Exhibit 1 

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1 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

FAIR ISAAC CORPORATION, 

Plaintiff/Counterclaim Defendant, 

v. 

TRANS UNION LLC, 

Defendant/Counterclaim Plaintiff. 

Case No. 1:17-cv-08318 

Honorable Sharon Johnson Coleman 

MOVANTS’ MOTION TO REASSIGN CASES AS RELATED 

Pursuant to Northern District of Illinois Local Rule 40.4, Movants, Plaintiffs in five 

pending proposed class actions (the “Class Actions”) assigned to other judges in this District,1

respectfully move for entry of an order finding that their cases are related to the above-captioned 

action and, accordingly, should be reassigned to this calendar because this is the earliestnumbered case. 

WHEREFORE, Movants respectfully request that the Court enter an Order finding that 

the Class Actions are related to each other and to this action, and that the Class Actions should 

be reassigned to this calendar, and providing such other and further relief as the Court deems 

proper. 

Dated: May 4, 2020 Respectfully submitted, 

SCOTT+SCOTT ATTORNEYS AT LAW LLP 

 s/ Joseph P. Guglielmo 

Joseph P. Guglielmo (N.D. Ill. No. 2759819) 

1 Movants include Sky Federal Credit Union, First Choice Federal Credit Union, 

Amalgamated Bank, Alcoa Community Federal Credit Union, and Getten Credit Company. 

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Peter A. Barile III (N.D. Ill. No. 4364295)

Justin W. Batten 

The Helmsley Building 

230 Park Avenue, 17th Floor 

New York, NY 10169 

Telephone: 212-223-6444 

Facsimile: 212-223-6444

jgugliemo@scott-scott.com 

pbarile@scott-scott.com 

jbatten@scott-scott.com

Christopher M. Burke 

SCOTT+SCOTT ATTORNEYS AT LAW LLP 

600 W. Broadway, Suite 3300 

San Diego, CA 92101 

Telephone: 619-233-4565 

Facsimile: 619-233-0508 

cburke@scott-scott.com

George A. Zelcs (Ill. Bar No. 3123738) 

Randall P. Ewing, Jr. (Ill. Bar No. 6294238) 

Ryan Z. Cortazar (Ill. Bar No. 6323766) 

KOREIN TILLERY, LLC 

205 North Michigan Avenue, Suite 1950 

Chicago, IL 60601 

Telephone: 312-641-9750 

Facsimile: 312-641-9751 

gzelcs@koreintillery.com 

rewing@koreintillery.com 

rcortazar@koreintillery.com 

Steven M. Berezney (N.D. Ill. Bar No. 56091) 

Michael E. Klenov (Ill. Bar No. 6300228) 

KOREIN TILLERY, LLC 

505 North 7th Street, Suite 3600 

St. Louis, MO 63101 

Telephone: 314-241-4844 

Facsimile: 314-241-3525 

sberezney@koreintillery.com 

mklenov@koreintillery.com 

Counsel for Plaintiff Sky Federal Credit Union 

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Steven F. Molo 

Lisa W. Bohl 

MOLOLAMKEN LLP 

300 N. LaSalle Street, Suite 5350 

Chicago, IL 60654 

Telephone: 312-450-6700 

Facsimile: 312-450-6701 

smolo@mololamken.com 

lbohl@mololamken.com 

Lauren M. Weinstein 

MOLOLAMKEN LLP 

600 New Hampshire Avenue, N.W., Suite 500 

Washington, DC 20037 

Telephone: 202-556-2000 

Facsimile: 202-556-2001 

lweinstein@mololamken.com 

Gary F. Lynch 

CARLSON LYNCH LLP 

1133 Penn Avenue, 5th Floor 

Pittsburgh, PA 15222 

Telephone: 412-322-9243 

Facsimile: 412-231-0246 

glynch@carlsonlynch.com 

Katrina Carroll 

CARLSON LYNCH LLP 

111 W. Wacker Drive, Suite 1240 

Chicago, IL 60602 

Telephone: 312-750-1265 

kcarroll@carlsonlynch.com 

Counsel for Plaintiff First Choice Federal Credit 

Union 

Jennifer W. Sprengel (Ill. Bar No. 06204446) 

CAFFERTY CLOBES MERIWETHER & 

SPRENGEL LLP 

150 S. Wacker, Suite 3000 

Chicago, IL 60606 

Telephone: 312-782-4880 

jsprengel@caffertyclobes.com 

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Barbara J. Hart 

Christian Levis 

Frank Strangeman 

Andrea Farah 

LOWEY DANNENBERG, P.C. 

44 South Broadway, Suite 1100 

White Plains, NY 10601 

Telephone: 914-997-0500 

bhart@lowey.com 

clevis@lowey.com 

fstrangeman@lowey.com 

afarah@lowey.com 

Counsel for Plaintiff Amalgamated Bank 

Paul E. Slater 

Joseph M. Vanek 

Michael G. Dickler 

Matthew T. Slater 

SPERLING & SLATER 

55 West Monroe Street, Suite 3200 

Chicago, IL 60603 

Telephone: 312-641-3200 

pes@sperling-law.com 

jvanek@sperling-law.com 

mdickler@sperling-law.com 

mslater@sperling-law.com 

Linda P. Nussbaum 

Bart D. Cohen 

NUSSBAUM LAW GROUP, P.C. 

1211 Avenue of the Americas, 40th Floor 

New York, NY 10036 

Telephone: 917-438-9102 

lnussbaum@nussbaumpc.com 

bcohen@nussbaumpc.com 

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Michael L. Roberts 

Karen Sharp Halbert 

ROBERTS LAW FIRM, P.A. 

20 Rahling Circle 

Little Rock, AR 72223 

Telephone: 501-821-5575 

mikeroberts@robertslawfirm.us 

karenhalbert@robertslawfirm.us 

Counsel for Plaintiff Alcoa Community Federal 

Credit Union

Daniel C. Hedlund 

Michelle J. Looby 

GUSTAFSON GLUEK PLLC 

Canadian Pacific Plaza 

120 South Sixth Street, Suite 2600 

Minneapolis, MN 55402 

Telephone: 612-333-8844 

dhedlund@gustafsongluek.com 

mlooby@gustafsongluek.com 

Dennis Stewart 

GUSTAFSON GLUEK PLLC 

600 B Street, 17th Floor 

San Diego, CA 92101 

Telephone: 619-595-3299 

dstewart@gustafsongluek.com 

Counsel for Plaintiff Getten Credit Company 

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CERTIFICATE OF SERVICE 

I, Joseph P. Guglielmo, an attorney, hereby certify that the foregoing MOVANTS’ 

MOTION TO REASSIGN CASES AS RELATED was electronically filed on May 4, 2020, 

and will be served electronically via the Court’s ECF Notice system upon the registered parties 

of record. 

 s/ Joseph P. Guglielmo 

Joseph P. Guglielmo (N.D. Ill. No. 2759819) 

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EXHIBIT A 

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UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

SKY FEDERAL CREDIT UNION, on Behalf 

of Itself and All Others Similarly Situated, 

Plaintiff, 

v. 

FAIR ISAAC CORPORATION, 

Defendant. 

Case No. 

CLASS ACTION COMPLAINT 

JURY TRIAL DEMANDED 

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TABLE OF CONTENTS 

I. NATURE OF THE ACTION ............................................................................................. 1

II. PARTIES ............................................................................................................................ 4

A. Plaintiff ................................................................................................................... 4

B. Defendant ................................................................................................................ 5

III. JURISDICTION, VENUE, AND INTERSTATE COMMERCE ...................................... 5

IV. ALLEGATIONS OF FACT SUPPORTING THE CLAIM FOR RELIEF ........................ 6

A. Credit Scores ........................................................................................................... 6

B. The Markets for Credit Scores in the United States ............................................... 7

C. Fair Isaac Has a Monopoly in the B2B Credit Score Market ............................... 10

D. Attempts to Compete Have Been Stymied by Fair Isaac’s Monopoly in 

the B2B Credit Score Market ................................................................................ 11

E. Fair Isaac Has Contracted with the Credit Bureaus as Agents and 

Co-Conspirators in Its Scheme to Monopolize ..................................................... 13

F. Fair Isaac’s Other Anticompetitive and Exclusionary Conduct ........................... 14

1. Fair Isaac and the Credit Bureaus Have Entered into Anticompetitive 

Contract Terms that Restrict Their Ability to Compete and Sell 

VantageScore ............................................................................................ 15

a. The Anticompetitive Agreements Restrict the Credit Bureaus’ 

Ability to Develop or Sell Other Credit Scores Compatible 

with B2B Purchasers’ Existing Systems ....................................... 15

b. Fair Isaac and the Credit Bureaus Have Agreed to a Penalty 

Pricing and Bundling Scheme to Foreclose Competition from 

Competitors in the B2B Credit Score Market ............................... 17

c. Fair Isaac and the Credit Bureaus Have Agreed to Contract 

Provisions that Allow Fair Isaac to Extract Monopoly Prices ...... 18

2. Fair Isaac’s Campaign to Create Fear, Uncertainty, and Doubt About 

VantageScore Among B2B Purchasers .................................................... 19

3. Fair Isaac’s Anticompetitive and Exclusionary Conduct Harms 

Competition............................................................................................... 21

V. CLASS ACTION ALLEGATIONS ................................................................................. 22

VI. STATUTES OF LIMITATIONS AND TOLLING .......................................................... 25

VII. CLAIMS FOR RELIEF .................................................................................................... 25

CLAIM ONE: MONOPOLIZATION 15 U.S.C. §2......................................................... 25

CLAIM TWO: CONSPIRACY TO MONOPOLIZE 15 U.S.C. §2 ................................. 27

CLAIM THREE: UNREASONABLE RESTRAINT OF TRADE 15 U.S.C. §1 ............ 29

CLAIM FOUR: STATE ANTITRUST LAWS ................................................................ 30

CLAIM FIVE: STATE UNFAIR TRADE PRACTICES LAWS .................................... 32

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VIII. PRAYER FOR RELIEF ................................................................................................... 33

IX. DEMAND FOR JURY TRIAL ........................................................................................ 33

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Plaintiff Sky Federal Credit Union, on behalf of itself and all other similarly situated 

residents of the United States, brings claims under the Sherman Act and state laws against 

Defendant Fair Isaac Corporation (“Fair Isaac”) for redress of the injury and damages resulting 

from its monopolizing, conspiring to monopolize, and otherwise unreasonably restraining trade 

from at least as early as January 1, 2006, through the date by which the anticompetitive effects of 

Defendant’s violations of law shall have ceased, but in any case no earlier than the present (the 

“Class Period”). Based upon personal knowledge, information and belief, proceedings and 

admissions made in Case No. 1:17-cv-08318 (N.D. Ill.), related ongoing federal government 

investigations, and investigation of counsel, Plaintiff alleges: 

I. NATURE OF THE ACTION 

1. “Credit Scores” are three digit numbers that rank or “score” creditworthiness within 

a range by applying certain algorithms to credit histories. There are two distinct markets for Credit 

Scores in the United States: (1) the market for the sale of Credit Scores to lenders, financial 

institutions, and other businesses for risk management decisions (the “B2B Credit Score Market”); 

and (2) the market for the sale of Credit Scores directly to consumers to monitor their own credit 

records (the “business-to-consumer” or “B2C Credit Score Market”). 

2. This case concerns the B2B Credit Score Market, over which Defendant Fair Isaac 

has unlawfully maintained a 90% monopoly for many years. 

3. Fair Isaac has abused its monopoly power by engaging in anticompetitive and 

exclusionary conduct and agreements. Fair Isaac has suppressed competition, stymied innovation, 

and limited access to credit for millions of Americans – all in violation of Sections 1 and 2 of the 

Sherman Act, 15 U.S.C. §§1 & 2, as well as numerous state antitrust and unfair trade practices 

laws. 

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4. Fair Isaac’s FICO Credit Scores (“FICO Scores”) have dominated the market for 

nearly three decades. Fair Isaac executives have bragged that their FICO Scores are “the 800-

pound gorilla” and are “deeply embedded in the system in North America.” Fair Isaac admitted 

in 2017 that it has “maintained a 90-plus percent market share for at least 13 years.” Fair Isaac 

advertises that its FICO Scores are used for 90% of all lending decisions in the United States and 

that Fair Isaac sells four times more FICO Scores per year than McDonald’s sells hamburgers 

worldwide.

5. TransUnion, Experian, and Equifax are credit reporting agencies that collect, 

standardize, and distribute information on consumer credit activity (collectively, the “Credit 

Bureaus”). Credit Bureaus sell lenders, financial institutions, and other businesses credit reports 

and Credit Scores – including Fair Isaac’s FICO Scores – that are used to make decisions about 

whether and on what terms to evaluate and extend credit. Credit Bureaus sell those credit reports 

and Credit Scores to businesses in every state. For decades, Credit Bureaus have acted as Fair 

Isaac’s agents and co-conspirators to broker sales between businesses and Fair Isaac of the 

dominant FICO Scores. Fair Isaac has used these distribution agreements to place anticompetitive 

restrictions on the three dominant Credit Bureaus’ ability to develop or distribute competitive 

Credit Scores; prohibited Credit Bureaus from individually negotiating royalty prices for access to 

FICO Scores; charged discriminatory and prohibitively high royalty prices for FICO Scores if a 

Credit Bureau customer purchases a FICO Score while providing the consumer with a competing 

score; and increased the royalty prices that must be paid by Credit Bureaus. Nevertheless, the 

Credit Bureaus have agreed to, and acquiesced in, these restrictions. 

6. In 2006, VantageScore Solutions, LLC (“VantageScore”), a joint venture of the 

Credit Bureaus, launched a competitive Credit Score known as VantageScore. From the outset, 

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VantageScore was competitively priced, highly predictive, and scored millions more Americans 

than Fair Isaac’s FICO products. Today, by making full use of the Credit Bureaus’ consumer data, 

including rental and utility payments, VantageScore is capable of providing Credit Scores for an 

additional 30 million Americans than FICO can. Were VantageScore widely adopted by 

businesses, millions more creditworthy Americans would have the opportunity to apply for a home 

mortgage, car loan, or credit card, and obtain credit at lower cost. 

