It is well settled in the Eleventh Circuit that consumers do not have a private cause of action under 15 U.S.C. 1681s-2(a).  Chipka v. Bank of America, 355 Fed. Appx. 380 (11th Cir. 2009); Green v. RBS Nat’l Bank, 288 Fed. Appx. 641 (11th Cir. 2009); Antoine v. State Farm Mut. Auto. Ins. Co., 662 F. Supp. 2d 1318 (M.D. Fla. 2009); Campbell v. Equifax, 2009 WL 302262 (S.D. Fla. 2009); Ray v. Equifax, 2006 WL 5441411 (N.D. Ga. 2006)(vacated on other grounds); Abbett v. Bank of America, 2006 WL 581193 (M.D. Ala. 2006); and Riley v. General Motors Acceptance Corp., 226 F. Supp. 2d 1316 (S.D. Ala. 2002).

Consumers’ state law claims are preempted by the Fair Credit reporting Act (FCRA) under 15 U.S.C. 1681s-2(a), according to a recent opinion from the Seventh Circuit Court of Appeals.  The 7th Circuit Court of Appeals held consumers are barred from making state common law claims against furnishers for supplying credit reporting agencies (such as Equifax, Experian and Trans Union) with inaccurate information. Instead, these types of claims may only be enforced by federal or state agencies, such as the Federal Trade Commission or state Attorney Generals.

In the case before the 7th Circuit, the plaintiff, Kristine Purcell, sued Bank of America (the furnisher) in state court and claimed Bank of America provided inaccurate account information regarding the account to a consumer reporting agency in violation of 15 USC 1681s-2(a).  BOA timely removed the state court action to federal court and moved to dismiss the plaintiff’s claims because she does not have a private cause of action under the Fair Credit Reporting Act (FCRA).  See Perry v. First National Bank, 459 F.3d 816 (7th Cir. 2006).

The District Court dismissed Purcell’s claims against Bank of America without prejudice.  U.S. Dist. LEXIS 126704 (N.D. Ind. Nov. 30, 2010).  On appeal, the appellate court held the plaintiff’s claims were barred by the FCRA and ordered the District Court Judge to dismiss the plaintiff’s state and federal claims with prejudice and enter a judgment in favor of Bank of America. (READ FULL OPINION).

Practitioners should be well aware that furnishers are not completely immune from liability under the Fair Credit Act (FCRA).  While Congress eliminated a private cause of action for companies like Bank of America to furnish accurate and complete information, furnishers may be held liable for failing to conduct a reasonable investigation of the consumer’s dispute after the furnisher receives notice of the dispute from a consumer reporting agency.  16 C.F.R 660.4(e)(1) (FTC); 222.43(e)(1)(FRB); 334.43(e)(1)(FDIC).

While furnshers may be immune from private claims under 1681s2-a, cosumers have a private cause of action under 15 U.S.C. 1681s-2(b).  See Saunders v. Branch Banking & Trust Co. of Virginia, 526 F.3d 142 (4th Cir. 2008); Green v, RBS National Bank, 288 Fed. Appx. 641 (11th Cir. 2008); Campbell v. Equifax Info. Services, L.L.C., 2009 WL 302262 (S.D. Fla. Feb. 9, 2009); Bosarge v. T-Mobile USA, Inc., 2008 WL 725017 (S.D. Ala. Mar. 17, 2008); Yelder v. Credit Bureau of Montgomery, 131 F. Supp. 2d 1275 (M.D. Ala. 2001).

If there was any ambiguity in Congress’ mandate, it is now clear, furnishers must perform a reasonable investigation of a consumer dispute after receiving notice from a credit bureau, such as Equifax, Experian or Trans Union. See Johnson v. MBNA, 357 F.3d 426 (4th Cir. 2004) Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147 (9th Cir. 2009); Chiang v. Verizon New England Inc., 595 F.3d 26 (1st Cir.  2010); Boggio v. USAA Federal Savings Bank (6th Cir.  2012).

After furnishers receive notice of a consumer dispute from a consumer reporting agency, furnishers must: (A) timely conduct an investigation; (B) review all relevant information supplied by the consumer reporting agency; (C)report the investigation results to the consumer reporting agency; and (D) if the furnisher determines the information is inaccurate or incomplete, then the furnisher must report the results to all other consumer reporting agencies to which the furnisher supplied the inaccurate or incomplete information; and if the information disputed by the consumer is inaccurate or incomplete or cannot be verified, then the furnisher must (i) modify that item of information; (ii) delete that item of information; or (iii) permanently block the reporting of that item of information. 15 U.S.C. 1681s-2(b)(A-D).

Furnishers who fail to perform a reasonable investigation of a consumer’s credit report dispute may be liable for actual damages, including credit denials, and attorneys’ fees for a negligent violation, or statutory ($100 to $1,000 per violation) and punitive damages, plus attorneys’ fees for a willful violation.  15 U.S.C. 1681n and o.

We represent consumers with credit reporting issues under the Fair Credit Reporting Act (FCRA).  If you are a lawyer, and need co-counsel, or you would like to refer a client to us, please contact FCRA attorney Micah Adkins for more information about our co-counsel and referral relationshipsIf you are a consumer and you have disputed errors on your credit report to the credit reporting agencies without success, contact attorney Micah Adkins for a free case review at 1-800-263-9091

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