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Posts published in “FCRA”

Fair Credit Reporting Act

8th Cir. Upholds Exclusion of ‘Similar Borrower’ Testimony in 8-to-1 Punitive Damages Award Case

The U.S. Court of Appeals for the Eighth Circuit recently affirmed a punitive damages award in an approximately 8-to-1 ratio to compensatory damages to a borrower who sued her mortgage loan servicer for alleged common law invasion of privacy and for allegedly violating the Fair Credit Reporting Act (FCRA), the Fair Debt Collection Practices Act (FDCPA) and the Real Estate Settlement Procedures Act (RESPA). In so ruling, the Court also held that the trial court properly excluded the testimony of a non-party consumer who was supposedly treated similarly by the servicer to rebut the servicer’s assertions of good faith conduct,…

9th Cir. Holds Company Willfully Violated FCRA by Including Liability Waiver in Disclosure Document

In a case of first impression, the U.S. Court of Appeals for the Ninth Circuit recently held that a prospective employer violated the federal Fair Credit Reporting Act by including a liability waiver in the same document as the statutorily required disclosure notice for obtaining a job applicant’s consumer report. In so ruling, the Ninth Circuit held that the company’s conduct was “willful” as a matter of law, because the language of the statute clearly contradicted the company’s interpretation, and whether or not the company “actually believed that its interpretation was correct is immaterial.” A copy of the opinion in…

3rd Cir. Rules Violation of Statute Without Concrete Harm Enough for Standing, At Least in Data Breach Cases

The U.S. Court of Appeals for the Third Circuit recently reversed the dismissal of a putative class action under the federal Fair Credit Reporting Act (FCRA) based on the theft of laptops from a health insurer containing sensitive personal information, holding that the plaintiffs had standing to sue because Congress created a statutory remedy for the unauthorized transfer of personal information, the disclosure of which constituted a cognizable injury, regardless of whether the stolen information was actually used improperly. A copy of the opinion in In re Horizon Healthcare Inc. Data Breach Litigation is available at: Link to Opinion. The…

MD Fla. Holds Non-Foreclosure Collection on Time-Barred Debt Does Not Provide Basis for FDCPA or FCCPA Claim

The U.S. District Court for the Middle District of Florida recently granted in part a mortgage loan servicer’s motion to dismiss a consumer borrower’s claims under the federal Fair Debt Collection Practices Act (FDCPA), the Florida Consumer Collection Practices Act (FCCPA), the Real Estate Settlement Procedures Act (RESPA), the federal Fair Credit Reporting Act (FCRA), and the federal Declaratory Judgment Act (DJA), holding: (a) the borrower’s complaint stated claims under the FDCPA and FCCPA because the allegations raised a plausible inference that the servicer knew the borrower was represented by counsel; (b) the borrower’s allegations that the statute of limitations…

7th Cir. Holds CRA’s ‘Reasonable Investigation’ Under FCRA Does Not Include Handwriting Analysis

The U.S. Court of Appeals for the Seventh Circuit recently held that a credit reporting agency had no duty under the federal Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681, et seq., to verify the accuracy of a consumer’s signature in a case of alleged forgery. A link to the opinion in Brill v. TransUnion LLC is available at:  Link to Opinion. The defendant, one of the three major credit reporting agencies, prepared a credit report based on information it received from a car dealership that the plaintiff was in arrears on a car lease.  The plaintiff informed the credit…

6th Cir. Reverses Dismissal of Data Breach Consolidated Class Actions

In an unpublished ruling, the U.S. Court of Appeals for the Sixth Circuit recently reversed the dismissal of consolidated class actions arising from a data breach, holding that the plaintiffs had Article III standing to pursue certain tort claims and that the district court had erred in dismissing a federal Fair Credit Reporting Act claim for lack of subject matter jurisdiction. A copy of the opinion in Galaria v. Nationwide Mutual Insurance Company is available at:  Link to Opinion. The plaintiffs brought class actions against an insurance company alleging violations of the FCRA and common law tort claims for invasion of…

