1996 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

12-6-1996

Philbin v. Trans Union Corp

Precedential or Non-Precedential:

Docket 96-5030

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Recommended Citation

"Philbin v. Trans Union Corp" (1996). 1996 Decisions. Paper 8.

http://digitalcommons.law.villanova.edu/thirdcircuit_1996/8
 UNITED STATES COURT OF APPEALS 

 FOR THE THIRD CIRCUIT 

 

 No. 96-5030 

 

 JAMES R. PHILBIN, JR. 

 v. 

 TRANS UNION CORPORATION; TRW CREDENTIALS 

 JAMES PHILBIN, JR., 

 Appellant 

 

 On Appeal from the United States District Court 

 for the District of New Jersey 

 (D.C. No. 93-cv-02360) 

 

 Argued October 28, 1996 

 BEFORE: SCIRICA and COWEN, Circuit Judges 

 and FEIKENS, District Judge* 

 (Filed December 6, 1996) 

Daniel J. de Luca, Esq. (argued) 

510 White Horse Pike 

Audobon, NJ 08106 

 COUNSEL FOR APPELLANT 

 James R. Philbin, Jr. 

Mark E. Kogan, Esq. (argued) 

Marion, Satzberg, Trichon & Kogan 

1735 Market Street 

3000 Mellon Bank Building 

Philadelphia, PA 19103 

 COUNSEL FOR APPELLEE 

 Trans Union Corporation 

 

*Honorable John Feikens, United States District Judge for the 

 Eastern District of Michigan, sitting by designation. 

Dorothy A. Kowal, Esq. (argued) 

Stoldt & Horan 
401 Hackensack Avenue 

Hackensack, NJ 07601 

 COUNSEL FOR APPELLEE 

 TRW Credentials 

 

 OPINION 

 

COWEN, Circuit Judge. 

 Plaintiff James R. Philbin, Jr. appeals two orders of the 

district court, the first dated November 29, 1994, and the second 

and final order dated December 8, 1995, granting summary judgment 

in favor of the defendants. This appeal raises issues regarding 

the elements of a cause of action pursuant to § 607(b) of the 

Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681e(b), and the 

nature of plaintiff's burden in demonstrating a prima facie case 

pursuant to such a cause of action, questions we have not yet had 

occasion to address. For the reasons that follow, the judgment 

of the district court is affirmed in part, reversed in part, and 

remanded for further proceedings. 

 I. 

 At some unspecified point in time, defendant Trans Union 

Corp. ("TUC"), a credit reporting service, prepared a credit 

report regarding Philbin that erroneously stated he was subject 

to a tax lien in the amount of approximately $9500. Apparently, 

TUC had him confused with his father, James R. Philbin, Sr. 

Plaintiff states in an affidavit that he has never been 

delinquent on any financial obligation. App. at 8. That 

statement has never been shown to be false, nor has it ever been 

denied by defendants. Philbin first notified TUC of the error in 

April of 1990. TUC corrected the error and added a notation to 

the credit report reading: "Do not confuse with father James 

Philbin Sr different address different social security number." 

App. at 14. 

 Defendant TRW Credentials, Inc. ("TRW") had also apparently 

prepared a false credit report on Philbin, although there is no 

evidence of what inaccuracies it contained. In the spring of 

1990, Philbin's attorney wrote a letter to TRW demanding that it 

correct its report. Philbin apparently did not have any further 

complaints with TRW until approximately two-and-a-half years 

later. 

 In July of 1990, Philbin applied for and was denied credit 

at Macy's department store. The reasons given were that his 

"credit profile shows delinquent past or present credit 

obligations with others" and "insufficient favorable credit 

experience." App. at 15. Macy's relied in whole or in part on 

the TUC report. Philbin requested and received a copy of his 

credit report from TUC, which he concedes was wholly accurate. 
 In February of 1992, Philbin applied for and was denied a 

$1500 loan by Household International Company. The decision was 

based in whole or in part on information received from TUC, but 

Household gave no reasons for its decision. That April, Philbin 

filed a complaint against TUC with the New Jersey Department of 

Law and Public Safety. That agency forwarded Philbin's complaint 

to the Federal Trade Commission ("FTC"). Two months later, 

Philbin was denied a loan of approximately $10,000 from Bayview 

Marina based in whole or in part on information received from 

TUC. The reason given was "insufficient credit file." App. at 

25. 

 That November, Philbin was denied credit from four different 

credit granting agencies. Philbin's application for a credit 

card from Circuit City electronics store was denied by the First 

North American National Bank, based in whole or in part on 

information received from TUC. The reasons given for the denial 

were "number of other recent credit inquiries" and "high 

utilization of bankcard credit lines." App. at 31. He applied 

for a credit card from Sears department store and was denied 

credit based in whole or in part on information received from 

both TUC and TRW. The reasons given were "unfavorable credit 

history," "number of credit bureau inquiries," and "number of 

open accounts." App. at 27. He was denied a Best Products 

credit card from Bank One based in whole or in part on 

information received from TUC. The reasons given were 

"sufficient pay history not established," and "limited credit 

experience." App. at 28. Finally, Philbin was denied a credit 

card by Citibank based in whole or in part on information 

received from TRW. The reason given was that "a delinquent 

credit obligation[] was recorded on [the] credit bureau report." 

