District Court partially grants defendant’s motion in FCRA case

Courts FCRA Consumer Reporting Consumer Reporting Agency Consumer Finance

On February 25, the U.S. District Court for the Eastern District of Pennsylvania denied in part and granted in part a defendant’s motion for summary judgment in an FCRA case. According to the opinion, the plaintiffs applied for a loan at a bank to refinance their home mortgage and the bank then engaged a service agency (defendant) to conduct a public records search and provide a report on the plaintiffs. To prepare the report, the defendant allegedly engaged an independent contractor to conduct a physical search of both the open judgment directory and the municipal lien directory. The plaintiffs claimed that the defendant’s report “erroneously” listed outstanding civil judgments against them and that defendant refused to investigate the alleged inaccuracies. The plaintiffs filed suit, alleging that the defendant violated the FCRA by failing to follow reasonable procedures to assure maximum possible accuracy when preparing a consumer report and by failing to conduct a reasonable reinvestigation of the plaintiffs’ dispute.

The defendant moved for summary judgment, asserting that it was not subject to the FCRA as a matter of law since it was not a consumer reporting agency and that it did not supply “consumer reports” within the meaning of the FCRA. Additionally, the defendant claimed that even if it was subject to the FCRA, no reasonable juror could find that it violated either of those FCRA provisions. The district court found that the defendant is a “consumer reporting agency” under FCRA because its operations met the statutory definition. The court partially granted the defendant’s summary judgment on the plaintiffs’ claims that it willfully violated the FCRA by failing to conduct a reasonable reinvestigation of the plaintiffs’ dispute.