7. Rather than compete on the merits with VantageScore, Fair Isaac has engaged in a 

pattern of anticompetitive conduct over the course of more than a decade to discourage the 

adoption of VantageScore and preserve its own monopoly, with the Credit Bureaus’ assistance. 

Fair Isaac has abused its monopoly power to prevent the Credit Bureaus from successfully 

marketing and selling a competitive alternative to FICO Scores and has waged a disparaging public 

relations and advertising campaign to create fear, uncertainty, and doubt about VantageScore’s 

viability and reliability with lenders and consumers. 

8. Through its exclusionary conduct, Fair Isaac has succeeded in preventing the 

substantial sales growth that VantageScore or a competing credit scoring system would have 

achieved though competition on the merits. Having suppressed competition, Fair Isaac has been 

able to significantly increase prices, including most recently in September 2019, for its FICO 

Scores. But for Fair Isaac’s suppression of competition and the resulting contractual agreements 

not to compete, VantageScore or another competitive credit scoring system would have thrived 

and won substantial market share through its innovative product and would have reduced the prices 

paid for B2B Credit Scores by Plaintiff and members of the Class. 

9. Fair Isaac’s anticompetitive and exclusionary conduct has harmed businesses that 

have been deprived of competitive pricing for instruments to allow them to gauge credit risk and 

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have had their freedom of choice restricted. Opening the market to competition is essential to 

competitive pricing and product innovation, including scoring the tens of millions of creditworthy 

Americans who have been denied access to credit. 

10. In February 2018, TransUnion filed antitrust counterclaims for monopolization and 

related claims against Fair Isaac in this District. See Fair Isaac Corp. v. Trans Union LLC, No. 

1:17-cv-08318, ECF No. 38 (redacted counterclaims). In March 2019, The Honorable Sharon 

Johnson Coleman denied Fair Isaac’s motion to dismiss TransUnion’s antitrust counterclaims. See 

id., ECF No. 96. The matter is ongoing. 

11. On March 15, 2020, Fair Isaac disclosed that it was under investigation by the 

Antitrust Division of the United States Department of Justice for exclusionary conduct relating to 

that alleged in the counterclaim upheld by Judge Coleman.1

II. PARTIES 

A. Plaintiff 

12. Plaintiff Sky Federal Credit Union is a federally chartered credit union with a 

principal place of business in Livingston, Montana. 

13. Plaintiff is a financial institution that provides financial services, including deposit 

accounts, credit and/or debit cards, and lending and other credit-related facilities for consumers. 

14. During the Class Period, Plaintiff directly purchased B2B Credit Scores from 

Defendant and a Credit Bureau. 

15. Plaintiff was injured in its business or property as a direct, proximate, and material 

result of Defendant’s violations of law. 

1

See Press Release, Fair Isaac Corporation, FICO Statement Regarding Antitrust 

Investigation, https://www.prnewswire.com/news-releases/fico-statement-regarding-antitrustinvestigation-301024452.html (Mar. 15, 2020). 

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16. Plaintiff is threatened with future injury to its business and property by reason of 

Defendant’s continuing violations of law. 

B. Defendant 

17. Defendant Fair Isaac Corporation is a Delaware corporation, with its principal place 

of business at 181 Metro Drive, Suite 700, San Jose, California 95110. 

III. JURISDICTION, VENUE, AND INTERSTATE COMMERCE 

18. This action arises under Sections 1 and 2 of the Sherman Antitrust Act of 1890 (as 

amended), 15 U.S.C. §§1 & 2, and Sections 4 & 16 of the Clayton Antitrust Act of 1914 (as 

amended), 15 U.S.C. §§15 & 26. 

19. This Court has subject matter jurisdiction under 28 U.S.C. §§1331, 1332(d), and 

1337. 

20. The Court has supplemental jurisdiction under 28 U.S.C. §1367 over Plaintiff’s 

state law claims. 

21. Venue is proper in this District under 15 U.S.C. §§15(a) & 22, and 28 U.S.C. 

§1391(b), (c) and (d), because during the Class Period, Defendant resided, transacted business, 

was found, or had agents in the United States, including in this District, and a substantial portion 

of the alleged activity affected interstate trade and commerce, including in this District. 

22. During the Class Period, Defendant’s conduct was within the flow of, was intended 

to, and did, in fact, have a substantial effect on the interstate commerce of the United States, 

including in this District. 

23. During the Class Period, Defendant used the instrumentalities of interstate 

commerce, including interstate wires, wireless spectrum, and the U.S. mail, to effectuate its illegal 

scheme. 

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24. Defendant’s conduct also had a substantial effect on the intrastate commerce of at 

least Arizona; Arkansas; California; Connecticut; District of Columbia; Florida; Hawaii; Illinois; 

Iowa; Kansas; Maine; Maryland; Massachusetts; Michigan; Minnesota; Mississippi; Missouri; 

Montana; Nebraska; Nevada; New Mexico; New York; North Carolina; North Dakota; Oregon; 

Rhode Island; South Carolina; South Dakota; Tennessee; Utah; Vermont; West Virginia; and 

Wisconsin. 

25. This Court has personal jurisdiction over Defendant because Defendant transacted 

business, maintained substantial contacts, and is located and/or committed unlawful conduct in 

this District. The unlawful scheme was directed at, and had the intended effect of, causing injury 

to persons residing in, located in, or doing business in this District. 

26. Plaintiff purchased at least one FICO Score from Fair Isaac and TransUnion, which 

is headquartered in this District. 

27. Defendant employs persons who work in its Credit Score business in this District. 

28. Defendant is registered to do business in Illinois with the Illinois Secretary of State. 

29. Defendant selected this District to institute Case No. 1:17-cv-08318, to which this 

case is filed as related by Plaintiff. 

IV. ALLEGATIONS OF FACT SUPPORTING THE CLAIM FOR RELIEF 

A. Credit Scores 

30. Credit Scores are typically three-digit numbers that are designed to assess credit 

risk. Higher scores generally indicate that a consumer poses less credit risk. Credit Scores are 

produced using credit scoring systems that apply a credit scoring algorithm to a consumer credit 

report. Credit Scores are usually accompanied by “reason codes,” which inform the lender about 

the reasons that contributed most significantly to reducing a particular consumer’s Credit Score. 

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31. Credit Scores are the most widely used indicators of consumers’ creditworthiness 

in the United States. Lenders, financial institutions, and other businesses rely on Credit Scores to 

decide whether and on what terms to extend credit to consumers. Consumers, in contrast, rely on 

Credit Scores to determine whether they will be able to get a mortgage, credit card, auto loan, or 

other credit product and the rate they will pay. 

32. The Credit Bureaus collect and supply aggregated consumer credit data in the form 

of consumer reports. The Credit Bureaus continuously gather credit and financial data about 

consumers from creditors, governmental entities, public records, collection agencies, and other 

third parties. This information is then compiled into a “credit file.” The Credit Bureaus sell credit 

reports, which include information gathered from a consumer’s credit file, to businesses and 

consumers. 

33. While Credit Scores are sometimes sold together with credit reports, credit reports 

are different from Credit Scores and can be sold independently. A credit report is a statement that 

has detailed information about a consumer’s credit activity and current credit situation. A 

consumer’s credit report might, for example, include information about that consumer’s history of 

mortgage payments, credit card balances, credit card payments, and credit inquiries. A Credit 

Score takes the detailed information in a credit report and turns it into a single three-digit number. 

B. The Markets for Credit Scores in the United States 

34. There are two distinct markets for Credit Scores in the United States: (1) the B2B 

Credit Score Market and (2) the B2C Credit Score Market. B2B and B2C Credit Scores are priced, 

purchased, and used very differently and serve very different purposes. The lenders, financial 

institutions, and other businesses in the B2B Credit Score Market that purchase and use Credit 

Scores to assess creditworthiness and make decisions about whether and on what terms to extend 

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credit or otherwise take on risk do not consider credit reports, insurance scores, or any other 

information about borrowers, to be a substitute for Credit Scores. 

35. Consumers in the B2C Credit Score Market purchase their own Credit Scores to 

better understand their own creditworthiness and how they likely will be viewed by potential 

lenders. 

36. The United States is the relevant geographic market in which B2B Credit Scores 

are provided. The restraints on competition in the B2B Credit Score Market contained in Fair 

Isaac’s contracts relate to the provision of B2B Credit Scores to businesses throughout the United 

States. 

37. Purchasers in the B2B Credit Score Market are comprised of lenders, financial 

institutions, and other businesses that purchase B2B Credit Scores in order to make risk 

management decisions (“B2B Purchasers”). Lenders, financial institutions, and other businesses 

that purchase Credit Reports from Defendant and/or the Credit Bureaus generally purchase Credit 

Scores in order to determine the credit-worthiness and identity of qualified borrowers to whom a 

preapproved credit offer will be extended (“pre-screening”), make lending decisions (“lending”), 

or review the risk associated with existing borrowers for purposes such as extending additional 

credit or changing other account terms (“account management”). 

38. Customers in the B2C Credit Score Market, in contrast, purchase Credit Scores in 

order to manage their credit, protect their identity, or assess their likelihood of obtaining credit. 

Today, American consumers have signed up for over 160 million credit monitoring or identity 

protection accounts from businesses such as Capital One, Credit Karma, and LifeLock. Many of 

those accounts include access to the consumer’s own Credit Score. 

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39. The credit risk scoring industry, industry analysts, policy analysts, and investors 

recognize the B2B Credit Score Market as distinct from the B2C Credit Score Market. Fair Isaac 

also regularly acknowledges that the B2B Credit Score Market is distinct from the B2C Credit 

Score Market. For example, in its 2019 Form 10-K, Fair Isaac distinguished between its “businessto-business scoring solutions and services” and “business-to-consumer scoring solutions and 

services including myFICO solutions for consumers.” 

40. The B2B Credit Score Market is characterized by significant barriers to entry. B2B 

Purchasers encounter significant “switching costs” if they adopt a new Credit Score that has 

different score-to-risk relationships or that uses different reason codes – regardless of whether it is 

an updated version of the score they already use or an entirely new brand of Credit Score (unlike 

consumers in the B2C Credit Score Market). These switching costs arise because employees have 

to be trained in the properties and characteristics of a new score; B2B Purchasers must ensure that 

the new score will be adequately predictive of the creditworthiness of their own customer base; 

B2B Purchasers often conduct extensive, costly, and time-consuming validation tests to determine 

whether the new score is cost-effective; and B2B Purchasers may need to invest in updating their 

internal systems to ensure technical compatibility between those systems and a new score. 

41. Network effects also characterize the B2B Credit Score Market. For example, in 

the mortgage and auto loan industries the consistent use of particular Credit Scores with similar 

score-to-risk relationships and reason codes facilitates the bundling of large groups of mortgage 

and auto loans from different originators into securities that can be sold to investors. Because of 

the consistent use of a single type of Credit Score, marketing materials for these securities can 

include data on the average and stratified Credit Scores of the borrowers associated with the 

underlying loans. 

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C. Fair Isaac Has a Monopoly in the B2B Credit Score Market 

42. Fair Isaac has maintained a monopoly over the B2B Credit Score Market in the 

United States for roughly three decades, largely through the unlawfully achieved dominance of its 

FICO product line, which includes many different types of FICO Scores. Introduced in the 1980s, 

Fair Isaac’s “FICO Classic” Credit Scores are the best known and most widely used B2B Credit 

Scores in the United States. FICO Classic applies an algorithm to each Credit Bureau’s data and 

generates a score between 300 and 850 that purports to give an indication of the individual’s credit 

risk. It also generates a set of “reason codes” that explain the reasons the consumer has not been 

assigned the maximum score. 

43. Fair Isaac advertises its monopoly in the B2B Credit Score Market. On its website, 

Fair Isaac advertises: 10 billion FICO Scores are sold each year, which is four times the number 

of hamburgers that McDonald’s sells worldwide each year; 27.4 million FICO Scores are sold 

every day, which is over twice the number of cups of coffee Starbucks sells worldwide in a day; 

and 90% of all lending decisions in the United States rely on FICO Scores.

44. Similarly, in its 2019 Form 10-K, Fair Isaac described its “FICO Scores” as “the 

standard measure in the U.S. of consumer credit risk” and reported that “FICO Scores are used . . 

. by nearly all of the major banks, credit card organizations, mortgage lenders, and auto loan 

originators.” 

45. Fair Isaac representatives have described Fair Isaac’s FICO score as “the 800-

pound gorilla” in the market for B2B Credit Scores and bragged about Fair Isaac’s 90% market 

share. For example, in November 2017, at the JPMorgan Ultimate Services Investor Conference, 

Fair Isaac’s CFO and Executive Vice President, Michael Pung, stated that Fair Isaac’s FICO 

Scores are: 

• The “most widely used credit scoring system here in the U.S.”; 

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• Used by “[v]irtually every major lender in the U.S.”; and that 

• Fair Isaac has “maintained a 90-plus percent market share for at least . . . 13 

years.” 

46. Fair Isaac representatives have also recognized that FICO Scores have benefited 

from the network effects created by the widespread use of FICO Scores in many industries. For 

example, in November 2011, then-CEO of Fair Isaac, Mark Greene, explained that the “network 

effect” of “FICO Scores . . . being sort of the standard language” and “having everybody . . . 

standardize on a FICO Score, that’s magic.”

47. Fair Isaac’s monopoly in the B2B Credit Score Market for Credit Scores has given 

it the power to control prices. Indeed, Fair Isaac’s CEO, Will Lansing, has noted that in the B2B 

Credit Score Market Fair Isaac has “quite a bit of discretion in whether we want our margins to 

be higher or lower or where they are.” 