App. at 44. 

 Fearing that these successive denials of credit were due to 

inaccuracies in his credit reports, Philbin requested a copy of 

his report from both TUC and TRW. TRW promptly sent him a copy 

of his report, which Philbin concedes contained no inaccuracies, 

indicating no delinquencies and listing six open accounts. 

 Ten days after the request to TUC was made, TUC informed him 

that the address he had provided them did not match the address 

in their records and requested that he send them proof of 

residence. The address to which he wished the report sent was 

the same address to which the 1990 report had been sent. 

However, other evidence in the record reflects that Philbin used 

two addresses. Philbin complied and, several weeks later, he 

received a copy of his TUC report. It erroneously stated that he 

had been released from a $9580 tax lien. Philbin states that he 

notified TUC about the error immediately. 

 In May of 1993, after having filed the complaint in the 

instant litigation, Philbin applied for a $5000 loan from 

Nation's Credit, which informed him that it was inclined to deny 

him the loan based in whole or in part on information received 

from TUC and TRW. He obtained from Nation's Credit a copy of 

the TUC report. Like the report he received directly from TUC 

the previous year, it erroneously stated that he had been 

released from a $9580 tax lien. Philbin also obtained the TRW 
report from Nation's Credit. That report, in addition to 

containing correct information regarding him, erroneously listed 

twelve open accounts, one currently delinquent account, and four 

past delinquent accounts. This information apparently pertained 

to Philbin's father, not to him. 

 On April 22, 1993, Philbin filed the instant suit in the 

Superior Court of New Jersey, Camden County, charging TUC and TRW 

with violations of the FCRA. He claimed that as a result of the 

inaccurate reporting of his credit history and the subsequent 

denials of credit, he suffered "deep humiliation and 

embarrassment . . . and will continue to suffer injury to his 

credit, reputation and financial standing." App. at 3, 5. He 

stated in an affidavit that he has suffered the humiliation and 

embarrassment of not being able to purchase items necessary to 

his business without the help of his father. App. at 8. 

Finally, he stated that he "suffered economic injury from the 

inability to establish credit so that [he] can pursue investment 

opportunities in real property." App. at 8. 

 TUC and TRW removed the case to the district court. They 

subsequently moved for summary judgment dismissing the complaint 

pursuant to Fed. R. Civ. P. 56 on the grounds that Philbin had 

not produced sufficient evidence to make out a prima facie case 

of either willful or negligent noncompliance with § 1681e(b). On 

November 29, 1994, the district court granted TRW's motion for 

summary judgment; granted TUC's motion for summary judgment on 

the issue of willful noncompliance with § 1681e(b); and denied 

TUC's motion for summary judgment on the issue of negligent 

noncompliance with § 1681e(b). 

 In preparation for trial, the parties filed a Joint PreTrial Order, paragraph six of which stated: "None of the letters 

from the creditors . . . mentions a tax lien as a reason for 

denial of credit." TUC's Mem. of Law at 6. Based on this, TUC 

moved for reconsideration of the portion of its motion for 

summary judgment that had been denied. On reconsideration, the 

district court held that, pursuant to the stipulation contained 

in the Joint Pre-Trial Order, Philbin would not be able to 

produce any evidence that the denials of credit by the credit 

granting agencies were caused by the inaccurate entry on the TUC 

report. The district court concluded that he would therefore not 

be capable of sustaining his burden of proof on at least one 

element of his prima facie case. Accordingly, the district court 

vacated that portion of its November 29, 1994, order denying 

summary judgment to TUC, granted TUC's motion for summary 

judgment, and dismissed the complaint. This appeal followed. 

 II. 

 The FCRA was enacted in order to ensure that "consumer 

reporting agencies adopt reasonable procedures for meeting the 

needs of commerce for consumer credit, personnel, insurance, and 

other information in a manner which is fair and equitable to the 

consumer, with regard to the confidentiality, accuracy, 

relevancy, and proper utilization of such information." 15 

U.S.C. § 1681(b). The FCRA was prompted by "congressional 

concern over abuses in the credit reporting industry." Guimond 

v. Trans Union Credit Information Co., 45 F.3d 1329, 1333 (9th 
Cir. 1995); see also St. Paul Guardian Ins. Co. v. Johnson, 884 

F.2d 881, 883 (5th Cir. 1989). In the FCRA, Congress has 

recognized the crucial role that consumer reporting agencies play 

in collecting and transmitting consumer credit information, and 

the detrimental effects inaccurate information can visit upon 

both the individual consumer and the nation's economy as a whole. 

See 15 U.S.C. § 1681(a)(1), (3). 

