Gordon Rees Scully Mansukhani Partner Haley M. Heath and Associate Samuel R. Wilson secured a victory in the United States District Court for the Western District of Arkansas on behalf of the firm’s client, a credit reporting agency, in a Fair Credit Reporting Act (FCRA) lawsuit.
The plaintiff alleged that inaccurate information regarding the plaintiff’s criminal history was included in a background check prepared by the client, resulting in the plaintiff being denied housing. The plaintiff alleged that the client’s operating procedures were in violation of the FCRA due to the criminal history of another individual with the same name being included on the background check at issue.
The GRSM team filed a motion to dismiss based on the novel argument that the plaintiff had failed to allege the client received notice of possible insufficiencies in its operations. The FCRA requires credit reporting agencies to follow reasonable procedures when matching individuals to prior records, but controlling case law pertained only to this reasonableness standard without emphasis as to a notice requirement. Granting GRSM’s motion, the district court determined that claims for violation of the FCRA require more than an allegation of furnished inaccurate information but also must include an allegation of notice of systemic problems with a credit reporting agency’s procedure.
At GRSM, our Bankruptcy, Restructuring & Creditors’ Rights practice delivers comprehensive counseling and litigation services to a diverse array of clients, ranging from Fortune 500 corporations to nonprofits, and brings extensive experience in handling cases alleging violations of the FCRA.