7th Circuit: Credit reporting agency did not provide inaccurate info

On August 7, the U.S. Court of Appeals for the Seventh Circuit affirmed a lower court’s decision in favor of a credit reporting agency (the defendant), finding it did not report inaccurate credit information. An individual brought a case against the defendant under the FCRA alleging the company reported inaccurate late payments in her consumer report. The individual made mortgage payments on her home from 2007 to 2015 but was later found delinquent on her mortgage. She settled her debt through a short sale and the account was closed. Years later, the plaintiff discovered her closed mortgage account was still reported as delinquent in her credit reports and contacted the defendant. The defendant confirmed the information on file, and the lower court ruled that all the information “furnished and reported by [the defendant] … was all true.”

The inaccuracy arose when the individual applied for another mortgage in 2020 with a bank. The bank contracted a third party to create a “tri-merge” report aggregating data from the three largest credit reporting agencies. This report showed inconsistent information: the third party failed to include the previous mortgage’s “closed date” or indicate a short sale. The 7th Circuit recognized there was no field for the third party to include this information. This inaccuracy led the individual to file three separate lawsuits. In the suit against the bank’s contracted company, the parties settled, and a district court dismissed the suit with prejudice. However, in this suit, the individual argued that the credit agency’s reporting was inaccurate based on its prepared report. The 7th Circuit held that the credit reporting agency cannot be held liable for a report it neither prepared nor sent, since the individual’s injury was not connected with the defendant’s credit report.