 Title 15 U.S.C. § 1681e(b) provides: "Whenever a consumer 

reporting agency prepares a consumer report it shall follow 

reasonable procedures to assure maximum possible accuracy of the 

information concerning the individual about whom the report 

relates." It is undisputed that TUC and TRW are "consumer 

reporting agenc[ies]" within the terms of 15 U.S.C. § 1681a(f), 

the credit reports they produced are "consumer report[s]" within 

the meaning of § 1681a(d), and Philbin is a "consumer" for 

purposes of § 1681a(c). Sections 1681n and 1681o of Title 15 

respectively provide private rights of action for willful and 

negligent noncompliance with any duty imposed by the FCRA and 

allow recovery for actual damages and attorneys fees and costs, 

as well as punitive damages in the case of willful noncompliance. 

See Casella v. Equifax Credit Information Servs., 56 F.3d 469, 

473 (2d Cir. 1995), cert. denied, 116 S.Ct. 1452 (1996); Guimond, 

45 F.3d at 1332; Henson v. CSC Credit Servs., 29 F.3d 280, 284 

(7th Cir. 1994); Cahlin v. General Motors Acceptance Corp., 936 

F.2d 1151, 1156 & n.4 (11th Cir. 1991). 

 A. 

 The parties agree that a case of negligent noncompliance 

with § 1681e(b) consists of four elements: (1) inaccurate 

information was included in a consumer's credit report; (2) the 

inaccuracy was due to defendant's failure to follow reasonable 

procedures to assure maximum possible accuracy; (3) the consumer 

suffered injury; and (4) the consumer's injury was caused by the 

inclusion of the inaccurate entry. See Morris v. Credit Bureau 

of Cincinnati, Inc., 563 F. Supp. 962, 967 (S.D. Ohio 1983); 

Bryant v. TRW, Inc., 487 F. Supp. 1234, 1238 (E.D. Mich. 1980), 

aff'd, 689 F.2d 72 (6th Cir. 1982). Defendants do not dispute 

they both produced at least one report that contained inaccurate 

information about Philbin. Nor do they contest that Philbin's 

emotional distress damages are cognizable. See Guimond, 45 F.3d 

at 1333; Stevenson v. TRW Inc., 987 F.2d 288, 296 (5th Cir. 

1993); Millstone v. O'Hanlon Reports, Inc., 528 F.2d 829, 834-35 

(8th Cir. 1976). Moreover, TUC apparently concedes that Philbin 

has satisfied his burden on summary judgment of producing facts 

from which a reasonable jury could infer that it did not follow 

reasonable procedures. As other courts have held, "[a]llowing 

inaccurate information back onto a credit report after deleting 

it because it is inaccurate is negligent." Stevenson, 987 F.2d 

at 293; see also Morris, 563 F. Supp. at 968. 

 As their main contention, both defendants urge that Philbin 

has failed to produce sufficient evidence from which a reasonable 

trier of fact could conclude that the inaccuracies in the reports 

were the cause of Philbin's damages. TRW additionally contends 

that Philbin has failed to produce any evidence that it failed to 

follow reasonable procedures. We address these contentions in 
reverse order. 

 1. 

 Reasonable Procedures 

 Reasonable procedures are those that "`a reasonably prudent 

person would [undertake] under the circumstances.'" Stewart v. 

Credit Bureau, Inc., 734 F.2d 47, 51 (D.C. Cir. 1984) (per 

curiam) (quoting Bryant v. TRW, Inc., 689 F.2d 72, 78 (6th Cir. 

1982)) (alteration added). "Judging the reasonableness of a[ 

credit reporting] agency's procedures involves weighing the 

potential harm from inaccuracy against the burden of safeguarding 

against such inaccuracy." Id. 

 TRW urges that Philbin must come forward with affirmative 

proof that it failed to use reasonable procedures to assure 

maximum accuracy and that he has failed to do so. It cites a 

number of cases for the proposition that the FCRA "does not make 

reporting agencies strictly liable for all inaccuracies" that 

appear on a consumer report it prepares. Cahlin, 936 F.2d at 

1156; see also Stewart, 734 F.2d at 51; Bryant, 689 F.2d at 78; 

Thompson v. San Antonio Retail Merchants Ass'n, 682 F.2d 509, 513 

(5th Cir. 1982) (per curiam); Equifax, Inc. v. Federal Trade 

Commission, 678 F.2d 1047, 1049 (11th Cir. 1982); Hauser v. 

Equifax, Inc., 602 F.2d 811, 814 (8th Cir. 1979); Neptune v. 

Trans Union Corp., 1993 WL 505601, at *2 (E.D. Pa. Dec. 8, 1993), 

aff'd, 27 F.3d 558 (3d Cir. 1994); Hussain v. Carteret Sav. Bank, 

F.A., 704 F. Supp. 567, 569 (D.N.J. 1989). 

 TRW accurately states that consumer reporting agencies are 

liable only when inaccuracies are the result of their failure to 

follow reasonable procedures. However, this statement gives 

little guidance as to the nature of the plaintiff's burden of 

proof on the "reasonable procedures" issue on a motion for 

summary judgment. We must determine the nature and quantum of 

proof, if any, beyond the mere fact of an inaccuracy, that a 

plaintiff must provide in order for a reasonable trier of fact to 

conclude that reasonable procedures were not followed. 

