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No Cum Shot, But Still Important

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This thread is about a pretty big decision made by a Federal Appeals Court, but it is not going to really bore you unless you are a creditor. You see credit reporting agencies like Experian have become gods. Anyone can make a bad credit report against you and they can put it on your record and you're screwed the next time you want credit, even if they put something untrue up there. The top three credit reporting agencies have become like gods. Creditors don't have to take you to court and win, they just ruin your credit rating. There is no easy remedy for you to fight them once they get you.


So a Federal Court just ruled AGAINST the little guy, as usual when it comes to money, but then they took the shocking step of overruling themselves and ruling FOR the little guy in the same case. Now Experian and the others might have to be a little more careful. Read the story and see:


Court reverses itself - finds credit agency violated man's rights

Bob Egelko, Chronicle Staff Writer


Thursday, September 27, 2007


A federal appeals court has reversed itself and ruled that a Southern California man's rights were violated by a credit agency that put an erroneous court filing on his record, refused to change it when he complained and wrecked his hopes of starting a business.


The Ninth U.S. Circuit Court of Appeals in San Francisco had voted 2-1 in May to dismiss Jason Dennis' lawsuit, saying the credit agency had conducted an adequate investigation of his case. But on Tuesday, the same panel, by a 3-0 ruling, not only reinstated the suit but also found the agency negligent for failing to correct the error.


The court told a federal judge who had previously dismissed the suit to decide how much Dennis should receive in damages and attorney's fees from Experian Information Solutions, a credit reporting agency. The court also said Dennis was entitled to a trial on his claim that Experian failed to adopt reasonable procedures to assure accurate reporting, which could lead to additional damages.


"This case illustrates how important it is for Experian, a company that traffics in the reputations of ordinary people, to train its employees to understand the legal significance of the documents they rely on," Judge Alex Kozinski wrote. Kozinski had dissented from the ruling in May, by Judges Diarmuid O'Scannlain and Carlos Bea, that threw out the lawsuit.


The court issued its new ruling after Dennis' lawyer, Louis Dell, filed a request for rehearing. Dell said Wednesday that his filing pointed out evidence that the court may have previously overlooked - a document that should have cleared up Dennis' record - but he doesn't know why the panel changed course. The court gave no explanation for its reversal.


Credit reporting agencies have the power to "put you in a financial prison," Dell said. He said the ruling should send a message to agencies that "once you find out that you're reporting inaccurate information, you can't keep reporting that error."


Experian spokesman Don Girard said the company doesn't comment on pending cases. (Damn easy to see why...Lucky)


Dennis was sued by his landlord over rental payments in 2002. The case was later settled, with the landlord dismissing the suit in exchange for Dennis' agreement to pay $1,959. But a document in the Los Angeles Superior Court file mistakenly stated that a legal judgment had been entered against Dennis, a report that Experian picked up when it conducted a credit check of Dennis.


Dennis told the company of the error and said the settlement and dismissal were reported in another document in the court file. He said Experian's refusal to alter its conclusion left him with a blot on his record that prevented him from getting loans for a planned film production business and also prompted his next landlord to demand a higher security deposit.


He sued Experian under a federal law that requires credit agencies to take reasonable steps to verify the accuracy of credit reports, and to reinvestigate reports that have been challenged. The panel majority ruled in May that the company had acted reasonably by relying on the court record, but reached a different conclusion Tuesday.


Because the first court document was inaccurate, Kozinski said, Dennis is entitled to a trial on whether Experian took reasonable steps to guard against inaccuracies. And he said the company was negligent in misunderstanding or ignoring the second document that showed the case had been dismissed.

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Very interesting. I haven't had to worry about my credit for a while but lately have been thinking of selling and moving. So I thought I would seek out and get copies of my credit report at each of three credit reporting agencies. I had two blips on each of the report. Both negative reportings were in error. One, with the bank I have used for 19 years was very easy to get cleared up. The other, with my internet service provider, has been a pain. In the latter case, the ISP actually owed me a credit that got reported as a delinquent bill. You wouldn't believe the number of calls it has taken to clear up.


Bottom line, take advantage of the free annual report you can get from each of the reporting agencies. If you find errors, be sure to dispute the entries. Below is site where you can go to get your free credit reports.



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