Defamatory Statements to Credit Reporting Agencies Held Not Preempted by FCRA

Michelle Bourdelais brought a defamation claim in the Richmond Division of the Eastern District of Virginia against Chase Bank and Chase Home Finance, based on Chase's alleged reporting of inaccurate information about the status of her mortgage payments to consumer reporting agencies. Chase moved to dismiss the claim, arguing that it was preempted by the Fair Credit Reporting Act. Judge Henry E. Hudson denied the motion, allowing the claim to proceed.

The Fair Credit Reporting Act ("FCRA") contains two seemingly conflicting sections. Section 1681t(b)(1)(F) appears to preempt all state laws regarding the liability of credit reporting agencies, whereas § 1681h(e) preempts only certain types of common law actions and then only under certain circumstances. The court noted that although the Fourth Circuit has not addressed the issue, seven of nine district courts in the Fourth Circuit have reconciled this conflict by using the "statutory approach" and holding that §1681t(b)(1)(F) only applies to state statutory claims and § 1681h(e) only addresses state common law claims.

Read the rest of the article at the Virginia Defamation Law Blog.

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