PHILADELPHIA – A judge has granted a motion for summary judgment filed by a consulting company which accessed a plaintiff’s credit report, in order to collect on a debt owed by that same plaintiff in the instant case.

Judge Cynthia M. Rufe granted a motion for summary judgment on Nov. 28 in favor of defendant Diversified Consultants, Inc. and against plaintiff Scottland Johnson, declaring the data collection method used by Diversified for the purpose of collecting a debt from Johnson was legal under federal statute.

On July 26, 2016, Johnson filed suit against Diversified, a debt collection agency which acts on behalf of telecommunications companies, claiming it committed two violations of the Fair Credit Reporting Act (FCRA). Johnson alleges on June 8, 2015, Diversified accessed Johnson’s consumer credit report from Transunion, a third-party credit bureau, without his consent.

Johnson claims this constituted “willful and negligent non-compliance” with the FCRA, which usually does not allow access to a consumer’s credit report unless there is “a permissible purpose,” under the statute.

The defendant responded by moving for summary judgment, arguing that on June 5, 2015, DISH Network listed a debt owed by Johnson with Diversified, and that the agency accessed Johnson’s credit report in order to collect on that debt. Diversified argued this was a permissible purpose under the FCRA, and that Johnson’s claims failed under the law.

Though Johnson did not respond to Diversified’s motion, Rufe considered the motion on its own merits and did not grant it as unopposed.

“The defendant is entitled to summary judgment because [it] has shown that it accessed plaintiff’s credit report in order to collect on a debt owed by plaintiff, which is permissible under the FCRA. The FCRA imposes civil liability on any person who willfully or negligently obtains a consumer credit report for a purpose that is not authorized by the statute,” Rufe stated.

Rufe clarified the FCRA “expressly permits distribution of a consumer report to an entity that intends to use the information in connection with a credit transaction involving the consumer…and involving the…review or collection of an account of, the consumer” and a number of courts have held “the collection of a debt is a permissible purpose for seeking a consumer’s credit report.”

“Here, defendant has submitted an affidavit from its Vice President of Compliance stating that defendant accessed plaintiff’s credit report as part of its efforts to collect on a debt that plaintiff owed to DISH Network, which is sufficient to establish that defendant acted with a permissible purpose under the FCRA, especially in the absence of any contradictory evidence. Accordingly, defendant’s motion will be granted,” Rufe said.

The defendant is represented by Ross S. Enders of Sessions Fishman Nathan & Israel, in Furlong.

U.S. District Court for the Eastern District of Pennsylvania case 2:16-cv-03935

From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nickpennrecord@gmail.com

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