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HOUGHTON v. NEW JERSEY MFRS. INS. CO.

July 31, 1985

DONNA M. HOUGHTON
v.
NEW JERSEY MANUFACTURERS INSURANCE COMPANY



The opinion of the court was delivered by: BECHTLE

BECHTLE, J.

 MEMORANDUM AND ORDER

 This case involves a claim by plaintiff that defendant caused to be prepared and received a credit report on plaintiff in violation of the disclosure requirements of the Fair Credit Reporting Act ("FCRA" or "the Act") and other of plaintiff's constitutional and common law rights. Prior to trial both parties moved for summary judgment on all liability issues. Following argument, the court granted plaintiff's motion seeking to hold the Fair Credit Reporting Act applicable to the credit report at issue and found defendant had violated the Act's disclosure requirements. Conversely, defendant's motion for summary judgment was granted as to all of plaintiff's remaining claims. All liability issues having been decided, the case was tried before the court without a jury solely on the issue of damages. The court found in favor of plaintiff and awarded compensatory and punitive damages totaling $7,000. Plaintiff subsequently petitioned for attorney's fees and costs.

 The following supplements the court's bench rulings administered at both the summary judgment hearing and at the bench trial, and rules upon plaintiff's petition for attorney's fees and costs.

 I. CROSS-MOTIONS FOR SUMMARY JUDGMENT

 A. Facts

 Summary judgment is proper only when the record clearly establishes that no genuine issue of material fact remains to be tried and that the moving party is entitled to judgment as a matter of law. Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 467, 7 L. Ed. 2d 458, 82 S. Ct. 486 (1962); Ely v. Hall's Motor Transit Co., 590 F.2d 62, 66 (3d Cir. 1978). Any doubt respecting the existence of a material fact must be resolved against the moving party, and all inferences must be viewed in the light most favorable to the party opposing summary judgment. Adickes v. S. H. Kress & Company, 398 U.S. 144, 157, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970).

 Based on these standards, the undisputed facts in this case are as follows:

 On November 19, 1977, plaintiff Donna M. Houghton ("plaintiff") was involved in an automobile collision with Bernice P. Rosenfeld, an insured of defendant New Jersey Manufacturers Insurance Company ("defendant"). On March 16, 1979, plaintiff filed suit against Rosenfeld for injuries resulting from the November 19, 1977 collision, including a claim for lost earnings.

 On May 14, 1979, shortly after the case was filed, defendant requested that Equifax Services, Inc. ("Equifax") conduct an investigation of plaintiff and prepare a written report. *fn1" Defendant specifically requested that the investigation include: (1) "Activities since date of accident" (2) "Cover fully past history (illness, injuries, hospitalization, etc.)" and (3) "General financial information (income, property, etc.)." Neither Equifax nor defendant notified plaintiff that a report had been requested.

 On May 22, 1979, Equifax submitted to defendant a three-page written report ("Equifax Report" or "the Report"). The Report included interviews with three of plaintiff's neighbors, reference to a previous report regarding a claim made by plaintiff's mother-in-law, reference to a check made through Montgomery County records, a check for any previous reports on plaintiff, and a check made through existing credit files prepared on plaintiff. *fn2" A copy of the report was forwarded by defendant to Frederick Fletcher, Esquire, who was retained by defendant to represent its insured Rosenfeld and in November, 1979, the case was settled.

 Some four years later, on October 21, 1983, plaintiff first learned of the existence of the 1979 Equifax Report. Plaintiff made written requests to defendant demanding that defendant disclose the substance of the Report to her, which defendant repeatedly refused to do.

 On October 18, 1984, plaintiff filed the instant action against defendant alleging: violations of the Fair Credit Reporting Act ("FCRA" or "the Act"), 15 U.S.C. § 1681 et seq. (1982); violation of her right to privacy under the United States and Pennsylvania Constitutions; invasion of privacy under Pennsylvania common law; and intentional infliction of emotional distress.

 B. Discussion

 1. Plaintiff's Claims Under the FCRA

 a. Applicability of the FCRA

 Defendant does not deny that it requested and received the Equifax Report without giving notice to plaintiff, nor that it refused to disclose the substance of the Report to plaintiff upon her several requests to do so. Rather, defendant contends that the Equifax Report is not a "consumer report" or "investigative consumer report" within the meaning of the FCRA and therefore the Act does not apply to defendant's conduct. The court disagrees.

 At the heart of the dispute is whether the Equifax Report is a "consumer report" under the Act. 15 U.S.C. § 1681a(d) defines "consumer report" as:

 
any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, characteristics or mode of living which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer's eligibility for (1) credit insurance to be used primarily for personal, family, or household purposes, or (2) employment purposes, or (3) other purposes authorized under section 1681b of this title. *fn3"

 Defendant contends that under this definition, if the requester of the report does not use or intend to use the report for one of the purposes enumerated in § 1681a(d) then it is not a consumer report. Since it requested the Equifax Report for the purpose of investigating the validity of plaintiff's injuries allegedly sustained in the November 19, 1977 accident, and not for one of the purposes listed in § 1681a(d), defendant argues that, by definition, the Equifax Report cannot be a consumer report. This contention, however, is based on the mistaken premise that a "consumer report" determination is governed entirely by the purpose for which the information was requested.

 The critical phrase here in the definition of "consumer report" is the requirement that the information must be "used or expected to be used or collected in whole or in part " (emphasis added) for one of the definition's enumerated transactions. Under this definition, the court's focus of inquiry is on the purpose for which the credit reporting agency originally collected the information, (for only it "collects" the information), and not, as defendant contends, on the purpose for which it was released. *fn4" If the information was collected "in whole or in part" for one of the purposes listed in 1681a(d) or 1681(b), regardless of its ultimate use, it is a consumer report. See Heath v. Credit Bureau of Sheridan, Inc., 618 F.2d 693, 696 (10th Cir. 1980); Boothe v. TRW Credit Data, 523 F. Supp. 631, 634 (S.D.N.Y. 1981).

 Defendant's interpretation of § 1681a(d) was specifically rejected by the court in Boothe, where the court stated:

 
Defendants would have this court hold that the release of a consumer report to a third party for a purpose not permitted by the Act converts the report into one outside the scope of the Act. Such a holding would render section 1681b, which restricts the release of consumer reports to certain specified circumstances, totally ineffective. The Act applies when the information in question was collected for one of the purposes provided in the Act, and it requires that the information be made available to third parties only for those purposes.

 523 F. Supp. at 634. In a later opinion, the court concluded:

 
An examination of the report issued to plaintiff upon his request . . . leads the court to conclude that the information collected by TRW was "expected to be used or collected in whole or in part" for . . . credit purposes. . . . The information in the TRW files included personal and credit information about plaintiff and his wife . . . Thus, although TRW may have ...

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