1681e[b]: Burden of Proof: Sampson, SD Ga.

Maximum Possible Accuracy
David A. Szwak

1681e[b]: Burden of Proof: Sampson, SD Ga.

Postby David A. Szwak » Sat Dec 24, 2005 8:54 pm

Sampson v. Equifax Information Services, LLC
Slip Copy, 2005 WL 2095092

Whether Equifax is Liable Under § 1681e(b) is a Question of Fact
THE FCRA provides: "Whenever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates." 15 U.S.C.A. § 1681e(b) (1998).
If a consumer satisfies her initial burden by presenting evidence tending to show that the reporting agency published a credit report containing inaccurate data, "[t]he agency can escape liability if it establishes that an inaccurate report was generated by following reasonable procedures, which will be a jury question in the overwhelming majority of cases." Cahlin v. Gen. Motors Acceptance Corp., 936 F.2d 1151, 1156 (11th Cir.1991). Consequently, under Cahlin, "following reasonable procedures" is an affirmative defense that must be proven by the reporting agency. See also Guimond v. Trans Union Credit Info. Co., 45 F.3d 1329, 1333 (9th Cir.1995); but see Philbin v. Trans Union Corp., 101 F.3d 957, 964-65 (3d Cir.1996).
*3 In Philbin, the Third Circuit considered the appellate decisions in Cahlin and Guimond, and determined that the more plausible reading of the cases does not shift the burden of proving "reasonable procedures" to the credit reporting agency. Instead, it interpreted Cahlin and Guimond as allowing the jury to infer that reasonable procedures were not followed based upon the showing of some inaccuracy. Analogizing to the doctrine of res ipsa loquitur, Philbin construed these decisions as allowing the jury to reject such an inference, and the burden of proof remains with the plaintiff. Id. at 965.
The Court concludes that Philbin, perhaps in trying to narrow the divide between Cahlin and Guimond, on the one hand, and contrary decisions describing the plaintiff's burden of proof under § 1681e(b), [FN1] on the other, has placed an unnatural strain on Cahlin' s language. The Court reads Cahlin (and, less importantly, Guimond ) as requiring the reporting agency to bear the burden of proof on this point. Indeed, Philbin appears to have conceded the desirability of this approach, when it recognized that the reporting agency is "in a far better position to prove that reasonable procedures were followed than a plaintiff is to prove the opposite." Id.

FN1. E.g., Sepulvado v. CSC Credit Servs., Inc., 158 F.3d 890,
896 (5th Cir.1998); Dalton v. Capital Associated Indus. Inc., 257 F.3d 409, 416 (4th Cir.2001); Stewart v. Credit Bureau, Inc., 734 F.2d 47, 51 & n. 5 (D.C.Cir.1984) (consumer bears burden of proving failure to follow reasonable procedures).

Sampson's affidavit provides some evidence to support her contention that the credit report contained inaccurate information. According to her affidavit, The Money Tree was unsuccessful, in three different lawsuits against her, to collect her alleged indebtedness to it. Sampson Aff. ¶ 7. She also related that she has been denied credit on several occasions as a result of the false statements contained in her Equifax credit report. Sampson Aff. ¶¶ 4-5.
Contrary to Equifax's arguments, the Court cannot credit Willis' contrary representations regarding the accuracy of the report on a motion for summary judgment. See also Philbin, 101 F.3d at 968 (the plaintiff need not depose, or take affidavits from, "those responsible for the decision" to make out a prima facie case under § 1681e(b)). The Court cannot find the report was "accurate" as a matter of law. Cahlin, 936 F.2d at 1156 (indicating that summary judgment would be proper on such a claim only if the court could so conclude). At trial, presuming that Sampson marshals enough evidence to survive a directed verdict on the inaccuracy of a credit item in her report, the burden will then shift to Equifax to prove to the jury that it followed reasonable procedures in assuring "maximum possible accuracy" in the preparation of Sampson's credit report. 15 U.S.C.A. § 1681e(b) (1998); Cahlin, 936 F.2d at 1156.

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