Written By Digital Content Editor Thomas Ahearn

On June 20, 2023, the Supreme Court of the United States (SCOTUS) agreed to review the case of Department of Agriculture Rural Development Rural Housing Service v. Kirtz to see whether the civil-liability provisions of the federal Fair Credit Reporting Act (FCRA) unequivocally waive the “sovereign immunity” of the United States.

“The question comes to the court in a case filed by Reginald Kirtz, who contends that although he no longer owed anything on a loan made to him by the Department of Agriculture [USDA], the department reported that his account was 120 days past due, damaging his credit score,” according to a SCOTUSblog explaining the case.

  • Kirtz notified the credit union reporting the overdue account of the inaccurate statement by USDA but USDA did not correct it.
  • Kirtz went to federal court in 2020 and alleged that USDA violated the FCRA which requires anyone who provides disputed information to credit reporting agencies to investigate it and, if necessary, correct it.
  • The USDA asked a district court to dismiss the case, arguing that the FCRA did not clearly show that Congress had intended to waive the federal government’s immunity from lawsuits, and the district court agreed.
  • Kirtz appealed to the U.S. Court of Appeals for the 3rd Circuit, which reversed, pointing to the FCRA’s definition of “person” which includes “any ‘government or governmental subdivision or agency.”
  • Moreover, because the federal government is “the nation’s largest employer and creditor,” allowing lawsuits against it for violations of the FCRA would be consistent with the goal of Congress to ensure “fair and accurate credit reporting.”
  • The USDA came to the Supreme Court asking the justices to weigh in.

In March 2023, the USDA filed a petition for a writ of certiorari and SCOTUS granted the petition in June 2023. The case likely will be argued in the fall of 2023. The SCOTUSblog about the case was written by Independent Contractor and Reporter Amy Howe and the article was originally published at Howe on the Court.

Under FCRA 1681s-2(b), a data furnisher receiving notice of a dispute regarding the completeness or accuracy of information provided to a consumer reporting agency (CRA) must conduct an investigation, report the results to the CRA, and modify, delete, or block any disputed information found to be inaccurate or incomplete.

Enacted by Congress in 1970, the FCRA 15 U.S.C. § 1681 protects information collected by CRAs such as credit bureaus. Furnishers that provide information to CRAs also have specific legal obligations, including the duty to investigate disputed information. To view a complete copy of the FCRA, click here.

Employment Screening Resources (ESR) is a service offering of ClearStar, a leading Human Resource technology company specializing in background checks, drug testing, and occupational health screening. ClearStar offers workforce screening solutions for employers that comply with the FCRA. To learn more, contact ClearStar.

CITATION: Amy Howe, Justices take up Fair Credit Reporting Act case, SCOTUSblog (June 20, 2023), https://www.scotusblog.com/2023/06/justices-take-up-fair-credit-reporting-act-case/

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