D. Attempts to Compete Have Been Stymied by Fair Isaac’s Monopoly in the B2B 

Credit Score Market 

48. In March 2006, VantageScore introduced the VantageScore Credit Score and credit 

scoring system. VantageScore is a competitor to FICO Scores in the B2B Credit Score Market. 

49. From the time it was first released in 2006, VantageScore scored millions more 

consumers than the FICO scoring systems. Whereas Fair Isaac’s FICO scoring systems would not 

generate a score if a consumer had not used credit in more than six months or if a credit account 

was fewer than six months old, VantageScore calculated scores for consumers that had not used 

credit for up to two years. It also reached more consumers by using utility and telecommunications 

payment histories when reported to the Credit Bureaus. 

50. Today, VantageScore scores 30 million more Americans than traditional FICO 

scoring systems. Fair Isaac’s outdated FICO Classic credit scoring systems – which are still used 

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by many lenders – exclude many creditworthy Americans that VantageScore can reliably score. 

About one-quarter of American adults – some 65 million people – do not have a traditional FICO 

score. VantageScore is capable of reducing the number of adults without a Credit Score by almost 

half. Ten million of those newly scored individuals are “prime” borrowers that should be attractive 

to traditional lenders. 

51. Without a Credit Score, it is difficult or impossible to apply for or successfully 

obtain a mortgage, car loan, or reasonable interest rates on personal lines of credit. Not having a 

Credit Score can also have drastic effects outside of the credit market. For example, Credit Scores 

are increasingly used by landlords to screen potential tenants. 

52. Those excluded by Fair Isaac’s traditional FICO scoring systems – who face an 

increased risk of being denied access to credit in the form of credit cards, auto and home loans, 

and apartment housing – include disproportionate numbers of low-income and minority 

consumers. 

53. Indeed, one advocacy group focused on making it possible for people with limited 

incomes, especially people of color, to achieve financial security has observed: “Black and 

Hispanic individuals are . . . significantly more likely than white individuals to be credit invisible” 

– meaning that they have “no established credit history,” are “unscored,” and “lack[] sufficient or 

recent enough credit history to be given a [FICO] Credit Score.” VantageScore calculates a score 

for 9.5 million Hispanic and Black consumers who do not have a FICO score, including 2.7 million 

minority consumers who should be considered “prime” borrowers. 

54. Despite the potential advantages of using VantageScore, Fair Isaac continues to 

maintain its monopoly in the B2B Credit Score Market. In February 2013, at a Morgan Stanley 

Conference, Fair Isaac’s CEO, Will Lansing, explained that despite the existence of VantageScore, 

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“there [is] not that much competition around our [B2B] scores business” because “FICO scores 

are very much part of the fabric of the banking industry” and “really deeply imbedded.” 

E. Fair Isaac Has Contracted with the Credit Bureaus as Agents and CoConspirators in Its Scheme to Monopolize 

55. With its dominant position in the B2B Credit Score Market, Fair Isaac uses the 

Credit Bureaus to perpetuate and extend its monopoly. Fair Isaac’s relationship with B2B 

Purchasers is often dependent on B2B Purchasers’ relationships with the Credit Bureaus. To 

facilitate the sale of its FICO Scores to B2B Purchasers, Fair Isaac enlists the assistance of the 

Credit Bureaus. 

56. When a B2B Purchaser requires a Credit Score, it purchases the report from the 

Credit Bureau, and the Credit Score jointly from the Credit Bureau and Fair Isaac. Although the 

payment may at times occur in a single transaction, the practical reality, as expressly set forth in 

contracts governing the sale of Credit Scores to B2B Purchasers, is that both the Credit Bureau 

and Fair Isaac act as the provider of the FICO Score. 

57. B2B Purchasers’ contracts for FICO Scores are often known as Credit Scoring 

Services Agreements (“CSSAs”). CSSAs provide for both the method of payment and fee model 

for the delivery of Credit Score services. 

58. For example, the CSSA between Plaintiff, its Credit Bureau, and Fair Isaac makes 

clear in the “Method of Payment” section that “Experian/Fair, Isaac will deliver to Subscriber 

invoices” for its Credit Scores and that “Subscriber will pay Experian/Fair, Isaac the amounts 

indicated on such invoices.” It also specifies that in “consideration of Experian/Fair, Isaac’s 

performance of the Experian/Fair, Isaac Model, Subscriber will pay Experian/Fair, Isaac fees.” 

59. In Plaintiff’s and Class Members’ procurement of FICO Scores, the Credit Bureaus 

act as co-conspirators and agents of Fair Isaac. Indeed, Plaintiff’s CSSA states that “the 

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Experian/Fair, Isaac Model results from the joint efforts of Experian Information Solutions, Inc. 

and Fair, Isaac and Company, Incorporated”; and authorizes the Credit Bureau to execute the 

contract “on behalf of itself and Fair, Isaac and Company, Incorporated.” (Fair Isaac was formerly 

known as Fair, Isaac and Company.) 

F. Fair Isaac’s Other Anticompetitive and Exclusionary Conduct 

60. Fair Isaac has used its monopoly power to coordinate a multi-faceted campaign to 

eliminate competition from VantageScore. Fair Isaac has been explicit that this is its goal. In 

April 2015, Will Lansing informed investors on a quarterly earnings conference call that Fair 

Isaac’s strategic goal was to ensure that “the entire industry adopts FICO scores instead of [other] 

scores.” To achieve this goal, Fair Isaac has enlisted its competitors (the Credit Bureaus, which 

jointly own and control VantageScore) to agree to anticompetitive contracts that: prevent them 

from developing or selling alternative Credit Scores that could be seamlessly integrated into many 

lenders’ systems or used interchangeably with FICO Scores; prevent them from competing with 

each other to negotiate prices from FICO; and create a pricing scheme effectively foreclosing B2B 

Purchasers from choosing to use FICO Scores in their lending decisions at the same time as 

providing customers with a competing Credit Score, including VantageScore. At the same time, 

Fair Isaac has waged a media campaign against VantageScore and made false and misleading 

statements in order to sow fear, uncertainty, and doubt about VantageScore’s reliability. By its 

anticompetitive and exclusionary conduct, Fair Isaac has injured competition in the B2B Credit 

Score Market, increased prices for Plaintiff and the Class, and limited access to credit for millions 

of Americans. 

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1. Fair Isaac and the Credit Bureaus Have Entered into Anticompetitive 

Contract Terms that Restrict Their Ability to Compete and Sell 

VantageScore 

61. In January 2015, Fair Isaac and TransUnion entered into a contract, the Analytic 

and Data License Agreement. With TransUnion’s prior contracts with Fair Isaac set to expire on 

December 31, 2014, Fair Isaac demanded that the parties enter into a new contract rather than 

renew their existing contracts. Fair Isaac represented to TransUnion that Experian and Equifax 

had already agreed to materially similar new contracts with Fair Isaac. If TransUnion did not agree 

to the terms demanded by Fair Isaac, it would lose substantial business from customers that depend 

on FICO Scores. On information and belief, TransUnion, Equifax, and Experian all agreed to Fair 

Isaac’s plan to exclude competitors and maintain its monopoly. 

a. The Anticompetitive Agreements Restrict the Credit Bureaus’ 

Ability to Develop or Sell Other Credit Scores Compatible with 

B2B Purchasers’ Existing Systems 

62. Fair Isaac has imposed a similar or identical “No Equivalent Products” clause on 

each of the Credit Bureaus. By imposing a “No Equivalent Products” term, Fair Isaac has sought 

to block the Credit Bureaus from offering alternative Credit Score products, such as VantageScore, 

that would allow B2B Purchasers to easily switch from FICO Scores to VantageScore without 

incurring the cost of redesigning their lending programs and systems, or to use VantageScore 

alongside or interchangeably with FICO Scores. The Credit Bureaus have agreed to and 

acquiesced in these anticompetitive agreements, terms, and resulting anticompetitive effects. 

63. The “No Equivalent Products” clause provides that a Credit Bureau may not 

internally develop a credit scoring system that is aligned to the odds-to-score relationship of any 

Fair Isaac Analytic or that uses more than a limited number of reason codes that “match” reason 

codes used by any Fair Isaac Analytic. It also prohibits a Credit Bureau from distributing any 

competing analytic (i.e., credit scoring system) that is aligned with FICO Scores or uses too many 

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of the same reason codes, and the clause expressly names Vantage Score Solutions LLC as a 

developer of such a scoring system that may not be distributed if VantageScore were to offer an 

“Equivalent Product.” 

64. For example, if a competing Credit Score product used a 700 score to indicate a 

less-than-five-percent risk of credit delinquency, and if a 700 FICO score also indicated the same 

risk of delinquency, then the “No Equivalent Products” clause prevents a Credit Bureau from 

distributing the competing product. Similarly, if a competing Credit Score product used reason 

codes that match 20% or more of the reason codes used by FICO scoring systems, the “No 

Equivalent Products” clause prohibits a Credit Bureau from distributing the product. 

65. The “No Equivalent Products” clause effectively prevents a Credit Bureau from 

developing (contrary to the original goal of VantageScore and the easy ability to do so) or selling 

an alternative to FICO’s Credit Scores that would (i) be compatible with many B2B Purchasers’ 

systems, models, and processes; and (ii) allow B2B Purchasers to have a legitimate choice between 

using FICO Scores and an alternative score. Many B2B Purchasers have spent substantial effort 

and resources to develop systems, models, and processes that are designed for FICO Scores. B2B 

Purchasers’ systems, models, and processes are tailored to FICO’s odds-to-score relationship (i.e., 

each given score has a given ratio of non-defaulting consumers to defaulting consumers), and 

reason codes (the particular reasons cited for increased risk of default). For example, a bank’s 

software might be designed to accept one or more FICO Scores and reason codes, combine this 

information with data it collects internally, and automatically produce a lending decision. 

66. The “No Equivalent Products” clause protects and sustains Fair Isaac’s monopoly. 

The odds-to-score relationship is an arbitrary mapping between risk and score and does not reflect 

protectable intellectual property. Similarly, the reason codes that may not be used by an 

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“Equivalent Product” were not invented by Fair Isaac but reflect well-established industry best 

practices for lending. 

b. Fair Isaac and the Credit Bureaus Have Agreed to a Penalty 

Pricing and Bundling Scheme to Foreclose Competition from 

Competitors in the B2B Credit Score Market 

67. Fair Isaac’s contracts with each Credit Bureau include a similar or identical 

“Dynamic Royalty Schedule” clause and a similar or identical “Pre-Qualification” royalty 

category. Through the “Pre-Qualification” royalty category, Fair Isaac has effectively foreclosed 

lenders from the ability to purchase and use a FICO score in their lending decision while providing 

a consumer with a competing Credit Score, which drives lenders to buy exclusively Fair Isaac’s 

FICO Scores and not to purchase competing Credit Scores. As a consequence of Fair Isaac’s 

imposition of the “Pre-Qualification” royalty category, TransUnion has lost sales of VantageScore 

to major banks to provide to consumers. 

68. In 2015, Fair Isaac unilaterally imposed, and the Credit Bureaus have complied 

with, a new “Pre-Qualification” royalty category, which Fair Isaac defines to “mean an End User’s 

qualification of a potential consumer customer for an End User’s own internal lending offering.” 

This royalty category distinguishes between: (1) lenders that use FICO Scores for “PreQualification” without providing any Credit Score or credit data to consumers; and (2) lenders that 

use FICO Scores for “Pre-Qualification” while also providing Credit Scores or credit data to 

consumers “in connection” with the “Pre-Qualification.” Certain banks and lenders offer 

consumers opportunities to apply to qualify for credit opportunities (e.g., a credit card or loan) 

and, at the same time, receive their personal Credit Score. The offer of a free Credit Score to a 

consumer can entice consumers to apply for credit opportunities. 

69. The royalty price associated with a FICO score used for “Pre-Qualification” 

depends on whether other Credit Scores or credit data are provided to consumers. If a lender 

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purchases a FICO score for use in “Pre-Qualification” and does not provide any Credit Score or 

credit data to the consumer “in connection” with the “Pre-Qualification,” there is one per-score 

royalty rate. If the lender purchases a FICO score for use in “Pre-Qualification” and provides any 

other Credit Score (such as a VantageScore) to the consumer “in connection” with the “PreQualification,” there is a different per-score royalty rate that is higher – a penalty rate. 

70. The penalty rate can be avoided in one of two ways, both of which involve 

purchasing exclusively FICO Scores. First, the B2B Purchaser could purchase a FICO score for 

use in “Pre-Qualification” and provide no Credit Score or credit data to the consumer. Second, 

the B2B Purchaser could purchase a bundled FICO product from Fair Isaac. Fair Isaac offers 

bundled products to lenders that combine the use of scores by lenders with the provision of scores 

to consumers. 

71. There is no legitimate business justification for the penalty rate agreed upon by Fair 

Isaac and the Credit Bureaus when the lender also purchases any other Credit Score to disclose to 

consumers. The transparent purpose of the “Pre-Qualification” royalty category is to drive all B2B 

Purchasers engaging in “Pre-Qualification” to purchase exclusively FICO Scores and make it costprohibitive for B2B Purchasers engaging in “Pre-Qualification” to purchase a competing Credit 

Score for disclosure to consumers. This scheme has been effective, and few, if any, B2B 

Purchasers have opted to pay the penalty rate. 

c. Fair Isaac and the Credit Bureaus Have Agreed to Contract 

Provisions that Allow Fair Isaac to Extract Monopoly Prices 

72. Fair Isaac’s “Level Playing Field,” requires that the prices that are made available 

to one Credit Bureau be made available to the other Credit Bureaus. Taken together, the “Dynamic 

Royalty Schedule” and the “Level Playing Field” clauses enable Fair Isaac to unilaterally increase 

the royalty prices it charges for FICO Scores. Fair Isaac’s contracts with TransUnion, Equifax, 

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and Experian include similar or identical “Level Playing Field” and “Dynamic Royalty Schedule” 

provisions. 

