Home > Uncategorized > Can lawyers obtain consumer reports about you for use in lawsuits?

Can lawyers obtain consumer reports about you for use in lawsuits?

October 5, 2012

This post will address an issue that just came up in my FCRA practice:  can I, in the course of defending a client in a lawsuit that alleges violations of the FCRA, obtain a copy of the consumer reports that are at issue in the lawsuit?

The FCRA has a provision that regulates who can obtain a consumer report and under what circumstances they may do so.  It is the “permissible purpose” provision at 15 USC Sec. 1681b.  To summarize, you are allowed to get someone’s consumer report if:  a) a court says that you can; b) the consumer says that you can; or c) you have a business purpose for doing so.  The statute lists a number of specific business purposes and then has a catch-all at the end which says that someone may obtain a consumer report if he “otherwise has a legitimate business need for the information – (i) in connection with a business transaction that is initiated by the consumer; or (ii) to review an account to determine whether the consumer continues to meet the terms of the account.”

Normally, when I am defending an FCRA lawsuit, the first thing I do is ask the consumer’s lawyer for permission to obtain a copy of his/her report.  That is acceptable under Section 1681b because the consumer, through his/her lawyer, has consented.

But suppose that I don’t ask the consumer’s lawyer for permission to obtain a copy of his/her report.  Suppose that I am defending one of several defendants, all of whom created consumer reports about the plaintiff, and I want to ask the other defendants to give me their copies without telling the plaintiff about this request?  Can I do that?

As is usually the case with legal questions, the answer here is “maybe.”  There is case law from one federal court of appeal – the Sixth Circuit – which helps to illustrate when a lawyer can and can’t get a consumer report for use in defending a case.  In Spence v. TRW, Inc., 92 F.3d 380 (6th Cir. 1996), the plaintiff sued his gas company and a consumer reporting agency, and the gas company’s lawyer asked the agency to provide a copy of the underlying report for use in defending the case, which it did.  The plaintiff claimed that this was a violation of the FCRA, but the court disagreed, stating that the defense lawyer had a “legitimate business need” to obtain the report for use in his defense of an FCRA case.  However, in Duncan v. Handmaker, 149 F.3d 424 (6th Cir. 1998), the same court – the Sixth Circuit – held that a lawyer who was defending a company in a negligence case involving a real estate closing that went awry did NOT have a legitimate business need to obtain the consumer report.  More specifically, the trial court had granted the lawyer summary judgment on the grounds that he had a permissible purpose, but the Sixth Circuit reversed that and remanded it to the trial court, to determine what the lawyer’s motivations were (negligent or wilful) and what impact they might have on his liability.

In other words, while there isn’t much law on this issue, it seems as though lawyers CAN get consumer reports for use in defending FCRA cases, but they CANNOT necessarily get consumer reports for use in defending other kinds of cases.

Note:  the Supreme Judicial Court of Maine also found that lawyers who are defending FCRA cases have a legitimate business need for consumer reports.  Myshrall v. Key Bank Nat’l Ass’n, 802 A.2d 419 (Me. 2002).  This is a persuasive opinion, but not a binding one, in the federal courts that handle most FCRA cases.

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