Pre-1996 Amendment: 1681c[a][4]: Cahlin v. GMAC

This Folder Examines the Differing Time Periods That the Various Types of Credit Data May be Retained in Your Credit File. The Related Re-Aging Folder Also Contained in This Forum Examines the Known, Deceptive Trade Practice of Tampering With the Reporting to Avoid Automated Purge Mechanisms at the Bureaus.
David A. Szwak

Pre-1996 Amendment: 1681c[a][4]: Cahlin v. GMAC

Postby David A. Szwak » Sat Jan 14, 2006 9:52 pm

Cahlin v. General Motors Acceptance Corp.
936 F.2d 1151
C.A.11 (Fla.),1991.
Jul 25, 1991

Yet, even when the reporting of Cahlin's account is examined in detail, we find that CBI never reported any inaccurate information. Beginning in December, 1985 as a result of the termination of the lease agreement, CBI began reporting the GMAC account as a bad debt with an outstanding balance of $3,843.44. As we noted above, it is uncontroverted that this notation accurately reflected the status of the account at this time. After the terms of the settlement were satisfied, GMAC informed CBI in June, 1986 that the balance on the account had been liquidated, and, as a result, CBI changed the reporting of Cahlin's account to a bad debt with a zero balance. The deposition testimony of GMAC's representatives indicates without contradiction that this characterization of the account was accurate after May, 1986, and, indeed, is how this account might be reported today. Thus, any claim that CBI was reporting "inaccurate" information prior to June, 1986 is utterly without merit.
[10] Due to Cahlin's complaints, however, GMAC further informed CBI by letter on October 9, 1986, the totality of which stated, to "[p]lease change the rating on the above customer's account from I-9 to I-1." In response, CBI changed the current status of Cahlin's GMAC account to an "I1" rating, which is a favorable rating, but moved the "I9" rating to the section of the report detailing past credit history. Relying on deposition testimony from a GMAC employee, Cahlin contends that it was against GMAC's intent to have any reference to an "I9" rating on his credit report after the October 9, 1986 letter and therefore all of CBI's reports from the date of this letter to November, 1987 were inaccurate. [FN20] We disagree. Viewed in the light most favorable to Cahlin, the facts show that GMAC in June, 1986 believed that the Cahlin account was accurately reported as being a bad debt with a zero balance, but agreed in October, 1986 to inform CBI to change the reporting of the account under the threat of litigation. This change of heart, however, does not erase the historical fact that until at least June, 1986, GMAC was reporting to CBI that the Cahlin account was a bad debt. [FN21] It was this information that was conveyed by CBI's report when it moved the "I9" rating to the previous history section of Cahlin's account. Thus, the notation was an "accurate" reflection of how GMAC had been *1160 reporting this account to CBI in the past. Nothing contained in GMAC's terse letter of October 9 instructs CBI to eradicate GMAC's own past characterizations of the account from future credit reports. As we noted above, the fact that CBI eventually abided by GMAC's instructions to wipe completely clean Cahlin's report in November, 1987 does not mean that its reporting of this account after October 9, 1986 was inaccurate. Those reports accurately reflected GMAC's current characterization of the account and how it had been previously reported and therefore are not actionable under FCRA.


FN20. We have examined the transcript of this deposition and find that there is a substantial question as to whether this statement is fairly supported by the record. However, because of the procedural posture of this case, we are required to view the facts in the light most favorable to Cahlin.



FN21. Under the Act, a credit reporting agency is authorized to report information concerning "[a]ccounts placed for collection or charged to profit and loss" for up to seven years after such information is first collected. See § 1681c(a)(4).

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