73. Fair Isaac has used the “Level Playing Field” and “Dynamic Royalty Schedule” 

provisions in its contracts with the Credit Bureaus to extract monopoly prices from B2B 

Purchasers. These provisions disincentivize a Credit Bureau from negotiating for a lower price 

because it knows that even if it succeeds, it will not as a result gain a competitive advantage over 

the other Credit Bureaus. 

2. Fair Isaac’s Campaign to Create Fear, Uncertainty, and Doubt About 

VantageScore Among B2B Purchasers 

74. Despite having successfully induced the Credit Bureaus to agree with Fair Isaac 

and with each other to impose restrictions on VantageScore’s ability to compete with FICO, Fair 

Isaac has gone even further and waged an aggressive public relations and advertising campaign to 

spread false statements, convey false impressions, and mislead B2B Purchasers about the qualities 

and characteristics of FICO Scores and VantageScore. In advertisements, letters, and blog posts, 

Fair Isaac has disparaged VantageScore by calling it a “Fako” score, falsely claimed that 

VantageScore is an unreliable measure of creditworthiness, and misrepresented the information 

considered by VantageScore’s credit scoring system. 

75. On December 12, 2017, Fair Isaac took out a full-page advertisement in The Wall 

Street Journal addressed to “Lenders, Policymakers and Consumer Advocates” that disparaged 

VantageScore without identifying it by name. The advertisement contrasted Fair Isaac, which “is 

not owned by the credit bureaus” and whose FICO Scores have been used “by lenders and 

securitization investors for decades,” with an alternative Credit Score, which is “owned by the 

credit bureaus,” is less reliable than FICO Scores in evaluating credit risk, and fails to use “sound 

practices” or “science-based credit evaluation.” To anyone familiar with the market for Credit 

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Scores, the advertisement unambiguously conveys the false message that VantageScore is 

“[w]eakening scoring standards, [and] harm[ing] consumers, and the lending system,” particularly 

in the B2B Credit Score Market. 

76. The Wall Street Journal advertisement directed readers to “Learn more at 

FICO.com/independent,” a Fair Isaac-owned website that connects visitors to articles and blog 

posts that disparage VantageScore by name. One such blog post asserts: “Despite claims by 

VantageScore, weakening the minimum scoring criteria will not empower millions of low-risk 

mortgage credit seekers.” 

77. Moreover, the implication that FICO Classic scoring systems provide Credit Scores 

for as many consumers as VantageScore is false and misleading. VantageScore provides Credit 

Scores for millions of American consumers that are not scored by FICO Classic scoring systems. 

78. Fair Isaac’s website includes numerous posts disparaging VantageScore and 

making false or misleading statements about VantageScore’s features. For example, one blog post 

claims that “[r]esearch results consistently showed that scoring models relying solely on sparse or 

old credit data were weak and did a poor job forecasting future performance.” This statement is 

false and misleading because it conveys the message that VantageScore’s scoring model is “weak” 

and does a “poor job forecasting future performance” because it considers a consumer’s full credit 

history even if the consumer has not used a traditional credit line in the last six months. In fact, 

studies have shown that VantageScore is strongly predictive. 

79. Another blog post claims that whereas “FICO Score 9 differentiates medical from 

non-medical collections,” “VantageScore does not.” This statement conveys the false message 

that VantageScore does not differentiate medical from non-medical collections. In fact, 

VantageScore 3.0 was the first credit scoring system to address medical debt. VantageScore 4.0, 

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the most recent version of VantageScore, distinguishes medical collection accounts from nonmedical collection accounts and penalizes medical collections less than non-medical ones. 

80. Fair Isaac’s campaign against VantageScore is not new. In 2006, just months after 

the launch of VantageScore, Fair Isaac filed a meritless lawsuit against the Credit Bureaus and 

VantageScore in the United States District Court for the District of Minnesota. See Fair Isaac 

Corporation v. Equifax Inc., No. 06-cv-04112 (D. Minn.). This was the monopolist’s first attempt 

to kill the nascent competitor. Fair Isaac’s numerous claims included a claim that the development 

of VantageScore violated the antitrust laws and a claim that the development of VantageScore 

constituted trademark infringement. In its prayer for relief, Fair Isaac sought nothing less than the 

end of VantageScore: it requested that the “Defendants be ordered to dissolve VantageScore.” 

81. All of Fair Isaac’s claims failed; in fact, the jury concluded that Fair Isaac was the 

wrongdoer. In support of its trademark infringement claim, Fair Isaac had alleged that 

VantageScore’s use of a scoring range of 501-990 constituted trademark infringement because it 

was similar to FICO’s scoring range of 300-850. The Credit Bureaus and VantageScore 

counterclaimed for fraud on the United States Patent and Trademark Office (“PTO”), alleging that 

Fair Isaac had misrepresented to the PTO that only FICO used the 300-850 score range. The jury 

concluded that Fair Isaac had committed fraud on the PTO by making false statements as part of 

its application to register the score range of 300-850 as a trademark. 

82. The public statements described in the foregoing paragraphs were transmitted to 

and seen by a substantial number of businesses and consumers nationwide. 

3. Fair Isaac’s Anticompetitive and Exclusionary Conduct Harms 

Competition 

83. Fair Isaac’s campaign of exclusionary conduct to maintain and expand its 

monopoly has harmed and continues to harm participants in the B2B Credit Score Market. Fair 

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Isaac’s unlawful conduct, including that which has been taken in concert with the Credit Bureaus, 

has foreclosed competition in the B2B Credit Score Market by foreclosing opportunities for the 

Credit Bureaus to sell VantageScore or any other competitive products. The anticompetitive and 

exclusionary conduct has allowed Fair Isaac to maintain its monopoly and charge monopoly prices 

for B2B Credit Scores to B2B Purchasers during the Class Period. 

84. Fair Isaac’s conduct, in concert with the Credit Bureaus, including by the contracts 

entered into by the Credit Bureaus, has reduced choice for B2B Purchasers. The anticompetitive 

terms agreed to between Fair Isaac and the Credit Bureaus have frustrated the ability of B2B 

Purchasers to purchase VantageScore or any other competitive Credit Score that could be 

seamlessly integrated into lenders’ existing processes and systems. Fair Isaac’s media and 

advertising campaign against VantageScore has been successful in sowing fear, uncertainty, and 

doubt about VantageScore in the marketplace. 

85. Media sources, financial blogs, and consumers have absorbed Fair Isaac’s message 

that VantageScore is a “Fako” score merely because it is not a FICO score. For example, 

thebalance.com – a website devoted to personal finance issues – posted in February 2017, and 

continues to display as of the date of this filing: “If you purchased your Credit Score anywhere 

but MyFICO.com, then it’s a Fako score.”2

V. CLASS ACTION ALLEGATIONS 

86. Plaintiff brings this action on behalf of itself, and, under Rules 23(a) and (b) of 

the Federal Rules of Civil Procedure, on behalf of: 

All B2B Purchasers residing in the United States that directly purchased a 

FICO Score from Fair Isaac and/or a Credit Bureau during the Class Period. 

2 Latoya Irby, FICO & FAKO Credit Scores, THE BALANCE, https://www.thebalance.com/ 

fico-and-fako-credit-scores-960497 (last visited Apr. 2, 2020). 

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87. Excluded from the Class are: Defendant, its officers, directors, management, 

employees, subsidiaries, and affiliates. Also expressly excluded are any natural persons that 

purchased their own Credit Score solely via myFico.com, the Credit Bureaus, or other entities for 

their personal use. 

88. Also excluded is the Judge presiding over this action, his or her law clerks, spouse, 

and any person within the third degree of relationship living in the Judge’s household or the spouse 

of such a person. 

89. Members of the Class are so numerous and geographically dispersed that joinder is 

impracticable. Further, members of the Class are readily identifiable from information and records 

in the possession of Defendant. 

90. Plaintiff’s claims are typical of the claims of the members of the Class. Plaintiff 

and members of the Class were damaged by the same wrongful conduct of Defendant. 

91. Plaintiff will fairly and adequately protect and represent the interests of members 

of the Class. The interests of Plaintiff are coincident with, and not antagonistic to, those of 

members of the Class. 

92. Plaintiff is represented by counsel with experience in the prosecution and leadership 

of class action antitrust and other complex litigation, including class actions in the financial 

services industry. 

93. Questions of law and fact common to the members of the Class predominate over 

questions that may affect only individual Class members, thereby making damages with respect to 

members of the Class as a whole appropriate. Questions of law and fact common to members of 

the Class include, but are not limited to: 

a. whether Defendant monopolized, conspired to monopolize, or unreasonably 

restrained trade in violation of federal law; 

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b. whether Defendant monopolized, conspired to monopolize, or unreasonably 

restrained trade in violation of certain state antitrust laws; 

c. whether Defendant engaged in unfair or deceptive trade practices in violation 

of certain state laws; 

d. the duration of the alleged unlawful conduct; 

e. injury suffered by Plaintiff and members of the Class; 

f. damages suffered by Plaintiff and members of the Class; and 

g. whether Defendant has acted or refused to act on grounds generally applicable 

to members of the Class, thereby making appropriate final injunctive relief or 

corresponding declaratory relief with respect to members of the Class as a 

whole. 

94. Class action treatment is a superior method for the fair and efficient adjudication of 

the controversy. Such treatment will permit a large number of similarly situated persons to 

prosecute their common claims in a single forum simultaneously, efficiently, and without the 

unnecessary duplication of evidence, effort, or expense that numerous individual actions would 

require. 

95. The benefit of proceeding through the class mechanism, including providing 

injured persons or entities a method for obtaining redress on claims that could not practicably be 

pursued individually, substantially outweighs potential difficulties in management of this class 

action. 

96. Plaintiff knows of no special difficulty to be encountered in the maintenance of this 

action that would preclude its maintenance as a class action. 

97. Plaintiff has defined members of the Class based on currently available information 

and hereby reserves the right to amend the definition of members of the Class, including, without 

limitation, the Class Period. 

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VI. STATUTES OF LIMITATIONS AND TOLLING 

98. By its very nature, the unlawful activity in which Defendant engaged was selfconcealing from Plaintiff and the Class. As a result of Defendant’s affirmative acts, 

misrepresentations, and nondisclosures as alleged herein, any applicable statutes of limitation on 

claims asserted by Plaintiff and members of the Class have been and are tolled, and Defendant is 

equitably estopped from raising statutes of limitations as a defense. 

99. Any applicable statutes of limitations were tolled at least until February 12, 2018, 

the date that TransUnion filed its Counterclaim against Defendant. 

100. The federal government’s initiation of its antitrust investigation of Defendant’s 

unlawful conduct also operates to toll any federal statute of limitations under 15 U.S.C. §16. 

VII. CLAIMS FOR RELIEF 

CLAIM ONE: 

MONOPOLIZATION 

15 U.S.C. §2 

101. Plaintiff incorporates by reference and re-alleges the preceding allegations as 

though fully set forth herein. 

102. The relevant product market is the market for the sale of B2B Credit Scores. 

103. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

104. The B2B Credit Score Market is the relevant market. 

105. Fair Isaac has had and continues to have at least 90% market share in the B2B 

Credit Score Market. 

106. Fair Isaac has had and continues to have monopoly power in the B2B Credit Score 

Market. 

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107. Fair Isaac has had and continues to have the power to control prices or exclude 

competition in the B2B Credit Score Market. 

108. Through unlawful, interconnected, and mutually reinforcing anticompetitive and 

exclusionary acts and agreements, Fair Isaac has substantially foreclosed competition in the market 

for B2B Credit Scores in the United States in violation of Section 2 of the Sherman Act, 15 U.S.C. 

§2. 

109. Fair Isaac has demonstrated its ability to control prices and exclude competition by 

raising prices without a corresponding increase in demand and to supracompetitive levels. 

110. Fair Isaac’s monopoly is not due to growth or development because of a superior 

product, business acumen, or historic accident. 

111. Fair Isaac’s monopolization has injured and will continue to injure competition in 

this market. 

112. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

113. The anticompetitive conduct raised the prices for FICO Scores above the 

competitive level and otherwise injured competition without any offsetting procompetitive benefit 

to consumers. 

114. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 2 of the Sherman Act within the meaning of Section 

4 of the Clayton Antitrust Act, 15 U.S.C. §15. 

115. Plaintiff and members of the Class are threatened with future injury to their business 

and property by reason of Defendant’s continuing violation of Section 2 of the Sherman Act within 

the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. §26. 

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CLAIM TWO: 

CONSPIRACY TO MONOPOLIZE 

15 U.S.C. §2 

116. Plaintiff incorporates by reference and re-alleges the preceding allegations as 

though fully set forth herein. 

117. The relevant product market is the market for the sale of B2B Credit Scores. 

118. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

119. The B2B Credit Score Market is the relevant market. 

120. Fair Isaac has had and continues to have at least 90% market share in the B2B 

Credit Score Market. 

121. Fair Isaac has had and continues to have monopoly power in the B2B Credit Score 

Market. 

122. Fair Isaac has had and continues to have the power to control prices or exclude 

competition in the B2B Credit Score Market. 

123. Through unlawful, interconnected, and mutually reinforcing anticompetitive and 

exclusionary acts and agreements, Fair Isaac has substantially foreclosed competition in the market 

for B2B Credit Score Market in the United States in violation of Section 2 of the Sherman Act, 15 

U.S.C. §2. 

124. Fair Isaac has demonstrated its ability to control prices and exclude competition by 

raising prices without a corresponding increase in demand, and to supracompetitive levels. 

