Okocha v. Trans Union LLC, 2011 U.S. Dist. LEXIS 39998 (E.D.N.Y. Mar. 31, 2011)
Facts: Plaintiff alleged that Trans Union, Experian, and Equifax violated the FCRA, the New York FCRA, and New York common law by inaccurately reporting five accounts on his consumer report and by failing to conduct an adequate reinvestigation of those accounts. The Court granted Defendants' Motions for Summary Judgment because Plaintiff failed to produce any evidence to support his claims.
- Reasonable Procedures. Under § 1681e(b), CRAs have a duty to follow reasonable procedures to assure maximum possible accuracy of consumer information when preparing a consumer report. The threshold question is whether the challenged information was inaccurate. If the information was inaccurate, a plaintiff must then present some evidence from which a trier of fact could infer that a CRA failed to follow reasonable procedures in preparing Plaintiff's consumer report. The Court dismissed Plaintiff's claims under § 1681e(b) because Plaintiff failed to produce any evidence that Defendants did not follow reasonable procedures to ensure the accuracy of the information once notified of the alleged inaccuracies.
- Reasonable Procedures. Whether Plaintiff had a legal obligation to pay the debts reported by the underlying creditors turned on questions of law that Defendants could not have possibly resolved through a reinvestigation. Thus, even if the accounts were reported inaccurately, the Court held that Defendants were entitled to report the account information until Plaintiff properly resolved the issues with his creditors in a legal proceeding.
- Reasonable Reinvestigation. Section 1681i(a) and NY FCRA § 380-f require a CRA to reasonably reinvestigate any disputed information contained within an individual's consumer report after receiving a direct dispute from the consumer. The Court held that even if Plaintiffs' accounts were reported inaccurately, Plaintiff failed to produce any evidence to suggest that Defendants failed to discharge their duty to reinvestigate Plaintiff's disputes in a reasonable manner. Each Defendant properly used the ACDV process and timely notified Plaintiff of the results. Because Plaintiff did not raise any significant factual challenges to the accuracy or reliability of the original source of the reported information and did not make any actual allegations of fraud, the Court held that the ACDV process followed by Defendants was reasonable as a matter of law.
- Reinsertion. Section 1681i(a)(5) mandates that disputed information must be deleted from a consumer report if it cannot be verified pursuant to a reinvestigation. Before a CRA may reinsert previously deleted information into a consumer's report, it must certify the accuracy of the information with the furnisher and must notify the consumer of the reinsertion. In this case, the CRAs removed an Alllied Interstate, Inc. account from Plaintiff's consumer report in November of 2006. The original debt was then sold to Harvard Collection Services, who in turn reported the debt again to the CRAs. The Court held that because the account information was provided by two different furnishers and was identified by two completely different account numbers, the appearance of the Harvard Collection Services account did not constitute a reinsertion of previously deleted information under the FCRA.
- Reinvestigation. Pursuant to § 1681i(a)(6)(A), a CRA is required to send notice to a consumer following the completion of a reinvestigation of disputed information. The notification must include a notice that the consumer has a right to add a statement to his file disputing the accuracy or completeness of the information. While Equifax failed to send Plaintiff a notification of its reinvestigation, the Court held that a CRA was entitled to require proof of proper identification from the consumer under § 1681h(a)(1) before providing such notice. In this instance, Plaintiff failed to comply with repeated requests to provide identifying information, so the Court granted summary judgment on this claim.
- Preemption. Section 1681h(e) prohibits a consumer from bringing any action or proceedings for defamation, invasion of privacy, or negligence except as they relate to false information furnished with malice or willful intent to injure such a consumer. Because Plaintiff failed to provide any evidence supporting his allegations that Defendants showed malice or willful intent to injure and because the procedures Defendants utilized were reasonably calculated to assure accuracy in the consumer reports it produced, the Court held that Plaintiff's state common law claims for defamation, invasion of privacy, false light and negligence were preempted by the FCRA and were dismissed.
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