 We are guided in this endeavor by those courts of appeals 

that have addressed this question. We note, however, that there 

is a divergence among the approaches those courts have taken. In 

Stewart, 734 F.2d at 51 n.5, the Court of Appeals for the 

District of Columbia Circuit noted that although it was unaware 

of any cases "directly addressing who has the burden of proving 

reasonableness of procedures, courts have generally assumed that 

burden falls on the plaintiff" (citing Hauser, 602 F.2d at 814- 

15; Morris, 563 F. Supp. at 968; Alexander v. Moore & Assocs., 

Inc., 553 F. Supp. 948, 954 (D. Haw. 1982)). Accordingly, it 

held that 

 a plaintiff cannot rest on a showing of a 

 mere inaccuracy, shifting to the defendant 

 the burden of proof on the reasonableness of 

 procedures for ensuring accuracy: There is 

 no indication that Congress meant to so shift 

 the nominal plaintiff's burden of proof as to 

 requisite components of a claim based on a 

 statutory violation. Thus, we conclude that 

 a plaintiff must minimally present some 
 evidence from which a trier of fact can infer 

 that the consumer reporting agency failed to 

 follow reasonable procedures in preparing a 

 credit report. 

 

 Id. at 51 (footnote omitted) (emphasis added). 

 However, the court went on to hold that, in order to satisfy 

this "minimal[]" burden, "a plaintiff need not introduce direct 

evidence of unreasonableness of procedures: In certain 

instances, inaccurate credit reports by themselves can fairly be 

read as evidencing unreasonable procedures, and . . . in such 

instances plaintiff's failure to present direct evidence will not 

be fatal to his claim." Id. at 51-52 (emphasis added). While 

the Stewart court did not definitively spell out what those 

"certain instances" were, it did give some guidance. For 

example, it cited with approval Bryant, 487 F. Supp. at 1242, in 

which the court concluded that inconsistencies between two 

different reports concerning the plaintiff "imposed a duty on the 

reporting agency to verify the information in those reports." 

Stewart, 734 F.2d at 52. The court also approvingly cited 

Morris, 563 F. Supp. at 968, in which the court likewise found 

"the existence of . . . two similar files [on plaintiff] to be a 

sufficient indicium of unreasonable procedures to satisfy the 

plaintiffs' `burden.'" Stewart, 734 F.2d at 52. The D.C. 

Circuit concluded: "Certainly . . . inconsistencies between two 

files or reports involving less fundamental inaccuracies [than a 

falsely reported wage earner plan] can provide sufficient grounds 

for inferring that an agency acted negligently in failing to 

verify information." Id. 

 In an even broader holding, the Court of Appeals for the 

Ninth Circuit recently wrote: 

 In order to make out a prima facie violation 

 under § 1681e(b), a consumer must present 

 evidence tending to show that a credit 

 reporting agency prepared a report containing 

 inaccurate information. The FCRA does not 

 impose strict liability, however -- an agency 

 can escape liability if it establishes that 

 an inaccurate report was generated despite 

 the agency's following reasonable procedures. 

 

 Guimond, 45 F.3d at 1333 (emphasis added) (citation and footnote 

omitted); see also id. at 1334 ("Guimond has made out a prima 

facie case under § 1681e(b) by showing that there were 

inaccuracies in her credit report."). Similarly, the Court of 

Appeals for the Eleventh Circuit wrote: 

 In order to make out a prima facie violation 

 of [§ 1681e(b)], the Act implicitly requires 

 that a consumer must present evidence tending 

 to show that a credit reporting agency 

 prepared a report containing "inaccurate" 

 information. . . . The Act, however, does 

 not make reporting agencies strictly liable 

 for all inaccuracies. The agency can escape 
 liability if it establishes that an 

 inaccurate report was generated by following 

 reasonable procedures, which will be a jury 

 question in the overwhelming majority of 

 cases. Thus, prior to sending a [§ 1681e(b)] 

 claim to the jury, a credit reporting agency 

 can usually prevail only if a court finds, as 

 a matter of law, that a credit report was 

 "accurate." 

 

 Cahlin, 936 F.2d at 1156 (emphasis added) (footnotes omitted). 

 The language from Guimond and Cahlin may be interpreted in 

two different ways. A broader reading is that, once a plaintiff 

demonstrates inaccuracies in a credit report, the burden shifts 

to the defendant to prove as an affirmative defense the presence 

of reasonable procedures. But see Stewart, 734 F.2d at 51 n.5 

(citing 15 U.S.C. §§ 1681d(c) and 1681m(c) for the proposition 

that Congress "`knew how' to shift the burden of proof from 

plaintiff to defendant by explicitly doing so"). 

 A somewhat narrower, and more plausible, reading is that a 

plaintiff may present his case to the jury on the issue of 

reasonable procedures merely by showing an inaccuracy in the 

consumer report and nothing more, but the burden does not shift 

to the defendant. Rather, a jury may, but need not, infer from 

the inaccuracy that the defendant failed to follow reasonable 

procedures. 

