52 F.4th 669
6th Cir.2022Background
- Ahmed Hammoud’s father, Mohamad, filed a Chapter 7 petition that — due to counsel’s error — listed Ahmed’s last four SSN digits (7409) instead of Mohamad’s; counsel filed a one-day-later “Statement of Social Security Number” correcting the error.
- LexisNexis supplied bankruptcy summary data to Experian; Experian’s automated matching relied on exact SSN and therefore linked Mohamad’s October 2010 filing to Ahmed’s credit file.
- Mohamad’s corrected SSN appeared on the eventual discharge order, so Experian updated Mohamad’s file but the erroneous October 2010 bankruptcy remained on Ahmed’s report for ~9 years.
- Ahmed discovered the error while pursuing a mortgage refinance in 2019, withdrew his application after learning an undischarged bankruptcy harmed automated approval, disputed the report to Experian in August 2019, and Experian removed the entry within two weeks.
- Ahmed sued Experian and Equifax under 15 U.S.C. § 1681e(b); Equifax settled. The district court denied Experian’s dismissal motion, then granted Experian summary judgment. The Sixth Circuit affirmed: Ahmed had Article III standing but could not show Experian’s procedures were unreasonable as a matter of law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing (traceability) | Inaccurate bankruptcy was published to third parties and caused harm to Ahmed’s refinance; Experian caused the disclosure. | Other CRAs (e.g., Equifax) might have provided the report, so causation is uncertain. | Ahmed has Article III standing; record supports a "substantial likelihood" Experian’s report was the source. |
| Reasonableness of procedures under §1681e(b): reliance on LexisNexis | Experian unreasonably and “blindly” relied on LexisNexis summary data instead of reviewing court documents. | Reliance on a reputable vendor (LexisNexis), with audits and automated matching, is reasonable; manual review for every record is impracticable. | Experian’s reliance on LexisNexis was reasonable as a matter of law. |
| Duty to monitor/verify court docket corrections proactively | Experian should have procedures to detect docket corrections (e.g., the SSN statement) and update consumer files. | Docket correction detail was not publicly visible to Experian/LexisNexis; requiring manual legal review of dockets would impose enormous burden—no duty absent consumer notice. | No duty to undertake such manual verification; credit agencies need not search dockets unless consumer pinpoints inaccuracy. |
| §1681e(b) liability (ultimate claim) | Ahmed alleges Experian negligently failed to follow reasonable procedures, causing injury. | Experian’s procedures were reasonable and it corrected the error promptly after notice. | Ahmed cannot show procedures were unreasonable as a matter of law; §1681e(b) claim fails. |
Key Cases Cited
- TransUnion LLC v. Ramirez, 141 S. Ct. 2190 (2021) (disclosure of inaccurate consumer information to third parties can be a concrete, redressable injury)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (standing evidentiary standards vary by stage of litigation)
- Wright v. Experian Info. Sols., Inc., 805 F.3d 1232 (10th Cir. 2015) (reliance on reputable data vendors can satisfy §1681e(b) as a matter of law)
- Childress v. Experian Info. Sols., Inc., 790 F.3d 745 (7th Cir. 2015) (requiring manual review of every public record would impose an enormous burden on CRAs)
- Losch v. Nationstar Mortgage LLC, 995 F.3d 937 (11th Cir. 2021) (once a consumer pinpoints an inaccuracy, CRA’s investigative burden narrows and correction is required)
- Henson v. CSC Credit Servs., 29 F.3d 280 (7th Cir. 1994) (consumers are better positioned to detect errors in their reports)
- Cushman v. Trans Union Corp., 115 F.3d 220 (3d Cir. 1997) (consumer pinpointing of disputed information reduces CRA’s reinvestigation burden)
- Sarver v. Experian Info. Sols., 390 F.3d 969 (7th Cir. 2004) (credit-reporting procedures based on reputable sources can be reasonable)