District Court (Mass.) Finds Mass. State Law That Is Exempted from FCRA Pre-Emption Still Provides No Remedy

In Brown v. JPMorgan Chase & Co., Civil Action No. 22-11298-FDS, 2023 U.S. Dist. LEXIS 86171 (D. Mass. May 17, 2023), Judge Saylor dismissed a claim under Massachusetts state law.

The Massachusetts Credit Reporting Act provides, in relevant part, that: [e]very person who furnishes information to a consumer reporting agency shall follow reasonable procedures to ensure that the information reported to a consumer reporting agency is accurate [*9]  and complete. No person may provide information to a consumer reporting agency if such person knows or has reasonable cause to believe such information is not accurate or complete. Mass. Gen. Laws. ch. 93, § 54A(a). According to the complaint, Chase violated that statute when it failed to erase the credit inquiry from plaintiff’s credit report.5 As the Court has held in a comparable case, “while the FCRA expressly exempts § 54A(a) from its preemptive reach, it includes no such exemption for § 54A(g)—the provision that creates a private cause of action for violations of § 54A(a). In the Court’s view, the absence of express language exempting § 54A(g) from the FCRA’s preemption provision is fatal.” Leet v. Cellco P’ship, 480 F. Supp. 2d 422, 433 (D. Mass. 2007) (footnote omitted); see also Logan v. Bank of Am., N.A., 2020 U.S. Dist. LEXIS 45006, 2020 WL 1245124, at *5 (D. Mass. Mar. 16, 2020) (same). In any event, the complaint does not allege that Chase inaccurately reported plaintiff’s application for credit to the credit reporting agencies, but instead that it failed to remove accurate—albeit harmful—information from his credit report. Accordingly, dismissal of Count 5 is warranted for the additional reason that the complaint fails to allege how, if at all, that accurate reporting violated the MCRA. Cf. Galvin v. U.S. Bank, N.A., 852 F.3d 146, 160 (1st Cir. 2017) (dismissing claim where the complaint did not “specify the law with which the defendants allegedly failed to comply or how they failed to comply with it” (emphasis added)). Accordingly, the motion to dismiss Count 5 will be granted.

The Court’s analysis is interesting because it is the exact analysis that has been rejected by California courts.  Section 1785.25(a), like section 54(a), is one of two states laws that are exempt from FCRA pre-emotion.  But, like section 54(a), the CCRAA’s remedy is found in Civil Code 1785.31, which is not exempted from FCRA pre-emotion.  California Courts, however, have nevertheless found that claims (and remedies) can proceed under section 1785.25(a).  See generally Hyman, S. J. “Can the Law Be That Unclear? 9th Circuit California Courts Reach Opposite Conclusions on FCRA Pre-euption of CCRAA”. 12 Con Fin. Serv. L. Rep. 5 (March 4, 2009).