On the alleged promises about tradelines, Judge Hanen highlighted a nuance that will resonate with compliance teams. The emails referenced deletion of “the tradeline,” not “tradelines,” undercutting the plaintiff’s position that all accounts were supposed to be closed. “[W]e will delete the tradeline once the payment is posted to the account,” indicated to the the judge that a singular account was being discussed and not a blanket promise covering every account.
