In Collins v. Experian Information Solutions, Inc., No. 14-11111 (11th Cir. January 5, 2015), the plaintiff sought to recover damages for emotional distress resulting from a credit reporting agency’s failure to reasonably investigate disputed information in his credit file. Prior to the lawsuit before the court, Equable Ascent Financial, LLC sued Curtis Collins in small claims court in Jefferson County, Alabama. After a trial, the small claims court entered judgment for Collins. He immediately wrote to Experian and requested that it remove the Equable debt from his credit file. Experian’s investigation of this dispute involved requesting additional information from Collins, which he provided, and asking Equable if the debt remained valid. After Equable erroneously told Experian that the debt was valid, Experian made no further investigation and did not remove the debt from Collins’ credit file.
After learning that Experian was still reporting the Equable debt as valid, Collins sued Experian for violating the Fair Credit Reporting Act. He alleged, among other things, that Experian had negligently or willfully failed to conduct a reasonable investigation of the accuracy of the Equable debt as required by 15 U.S.C. § 1681i(a)(1) and claimed emotional distress as actual damages. Although it held that there was a genuine dispute of material fact regarding the reasonableness of Experian’s investigation, the district court nevertheless entered judgment for Experian, explaining that a party cannot recover actual damages unless a credit reporting agency has published erroneous information to a third party.
Collins appealed. The Eleventh Circuit reversed, explaining that, while third party publication may be required to show actual harm under other provisions of the FCRA, such a showing is not required by the plain language of § 1681i(a)(1). That subsection directs that, when the “accuracy of any item of information in a consumer’s credit file at a consumer reporting agency is disputed by the consumer and the consumer notifies the agency directly,” then “the agency shall, free of charge, conduct a reasonable investigation to determine whether the disputed information is inaccurate.” As defined by the FCRA, a consumer’s file includes all information retained by the credit reporting agency, not just information which has been reported to third parties. Thus, a credit reporting agency can violate § 1681i(a)(1) by merely failing to reasonably investigate the accuracy of information in a consumer’s file; communicating erroneous information to a third party is not required. Accordingly, the Court held that a plaintiff can recover emotional distress as actual damages for a violation of § 1681i(a)(1) regardless of whether that information has been published to a third party. The Court remanded so that the district court could consider in the first instance whether Collins had sufficient evidence of emotional distress to survive summary judgment.