 This position imposes a less stringent burden on the 

plaintiff than does the position taken in Stewart, which requires 

some unspecified quantum of evidence beyond a mere inaccuracy, 

such as the existence of a second report, inconsistent with the 

first, in order for a plaintiff to survive summary judgment. On 

the other hand, it does not entirely relieve the plaintiff of his 

burden of proving to the jury a lack of reasonable procedures and 

instead impose on the defendant an affirmative obligation to 

prove that reasonable procedures were in place. 

 This "middle position" is akin to the common law rule of resipsa 

loquitur, which permits but does not require the jury to 

infer negligence from certain predicate facts. See Restatement 

(Second) of Torts § 328 D (1965). The justification for 

importing 

 such a rule into the FCRA context would be that, as in 

the 

 traditional res ipsa situation, the inaccuracy has 

been caused by 

 an instrumentality under the exclusive control of the 

defendant. 

 Such a defendant is in a far better position to prove 

that 

 reasonable procedures were followed than a plaintiff 

is to prove 

 the opposite. 

 Pursuant to either reading of Guimond and Cahlin, 

once a 
 plaintiff has demonstrated inaccuracies in the report, 

a 

 defendant could prevail on summary judgment only if it 

were to 

 produce evidence that demonstrates as a matter of law 

that the 

 procedures it followed were reasonable. See, e.g., 

Henson, 29 

 F.3d at 285 ("[A]s a matter of law, a credit reporting 

agency is 

 not liable under the FCRA for reporting inaccurate 

information 

 obtained from a court's Judgment Docket, absent prior 

notice from 

 the consumer that the information may be 

inaccurate."). 

 Having discussed these three possibilities (that 

a plaintiff 

 must produce some evidence beyond a mere inaccuracy in 

order to 

 demonstrate the failure to follow reasonable 

procedures; that the 

 jury may infer the failure to follow reasonable 

procedures from 

 the mere fact of an inaccuracy; or that upon 

demonstrating an 

 inaccuracy, the burden shifts to the defendant to 

prove that 

 reasonable procedures were followed), we find it 

unnecessary to 

 decide among them. Pursuant to either reading of 

Guimond and 

 Cahlin, plaintiff has produced sufficient evidence to 

survive 

 summary judgment on the issue of reasonable procedures 

merely by 

 demonstrating that there were inaccuracies in the TRW 

report. 

 Moreover, even under the rule enunciated in Stewart, 

plaintiff 

 has produced sufficient evidence from which a 

reasonable trier of 

 fact could infer that TRW did not follow reasonable 

procedures. 

 The court there stated that "[i]n certain instances, 

inaccurate 

 credit reports by themselves can fairly be read as 

evidencing 

 unreasonable procedures." Stewart, 734 F.2d at 52. 

As one 

 specific example of such an instance, the court 

posited that 

 where there exist two or more inconsistent reports, 

and the 
 inconsistency relates to inaccurate information 

contained in at 

 least one of the reports, a jury could reasonably 

conclude that 

 the defendant failed to follow reasonable procedures. 

 Here, TRW issued two reports that were 

inconsistent with 

 each other. Unquestionably, one was inaccurate. The 

 inconsistencies related to the inaccurate information. 

Pursuant 

 to Stewart, and a fortiori pursuant to either of the 

two readings 

 of Guimond and Cahlin, these facts alone are 

sufficient to allow 

 a jury to infer that TRW did not follow reasonable 

procedures. 

 2. 

 Causation 

 Both TUC and TRW contend that there is no 

evidence that the 

 inaccuracy of the credit reports, even if the result 

of 

 unreasonable procedures, caused Philbin's injuries. 

Given the 

 existence of one accurate and one inaccurate report 

prepared by 

 each agency, they claim that there is no evidence from 

which a 

 reasonable trier of fact could infer both (1) that the 

credit 

 granting agencies utilized the inaccurate as opposed 

to the 

 accurate versions; and (2) even assuming that the 

inaccurate 

 versions were used, that the inaccurate entries were 

the cause of 

 the denial of credit. 

 The district court agreed with defendants and 

granted 

 summary judgment on this basis, holding that a 

"plaintiff must 

 establish that `the denial was not caused by factors 

other than 

 the alleged inaccurate entry.'" Philbin v. Trans Union 

Corp., No. 

 93-cv-2360 (JBS), at 13 (D.N.J. Dec. 8, 1995) 

("Philbin II") 

 (quoting Neptune, 1993 WL 505601 at *2)); Philbin v. 

Trans Union 

 Corp., No. 93-cv-2360 (JBS), at 11 (D.N.J. Nov. 29, 

1994) 

 ("Philbin I") (quoting Neptune, 1993 WL 505601 at 

*2)); see alsoEvans v. Credit Bureau, 904 F. Supp. 123, 126 (W.D.N.Y. 

1995); 
 Pendleton v. Trans Union Systems Corp., 76 F.R.D. 192, 

195 (E.D. 

 Pa. 1977) ("[A] consumer who was denied credit must 

show that the 

 denial was caused by inaccurate entries . . . rather 

than by 

 correct adverse entries or any other factors."). 