125. Fair Isaac entered into a combination or conspiracy with the Credit Bureaus to 

maintain its monopoly power in the B2B Credit Score Market. Fair Isaac created and maintained 

this conspiracy through a series of agreements with each of the Credit Bureaus. In these 

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agreements, the Credit Bureaus and Fair Isaac agreed that the Credit Bureaus would not offer or 

sell VantageScore or any other competing Credit Score to Plaintiff and members of the Class. Fair 

Isaac and the Credit Bureaus further agreed that the Credit Bureaus would act as Fair Isaac’s agent 

in the sale of FICO Scores to Plaintiff and members of the Class. 

126. These agreements foreclosed competition in a substantial portion of the B2B Credit 

Score Market and unlawfully maintained Fair Isaac’s monopoly, resulting in Fair Isaac extracting 

supracompetitive prices for FICO Scores from Plaintiff and members of the Class. 

127. Fair Isaac’s monopoly is not due to growth or development because of a superior 

product, business acumen, or historic accident. 

128. Fair Isaac’s monopolization conspiracy has injured and will continue to injure 

competition in this market. 

129. Fair Isaac has acted with the specific intent of monopolizing the market for B2B 

Credit Scores in the United States. 

130. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

131. The conspiracy raised the prices for FICO Scores above the competitive level and 

otherwise injured competition without any offsetting procompetitive benefit to consumers. 

132. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 2 of the Sherman Act within the meaning of Section 

4 of the Clayton Antitrust Act, 15 U.S.C. §15. 

133. Plaintiff and members of the Class are threatened with future injury to their business 

and property by reason of Defendant’s continuing violation of Section 2 of the Sherman Act within 

the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. §26. 

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CLAIM THREE: 

UNREASONABLE RESTRAINT OF TRADE 

15 U.S.C. §1 

134. Plaintiff incorporates by reference and re-alleges the preceding allegations as 

though fully set forth herein. 

135. The relevant product market is the market for the sale of B2B Credit Scores. 

136. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

137. The B2B Credit Score Market is the relevant market. 

138. Fair Isaac and the Credit Bureaus have had and continue to collectively have at least 

90% market share in the B2B Credit Score Market. 

139. Fair Isaac has had and continues to have monopoly power in the B2B Credit Score 

Market. 

140. Fair Isaac has had and continues to have the power to control prices or exclude 

competition in the B2B Credit Score Market. 

141. Fair Isaac entered into agreements with TransUnion, Experian, and Equifax that 

contained anticompetitive terms whereby each Credit Bureau agreed not to offer or sell 

VantageScore as a competing product to Plaintiff and members of the Class. 

142. The agreements between Fair Isaac and the Credit Bureaus had substantial 

anticompetitive effects. The agreements excluded VantageScore, a significant competitor, from a 

substantial portion of competition in the B2B Credit Score Market. 

143. The agreements raised the price for FICO Scores above the competitive level and 

otherwise injured competition without any offsetting procompetitive benefit to consumers. 

144. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

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145. Plaintiff and members of the Class continue to suffer damage, and will continue to 

do so, if Fair Isaac does not cease its anticompetitive conduct. 

146. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 1 of the Sherman Act, within the meaning of Section 

4 of the Clayton Antitrust Act, 15 U.S.C. §15. 

147. Plaintiff and members of the Class are threatened with future injury to their business 

and property by reason of Defendant’s continuing violation of Section 1 of the Sherman Act, within 

the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. §26. 

CLAIM FOUR: 

STATE ANTITRUST LAWS 

148. Plaintiff incorporates by reference and re-alleges the preceding allegations as 

though fully set forth herein. 

149. By reason of the foregoing, Defendant has violated, and Plaintiff and members of 

the Class are entitled to relief under, the antitrust laws of the States of Arizona, California, 

Connecticut, Hawaii, Illinois, Iowa, Kansas, Maine, Maryland, Michigan, Minnesota, Mississippi, 

Nebraska, Nevada, New Mexico, New York, North Carolina, North Dakota, Oregon, Rhode 

Island, South Dakota, Tennessee, Utah, Vermont, West Virginia, and Wisconsin, as well as the 

District of Columbia, as follows: 

i. Arizona Revised Statutes §44-1401, et seq.; 

ii. California Cartwright Act, California Business & Professions Code §16700, 

et seq. 

iii. Connecticut Antitrust Act, Conn. Gen. Stat. 35-24, et seq.; 

iv. District of Columbia Code §28-4501, et seq.; 

v. Hawaii Revised Statutes §480-2, et seq.; 

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vi. Illinois Antitrust Act, Illinois Complied Statutes §740, Ill. Comp. Stat. 

1011, et seq.; 

vii. Iowa Competition Law, Iowa Code §553.1, et seq.; 

viii. Kansas Statutes Annotated §50-101, et seq.; 

ix. Maine Revised Statutes Annotated, tit. 10, §1101, et seq.; 

x. Maryland Code Annotated, Commercial Law, §11-204, et seq.; 

xi. Michigan Compiled Laws §445.771, et seq.; 

xii. Minnesota Antitrust Law of 1971, Minnesota Statutes §325D.49, et seq.; 

xiii. Mississippi Code Annotated §75-21-1, et seq.; 

xiv. Nebraska Revised Statutes §59-801, et seq.; 

xv. Nevada Revised Statutes Annotated §598A.010, et seq.; 

xvi. New Mexico Statutes Annotated §57-1-1, et seq.; 

xvii. New York Donnelly Act, New York General Business Law §340, et seq.; 

xviii. North Carolina General Statutes §75-1, et seq.; 

xix. North Dakota Century Code §51-08.1-01, et seq.; 

xx. Oregon Revised Statutes §646.705, et seq.; 

xxi. Rhode Island General Laws §6-36-4, et seq.; 

xxii. South Dakota Codified Laws §37-1-3.1, et seq.; 

xxiii. Tennessee Code Annotated §47-25-101, et seq.; 

xxiv. Utah Code Annotated §76-10-3104, et seq.; 

xxv. Vermont Statutes Annotated, tit. 9, §2451, et seq.; 

xxvi. West Virginia Code §47-18-1, et seq.; and 

xxvii. Wisconsin Statutes §133.01, et seq. 

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CLAIM FIVE: 

STATE UNFAIR TRADE PRACTICES LAWS 

150. Plaintiff incorporates by reference and re-alleges the preceding allegations as 

though fully set forth herein. 

151. By reason of the foregoing, Defendant has violated, and Plaintiff and members of 

the Class are entitled to relief under, the Unfair Trade Practices and Consumer Protection Laws of 

the States of Arkansas, California, Connecticut, Florida, Massachusetts, Missouri, Montana, New 

Mexico, New York, North Carolina, Rhode Island, South Carolina, and Vermont, as well as the 

District of Columbia, as follows: 

i. Arkansas Code Annotated, §4-88-101, et seq.; 

ii. California Business and Professions Code §17200, et seq.; 

iii. Connecticut Unfair Trade Practices Act, Conn Gen. Stat. §42-110a, et seq.; 

iv. District of Columbia Code §28-3901, et seq.; 

v. Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. §501.201, et 

seq.; 

vi. Massachusetts Consumer Protection Act, Mass. Gen. L. Ch. 93A, et seq.; 

vii. Missouri Merchandising Practices Act, Mo. Rev. Stat. §407.010, et seq.; 

viii. Montana Code, §30-14-103, et seq., and §30-14-201, et seq.; 

ix. New Mexico Statutes Annotated §57-12-1, et seq.; 

x. New York General Business Law §349, et seq.; 

xi. North Carolina General Statutes §75-1.1, et seq.; 

xii. Rhode Island General Laws §6-13.1-1, et seq.; 

xiii. South Carolina Code Annotated §39-5-10, et seq.; and 

xiv. Vermont Statutes Annotated, tit. 9, §2451, et seq. 

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VIII. PRAYER FOR RELIEF 

WHEREFORE, Plaintiff, on behalf of itself and members of the Class, respectfully prays 

that This Honorable Court: 

A. Order that this action may be maintained as a class action pursuant to Rules 23(a) 

& (b) of the Federal Rules of Civil Procedure, that it be named a Class Representative, that the 

undersigned be named Lead Class Counsel, and that reasonable notice of this action, as provided 

by Rule 23(c)(2), be given to members of the Class; 

B. Adjudge that Defendant violated the federal antitrust laws as set forth above; 

C. Adjudge that Defendant violated the state antitrust and unfair trade practices laws 

as set forth above; 

D. Award Plaintiff and members of the Class actual, treble, and exemplary damages; 

E. Award Plaintiff and members of the Class attorneys’ fees and costs of suit, 

including costs of consulting and testifying experts; 

F. Award Plaintiff and members of the Class pre- and post-judgment interest; 

G. Enjoin Defendant from its violations of law; and 

H. Grant such other, further and different relief, including structural relief, as may be 

just and proper. 

IX. DEMAND FOR JURY TRIAL 

Under Rule 38(b) of the Federal Rules of Civil Procedure, Plaintiff demands a Trial by 

Jury as to all issues so triable. 

Dated: April 2, 2020

SCOTT+SCOTT ATTORNEYS AT LAW LLP

 s/ Joseph P. Guglielmo 

Joseph P. Guglielmo (N.D. Ill. No. 2759819) 

Peter A. Barile III (N.D. Ill. No. 4364295) 

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Justin W. Batten (pro hac vice forthcoming) 

The Helmsley Building 

230 Park Avenue, 17th Floor 

New York, NY 10169 

Telephone: 212-223-6444 

Facsimile: 212-223-6334 

jgugliemo@scott-scott.com 

pbarile@scott-scott.com 

jbatten@scott-scott.com 

Christopher M. Burke (pro hac vice forthcoming) 

SCOTT+SCOTT ATTORNEYS AT LAW LLP

600 W. Broadway, Suite 3300 

San Diego, CA 92101 

Telephone: 619-233-4565 

Facsimile: 619-233-0508 

cburke@scott-scott.com 

George A. Zelcs (Ill. Bar No. 3123738) 

Randall P. Ewing, Jr. (Ill. Bar No. 6294238) 

Ryan Z. Cortazar (Ill. Bar No. 6323766) 

KOREIN TILLERY, LLC 

205 North Michigan Avenue, Suite 1950 

Chicago, IL 60601 

Telephone: 312-641-9750 

Facsimile: 312-641-9751 

gzelcs@koreintillery.com 

rewing@koreintillery.com 

rcortazar@koreintillery.com 

Steven M. Berezney (N.D. Ill. Bar No. 56091) 

Michael E. Klenov (Ill. Bar No. 6300228) 

KOREIN TILLERY, LLC 

505 North 7th Street, Suite 3600 

St. Louis, MO 63101 

Telephone: 314-241-4844 

Facsimile: 314-241-3525 

sberezney@koreintillery.com 

mklenov@koreintillery.com 

Counsel for Plaintiff Sky Federal Credit Union 

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EXHIBIT B 

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UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

FIRST CHOICE FEDERAL CREDIT 

UNION, on Behalf of Itself and All Others 

Similarly Situated, 

Plaintiff, 

v. 

FAIR ISAAC CORPORATION, 

Defendant. 

Case No. 

CLASS ACTION COMPLAINT 

JURY TRIAL DEMANDED 

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TABLE OF CONTENTS 

I. NATURE OF THE ACTION ............................................................................................. 1

II. PARTIES ............................................................................................................................ 4

A. Plaintiff ................................................................................................................... 4

B. Defendant ................................................................................................................ 5

III. JURISDICTION, VENUE, AND INTERSTATE COMMERCE ...................................... 5

IV. ALLEGATIONS OF FACT SUPPORTING THE CLAIM FOR RELIEF ........................ 6

A. Credit Scores ........................................................................................................... 6

B. The Markets for Credit Scores in the United States ............................................... 7

C. Fair Isaac Has a Monopoly in the B2B Credit Score Market ................................. 9

D. Attempts To Compete Have Been Stymied by Fair Isaac’s Monopoly in the 

B2B Credit Score Market...................................................................................... 11

E. Fair Isaac Has Contracted with the Credit Bureaus as Agents and 

Co-Conspirators in Its Scheme To Monopolize.................................................... 13

F. Fair Isaac’s Other Anticompetitive and Exclusionary Conduct ........................... 14

1. Fair Isaac and the Credit Bureaus Have Entered into Anticompetitive 

Contract Terms that Restrict Their Ability To Compete and Sell 

VantageScore ............................................................................................ 15

a. The Anticompetitive Agreements Restrict the Credit Bureaus’ 

Ability To Develop or Sell Other Credit Scores Compatible 

with B2B Purchasers’ Existing Systems ....................................... 15

b. Fair Isaac and the Credit Bureaus Have Agreed to a Penalty 

Pricing and Bundling Scheme To Foreclose Competition from 

Competitors in the B2B Credit Score Market ............................... 17

c. Fair Isaac and the Credit Bureaus Have Agreed to Contract 

Provisions that Allow Fair Isaac To Extract Monopoly Prices ..... 19

2. Fair Isaac’s Campaign To Create Fear, Uncertainty, and Doubt About 

VantageScore Among B2B Purchasers .................................................... 19

3. Fair Isaac’s Anticompetitive and Exclusionary Conduct Harms 

Competition............................................................................................... 22

V. CLASS ACTION ALLEGATIONS ................................................................................. 23

VI. STATUTES OF LIMITATIONS AND TOLLING .......................................................... 25

VII. CLAIMS FOR RELIEF .................................................................................................... 25

CLAIM ONE: MONOPOLIZATION 15 U.S.C. § 2 ........................................................ 25

CLAIM TWO: CONSPIRACY TO MONOPOLIZE 15 U.S.C.§ 2 ................................. 27

CLAIM THREE: UNREASONABLE RESTRAINT OF TRADE 15 U.S.C. §1 ............ 29

VIII. PRAYER FOR RELIEF ................................................................................................... 30

IX. DEMAND FOR JURY TRIAL ........................................................................................ 31

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Plaintiff First Choice Federal Credit Union, on behalf of itself and all other similarly 

situated residents of the United States, brings claims under the Sherman Act against Defendant 

Fair Isaac Corporation (“Fair Isaac”) for redress of the injury and damages resulting from its 

monopolizing, conspiring to monopolize, and otherwise unreasonably restraining trade from at 

least as early as January 1, 2006, through the date by which the anticompetitive effects of 

Defendant’s violations of law shall have ceased, but in any case no earlier than the present (the 

“Class Period”). Based upon personal knowledge, information and belief, proceedings and 

admissions made in Case No. 1:17-cv-08318 (N.D. Ill.), related ongoing federal government 

investigations, and investigation of counsel, Plaintiff alleges: 

I. NATURE OF THE ACTION 

1. “Credit Scores” are three digit numbers that rank or “score” creditworthiness 

within a range by applying certain algorithms to credit histories. There are two distinct markets 

for Credit Scores in the United States: (1) the market for the sale of Credit Scores to lenders, 

financial institutions, and other businesses for risk management decisions (the “B2B Credit 

Score Market”); and (2) the market for the sale of Credit Scores directly to consumers to monitor 

their own credit records (the “business-to-consumer” or “B2C Credit Score Market”). 

