A District Court judge in New York has granted a defendant’s motion to dismiss a Fair Credit Reporting Act lawsuit accusing a credit card issuer of reporting a charged-off account inaccurately, ruling that the plaintiff never cleared the threshold requirement of identifying anything inaccurate in the first place.
The background: The dispute grew out of a single credit card account and the way its tradeline appeared after the balance went bad.
- The plaintiff opened a credit card with a $10,000 limit five years ago, and the account was charged off two years ago at a balance of $12,031.
- His credit report described the account this way: “Account charged off. $12,031 written off. $12,031 past due as of Aug 2025.” He argued that calling the balance written off while still reporting it as an active receivable created ambiguity about the account’s present status. Similar charge-off reporting arguments have failed before.
- He also claimed the defendant never reported his monthly balances, scheduled payment amounts, amounts actually paid, most recent payment, or account terms, either before or after charge-off.
- Last year he disputed the tradeline through both credit reporting agencies, and both came back verified as accurate.
- He then sued, claiming denials of credit, a measurable drop in his score, out-of-pocket costs, and emotional distress.
The ruling: Judge Orelia E. Merchant of the District Court for the Eastern District of New York found the reporting was accurate as a matter of law and dismissed the case.
- Written off and charged off are synonymous, the judge held, so reporting both is not contradictory. Nor is it misleading, because neither term suggests the consumer stops owing the money or that the creditor cannot collect it. Charging off, she noted, does not equal forgiveness; a contrary rule “would simply encourage a consumer to take out massive amounts of debt and wait around six months for it to be wiped away.”
- The plaintiff argued that whether reporting is misleading is a fact question unsuitable for dismissal. Judge Merchant disagreed, saying judges can resolve it early where only one reasonable interpretation of the report exists.
- On the missing payment history, the judge pointed out that furnishing is voluntary and the statute imposes no affirmative duty to supply positive information. “The Court’s task is to consider whether the information is inaccurate or misleading, not to look for ways that the information might be more accurate,” she wrote. The plaintiff also never alleged what specific history was left out or how its absence swayed a credit decision.
- Because nothing was plausibly inaccurate, the reasonable investigation claim collapsed with it.
- The claim that the account was never flagged as disputed failed for a different reason: that duty sits in a subsection of the statute that consumers cannot sue over.
