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FCRA Decision of the Day: Vartanian v. Portfolio Recovery Associates

Today’s  Decision of the Day is Vartanian v. Portfolio Recovery Associates, a Fair Credit Reporting Act (“FCRA”) opinion from the United States District Court for the Central District of California.© SeanPavonePhoto -

The opinion examines the FCRA’s conflicting preemption provisions,  § 1681t(b)(1)(F) and § 1681h(e), in the context of a claim arising from a person’s furnishing of information to a credit reporting agency. Section 1681t(b)(1)(F) can be read to preempt all state law claims, but at the same time others read § 1681h(e) as permitting state law claims based on willful or malicious conduct.

Congress amended the FCRA in 1996 by adding § 1681t(b)(1)(F) to preempt “any state laws that imposed any ‘requirement or prohibition’  on, among others . . .” the furnishing of information to a credit reporting agency. But the 1996 amendments left § 1681h(e) intact. Some have interpreted this to mean that § 1681t(b)(1)(f) only preempts state statutes but leaves state common law claims, like willful or malicious defamation, actionable.

The court held the 1996 amendment adding § 1681t(b)(1)(F) was intended to preempt any state law claims, both statutory and common law.  Noting that § 1681t(b)(1)(F) uses the phrase “requirement or prohibition,” in explaining the scope of the preemption, the United States Supreme Court has interpreted the phrase to mean the preemption is broad, encompassing both statutory and common law claims.  If Congress intended to make the preemption encompass both state statutory and common law claims,

[t]o think that Congress clumsily left behind a Trojan horse that a litigant could employ to penetrate § 1681t and destroy FCRA’s delicately crafted preemption scheme is irrational.

It is a great, sound analysis and the holding is consistent with opinions from the United States District Courts in New Jersey and Massachusetts. Not all courts agree, and certain U.S. District courts still permit state law claims for defamation and libel for a person’s credit reporting.

Hat tip to our friends at Simmonds & Narita, LLP in San Francisco who handled the defense.

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Donald Maurice provides counsel to the financial services industry, successfully litigating matters in the state and federal courts in individual and class actions. He has successfully argued before the Third, Fourth and Eighth Circuit U.S. Courts of Appeals, and has represented the financial services industry before several courts including as counsel for amicus curiae before the United States Supreme Court. He counsels clients in regulatory actions before the CFPB, and other federal and state regulators and in the development and testing of debt collection compliance systems. Don is peer-rated AV by Martindale-Hubbell, the worldwide guide to lawyers. In addition to being a frequent speaker and author on consumer financial services law, he serves as outside counsel to RMA International, on the governing Board of Regents of the American College of Consumer Financial Services Lawyers and on the Governing Committee of the Conference on Consumer Finance Law. From 2014 to 2017, he chaired the ABA's Bankruptcy and Debt Collection Subcommittee. For more information, see

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