2. This case concerns the B2B Credit Score Market, over which Defendant Fair 

Isaac has unlawfully maintained a 90% monopoly for many years. 

3. Fair Isaac has abused its monopoly power by engaging in anticompetitive and 

exclusionary conduct and agreements. Fair Isaac has suppressed competition, stymied 

innovation, and limited access to credit for millions of Americans – all in violation of Sections 1 

and 2 of the Sherman Act, 15 U.S.C. §§1, 2. 

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4. Fair Isaac’s FICO Credit Scores (“FICO Scores”) have dominated the market for 

nearly three decades. Fair Isaac executives have bragged that their FICO Scores are “the 800-

pound gorilla” and are “deeply embedded in the system in North America.” Fair Isaac admitted 

in 2017 that it has “maintained a 90-plus percent market share for at least 13 years.” Fair Isaac 

advertises that its FICO Scores are used for 90% of all lending decisions in the United States and 

that Fair Isaac sells four times more FICO Scores per year than McDonald’s sells hamburgers 

worldwide.

5. TransUnion, Experian, and Equifax are credit reporting agencies that collect, 

standardize, and distribute information on consumer credit activity (collectively, the “Credit 

Bureaus”). Credit Bureaus sell lenders, financial institutions, and other businesses credit reports 

and Credit Scores – including Fair Isaac’s FICO Scores – that are used to make decisions about 

whether and on what terms to evaluate and extend credit. Credit Bureaus sell those credit reports 

and Credit Scores to businesses in every state. For decades, Credit Bureaus have acted as Fair 

Isaac’s agents and co-conspirators to broker sales between businesses and Fair Isaac of the 

dominant FICO Scores. Fair Isaac has used these distribution agreements to place 

anticompetitive restrictions on the three dominant Credit Bureaus’ ability to develop or distribute 

competitive Credit Scores; prohibited Credit Bureaus from individually negotiating royalty 

prices for access to FICO Scores; charged discriminatory and prohibitively high royalty prices 

for FICO Scores if a Credit Bureau customer purchases a FICO Score while providing the 

consumer with a competing score; and increased the royalty prices that must be paid by Credit 

Bureaus. Nevertheless, the Credit Bureaus have agreed to, and acquiesced in, these restrictions. 

6. In 2006, VantageScore Solutions, LLC (“VantageScore”), a joint venture of the 

Credit Bureaus, launched a competitive Credit Score known as VantageScore. From the outset, 

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VantageScore was competitively priced, highly predictive, and scored millions more Americans 

than Fair Isaac’s FICO products. Today, by making full use of the Credit Bureaus’ consumer 

data, including rental and utility payments, VantageScore is capable of providing Credit Scores 

for an additional 30 million Americans who do not have a FICO Score. Were VantageScore 

widely adopted by businesses, millions more creditworthy Americans would have the 

opportunity to apply for a home mortgage, car loan, or credit card, and obtain credit at lower 

costs. 

7. Rather than compete on the merits with VantageScore, Fair Isaac has engaged in a 

pattern of anticompetitive conduct over the course of more than a decade to discourage the 

adoption of VantageScore and preserve its own monopoly, with the Credit Bureaus’ assistance. 

Fair Isaac has abused its monopoly power to prevent the Credit Bureaus from successfully 

marketing and selling a competitive alternative to FICO Scores and has waged a disparaging 

public relations and advertising campaign to create fear, uncertainty, and doubt about 

VantageScore’s viability and reliability with lenders and consumers. 

8. Through its exclusionary conduct, Fair Isaac has succeeded in preventing the 

substantial sales growth that VantageScore or a competing credit scoring system would have 

achieved though competition on the merits. Having suppressed competition, Fair Isaac has been 

able to significantly increase prices, including most recently in September 2019, for its FICO 

Scores. But for Fair Isaac’s suppression of competition and the resulting contractual agreements 

not to compete, VantageScore or another competitive credit scoring system would have thrived 

and won substantial market share through its innovative product and would have reduced the 

prices paid for B2B Credit Scores by Plaintiff and members of the Class. 

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9. Fair Isaac’s anticompetitive and exclusionary conduct has harmed businesses that 

have been deprived of competitive pricing for instruments that allow them to gauge credit risk 

and have had their freedom of choice restricted. Opening the market to competition is essential 

to competitive pricing and product innovation, including scoring the tens of millions of 

creditworthy Americans who have been denied access to credit. 

10. In February 2018, TransUnion filed antitrust counterclaims for monopolization 

and related claims against Fair Isaac in this District. See Fair Isaac Corp. v. Trans Union LLC, 

No. 1:17-cv-08318, ECF No. 38 (redacted counterclaims). In March 2019, The Honorable Judge 

Sharon Johnson Coleman denied Fair Isaac’s motion to dismiss TransUnion’s antitrust 

counterclaims. See id., ECF No. 96. The matter is ongoing. 

11. On March 15, 2020, Fair Isaac disclosed that it was under investigation by the 

Antitrust Division of the United States Department of Justice for exclusionary conduct relating to 

the allegations in the counterclaims upheld by Judge Coleman.1

II. PARTIES 

A. Plaintiff 

12. Plaintiff First Choice Federal Credit Union is a federally chartered credit union 

with a principal place of business in New Castle, Pennsylvania. 

13. Plaintiff is a financial institution that provides financial services, including 

deposit accounts, credit and/or debit cards, and lending and other credit-related facilities for 

consumers. 

 

1 See Fair Isaac Corporation, Press Release: FICO Statement Regarding Antitrust Investigation, 

PR Newswire (Mar. 15, 2020), https://www.prnewswire.com/news-releases/fico-statementregarding-antitrust-investigation-301024452.html. 

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14. During the Class Period, Plaintiff directly purchased B2B Credit Scores from 

Defendant and a Credit Bureau. 

15. Plaintiff was injured in its business or property as a direct, proximate, and 

material result of Defendant’s violations of law. 

16. Plaintiff is threatened with future injury to its business and property by reason of 

Defendant’s continuing violations of law. 

B. Defendant 

17. Defendant Fair Isaac Corporation is a Delaware corporation, with its principal 

place of business at 181 Metro Drive, Suite 700, San Jose, California 95110. 

III. JURISDICTION, VENUE, AND INTERSTATE COMMERCE 

18. This action arises under Sections 1 and 2 of the Sherman Antitrust Act of 1890 (as 

amended), 15 U.S.C. §§ 1, 2, and Sections 4 and 16 of the Clayton Antitrust Act of 1914 (as 

amended), 15 U.S.C. §§ 15, 26. 

19. This Court has subject matter jurisdiction under 28 U.S.C. §§1331, 1332(d), and 

1337. 

20. Venue is proper in this District under 15 U.S.C. §§15(a) and 22, and 28 U.S.C. 

§1391(b), (c) and (d), because during the Class Period, Defendant resided, transacted business, 

was found, or had agents in the United States, including in this District, and a substantial portion 

of the alleged activity affected interstate trade and commerce, including in this District. 

21. During the Class Period, Defendant’s conduct was within the flow of, was 

intended to, and did, in fact, have a substantial effect on the interstate commerce of the United 

States, including in this District. 

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22. During the Class Period, Defendant used the instrumentalities of interstate 

commerce, including interstate wires, wireless spectrum, and the U.S. mail, to effectuate its 

illegal scheme. 

23. This Court has personal jurisdiction over Defendant because Defendant transacted 

business, maintained substantial contacts, and is located and/or committed unlawful conduct in 

this District. The unlawful scheme was directed at, and had the intended effect of, causing injury 

to persons residing in, located in, or doing business in this District. 

24. Plaintiff purchased at least one FICO Score from Fair Isaac and TransUnion, 

which is headquartered in this District. 

25. Defendant employs persons who work in its Credit Score business in this District. 

26. Defendant is registered to do business in Illinois with the Illinois Secretary of 

State. 

27. Defendant selected this District to institute Case No. 1:17-cv-08318, to which this 

case is filed as related by Plaintiff. 

IV. ALLEGATIONS OF FACT SUPPORTING THE CLAIM FOR RELIEF 

A. Credit Scores 

28. Credit Scores are typically three-digit numbers that are designed to assess credit 

risk. Higher scores generally indicate that a consumer poses less credit risk. Credit Scores are 

produced using credit scoring systems that apply a credit scoring algorithm to a consumer credit 

report. Credit Scores are usually accompanied by “reason codes,” which inform the lender about 

the reasons that contributed most significantly to reducing a particular consumer’s Credit Score. 

29. Credit Scores are the most widely used indicators of consumers’ creditworthiness 

in the United States. Lenders, financial institutions, and other businesses rely on Credit Scores to 

decide whether and on what terms to extend credit to consumers. Consumers, in contrast, rely on 

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Credit Scores to determine whether they will be able to get a mortgage, credit card, auto loan, or 

other credit product and the rate they will pay. 

30. The Credit Bureaus collect and supply aggregated consumer credit data in the 

form of consumer reports. The Credit Bureaus continuously gather credit and financial data 

about consumers from creditors, governmental entities, public records, collection agencies, and 

other third parties. This information is then compiled into a “credit file.” The Credit Bureaus 

sell credit reports, which include information gathered from a consumer’s credit file, to 

businesses and consumers. 

31. While Credit Scores are sometimes sold together with credit reports, credit reports 

are different from Credit Scores and can be sold independently. A credit report is a statement 

that has detailed information about a consumer’s credit activity and current credit situation. A 

consumer’s credit report might, for example, include information about that consumer’s history 

of mortgage payments, credit card balances, credit card payments, and credit inquiries. A Credit 

Score takes the detailed information in a credit report and turns it into a single three-digit 

number. 

B. The Markets for Credit Scores in the United States 

32. There are two distinct markets for Credit Scores in the United States: (1) the B2B 

Credit Score Market; and (2) the B2C Credit Score Market. B2B and B2C Credit Scores are 

priced, purchased, and used very differently and serve very different purposes. The lenders, 

financial institutions, and other businesses in the B2B Credit Score Market that purchase and use 

Credit Scores to assess creditworthiness and make decisions about whether and on what terms to 

extend credit or otherwise take on risk do not consider credit reports, insurance scores, or any 

other information about borrowers, to be a substitute for Credit Scores. 

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33. Consumers in the B2C Credit Score Market purchase their own Credit Scores to 

better understand their own creditworthiness and how they likely will be viewed by potential 

lenders. 

34. The United States is the relevant geographic market in which B2B Credit Scores 

are provided. The restraints on competition in the B2B Credit Score Market contained in Fair 

Isaac’s contracts relate to the provision of B2B Credit Scores to businesses throughout the 

United States. 

35. Purchasers in the B2B Credit Score Market are comprised of lenders, financial 

institutions, and other businesses that purchase B2B Credit Scores in order to make risk 

management decisions (“B2B Purchasers”). Lenders, financial institutions, and other businesses 

that purchase Credit Reports from Defendant and/or the Credit Bureaus generally purchase 

Credit Scores in order to determine the creditworthiness and identity of qualified borrowers to 

whom a preapproved credit offer will be extended (“pre-screening”), make lending decisions 

(“lending”), or review the risk associated with existing borrowers for purposes such as extending 

additional credit or changing other account terms (“account management”). 

36. Customers in the B2C Credit Score Market, in contrast, purchase Credit Scores in 

order to manage their credit, protect their identity, or assess their likelihood of obtaining credit. 

Today, American consumers have signed up for over 160 million credit monitoring or identity 

protection accounts from businesses such as Capital One, Credit Karma, and LifeLock. Many of 

those accounts include access to the consumer’s own Credit Score. 

37. The credit risk scoring industry, industry analysts, policy analysts, and investors 

recognize the B2B Credit Score Market as distinct from the B2C Credit Score Market. Fair Isaac 

also regularly acknowledges that the B2B Credit Score Market is distinct from the B2C Credit 

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Score Market. For example, in its 2019 Form 10-K, Fair Isaac distinguished between its 

“business-to-business scoring solutions and services” and “business-to-consumer scoring 

solutions and services including myFICO® solutions for consumers.” 

38. The B2B Credit Score Market is characterized by significant barriers to entry. 

B2B Purchasers encounter significant “switching costs” if they adopt a new Credit Score that has 

different score-to-risk relationships or that uses different reason codes – regardless of whether it 

is an updated version of the score they already use or an entirely new brand of Credit Score 

(unlike consumers in the B2C Credit Score Market). These switching costs arise because 

employees have to be trained in the properties and characteristics of a new score; B2B 

Purchasers must ensure that the new score will be adequately predictive of the creditworthiness 

of their own customer base; B2B Purchasers often conduct extensive, costly, and timeconsuming validation tests to determine whether the new score is cost-effective; and B2B 

Purchasers may need to invest in updating their internal systems to ensure technical 

compatibility between those systems and a new score. 

