In a recent decision, the U.S. District Court for the Eastern District of Pennsylvania granted summary judgment in a Fair Credit Reporting Act (FCRA) case where a bank promptly corrected inaccurate mortgage payment information furnished to three national consumer reporting agencies (CRAs).

In their complaint, the plaintiffs asserted FCRA claims against the bank holding their mortgage and the CRAs alleging the bank incorrectly reported payments in forbearance were, in fact, delinquent. One plaintiff filed a dispute with one of the CRAs on August 7, 2020, which then sent notice of the dispute to the bank. The bank investigated, determined the account was reported delinquent in error, and modified its reporting to eliminate the past due amount, delete the delinquency notation, show the loan to be current, and report the loan as “paying as agreed.” Two of the CRAs confirmed receiving this update and corrected the inaccuracy by September 3, 2020. The third CRA never reported the inaccurate information, so there was nothing to correct.

The plaintiffs then filed suit, alleging the bank violated § 1681s-2(b)(1) of the FCRA by failing to conduct a reasonable investigation and correct the inaccurate information after receiving a dispute from the CRA. They further alleged that the CRAs violated § 1681e(b) by not having reasonable procedures to ensure maximum possible accuracy of any information submitted and § 1681i by failing to reasonably reinvestigate the inaccurate information and properly or timely modify the inaccuracies. All defendants filed motions for summary judgment, which were granted.

Looking at the claim against the bank, the court noted a furnisher cannot be sued under § 1681s-2(b) with a claim predicated solely on inaccuracy and, instead, the plaintiff has the burden of showing the furnisher failed to conduct a reasonable investigation of the dispute. Although this is usually a question of fact, here there was no dispute the bank received the dispute on August 12, 2020, and by September 2, 2020, determined there was an error and sent the corrected information to the CRAs. Thus, it was “beyond question” the bank had complied with the requirements of § 1681s-2(b)(1) by conducting a reasonable investigation and timely providing updated information.

Moving to the claims against the CRAs, the CRAs provided detailed information about their practices, procedures, and protocols to ensure accurate and reliable data. The plaintiffs did not proffer sufficient evidence to rebut the CRAs’ assertion and the court found there was no genuine issue of fact regarding the reasonableness of their procedures to ensure accuracy under § 1681e(b).

The court followed Third Circuit precedent holding § 1681i requires any CRA to reinvestigate within a reasonable time and promptly delete inaccurate or unverifiable information. The court again found that while the reasonableness of a reinvestigation is usually a jury question, here there were no genuine issues for a jury to consider. The two CRAs that reported the inaccurate information updated the plaintiffs’ consumer reports after receiving notification through the ACDV process, which the court found to be an adequate and reasonable method of reinvestigation. The third CRA, which never reported the inaccurate information, could not have violated § 1681i.

Furnishers and CRAs can take comfort that despite the plaintiffs’ efforts to have the bank and CRAs pay damages for a mistake that was promptly corrected, the court granted summary judgment to all of the defendants.