District Court says disputed tradeline is not misleading

Courts Credit Report FCRA Consumer Finance Auto Finance

On June 8, the U.S. District Court for the Middle District of Alabama granted a defendant auto finance company’s motion for judgment on the pleadings in an action concerning alleged violations of the FCRA. The plaintiff filed an action against the defendants (an auto finance company and a financial service company) alleging that her credit report included an inaccurate or misleading “Errant Tradeline” in violation of the FCRA because it identified a paid off loan as being “closed” with a “$0 balance,” but also indicated that the loan had a monthly payment amount of $669. The plaintiff argued that this created “the impression that she still ha[d] an outstanding loan” as well as upcoming payments and alleged that the inaccurate reporting caused her financial and emotional damages. The plaintiff also claimed that the auto finance company negligently or willfully violated the FCRA because it failed to conduct a proper investigation. Upon review, the court granted the motion by the auto finance company, finding that because the balance listed says “$0,” and the account is listed as “closed,” there is “little opportunity for confusion when the alleged Errant Tradeline is reviewed in context.” The court further noted that “the context of the report reveals that the monthly payment line is neither inaccurate nor misleading.”