 Although the district court did not say so 

explicitly, it 

 appears that it concluded that Philbin could not show 

that the 

 inaccurate information was the "but for" cause of his 

injury, 

 because he could not show that the harm would not have 

occurred 

 absent the inaccurate entry. While we agree with the 

district 

 court that a FCRA plaintiff must prove causation by a 

 preponderance of the evidence, we disagree that 

Philbin has 

 failed to produce sufficient facts from which a 

reasonable jury 

 could find that defendants' alleged negligence caused 

his 

 injuries. A comparison of the record here with the 

facts of the 

 cases relied upon by the district court and defendants 

bears this 

 out. 

 In Neptune, that court did indeed find that 

plaintiff had 

 not established "that the denial [of credit] was not 

caused by 

 factors other than the alleged inaccurate entry." 

1993 WL 505601 

 at *2. However, it noted: 

 It is undisputed that at the time plaintiff 

 claims he was denied credit based on TUC's 

 violations of the Fair Credit Reporting Act, 

 he was in default on an obligation to re-pay 

 a student loan, he was in default on an 

 obligation to re-pay a commercial loan from 

 ITT Financial Services, he was failing to 

 comply with a court order requiring him to 

 pay child support, and he had virtually no 

 income and no assets. 

 

 Id. The court in addition noted how unusual it was for a 

plaintiff to contend that he had been denied credit due to an 

inaccurate credit report while at the same time applying for and 

receiving leave to proceed in forma pauperis. See id. at *1-2. 

Thus, the court's statement regarding the plaintiff's burden visà-vis the causation issue must be read in light of the fact that 

there were indisputably numerous additional reasons plaintiff 
could have been denied credit. 

 Similarly, in Evans, 904 F. Supp. at 126, the defendant 

introduced affidavit testimony from an employee of the credit 

granting agency that plaintiff had been denied a loan because he 

had filed for bankruptcy within two years prior to the loan 

application. The presence of undisputed, correct, adverse 

information on the credit report, along with the unrebutted 

testimony of one responsible for the credit-granting decision, 

arguably supports the conclusion that no reasonable jury could 

conclude that the presence of inaccurate entries on the reports 

made a difference as to the decision whether to grant or deny 

credit. 

 In Cahlin, 936 F.2d at 1156, 1161, the Eleventh Circuit 

upheld a grant of summary judgment to the defendant only after 

all of the credit grantor's records had been subpoenaed and there 

was no indication that an adverse credit report prepared by the 

defendant had ever been used in making the credit decision, much 

less any indication that such a report had been a causal factor 

in the decision. See also Wood v. Holiday Inns, Inc., 508 F.2d 

167, 172 (5th Cir. 1975). 

 In contrast with these cases, the facts of the instant case 

more closely resemble those in Lendino v. Trans Union Credit 

Information Co., 970 F.2d 1110, 1111-12 (2d Cir. 1992), in which 

adverse outdated information was included on one of three credit 

reports concerning the plaintiff prepared by the defendant, in 

violation of 15 U.S.C. § 1681c. The other two reports contained 

"no delinquent credit accounts or any other adverse information." 

Id. at 1112. The plaintiff was denied credit by Bloomingdale's 

department store after its credit department reviewed one or more 

of the three reports, but it is unclear which of the reports it 

had seen. See id. at 1112-13. Although the only report that 

indicated it had been accessed by Bloomingdale's was one of the 

valid versions, the plaintiff testified that an employee of the 

defendant told him that Bloomingdale's had obtained all three 

reports. See id. at 1112. The district court granted summary 

judgment to the defendant based on the conclusion that there was 

no evidence that the credit grantor had seen the invalid version 

of the report. See id. at 1111-12. 

 The Second Circuit reversed, holding that a reasonable jury 

could indeed infer that Bloomingdale's had seen the invalid 

report and denied plaintiff credit based on that report, because 

"[t]here is, at least on the present record, no other evidence 

which reasonably demonstrates why Bloomingdale's rejected 

Lendino's credit application." Id. at 1113. At oral argument, 

counsel for TUC was unable persuasively to distinguish Lendinofrom the 

instant case. 

 Here, the district court originally held that because the 

accurate report prepared by TUC appeared to contain no delinquent 

accounts, and because Philbin stated in his affidavit that he has 

never been delinquent on an account (which statement is not 

disputed by defendants), Philbin could convince a jury, "by 

process of elimination," Philbin I at 19, that the credit 

granting agencies must have both used the inaccurate report and 

considered the inaccurate information on that report in reaching 
their decisions to deny credit. On reconsideration, however, in 

light of the stipulation in the Joint Pre-Trial Order that none 

of the rejection letters specifically cites the erroneous 

information, the district court reversed itself and granted 

summary judgment to TUC. 

 With respect to TRW, the report Philbin received in November 

of 1992, contemporaneously with the denials of credit from Sears 

and Citibank, was concededly correct. The inaccurate TRW report, 

which he received from a credit granting agency, was received six 

months later. The district court concluded that Philbin's 

contention that Sears and Citibank used the inaccurate report 

rather than the accurate one was sheer speculation, and therefore 

granted summary judgment to TRW. 

