The Sixth Circuit Applauds a Company’s Efforts to Prevent Identity Theft by Rejecting a Consumer’s FCRA Claims: the good deed went unpunished, and the identity theft victim’s bad deed may well be punished.
The Sixth Circuit began its opinion in Bickley v. Dish Network, LLC
by citing “the axiom that no good deed should go unpunished.” The rest of the Bickley
decision highlighted why this particular good deed would
go unpunished and ended with a not-so-subtle invitation for the defendant to seek sanctions against the plaintiff.
American Satellite (an independent third-party retailer for Dish Network) received a telephone call from a person identifying herself as “Gregina Dickley” and providing a social security number. As it turned out, that social security number actually belonged to Gregory Bickley – his identity had been stolen. As part of its identity-verification, customer-eligibility, and fraud prevention procedures, American Satellite transmitted the name and social security number to the three primary consumer reporting agencies (CRA): TransUnion, Equifax, and Experian. That process resulted in a “Declined No Hit” message – translation, the name and social security number do not match, indicating a problem with this potential customer. American Satellite informed the caller that the account could not be opened.
The real Bickley then received a credit report indicating that Dish Network had made some sort of inquiry under his name. Dish contacted Bickley and explained that Dish had prevented theft of Bickley’s identity. Despite Dish’s good deed, Bickley sued, alleging violations of the Fair Credit Reporting Act (FCRA). Specifically, Bickley argued that Dish’s use of his credit report lacked a “permissible purpose.” The Complaint did not mention the aborted identity theft at all
– a fact the Sixth Circuit found “bordering on deceitful.” Bickley also alleged Dish intentionally inflicted emotional distress by using the credit report to save his identity, an allegation the Sixth Circuit noted was curious in light of the fact that Dish’s credit inquiry was only one of “more than one dozen credit inquiries on his report.”
The Sixth Circuit quickly dispatched Bickley’s claims and affirmed summary judgment in Dish’s favor. Under the Fair Credit Reporting Act (FCRA), a “user” of a consumer report must have a “permissible purpose” to use the report. In an issue of first impression in the Sixth Circuit, the Court concluded that verifying a customer’s identity, assessing a customer’s eligibility, and preventing identity theft were all “legitimate business needs” and, therefore, permissible purposes under the FCRA. Summary judgment for Dish was affirmed.
Separately, Dish had filed a counterclaim against Bickley for abuse of process – essentially that Bickley filed the FCRA lawsuit for the ulterior motive of extorting money from Dish. The trial court and the Sixth Circuit agreed the counterclaim must be dismissed because Dish failed to properly plead the claim. However, in a rare expression of disdain for a party (who the Sixth Circuit variously referred to as “bordering on deceitful,” “litigious,” “and seemingly insensible”), the Sixth Circuit suggested that it was not rendering any judgment regarding whether the defendant should seek sanctions against the plaintiff for (1) filing a lawsuit and pursuing an appeal for the impermissible purpose of extorting money, (2) making “frivolous arguments because they were unsupported by any case law,” or (3) mischaracterizing or omitting key factual contentions to “purposefully mislead the court.” A not-so-subtle suggestion that the Court would approve those sanctions if Dish pursued them.
Good deed = 1; bad deed = 0.
This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.