72 F.4th 1212
11th Cir.2023Background
- Milgram hired an office manager (Williams) who opened three credit cards in Milgram’s name and ran up ~ $30,000; Williams used Milgram’s business checking accounts to pay the cards.
- Milgram reported fraud to Chase and to credit-reporting agencies, submitted texts, police report, and later a Florida state-court judgment finding Williams committed identity theft.
- Chase’s fraud team treated Milgram as liable based on apparent authority because Milgram-controlled accounts consistently paid the cards; Chase’s Dispute Verification team later simply matched account identifiers and re-verified the debts when disputes were forwarded by CRAs.
- Milgram repeatedly disputed the reporting; Comenity and Capital One removed reporting, but Chase continued to report Milgram as liable.
- Milgram sued Chase under the Fair Credit Reporting Act alleging Chase failed to conduct a reasonable investigation; the district court granted summary judgment to Chase; Eleventh Circuit affirms.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Chase’s investigations were “reasonable” under FCRA §1681s‑2(b) | Milgram: Chase ignored police/prosecutor, state‑court judgment, and failed to take investigatory steps; investigation was inadequate. | Chase: It reasonably concluded Williams had apparent authority because Milgram’s accounts paid the card; no further investigation would change that. | Court: Chase’s investigations were reasonable; Milgram failed to identify facts Chase could have uncovered that would show inaccuracy. |
| Whether each new dispute restarts the FCRA statute of limitations | Milgram: later disputes (with new info) timely; multiple disputes should be allowed. | Chase: only disputes presenting new material information should reset the limitations period. | Court: Each failure to conduct a reasonable investigation is a separate violation that can restart the limitations period; no "new‑material‑information" requirement. |
| Whether legal questions about liability (apparent authority) are cognizable under FCRA | Milgram: legal inaccuracy (liability) can be cognizable under FCRA. | Chase: Liability is a legal question outside FCRA’s scope. | Court: Assumed (without deciding) legal inaccuracies could be cognizable but resolved the case on reasonableness grounds—Milgram failed on the merits. |
| Effect of Williams’s criminal conviction / state judgment on Chase’s investigation | Milgram: conviction and state judgment proved fraud and required Chase to stop reporting or further investigate. | Chase: conviction proves only lack of actual authority; payments still supported apparent authority so conviction didn’t alter its analysis. | Court: Criminal judgment did not undermine Chase’s apparent‑authority determination; it was not a basis to require further investigation. |
Key Cases Cited
- Felts v. Wells Fargo Bank, N.A., 893 F.3d 1305 (11th Cir. 2018) (FCRA furnisher liability limited to failures to conduct reasonable investigations after notice of dispute)
- Hinkle v. Midland Credit Mgmt., Inc., 827 F.3d 1295 (11th Cir. 2016) (what constitutes a reasonable investigation depends on circumstances and furnisher identity)
- Brown v. Nexus Bus. Sols., LLC, 29 F.4th 1315 (11th Cir. 2022) (summary judgment standard review)
- Guimond v. TransUnion Credit Info. Co., 45 F.3d 1329 (9th Cir. 1995) (FCRA’s purpose includes preventing abuses in credit reporting)
- Losch v. Nationstar Mortg., LLC, 995 F.3d 937 (11th Cir. 2021) (reports of debt discharged or otherwise inaccurate can constitute actionable reporting)
- MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007) (declaratory‑judgment suit appropriate to resolve legal rights and relations)
- Travelers Prop. Cas. Co. v. Moore, 763 F.3d 1265 (11th Cir. 2014) (illustrative use of declaratory judgment practice)
- Jackson Hewitt, Inc. v. Kaman, 100 So. 3d 19 (Fla. Dist. Ct. App. 2011) (elements of apparent authority under Florida law)
- Williams v. Pennsylvania, 579 U.S. 1 (2016) (principle against deciding one’s own case; noted in concurrence regarding furnisher neutrality)