 As a preliminary matter, we must acknowledge that we are at 

a loss to explain the consequence ascribed by the district court 

to the stipulation in the Joint Pre-Trial Order that none of the 

rejection letters specifically cites the inaccurate information. 

At the time of its initial determination, discovery was complete 

and Philbin had failed to submit any deposition or affidavit 

testimony of those individuals who had made the decisions to deny 

him credit. Thus, both initially and on reconsideration, the 

rejection letters (which omit to state that the erroneous entry 

was the cause of the denial of credit), the fact that the 

accurate reports contained no adverse information, Philbin's 

statement that he had never been delinquent on an account, and 

the "process of elimination" argument to be drawn from this 

evidence were all that Philbin could have presented to a jury. 

Yet these were deemed sufficient initially as against TUC and 

insufficient on reconsideration. 

 More fundamentally, the district court erred by assuming 

that Philbin could satisfy his burden only by introducing direct 

evidence that consideration of the inaccurate entry was crucial 

to the decision to deny credit. While Philbin's case might have 

been stronger had he deposed or taken affidavits of those 

responsible for the decision, such evidence is not essential to 

make out a prima facie case pursuant to § 1681e(b). We deem it 

sufficient that, as with most other tort actions, a FCRA 

plaintiff produce evidence from which a reasonable trier of fact 

could infer that the inaccurate entry was a "substantial factor" 

that brought about the denial of credit. Restatement (Second) of 

Torts § 431(a); Keeton et al., Prosser and Keeton on Torts § 41, at 

266-68 (5th ed. 1984) [hereinafter Prosser & Keeton]. Philbin has 

met that burden in this instance as to each of the six credit 

denials encompassed by his complaint. 

 Because the accurate reports apparently contained no adverse 

information and because it is undisputed that Philbin has never 

been delinquent on a credit obligation, when Sears denied him 

credit because of an "unfavorable credit history," App. at 27, a 

reasonable jury certainly could infer that Sears was referring to 

the inaccurate adverse information contained in the inaccurate 

reports. See Lendino, 970 F.2d at 1113. 

 Household International gave no reason for the denial of 

credit. Again, however, given the absence of correct, adverse 

information concerning Philbin, a trier of fact could reasonably 
infer, by necessary implication, that the inaccurate adverse 

information must have played a substantial role in its decision 

to deny credit. 

 Finally, three credit grantors -- Bayview Marina, Bank One, 

and First North American Bank -- gave reasons for denying credit 

that appear to be innocuous. These include: "insufficient 

credit file," "sufficient pay history not established," "limited 

credit experience," "number of other recent credit inquiries," 

and "high utilization of bankcard credit lines." App. at 25, 28, 

31. While these present a closer question, we conclude that a 

trier of fact could reasonably infer that the inaccurate adverse 

information included on the inaccurate credit report was an 

additional, unstated reason for the credit denials. Moreover, as 

to Bank One, which stated that it denied credit because of 

Philbin's lack of credit history, one could infer that this lack 

of a credit history was itself due, at least in part, to his 

inability to get credit because of the inaccurate reports. 

 Philbin's case against TRW is somewhat more attenuated than 

his case against TUC, given that the inaccurate report surfaced 

some six months after the denial of credit by Sears and Citibank. 

However, we find that evidence of the existence of two 

inconsistent reports within six months of each other allows a 

reasonable trier of fact to infer that the two reports existed 

simultaneously in November of 1992, at the time of the denials of 

credit. This, taken along with the fact that the accurate report 

apparently contained no information adverse to Philbin and the 

undisputed fact that he has never been delinquent on any credit 

obligation, would allow a reasonable trier of fact to infer both 

that Citibank and Sears saw the inaccurate TRW report and that 

the inaccurate information was a substantial factor in bringing 

about the denial of credit. See Lendino, 970 F.2d at 1113. This 

is especially true given that the reasons supplied by Sears for 

the denial included "unfavorable credit history," and the reason 

supplied by Citibank was "a delinquent credit obligation[] was 

recorded on [the] credit bureau report." App. at 27, 44. 

 We note also that the district court's language might be 

understood as imposing a burden on a FCRA plaintiff of proving 

that the inaccurate information was the sole cause of the denial 

of credit. We reject such a view as inconsistent with 

traditional notions of tort law and the reality of human 

decision-making. While a plaintiff must prove that the 

inaccurate entry was "a substantial factor in bringing about" the 

denial of credit, Restatement (Second) of Torts § 431(a), he need not 

eliminate the possibility that "correct adverse entries or any 

other factors," Pendleton, 76 F.R.D. at 195, also entered into 

the decision to deny credit. See Cahlin, 936 F.2d at 1161 

(plaintiff "bears the burden of proving that [defendant's] credit 

report was a causal factor in the denial of" credit) (emphasis 

added); Stewart, 734 F.2d at 54 ("[A] trier of fact could 

reasonably conclude that [defendant] denied [plaintiff] 

membership at least in part because of the adverse credit report, 

and summary judgment was inappropriate.") (emphasis added); seealso 

Prosser & Keeton § 41, at 268 ("If the defendant's conduct was 

a substantial factor in causing the plaintiff's injury, it 
follows that he will not be absolved from liability merely 

because other causes have contributed to the result . . . ."). 

