A District Court judge in Colorado has granted a motion to dismiss filed by the Attorney General of Colorado, who was sued by a trade group, attempting to assert that the Fair Credit Reporting Act preempts portions of a state law that prohibits the reporting of criminal conviction records, as well as sealed and expunged records that do not result in a conviction.
For companies operating in credit reporting, tenant screening, and employment background checks, the case presented a potentially significant question about the limits of federal preemption under the Fair Credit Reporting Act. But notably, the court never reached that question. Instead, the case was dismissed on jurisdictional grounds.
The background: The plaintiff, a trade association representing background screening companies, challenged provisions of the Colorado Consumer Credit Reporting Act that restrict the reporting of certain criminal records. Specifically, the law prohibits reporting criminal convictions older than seven years, along with sealed, expunged, and non-conviction records.
- The plaintiff argued these provisions conflict with the FCRA, which allows reporting of criminal convictions without a time limit and does not categorically prohibit reporting of more recent non-conviction records. Based on that alleged conflict, the plaintiff sought a declaratory judgment that the federal law preempts Colorado’s statute and an injunction preventing enforcement.
- The lawsuit was directed at the state’s attorney general in his official capacity, based on the belief that he would enforce the law against the plaintiff’s members.
The ruling: Judge Philip A. Brimmer of the District Court for the District of Colorado dismissed the case, finding he lacked subject matter jurisdiction due to sovereign immunity. At the core of the decision was whether the attorney general had a sufficient connection to enforcing the challenged statute to fall within a specific exception. The judge concluded he did not.
- Importantly, Judge Brimmer emphasized that a general duty to enforce state laws is not enough.
- The judge found that:
- The statute at issue provides for private enforcement by consumers, not enforcement by the attorney general
- There was no specific statutory authority giving the attorney general a role in enforcing these provisions
- Attempts to tie enforcement authority through supervision of other officials failed because those officials also lacked authority over this specific law
- The opinion also rejected the plaintiff’s reliance on public statements and press releases, noting that such materials do not establish a legal duty to enforce the statute.
- Because the judge determined the attorney general lacked a “particular duty” to enforce the law, sovereign immunity applied and the case could not proceed.
- As a result, the court dismissed the case without reaching the underlying preemption argument, leaving unresolved whether the FCRA limits states’ ability to restrict the reporting of criminal records in this way.
- For industry participants, that means the compliance question remains open, and state-level restrictions like Colorado’s continue to stand, at least for now.
