Must Show CRA Prepared and Published Inaccurate Report

Maximum Possible Accuracy
David A. Szwak

Must Show CRA Prepared and Published Inaccurate Report

Postby David A. Szwak » Thu Nov 03, 2005 5:48 pm

Ritchie v. TRW, Inc.
953 F.2d 1392, 1992 Westlaw 21300
[10th Cir.[N.M.]] Feb. 3, 1992.

Ritchies, residents of New Mexico, alleged that defendants had violated their rights under the FCRA by not removing from the Ritchies' credit files all references to a civil judgment of foreclosure and bankruptcy filing after the Ritchies had filed two lawsuits challenging the legality of the foreclosure judgment and related bankruptcy.

The Ritchies alleged jurisdiction under diversity of citizenship and 1681p ["An action to enforce any liability created under this subchapter may be brought in any appropriate United States court...."]. With respect to diversity, the Ritchies stated that "[p]laintiffs are citizens of the State of New Mexico. All but one Defendant is a citizen of another state besides New Mexico."

On appeal, Ritchie contends that the issues are whether: [1] FCRA violations are to be heard in court; [2] defendants-appellees can ignore the court's authority; [3] they established the existence of incorrect and inconsistent information in their files so as to preclude dismissal or summary judgment; and [4] the defendants-appellees violated the FCRA's "standard of maximum accuracy."

Defendants-appellees respond that even if the court erred in dismissing the claim for lack of diversity jurisdiction, the dismissal was nevertheless appropriate because the Ritchies failed to state a claim under the FCRA.

Defendants-appellees assert that the information contained in the Ritchies' credit report [that a civil judgment of foreclosure had been entered against the Ritchies and that the Ritchies had filed a petition in bankruptcy] was neither inaccurate nor misleading and the complaint contained no allegation that the Ritchies were denied credit because of the aforesaid information.

The court agreed. Ritchies did not allege that the civil judgment and bankruptcy reported by defendants-appellees were false. Rather, the Ritchies simply alleged that once they advised defendants-appellees that they had filed two lawsuits challenging the civil judgment, the defendants-appellees should have immediately removed any references to the judgment and bankruptcy from their file. It is this failure on the part of the defendants-appellees which Ritchies allege to be a violation of their rights under the FRCA.

In Cahlin v. General Motors Acceptance Corporation, 936 F.2d 1151, 1156 [11th Cir.1991], the court made the following observation, with which this court agreed: In order to make out a prima facie violation of 1681e[b], the Act implicitly requires that a consumer must present evidence tending to show that a credit reporting agency prepared a report containing 'inaccurate' information. If he fails to satisfy this initial burden, the consumer, as a matter of law, has not established a violation of 1681e[b], and a court need not inquire further as to the reasonableness of the procedures adopted by the credit reporting agency. Having failed to even allege that the defendants- appellees prepared a report containing inaccurate information, the court that the Ritchies failed to state a cause of action under the FRCA. Defendants-appellees did not violate the FCRA by accurately reporting the Ritchies' civil judgment and bankruptcy. Court's order of dismissal was affirmed.

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