 Forcing a plaintiff affirmatively to rule out other 

explanations for the credit denial ignores the fact that 

decisions to deny credit will frequently have more than one 

cause. For example, in some instances the inaccurate entry and 

another factor may each, considered separately, be insufficient 

to have caused the denial of credit but when taken together are 

sufficient. Each may then be considered a substantial factor in 

bringing about the denial of credit and therefore a cause of 

plaintiff's injury. See Prosser & Keeton § 41, at 266-67 & n.25. 

 Courts have recognized that where a decision-making process 

implicates a wide range of considerations, all of which factor 

into the ultimate decision, it is inappropriate to saddle a 

plaintiff with the burden of proving that one of those factors 

was the cause of the decision. See, e.g., Price Waterhouse v. 

Hopkins, 490 U.S. 228, 241, 244, 109 S.Ct. 1775, 1785, 1787 

(1989) (plurality opinion) (finding that "Title VII [of the Civil 

Rights Act of 1964] meant to condemn even those decisions based 

on a mixture of legitimate and illegitimate considerations," and 

concluding that Title VII plaintiff must show illegitimate 

consideration "played a motivating part in an employment 

decision"); Village of Arlington Heights v. Metropolitan Housing 

Development Corp., 429 U.S. 252, 265-66, 97 S.Ct. 555, 563 (1977) 

(plaintiff claiming equal protection violation need not "prove 

that the challenged action rested solely on racially 

discriminatory purposes" but only that such a purpose was "a 

motivating factor in the decision"). Indeed, where multiple 

factors exist, any inquiry into the cause of a decision would be 

a meaningless endeavor. See Price Waterhouse, 490 U.S. at 247, 

109 S.Ct. at 1788-89 (plurality opinion). 

 We hasten to add that the burden of proving causation 

remains with the plaintiff at all times and never shifts to the 

defendant. We conclude however that even on this sparse record, 

a reasonable trier of fact could infer that the inaccurate 

entries were a substantial factor in bringing about Philbin's 

injuries. Accordingly, Philbin has produced evidence sufficient 

to satisfy his burden of proving a prima facie case of negligent 

noncompliance with 15 U.S.C. § 1681e(b) as to each defendant. 

 B. 

 By contrast, we agree with the district court that Philbin 

has not produced sufficient evidence of willful noncompliance 

with § 1681e(b) to survive summary judgment. To show willful 

noncompliance with the FCRA, Philbin must show that defendants 

"knowingly and intentionally committed an act in conscious 

disregard for the rights of others," but need not show "malice or 

evil motive." Pinner v. Schmidt, 805 F.2d 1258, 1263 (5th Cir. 

1986), cert. denied, 483 U.S. 1022, 107 S.Ct. 3267 (1987); seealso 

Casella, 56 F.3d at 476. 

 Philbin claims that TUC is liable for a willful violation 

because he notified it of the error several times and TUC failed 

to correct it. However, after the first notification, in 1990, 

TUC did remove the erroneous information for a period of time. 

Moreover, he contends that his filing of a complaint with the FTC 
gave TUC notice a second time, but there is no evidence that TUC 

had notice of the complaint. There appears to be one instance -- 

in November of 1992 -- when he notified TUC that, despite the 

earlier correction, the error re-appeared, and TUC failed to 

correct it. This, however, falls short of evidence of a willful 

violation. 

 Philbin also claims that TUC's refusal to send him a copy of 

his credit report in November of 1992 evidences a willful 

violation. However, it appears that TUC merely desired to verify 

his address. Moreover, the record reflects that Philbin had two 

mailing addresses, and so TUC's concern appears to be bona fide. 

After receiving verification of his address, TUC eventually sent 

him a copy of the report. Its actions do not rise to the level 

of a "willful misrepresentation[] or concealment[]" that 

justifies finding a willful violation. Pinner, 805 F.2d at 1263; 

cf. Millstone, 528 F.2d at 834. 

 Philbin's case against TRW for a willful violation is even 

weaker. He claims that after the 1990 letter and the 1992 filing 

with the FTC, TRW had notice of the inaccuracies and nonetheless 

circulated the inaccurate report. However, there is no evidence 

that the alleged errors that precipitated the 1990 letter are the 

same as those that appeared on the 1993 report. Moreover, the 

1990 letter is so far removed temporally from the 1993 report 

that it would strain the concept of notice to conclude that the 

former provided notice of errors in the latter. Further, 

Philbin's FTC filing concerned his problems only with TUC, not 

TRW. There is, therefore, no evidence of willful behavior on the 

part of TRW. 

 III. 

 The order of the district court, dated November 29, 1994, 

granting summary judgment to both defendants as to the claims for 

willful noncompliance with § 1681e(b) will be affirmed. The 

orders dated November 29, 1994, and December 8, 1995, granting 

summary judgment to defendants as to the claims for negligent 

noncompliance with § 1681e(b) will be reversed. The matter is 

remanded to the district court for further proceedings consistent 

with this opinion. 

 Costs taxed against appellees.