- CRA Is Not Liable To Consumer Because It Had Reason To Believe That The Subscriber Had A Permissible Purpose In Obtaining Consumer's Credit Report
- June 18, 2009 | Author: Martin Thornthwaite
- Law Firm: Strasburger & Price, LLP - Frisco Office
Harris v. Database Mgmt. & Mktg., 2009 U.S. Dist. LEXIS 34947 (D. Md. Apr. 23, 2009)
Facts:Plaintiff filed a lawsuit against ChoicePoint Services, Inc. alleging violation of the FCRA. Plaintiff claimed that his credit information was improperly accessed because Defendant’s offer did not comply with the FCRA’s “firm offer of credit” exception. More specifically, Plaintiff alleged that ChoicePoint violated § 1681b by selling information from Plaintiff’s consumer report to another entity, which did not use the information for transactions involving firm offers of credit. The Court, however, granted ChoicePoint’s motion for summary judgment on Plaintiff’s claim because ChoicePoint had the statutorily required “reason to believe” that the other entity was accessing the information permissibly.
- Permissible Purpose. Under § 1681b(a), a consumer report can only be accessed for certain statutorily enumerated “permissible purposes.” The firm offer of credit exception pursuant to § 1681a(l) requires an offer of credit or insurance to be honored “if the consumer is determined, based on information in a consumer report on the consumer, to meet the specific criteria used to select the consumer for the offer.” The firm offer exception can be conditioned on the fact that “the consumer actually met, and ‘continues to meet[,] the specific criteria used to select the consumer for the offer’ in the first place.”
- Permissible Purpose. The CRA must have “reason to believe” that the entity requesting and receiving the consumer’s report intends to use the information in connection with a transaction consisting of a firm offer of credit. In the instant matter, the subscriber certified in its agreement with ChoicePoint that its usage would “comply in all respects with applicable Federal, state, and local laws, regulations and rules.” The Court held that despite evidence that raised a question as to the subscriber’s use of information, there was nothing putting ChoicePoint on notice that information was actually being misused.
- Reasonable Procedures. A plaintiff must show that the CRA released a consumer report in violation of § 1681b before a reasonable procedures claim can be established under § 1681e.