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LEARN v. CREDIT BUR. OF LANCASTER CTY.

June 1, 1987

Leslie A. Learn
v.
Credit Bureau Of Lancaster County, Inc.



The opinion of the court was delivered by: TROUTMAN

 TROUTMAN, S.J.

 The plaintiff instituted this action claiming that the defendant had violated various provisions of the Fair Credit Reporting Act, 15 U.S.C.A. § 1681-1681t (West 1982 and Supp. 1987). Presently before us are the parties' cross-motions for summary judgment.

 The plaintiff alleges in his amended complaint that the defendant credit reporting agency violated §§ 607 and 611(a), 15 U.S.C.A. §§ 1681e and 1681i(a), by, respectively, (1) failing to maintain reasonable procedures to avoid violations of § 605, 15 U.S.C.A. § 1681c, and to assure maximum possible accuracy of the information contained in the consumer credit reports it issued regarding the plaintiff and (2) failing to reinvestigate the accuracy of its reports. *fn1" The facts averred to serve as the basis of these allegations are as follows: On October 20, 1978, the plaintiff, then in a bankruptcy proceeding in this District, was released by order of the bankruptcy court from all dischargeable debts. Among those debts discharged was the sum of $ 858.87 owed by the plaintiff to CoreStates Bank of Delaware, N.A., then trading as the Philadelphia National Bank. On April 28, 1985, the plaintiff appeared in person at the defendant's place of business with a copy of the order discharging the debt to CoreStates Bank and requested that any entries on his credit report be corrected. Some time thereafter, but prior to August 7, 1985, the plaintiff sought to open a credit account with the J. C. Penney Co., Inc. On August 6, 1985, the J. C. Penney Co. obtained a consumer credit report regarding the plaintiff from the defendant. On August 7, 1985, the J. C. Penney Co. denied the plaintiff consumer credit on the basis of adverse information contained in said consumer report. On August 14, 1985, the plaintiff obtained a copy of the report that the defendant had provided to J. C. Penney. The plaintiff asserts that the report was inaccurate because it contained an entry that the plaintiff had a balance past due and owing to CoreStates Bank in the amount of $ 858.00.

 On March 11, May 5, and May 8, 1986, the defendant issued four other credit reports to prospective creditors of the plaintiff. The plaintiff, with respect to these reports, claims that since CoreStates Bank charged this debt off to profit and loss in October, 1978, the information as to the CoreStates account as disclosed by the defendant in reports disseminated after October 20, 1985, was "stale" since it antedated the report by more than seven years and, thus, was improperly reported by the defendant in contravention of § 605(a)(4) of the Act. *fn2"

 The defendant does not, for the most part, dispute the plaintiff's factual allegations. It strenuously disputes, however, that it in any way violated the Fair Credit Reporting Act. It is the defendant's position that the reports it disseminated were completely accurate and contained no obsolete information.

 The Fair Credit Reporting Act does not impose strict liability upon consumer reporting agencies. The mere fact that a report disseminated by a credit reporting agency contains inaccurate and/or stale information does not provide the consumer with a cause of action; rather, it is the agency's failure to maintain and follow "reasonable procedures" to avoid violations of, for example, § 605(a)(4) and/or to assure the maximum possible accuracy of the information contained in the report which gives rise to liability. 15 U.S.C.A. § 1681e. Thus, it is entirely possible that a trier of fact could find that while a report contained inaccurate and/or stale information, the reporting agency followed "reasonable procedures" and, thus, is not liable. See, e.g., Bryant v. TRW, Inc., 689 F.2d 72 (6th Cir. 1982); Stewart v. Credit Bureau, Inc., 236 U.S. App. D.C. 146, 734 F.2d 47 (D.C. Cir. 1984); Thompson v. San Antonio Retail Merchants Association, 682 F.2d 509 (5th Cir. 1982); Hauser v. Equifax, Inc., 602 F.2d 811 (8th Cir. 1979), and Pendleton v. Trans Union Systems Corp., 76 F.R D. 192 (E.D. Pa. 1977).

 In the instant action, the plaintiff has asserted a number of discrete causes of action. Each shall be discussed seriatim.

 1. The J. C. Penney credit application.

 As stated above, the plaintiff claims that he was denied credit by J. C. Penney based on adverse information contained in a report disseminated by the defendant, specifically, the $ 858.00 "past due debt" to CoreStates Bank. *fn3" (See defendant's "Reply Brief", Doc. 15, Exhibit A [as designated by this Court], consumer disclosure dated 8/14/85). The plaintiff asserts that the CoreStates entry was inaccurate because it reflects a balance owing and past due to CoreStates of $ 858.00. In fact, as already indicated, this debt was discharged pursuant to the aforementioned bankruptcy proceeding and, therefore, the plaintiff had no outstanding debt due and owing CoreStates. Thus, if J. C. Penney interpreted the $ 858.00 entry under the heading "Present Status" as meaning the plaintiff had a presently outstanding, past due debt owing to CoreStates, the entry would be inaccurate. As might be expected, it is the defendant's position that J. C. Penney did not interpret the entry in this manner but, rather, understood it to mean that a debt of $ 858.00 was discharged by the plaintiff's bankruptcy. Interestingly, the only evidence before us as to the meaning of the entries regarding the CoreStates account, other than the two consumer disclosures themselves, is a letter from defendant's counsel to plaintiff's counsel purporting to explain the cryptic codes utilized in the consumer reports. Even more interesting is the fact that this letter was proffered by the plaintiff as part of his summary judgment motion. (See plaintiff's Motion for Summary Judgment, Doc. # 13, Exhibit A). In the letter, counsel for the defendant explains that the "BKL" entry accompanying the CoreStates Bank account description means that the "manner of payment" of the debt was a "charge off" as a result of the plaintiff's bankruptcy. The plaintiff has introduced no contradictory evidence which would indicate that J.C. Penney interpreted the CoreStates entries in a manner other than that asserted by the defendant, i.e., that an $ 858.00 debt owed by the plaintiff to CoreStates Bank was discharged by a bankruptcy and that the plaintiff presently had no outstanding debt due and owing CoreStates. As a result, we find that there is no genuine issue of material fact as to the accuracy of the report disseminated by the defendant to J. C. Penney, that the report, as interpreted by J. C Penney, was accurate, and that the defendant is entitled to judgment as a matter of law as to this aspect of the plaintiff's action.

 Further, the plaintiff has apparently chosen not to pursue its claim that the report received by J. C Penney was inaccurate since it has failed to respond to the defendant's arguments in its summary judgment motion that the report was accurate. Thus, we believe we would also be justified in simply concluding that the plaintiff has abandoned this claim. See e.g., Teamsters Local No. 429 v. Chain Bike Corp., 643 F. Supp. 1337, 1338 n. 1 (E.D Pa. 1986).

 2. The other credit applications.

 The plaintiff next claims that the CoreStates entries, as contained in reports disseminated by the defendant after October 20, 1985, i.e., seven years after the bankruptcy court's entry of an order for relief or adjudication in the plaintiff's proceeding, constituted obsolete information under § 605(a)(4) of the Act, since CoreStates had charged the debt off to profit and loss more than seven years prior to the defendant's issuance of the reports. The 5/8/86 consumer disclosure, Exhibit B [as designated by this Court], attached to defendant's "Reply Brief", Doc. # 15, reflects that four consumer reports were disseminated by the defendant after October 20, 1985, to the following entities: CB ...


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