A District Court judge in Alabama has allowed most of a consumer’s Fair Credit Reporting Act lawsuit against a credit reporting agency to move forward, dismissing two claims while letting four others survive.
The background: The plaintiff sued the defendant, a consumer reporting agency, over how it handled her personal and account information, bringing four claims under the FCRA.
- The defendant allegedly failed to follow reasonable procedures to assure the maximum possible accuracy of the plaintiff’s credit report, pointing to incorrect Social Security numbers, names, addresses, and phone numbers, plus information she said was missing.
- The defendant also did not give the plaintiff a full copy of her file when she asked, according to the complaint.
- The defendant allegedly failed to reasonably reinvestigate disputed information, refused to describe its reinvestigation procedures, and would not add her consumer statement, and furnished her report to a lender without confirming a permissible purpose existed.
The ruling: Judge Harold D. Mooty III of the District Court for the Northern District of Alabama granted the defendant’s motion for judgment on the pleadings in part and denied it in part, leaning heavily on the difference between a consumer’s “file” and a consumer “report.”
- Judge Mooty treated the disputed personal identifying information as nonactionable “header information” that does not bear on creditworthiness, and found the plaintiff alleged no “plus factor” to change that. The judge also held it was not reasonable to read “No data” or “Not reported” entries as meaning anything other than that the agency did not possess that data.
- The file-disclosure claim survived. The plaintiff alleged the defendant gave lenders her full nine-digit Social Security number but disclosed only a truncated version to her, leaving her unable to investigate why those numbers appeared in her file.
- The same identifying errors that doomed the disputed personal information helped the reinvestigation claims survive, because a “file” is broader than a “report” and the duty to reinvestigate reaches any item in the file, even items that are not part of the consumer report itself, Judge Mooty ruled.
- The permissible-purpose claim survived. The judge acknowledged a “significant information asymmetry” at this stage, since only the defendant knows why it released the report, and held that failing “to recite the precise legal language” is not by itself grounds for dismissal.
- The consumer statement claim was dismissed because the plaintiff asked for her statement to be added before the reinvestigation was completed, while the FCRA requires that request to come afterward.
- The dismissed claims were dismissed without prejudice, leaving room to replead.
