CAN A CONSUMER SUE A FEDERAL AGENCY UNDER FAIR CREDIT REPORTING ACT BY ALEXANDER CHANTHUNYA

In the case of Department of Agriculture Rural Development Rural Housing Service v. Kirtz, decided by the Supreme Court in February 2024, the key issue was whether a consumer can sue a federal agency under the Fair Credit Reporting Act (FCRA) for providing false credit information. Reginald Kirtz initiated a lawsuit against the USDA for negatively impacting his credit score by falsely reporting his account status to TransUnion. The USDA contested, citing sovereign immunity.

The Supreme Court ruled that the FCRA's language clearly waives sovereign immunity, allowing consumers to sue federal agencies for non-compliance. The Court determined that the term “any person” within the FCRA encompasses government agencies, making them liable under sections 1681n and 1681o of the FCRA for willful or negligent credit reporting inaccuracies.

The decision highlighted the FCRA's explicit terms, asserting that no separate sovereign immunity waiver is necessary beyond what the statute provides. The ruling also dismissed the government's broader concerns regarding state sovereign immunity and potential conflicts with other statutes like the Privacy Act.

This landmark ruling affirmed that federal agencies are accountable under the FCRA, upholding the principle that entities, including governmental ones, must ensure accurate and fair credit reporting.