39. Network effects also characterize the B2B Credit Score Market. For example, in 

the mortgage and auto loan industries, the consistent use of particular Credit Scores with similar 

score-to-risk relationships and reason codes facilitates the bundling of large groups of mortgage 

and auto loans from different originators into securities that can be sold to investors. Because of 

the consistent use of a single type of Credit Score, marketing materials for these securities can 

include data on the average and stratified Credit Scores of the borrowers associated with the 

underlying loans. 

C. Fair Isaac Has a Monopoly in the B2B Credit Score Market 

40. Fair Isaac has maintained a monopoly over the B2B Credit Score Market in the 

United States for roughly three decades, largely through the unlawfully achieved dominance of 

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its FICO product line, which includes many different types of FICO Scores. Introduced in the 

1980s, Fair Isaac’s “FICO Classic” Credit Scores are the best known and most widely used B2B 

Credit Scores in the United States. FICO Classic applies an algorithm to each Credit Bureau’s 

data and generates a score between 300 and 850 that purports to give an indication of the 

individual’s credit risk. It also generates a set of “reason codes” that explain the reasons the 

consumer has not been assigned the maximum score. 

41. Fair Isaac advertises its monopoly in the B2B Credit Score Market. On its 

website, Fair Isaac advertises: 10 billion FICO Scores are sold each year, which is four times the 

number of hamburgers that McDonald’s sells worldwide each year; 27.4 million FICO Scores 

are sold every day, which is over twice the number of cups of coffee Starbucks sells worldwide 

in a day; and 90% of all lending decisions in the United States rely on FICO Scores.

42. Similarly, in its 2019 Form 10-K, Fair Isaac described its “FICO Scores” as “the 

standard measure in the U.S. of consumer credit risk” and reported that “FICO Scores are used 

. . . by nearly all of the major banks, credit card organizations, mortgage lenders and auto loan 

originators.” 

43. Fair Isaac representatives have described Fair Isaac’s FICO Score as “the 800-

pound gorilla” in the market for B2B Credit Scores and bragged about Fair Isaac’s 90% market 

share. For example, in November 2017, at the JPMorgan Ultimate Services Investor Conference, 

Fair Isaac’s CFO and Executive Vice President, Michael Pung, stated that Fair Isaac’s FICO 

Scores are: 

 The “most widely used credit scoring system here in the U.S.”; 

 Used by “[v]irtually every major lender in the U.S.”; and 

 Fair Isaac has “maintained a 90-plus percent market share for at least . . . 13 

years.” 

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44. Fair Isaac representatives have also recognized that FICO Scores have benefited 

from the network effects created by the widespread use of FICO Scores in many industries. For 

example, in November 2011, then-CEO of Fair Isaac, Mark Greene, explained that the “network 

effect” of “FICO Scores . . . being sort of the standard language” and “having everybody . . . 

standardize on a FICO Score, that’s magic.”

45. Fair Isaac’s monopoly in the B2B Credit Score Market for Credit Scores has 

given it the power to control prices. Indeed, Fair Isaac’s CEO, Will Lansing, has noted that in 

the B2B Credit Score Market Fair Isaac has “quite a bit of discretion in whether we want our 

margins to be higher or lower or where they are.” 

D. Attempts To Compete Have Been Stymied by Fair Isaac’s Monopoly in the 

B2B Credit Score Market 

46. In March 2006, VantageScore introduced the VantageScore Credit Score and 

credit scoring system. VantageScore is a competitor to FICO Scores in the B2B Credit Score 

Market. 

47. From the time it was first released in 2006, VantageScore scored millions more 

consumers than the FICO scoring systems. Whereas Fair Isaac’s FICO scoring systems would 

not generate a score if a consumer had not used credit in more than six months or if a credit 

account was fewer than six months old, VantageScore calculated scores for consumers that had 

not used credit for up to two years. It also reached more consumers by using utility and 

telecommunications payment histories when reported to the Credit Bureaus. 

48. Today, VantageScore scores 30 million more Americans than traditional FICO 

scoring systems. Fair Isaac’s outdated FICO Classic credit scoring systems – which are still used 

by many lenders – exclude many creditworthy Americans that VantageScore can reliably score. 

About one-quarter of American adults – some 65 million people – do not have a traditional FICO 

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Score. VantageScore is capable of reducing the number of adults without a Credit Score by 

almost half. Ten million of those newly scored individuals are “prime” borrowers that should be 

attractive to traditional lenders. 

49. Without a Credit Score, it is difficult or impossible to apply for or successfully 

obtain a mortgage, car loan, or reasonable interest rates on personal lines of credit. Not having a 

Credit Score can also have drastic effects outside of the credit market. For example, Credit 

Scores are increasingly used by landlords to screen potential tenants. 

50. Those excluded by Fair Isaac’s traditional FICO scoring systems – who face an 

increased risk of being denied access to credit in the form of credit cards, auto and home loans, 

and apartment housing – include disproportionate numbers of low-income and minority 

consumers. 

51. Indeed, one advocacy group focused on making it possible for people with limited 

incomes, especially people of color, to achieve financial security has observed: “Black and 

Hispanic individuals are . . . significantly more likely than white individuals to be credit 

invisible” – meaning that they have “no established credit history,” are “unscored,” and “lack[] 

sufficient or recent enough credit history to be given a [FICO] credit score.” VantageScore 

calculates a score for 9.5 million Hispanic and Black consumers who do not have a FICO Score, 

including 2.7 million minority consumers who should be considered “prime” borrowers. 

52. Despite the potential advantages of using VantageScore, Fair Isaac continues to 

maintain its monopoly in the B2B Credit Score Market. In February 2013, at a Morgan Stanley 

Conference, Fair Isaac’s CEO, Will Lansing, explained that despite the existence of 

VantageScore, “there [is] not that much competition around our [B2B] scores business” because 

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“FICO scores are very much part of the fabric of the banking industry” and are “really deeply 

imbedded.” 

E. Fair Isaac Has Contracted with the Credit Bureaus as Agents and 

Co-Conspirators in Its Scheme To Monopolize 

53. With its dominant position in the B2B Credit Score Market, Fair Isaac uses the 

Credit Bureaus to perpetuate and extend its monopoly. Fair Isaac’s relationship with B2B 

Purchasers is often dependent on B2B Purchasers’ relationships with the Credit Bureaus. To 

facilitate the sale of its FICO Scores to B2B Purchasers, Fair Isaac enlists the assistance of the 

Credit Bureaus. 

54. When a B2B Purchaser requires a Credit Score, it purchases the report from the 

Credit Bureau and the Credit Score jointly from the Credit Bureau and Fair Isaac. Although the 

payment may at times occur in a single transaction, the practical reality, as expressly set forth in 

contracts governing the sale of Credit Scores to B2B Purchasers, is that both the Credit Bureau 

and Fair Isaac act as the provider of the FICO Score. 

55. B2B Purchasers’ contracts for FICO Scores are often known as Credit Scoring 

Services Agreements (“CSSAs”). CSSAs provide for both the method of payment and fee model 

for the delivery of Credit Score services. 

56. For example, the CSSA between Plaintiff, its Credit Bureau TransUnion, and Fair 

Isaac makes clear that “the Fair Isaac Scores are the property of Fair Isaac and are proprietary to 

Fair Isaac” and that Fair Isaac grants to Plaintiff a “limited license to use, internally, the Fair 

Isaac Scores solely for the particular purpose . . . for which the Fair Isaac Scores were obtained.” 

The CSSA further provides that TransUnion “is fully authorized to sign this Agreement, 

including Exhibit A, on behalf of Fair Isaac and such signature on behalf of Fair Isaac constitutes 

Fair Isaac’s agreement to the terms and conditions of this Agreement.” Exhibit A to the CSSA 

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then sets forth the various Fair Isaac Scores which may be purchased by Plaintiff and specifically 

permits the fees for such Fair Isaac Scores to “be included in a separate pricing schedule between 

TransUnion and Client.” 

57. In Plaintiff ’s and Class members’ procurement of FICO Scores, the Credit 

Bureaus act as co-conspirators and agents of Fair Isaac. Indeed, Plaintiff’s CSSA provides that 

“TransUnion [will] deliver Fair Isaac Scores” to Plaintiff and that TransUnion is executing the 

Agreement “for itself and Fair Isaac Corporation.” 

F. Fair Isaac’s Other Anticompetitive and Exclusionary Conduct 

58. Fair Isaac has used its monopoly power to coordinate a multi-faceted campaign to 

eliminate competition from VantageScore. Fair Isaac has been explicit that this is its goal. In 

April 2015, Will Lansing informed investors on a quarterly earnings conference call that Fair 

Isaac’s strategic goal was to ensure that “the entire industry adopts FICO scores instead of 

[other] scores.” To achieve this goal, Fair Isaac has enlisted its competitors (the Credit Bureaus, 

which jointly own and control VantageScore) to agree to anticompetitive contracts that: prevent 

them from developing or selling alternative Credit Scores that could be seamlessly integrated 

into many lenders’ systems or used interchangeably with FICO Scores; prevent them from 

competing with each other to negotiate prices from FICO; and create a pricing scheme that 

effectively forecloses B2B Purchasers from choosing to use FICO Scores in their lending 

decisions while simultaneously providing customers with a competing Credit Score, including 

VantageScore. At the same time, Fair Isaac has waged a media campaign against VantageScore 

and has made false and misleading statements in order to sow fear, uncertainty, and doubt about 

VantageScore’s reliability. By its anticompetitive and exclusionary conduct, Fair Isaac has 

injured competition in the B2B Credit Score Market, increased prices for Plaintiff and the Class, 

and limited access to credit for millions of Americans. 

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1. Fair Isaac and the Credit Bureaus Have Entered into Anticompetitive 

Contract Terms that Restrict Their Ability To Compete and Sell 

VantageScore 

59. In January 2015, Fair Isaac and TransUnion entered into a contract, the Analytic 

and Data License Agreement. With TransUnion’s prior contracts with Fair Isaac set to expire on 

December 31, 2014, Fair Isaac demanded that the parties enter into a new contract rather than 

renew their existing contracts. Fair Isaac represented to TransUnion that Experian and Equifax 

had already agreed to materially similar new contracts with Fair Isaac. If TransUnion did not 

agree to the terms demanded by Fair Isaac, it would lose substantial business from customers that 

depend on FICO Scores. On information and belief, TransUnion, Equifax, and Experian all 

agreed to Fair Isaac’s plan to exclude competitors and maintain its monopoly. 

a. The Anticompetitive Agreements Restrict the Credit Bureaus’ 

Ability To Develop or Sell Other Credit Scores Compatible 

with B2B Purchasers’ Existing Systems 

60. Fair Isaac has imposed a similar or identical “No Equivalent Products” clause on 

each of the Credit Bureaus. By imposing a “No Equivalent Products” term, Fair Isaac has sought 

to block the Credit Bureaus from offering alternative Credit Score products, such as 

VantageScore, that would allow B2B Purchasers to easily switch from FICO Scores to 

VantageScore without incurring the cost of redesigning their lending programs and systems, or to 

use VantageScore alongside or interchangeably with FICO Scores. The Credit Bureaus have 

agreed to and acquiesced in these anticompetitive agreements, terms, and resulting 

anticompetitive effects. 

61. The “No Equivalent Products” clause provides that a Credit Bureau may not 

internally develop a credit scoring system that is aligned to the odds-to-score relationship of any 

Fair Isaac Analytic or that uses more than a limited number of reason codes that “match” reason 

codes used by any Fair Isaac Analytic. It also prohibits a Credit Bureau from distributing any 

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competing analytic (i.e., credit scoring system) that is aligned with FICO Scores or uses too 

many of the same reason codes. The clause expressly names Vantage Score Solutions LLC as a 

developer of such a scoring system that may not be distributed if VantageScore were to offer an 

“Equivalent Product.” 

62. For example, if a competing Credit Score product used a 700 score to indicate a 

less-than-five-percent risk of credit delinquency, and if a 700 FICO Score also indicated the 

same risk of delinquency, then the “No Equivalent Products” clause prevents a Credit Bureau 

from distributing the competing product. Similarly, if a competing Credit Score product used 

reason codes that match 20% or more of the reason codes used by FICO scoring systems, the 

“No Equivalent Products” clause prohibits a Credit Bureau from distributing the product. 

63. The “No Equivalent Products” clause effectively prevents a Credit Bureau from 

developing (contrary to the original goal of VantageScore and the easy ability to do so) or selling 

an alternative to FICO’s Credit Scores that would (1) be compatible with many B2B Purchasers’ 

systems, models, and processes; and (2) allow B2B Purchasers to have a legitimate choice 

between using FICO Scores and an alternative score. Many B2B Purchasers have spent 

substantial effort and resources to develop systems, models, and processes that are designed for 

FICO Scores. B2B Purchasers’ systems, models, and processes are tailored to FICO’s odds-toscore relationship (i.e., each given score has a given ratio of non-defaulting consumers to 

defaulting consumers), and reason codes (the particular reasons cited for increased risk of 

default). For example, a bank’s software might be designed to accept one or more FICO Scores 

and reason codes, combine this information with data it collects internally, and automatically 

produce a lending decision. 

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64. The “No Equivalent Products” clause protects and sustains Fair Isaac’s monopoly. 

The odds-to-score relationship is an arbitrary mapping between risk and score and does not 

reflect protectable intellectual property. Similarly, the reason codes that may not be used by an 

“Equivalent Product” were not invented by Fair Isaac but reflect well-established industry best 

practices for lending. 

b. Fair Isaac and the Credit Bureaus Have Agreed to a Penalty 

Pricing and Bundling Scheme To Foreclose Competition from 

Competitors in the B2B Credit Score Market 

65. Fair Isaac’s contracts with each Credit Bureau include a similar or identical 

“Dynamic Royalty Schedule” clause and a similar or identical “Pre-Qualification” royalty 

category. Through the “Pre-Qualification” royalty category, Fair Isaac has effectively foreclosed 

lenders from the ability to purchase and use a FICO Score in their lending decision while 

providing a consumer with a competing Credit Score, which drives lenders to buy exclusively 

Fair Isaac’s FICO Scores and not to purchase competing Credit Scores. As a consequence of 

Fair Isaac’s imposition of the “Pre-Qualification” royalty category, TransUnion has lost sales of 

VantageScore to major banks to provide to consumers. 

