The Fair Credit Reporting Act requires consumer reporting agencies like Trans Union to conduct a “reasonable reinvestigation” when a consumer disputes a debt. For that requirement to be meaningful, several courts have held that a reinvestigation generally must mean more than parroting the creditor’s information.
In this case, Toyota Motor Credit Corp. believed Jeffrey Brill owed Toyota an outstanding debt on a car lease. Toyota reported that debt to consumer reporting agency Trans Union. In fact, Brill had not signed the lease. Brill disputed the debt with Trans Union and provided a sample of his signature to support his claim that his signature had been forged. Trans Union did no more than send an automated query to Toyota asking it for confirmation of the debt. When Toyota confirmed, Trans Union refused to remove the debt from Brill’s file. As a result, Brill struggled with fallout from damaged credit for more than a year.
In 2015, Brill sued Trans Union for failing to conduct a reasonable reinvestigation. The district court dismissed the case, however, holding that Trans Union had done enough because it had no power to cancel Brill’s debt.
Representing Brill on appeal to the U.S. Court of Appeals for the Seventh Circuit, Public Citizen argued that the power to modify a debt is irrelevant to Trans Union’s statutory duty to conduct a reasonable reinvestigation and that Trans Union’s investigation did not satisfy the statutory standard. The Seventh Circuit affirmed, however, holding that Trans Union was not required to do more than ask Toyota to confirm the debt under the circumstances in this case. Brill’s subsequent petition for rehearing en banc was denied.