11th Cir. Holds FCRA ‘Reasonable Investigation’ May Require Assignee to Examine Account-Level Documents

The U.S. Court of Appeals for the Eleventh Circuit recently reversed in part a trial court’s ruling granting summary judgment in favor of a debt buyer, its affiliated debt collector and their parent company, holding that a reasonable jury could find that the defendants willfully violated section 1681s-2(b) of the federal Fair Credit Reporting Act when they reported two charged-off debt accounts as “verified” without obtaining sufficient documentation that the debts in fact belonged to the plaintiff consumer. In so ruling, the Court held that a jury could find that because the buyer retained the right to seek account-level documentation…

5th Cir. Confirms Self-Serving Testimony of Emotional Distress Insufficient Under FCRA, Commercial Losses Not Recoverable

The U.S. Court of Appeals for the Fifth Circuit recently confirmed that the federal Fair Credit Reporting Act, 15 U.S.C. § 1681, et seq., does not allow recovery for commercial or investment property losses. The Court also concluded that where a plaintiff points to no evidence that the denial of credit was actually caused by the defendant’s inaccurate credit reporting, judgment is proper in favor of the furnisher. Finally, the Fifth Circuit concluded that a plaintiff is not entitled to emotional distress damages where the only evidence of emotional distress is the plaintiff’s own self-serving and conclusory deposition testimony. A…

How Spokeo May Limit Consumer Financial Services Litigation

Yesterday’s decision from the U.S. Supreme Court in Spokeo v. Robins should bolster the defense of companies subject to several federal consumer protection statutes. The ruling addresses lawsuits that claim an injury created solely by the violation of a federal statute and require the plaintiff to demonstrate not only that the statute was violated, but that the plaintiff herself suffered harm. The opinion does not go as far as many in the consumer financial services industry would have liked (not all injuries must be “tangible”), but it does close the door on civil lawsuits many have faced. The opinion was…

7th Cir. Holds Customer Did Not Agree to Online Contract, Adopts ‘Reasonable Communicativeness’ Test

The U.S. Court of Appeals for the Seventh Circuit recently held that, under Illinois law, a website must provide a user reasonable notice that use of the website and a click on a button constitutes assent to the terms of an agreement, in order for the agreement to be binding. In so ruling, the Seventh Circuit adopted a two-part “reasonable communicativeness” test for the enforceability of online agreements: (1) whether the web pages presented to the customer adequately communicated all of the terms and conditions of the agreement; and (2) whether the circumstances support the reasonable assumption that the customer…

4th Cir. Upholds Injunctive Relief Class Settlement in FCRA Action

The U.S. Court of Appeals for the Fourth Circuit recently rejected a challenge to a class action settlement by a group of consumers objecting to the release of statutory and punitive damages claims – but not claims for actual damages – in exchange for non-monetary injunctive relief under the federal Fair Credit Reporting Act (FCRA), holding that the district court did not abuse its discretion in approving the settlement or awarding attorney’s fees to class counsel. A copy of the opinion in Gregory Thomas Berry et al. v. LexisNexis Risk & Information Analytics Group Inc. et al. is available at: Link to…

Credit Bureau Settles FCRA Class Action Alleging Reporting Errors

A credit reporting agency has settled a long-pending class action lawsuit in the U.S. District Court for the Eastern District of Virginia, agreeing to pay more than $3 million and remove from its consumer credit reports judgments entered in Virginia General District Court. The Fair Credit Reporting Act (FCRA) class action, Soutter v. Equifax Information Services LLC, was given the green light in April, with U.S. District Judge Robert E. Payne agreeing the standards for class certification had been met. In the class claim, plaintiff Donna K. Soutter contended Equifax willfully violated the FCRA when it failed to take reasonable…