EDPA Judge Partially Denies MTD in FCRA Case

A District Court judge in Pennsylvania has become the latest to tackle the issue of whether a plaintiff has standing to sue when claiming certain violations of the Fair Credit Reporting Act, partially denying the defendant’s motion to dismiss in a class-action suit.

A copy of the ruling in the case of Coulter v. Sagestream can be accessed by clicking here.

Three years after filing for bankruptcy protection the plaintiff accessed a copy of his credit report, which indicated that the plaintiff still owed certain debts, even though they had been discharged in the bankruptcy proceeding. The plaintiff disputed the debts, but the defendant — a credit reporting agency — did not respond to the dispute for more than three months. The plaintiff filed a class-action lawsuit, alleging a number of violations of the FCRA, notably Section 1681e(b) requiring credit reporting agencies follow reasonable procedures to assure maximum possible accuracy and Section 1681i(a)(1) requiring credit reporting agencies to conduct reasonable reinvestigations when a debt is disputed. The plaintiff made several other allegations in his complaint, most of which Judge Gerald Austin McHugh of the District Court for the Eastern District of Pennsylvania referred to as “inventive” in granting the motion to dismiss on those claims.

On the other two claims, however, Judge McHugh denied the motion to dismiss, determining that the claims to constitute a concrete injury and give the plaintiff standing to sue.

The defendant attempted to use cases to convince Judge McHugh that the plaintiff lacked the proper standing to sue, but, quoting a ruling from the Third Circuit Court of Appeals in Horizon Healthcare Services Data Breach Litigation, “the injury-in-fact element is not Mount Everest,” at least when considering a motion to dismiss. “The contours of the injury-in-fact requirement, while not precisely defined, are very generous, requiring only that claimant allege some specific, identifiable trifle of injury.”

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