A District Court judge in New York has dismissed a Fair Credit Reporting Act lawsuit against a credit reporting agency, ruling the plaintiff never explained what was actually wrong about the tradeline she spent more than a year disputing.
The background: The dispute started with a charged-off credit card account that a lender was reporting through the defendant.
- In late 2024, the plaintiff disputed the tradeline twice with the defendant. The defendant replied that the item was verified as accurate and updated, and kept publishing it as charged off with a past-due balance.
- The plaintiff then sent a written dispute directly to the lender, enclosing debt collector notices, cease and desist letters, and the dismissal of a state court case that had been filed against her to collect the debt.
- The lender wrote back roughly a month later saying it could not locate the account. The defendant continued reporting the tradeline exactly as before.
- The plaintiff said the reporting cost her rental housing.
- Representing herself, she sued early last year, claiming the defendant failed to conduct a reasonable reinvestigation and failed to follow reasonable procedures to assure maximum possible accuracy, and adding a New York General Business Law Section 349 claim for materially misleading conduct.
- Her core argument was that “[a] tradeline cannot be ‘accurate’ when the source of that information admits it cannot locate or verify the account.”
The ruling: Judge Orelia E. Merchant of the District Court for the Eastern District of New York adopted a magistrate judge’s report and recommendation in full, overruled the plaintiff’s objections, and dismissed the claims against the defendant.
- Inaccuracy is a threshold question under both FCRA sections, Judge Merchant wrote, so once the plaintiff failed to clear it, there was no reason to reach her reinvestigation theory. The inquiry turns on objectively and readily verifiable information, the judge noted.
- The plaintiff never denied that the account was hers or that she incurred the debt. Her own objections conceded she did not challenge that the account historically existed. What she never did was explain how or why the reporting was wrong, such as by saying the debt was not in fact charged off or past due.
- The lender’s response was not the smoking gun she thought it was. “The fact that [the lender] could not locate Plaintiff’s account with the materials she furnished them does not necessarily mean that [the defendant] could not independently identify and verify the debt,” Judge Merchant wrote.
- The dismissed state court collection case did not move the needle either, because a dismissal without prejudice “leaves the situation as if the action never had been filed.”
- The Section 349 claim failed because the plaintiff alleged only an isolated dispute between private parties, not conduct with a broader impact on consumers at large. A bare recitation of the statute’s elements was not enough.
