Holden v. Holiday Inn Club Vacations, Inc.

The Fair Credit Reporting Act requires furnishers of information to consumer reporting agencies to reasonably investigate disputes regarding the completeness or accuracy of the information furnished. Although the statute does not distinguish between legal and factual disputes, the district court decisions conclude that a furnisher’s failure to investigate a dispute alleging that the information is inaccurate for a legal reason (as opposed to a factual one) cannot form the basis for a claim that a furnisher has violated § 1681s-2(b). These opinions are not supported by the statute, risk exposing consumers to more inaccurate credit reporting, conflict with the decision of another circuit, and undercut the remedial purpose of the FCRA. Moreover, separating “factual” disputes from “legal” ones is difficult to accomplish in practice and would allow furnishers to evade their statutory obligations by characterizing nearly any dispute as a “legal” one. This Court should reverse the district courts’ judgments and clarify that furnishers are required to, and can be held liable for failing to, conduct reasonable investigations of both legal and factual questions posed in consumer disputes.