A District Court judge in New York has granted a plaintiff’s motion to remand a Fair Credit Reporting Act case back to state court where it was originally filed, ruling the plaintiff did not suffer a concrete injury when she alleged that eight different creditors and three credit reporting agencies over how a number of different debts appeared on her credit report.
The background: The plaintiff filed suit in New York state court against a group of financial institutions, debt collectors, and the three major credit reporting agencies, alleging eighteen violations of the FCRA. The claims centered on how certain credit accounts were reported after they allegedly became delinquent and how disputes were handled.
- Several accounts were reported with inaccurate dates of first delinquency and other disputed information. The plaintiff claimed that these reporting issues could harm her credit score and cause the negative items to remain on her credit report longer than allowed under the FCRA.
- For example, one account allegedly listed a later delinquency date than the plaintiff believed was accurate, which she argued would “improperly further decrease” her credit score and extend the time the item appeared on her credit history.
- The plaintiff claimed that after she disputed the information, the defendants failed to properly investigate the issues or note the disputes on her credit report.
- The defendants removed the case to federal court and, at which point some of them were dismissed and others sought to have the suit dismissed. The plaintiff them moved to have the case remanded back to state court.
The ruling: Judge Margo K. Brodie of the District Court for the Eastern District of New York concluded that the plaintiff failed to demonstrate a concrete injury sufficient to establish Article III standing.
- The judge explained that an allegedly incorrect credit report entry or even a reduction in a credit score is not enough on its own to establish standing.
- Judge Brodie also rejected the argument that the risk of future harm was enough to keep the case in federal court.
- Judge Brodie also emphasized that requesting statutory damages does not create standing either, writing that plaintiffs cannot convert a non-concrete injury into a federal case “merely by putting a price tag on it.”
- Because the plaintiff failed to allege a specific harm such as denied credit, financial loss, or other tangible injury, the federal court ruled it lacked jurisdiction and sent the case back to state court.
