SCOTUS Archives - JDP https://www.jdp.com/blog/tag/scotus/ Employment Screening, Background Check Mon, 29 Jan 2024 16:13:48 +0000 en-US hourly 1 SCOTUS Hears Arguments On Government Immunity to FCRA Suits https://www.jdp.com/blog/scotus-hears-arguments-on-government-immunity-to-fcra-suits/ Mon, 13 Nov 2023 11:39:37 +0000 https://www.pre-employ.com/?p=17637 SCOTUS Hears Arguments On Government Immunity to FCRA Suits November 13, 2023 The Supreme Court of the United States (SCOTUS) has heard arguments in a case concerning the federal government. It will determine whether the federal government maintains immunity to liability under the Fair Credit Reporting Act (FCRA).  The arguments addressed many key issues in […]

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]]> SCOTUS Hears Arguments On Government Immunity to FCRA Suits
November 13, 2023

The Supreme Court of the United States (SCOTUS) has heard arguments in a case concerning the federal government. It will determine whether the federal government maintains immunity to liability under the Fair Credit Reporting Act (FCRA). 

The arguments addressed many key issues in deciding whether the FCRA explicitly waives the government’s immunity. Most justices focused on how Congress defined the term “persons.” In the FCRA’s text, Congress defined the term as “any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity.”

The Case

The plaintiff sued the U.S. Department of Agriculture’s (USDA) Rural Housing Authority in this case. He alleged that the agency reported a loan as delinquent despite him paying it in full. As such, he claimed that the agency violated the FCRA. The defined term for “persons” led him to claim that the USDA lacked sovereign immunity under the explicit waiver.

Initially, a U.S. District Court rejected the case. However, the Court of Appeals for the Third Circuit revived it. The Third Court also found that the definition of “person,” as written within the law, explicitly waived sovereign immunity. However, this reading conflicted with the Fourth and Ninth Circuits. The USDA appealed this decision to the Supreme Court to provide a final ruling and settle the division between Circuits.

The Progress

Several justices reviewing the case appeared swayed by the direct inclusion of “government or governmental subdivision.” However, one argument repeatedly brought up an existing 1973 precedent. This Supreme Court precedent could indicate that the waiver of sovereign immunity must become more direct.

The justices raised the question of how much money the government may have to pay if subject to FCRA litigation. According to an assistant for the Solicitor General, an existing class action against the government can answer this question. The pending outcome of this case could result in damages in the millions.

For now, the case’s fate remains uncertain, and many await the Supreme Court’s decision: Whether the government maintains sovereign immunity in the face of FCRA litigation. Regardless of the result, this case serves as a reminder for other entities to comply with the FCRA and other regulations. One way companies can ensure compliance is by working with a trustworthy background screening provider. The right partner can provide compliant and accurate reports.

Keep your business up to date on new laws and regulations with JDP’s free news resources. Contact a sales rep today.

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]]> SCOTUS to Determine Whether FCRA Holds Government Liable for Violations https://www.jdp.com/blog/scotus-to-determine-whether-fcra-holds-government-liable-for-violations/ Wed, 08 Nov 2023 20:17:06 +0000 https://www.pre-employ.com/?p=17606 SCOTUS to Determine Whether FCRA Holds Government Liable for Violations November 8, 2023 The U.S. Supreme Court has received the task to consider whether the Fair Credit Reporting Act (FCRA) can hold public agencies liable for violations. According to the case, the question will focus on defining a “person.” The determination will clarify whether the […]

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]]> SCOTUS to Determine Whether FCRA Holds Government Liable for Violations
November 8, 2023

The U.S. Supreme Court has received the task to consider whether the Fair Credit Reporting Act (FCRA) can hold public agencies liable for violations. According to the case, the question will focus on defining a “person.” The determination will clarify whether the federal law explicitly waiving the government’s sovereign immunity applies.

This case began as a typical consumer dispute. In it, the aggrieved alleged that the lender provided erroneous information. The lender in question was the U.S. Department of Agriculture (USDA). The plaintiff explained that the problem concerned a loan he received from the Rural Housing Service, an agency under the USDA.

The Complaint

The plaintiff claimed that he repaid this loan in full. However, his credit report continued showing outstanding past-due payments. The plaintiff disputed this error with a consumer reporting agency, which forwarded the dispute to the lender. When the information did not change, he filed a lawsuit alleging violations of the FCRA.

The USDA promptly filed a motion to dismiss. According to the USDA, the agency did not qualify as a “person” under the FCRA. Thus, the USDA claimed immunity from liability. The district court found that the FCRA did not explicitly waive this right and granted the motion for dismissal. However, the plaintiff appealed this ruling, which the Third Circuit reversed.

The Results

According to the Third Circuit, the government “unambiguously” waived its right to immunity in the text, which defines a “person” to include a “government or governmental subdivision or agency.” Congress amended the FCRA in 1996, expanding it to include “any person” who furnished information to consumer reporting agencies instead of only the agencies themselves. However, it did not change the definition of a person. It has been the same since 1970 and includes government agencies.

Though the language in the statute is clear, there is case history favoring the argument that the government holds sovereign immunity. This history also reveals a circuit split on the issue. The USDA requested the Supreme Court to overrule the Third Circuit’s decision to resolve this split. 

As such, the Supreme Court has agreed to take up the case and review the arguments. However, businesses and many other organizations do not have immunity. They must comply with the FCRA and other applicable laws when handling credit and background check reports. As such, companies should consider working with a trustworthy background-check company. The right partner will ensure they comply with all relative regulations while delivering accurate and timely reports.

JDP makes background checks easy and reliable. Speak with a sales representative today.

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