66. In 2015, Fair Isaac unilaterally imposed, and the Credit Bureaus have complied 

with, a new “Pre-Qualification” royalty category, which Fair Isaac defines to “mean an End 

User’s qualification of a potential consumer customer for an End User’s own internal lending 

offering.” This royalty category distinguishes between: (1) lenders that use FICO Scores for 

“Pre-Qualification” without providing any Credit Score or credit data to consumers; and (2) 

lenders that use FICO Scores for “Pre-Qualification” while also providing Credit Scores or credit 

data to consumers “in connection” with the “Pre-Qualification.” Certain banks and lenders offer 

consumers opportunities to apply to qualify for credit opportunities (e.g., a credit card or loan) 

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and, at the same time, receive their personal Credit Score. The offer of a free Credit Score to a 

consumer can entice consumers to apply for credit opportunities. 

67. The royalty price associated with a FICO Score used for “Pre-Qualification” 

depends on whether other Credit Scores or credit data are provided to consumers. If a lender 

purchases a FICO Score for use in “Pre-Qualification” and does not provide any Credit Score or 

credit data to the consumer “in connection” with the “Pre-Qualification,” there is one per-score 

royalty rate. If the lender purchases a FICO Score for use in “Pre-Qualification” and provides 

any other Credit Score (such as a VantageScore) to the consumer “in connection” with the “PreQualification,” there is a different per-score royalty rate that is higher – a penalty rate. 

68. The penalty rate can be avoided in one of two ways, both of which involve 

purchasing exclusively FICO Scores. First, the B2B Purchaser could purchase a FICO Score for 

use in “Pre-Qualification” and provide no Credit Score or credit data to the consumer. Second, 

the B2B Purchaser could purchase a bundled FICO product from Fair Isaac. Fair Isaac offers 

bundled products to lenders that combine the use of scores by lenders with the provision of 

scores to consumers. 

69. There is no legitimate business justification for the penalty rate agreed upon by 

Fair Isaac and the Credit Bureaus when the lender also purchases any other Credit Score to 

disclose to consumers. The transparent purpose of the “Pre-Qualification” royalty category is to 

drive all B2B Purchasers engaging in “Pre-Qualification” to purchase exclusively FICO Scores 

and make it cost-prohibitive for B2B Purchasers engaging in “Pre-Qualification” to purchase a 

competing Credit Score for disclosure to consumers. This scheme has been effective, and few, if 

any, B2B Purchasers have opted to pay the penalty rate. 

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c. Fair Isaac and the Credit Bureaus Have Agreed to Contract 

Provisions that Allow Fair Isaac To Extract Monopoly Prices 

70. Fair Isaac’s “Level Playing Field” provision requires that the prices that are made 

available to one Credit Bureau be made available to the other Credit Bureaus. Taken together, 

the “Dynamic Royalty Schedule” and the “Level Playing Field” clauses enable Fair Isaac to 

unilaterally increase the royalty prices it charges for FICO Scores. Fair Isaac’s contracts with 

TransUnion, Equifax, and Experian include similar or identical “Level Playing Field” and 

“Dynamic Royalty Schedule” provisions. 

71. Fair Isaac has used the “Level Playing Field” and “Dynamic Royalty Schedule” 

provisions in its contracts with the Credit Bureaus to extract monopoly prices from B2B 

Purchasers. These provisions disincentivize a Credit Bureau from negotiating for a lower price 

because it knows that even if it succeeds, it will not as a result gain a competitive advantage over 

the other Credit Bureaus. 

2. Fair Isaac’s Campaign To Create Fear, Uncertainty, and Doubt 

About VantageScore Among B2B Purchasers 

72. Despite having successfully induced the Credit Bureaus to agree with Fair Isaac 

and with each other to impose restrictions on VantageScore’s ability to compete with FICO, Fair 

Isaac has gone even further and waged an aggressive public relations and advertising campaign 

to spread false statements, convey false impressions, and mislead B2B Purchasers about the 

qualities and characteristics of FICO Scores and VantageScore. In advertisements, letters, and 

blog posts, Fair Isaac has disparaged VantageScore by calling it a “Fako” score, falsely claimed 

that VantageScore is an unreliable measure of creditworthiness, and misrepresented the 

information considered by VantageScore’s credit scoring system.

73. On December 12, 2017, Fair Isaac took out a full-page advertisement in The Wall 

Street Journal addressed to “Lenders, Policymakers and Consumer Advocates” that disparaged 

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VantageScore without identifying it by name. The advertisement contrasted Fair Isaac, which 

“is not owned by the credit bureaus” and whose FICO Scores have been used “by lenders and 

securitization investors for decades,” with an alternative Credit Score, which is “owned by the 

credit bureaus,” is less reliable than FICO Scores in evaluating credit risk, and fails to use “sound 

practices” or “science-based credit evaluation.” To anyone familiar with the market for Credit 

Scores, the advertisement unambiguously conveys the false message that VantageScore is 

“[w]eakening scoring standards, [and] harm[ing] consumers, and the lending system,” 

particularly in the B2B Credit Score Market. 

74. The Wall Street Journal advertisement directed readers to “Learn more at 

FICO.com/independent,” a Fair Isaac-owned website that connects visitors to articles and blog 

posts that disparage VantageScore by name. One such blog post asserts: “Despite claims by 

VantageScore, weakening the minimum scoring criteria will not empower millions of low-risk 

mortgage credit seekers.” 

75. Moreover, the implication that FICO Classic scoring systems provide Credit 

Scores for as many consumers as VantageScore is false and misleading. VantageScore provides 

Credit Scores for millions of American consumers that are not scored by FICO Classic scoring 

systems. 

76. Fair Isaac’s website includes numerous posts disparaging VantageScore and 

making false or misleading statements about VantageScore’s features. For example, one blog 

post claims that “[r]esearch results consistently showed that scoring models relying solely on 

sparse or old credit data were weak and did a poor job forecasting future performance.” This 

statement is false and misleading because it conveys the message that VantageScore’s scoring 

model is “weak” and does a “poor job forecasting future performance” because it considers a 

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consumer’s full credit history even if the consumer has not used a traditional credit line in the 

last six months. In fact, studies have shown that VantageScore is strongly predictive. 

77. Another blog post claims that whereas “FICO Score 9 differentiates medical from 

non-medical collections,” “VantageScore does not.” This statement conveys the false message 

that VantageScore does not differentiate medical from non-medical collections. In fact, 

VantageScore 3.0 was the first credit scoring system to address medical debt. VantageScore 4.0, 

the most recent version of VantageScore, distinguishes medical collection accounts from nonmedical collection accounts and penalizes medical collections less than non-medical ones. 

78. Fair Isaac’s campaign against VantageScore is not new. In 2006, just months 

after the launch of VantageScore, Fair Isaac filed a meritless lawsuit against the Credit Bureaus 

and VantageScore in the United States District Court for the District of Minnesota. See Fair 

Isaac Corporation v. Equifax Inc., No. 06-cv-04112 (D. Minn.). This was the monopolist’s first 

attempt to kill the nascent competitor. Fair Isaac’s numerous claims included a claim that the 

development of VantageScore violated the antitrust laws and a claim that the development of 

VantageScore constituted trademark infringement. In its prayer for relief, Fair Isaac sought 

nothing less than the end of VantageScore: It requested that the “Defendants be ordered to 

dissolve VantageScore.” 

79. All of Fair Isaac’s claims failed; in fact, the jury concluded that Fair Isaac was the 

wrongdoer. In support of its trademark infringement claim, Fair Isaac had alleged that 

VantageScore’s use of a scoring range of 501-990 constituted trademark infringement because it 

was similar to FICO’s scoring range of 300-850. The Credit Bureaus and VantageScore 

counterclaimed for fraud on the United States Patent and Trademark Office (“PTO”), alleging 

that Fair Isaac had misrepresented to the PTO that only FICO used the 300-850 score range. The 

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jury concluded that Fair Isaac had committed fraud on the PTO by making false statements as 

part of its application to register the score range of 300-850 as a trademark. 

80. The public statements described in the foregoing paragraphs were transmitted to 

and seen by a substantial number of businesses and consumers nationwide. 

3. Fair Isaac’s Anticompetitive and Exclusionary Conduct Harms 

Competition 

81. Fair Isaac’s campaign of exclusionary conduct to maintain and expand its 

monopoly has harmed and continues to harm participants in the B2B Credit Score Market. Fair 

Isaac’s unlawful conduct, including that which has been taken in concert with the Credit 

Bureaus, has foreclosed competition in the B2B Credit Score Market by foreclosing 

opportunities for the Credit Bureaus to sell VantageScore or any other competitive products. 

The anticompetitive and exclusionary conduct has allowed Fair Isaac to maintain its monopoly 

and charge monopoly prices for B2B Credit Scores to B2B Purchasers during the Class Period. 

82. Fair Isaac’s conduct, in concert with the Credit Bureaus, including by the 

contracts entered into by the Credit Bureaus, has reduced choice for B2B Purchasers. The 

anticompetitive terms agreed to between Fair Isaac and the Credit Bureaus have frustrated the 

ability of B2B Purchasers to purchase VantageScore or any other competitive Credit Score that 

could be seamlessly integrated into lenders’ existing processes and systems. Fair Isaac’s media 

and advertising campaign against VantageScore has been successful in sowing fear, uncertainty, 

and doubt about VantageScore in the marketplace. 

83. Media sources, financial blogs, and consumers have absorbed Fair Isaac’s 

message that VantageScore is a “Fako” score merely because it is not a FICO Score. For 

example, thebalance.com – a website devoted to personal finance issues – posted in February 

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2017, and continues to display as of the date of this filing: “If you purchased your Credit Score 

anywhere but MyFICO.com, then it’s a Fako score.”2

V. CLASS ACTION ALLEGATIONS 

84. Plaintiff brings this action on behalf of itself, and, under Rules 23(a) and (b) of 

the Federal Rules of Civil Procedure, on behalf of: 

All B2B Purchasers residing in the United States that directly purchased a 

FICO Score from Fair Isaac and/or a Credit Bureau during the Class Period. 

85. Excluded from the Class are: Defendant, its officers, directors, management, 

employees, subsidiaries, and affiliates. Also expressly excluded are any natural persons that 

purchased their own Credit Score solely via myFico.com, the Credit Bureaus, or other entities for 

their personal use. 

86. Also excluded is the Judge presiding over this action, his or her law clerks, 

spouse, and any person within the third degree of relationship living in the Judge’s household or 

the spouse of such a person. 

87. Members of the Class are so numerous and geographically dispersed that joinder 

is impracticable. Further, members of the Class are readily identifiable from information and 

records in the possession of Defendant. 

88. Plaintiff’s claims are typical of the claims of the members of the Class. Plaintiff 

and members of the Class were damaged by the same wrongful conduct of Defendant. 

89. Plaintiff will fairly and adequately protect and represent the interests of members 

of the Class. The interests of Plaintiff are coincident with, and not antagonistic to, those of the 

members of the Class. 

 

2

 Latoya Irby, FICO & FAKO Credit Scores, The Balance (Aug. 18, 2018), 

https://www.thebalance.com/ fico-and-fako-credit-scores-960497 (last visited Apr. 23, 2020). 

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90. Plaintiff is represented by counsel with experience in the prosecution and 

leadership of class action antitrust and other complex litigation, including class actions in the 

financial services industry. 

91. Questions of law and fact common to the members of the Class predominate over 

questions that may affect only individual Class members, thereby making damages with respect 

to members of the Class as a whole appropriate. Questions of law and fact common to members 

of the Class include, but are not limited to: 

a. whether Defendant monopolized, conspired to monopolize, or unreasonably 

restrained trade in violation of federal law; 

b. the duration of the alleged unlawful conduct; 

c. injury suffered by Plaintiff and members of the Class; 

d. damages suffered by Plaintiff and members of the Class; and 

e. whether Defendant has acted or refused to act on grounds generally applicable 

to members of the Class, thereby making appropriate final injunctive relief or 

corresponding declaratory relief with respect to members of the Class as a 

whole. 

92. Class action treatment is a superior method for the fair and efficient adjudication 

of the controversy. Such treatment will permit a large number of similarly situated persons to 

prosecute their common claims in a single forum simultaneously, efficiently, and without the 

unnecessary duplication of evidence, effort, or expense that numerous individual actions would 

require. 

93. The benefit of proceeding through the class mechanism, including providing 

injured persons or entities a method for obtaining redress on claims that could not practicably be 

pursued individually, substantially outweighs potential difficulties in management of this class 

action. 

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94. Plaintiff knows of no special difficulty to be encountered in the maintenance of 

this action that would preclude its maintenance as a class action. 

95. Plaintiff has defined members of the Class based on currently available 

information and hereby reserves the right to amend the definition of members of the Class, 

including, without limitation, the Class Period. 

VI. STATUTES OF LIMITATIONS AND TOLLING 

96. By its very nature, the unlawful activity in which Defendant engaged was selfconcealing from Plaintiff and the Class. As a result of Defendant’s affirmative acts, 

misrepresentations, and nondisclosures as alleged herein, any applicable statutes of limitation on 

claims asserted by Plaintiff and members of the Class have been and are tolled, and Defendant is 

equitably estopped from raising statutes of limitations as a defense. 

97. Any applicable statutes of limitations were tolled at least until February 12, 2018, 

the date that TransUnion filed its Counterclaim against Defendant. 

98. The federal government’s initiation of its antitrust investigation of Defendant’s 

unlawful conduct also operates to toll any federal statute of limitations under 15 U.S.C. § 16. 

VII. CLAIMS FOR RELIEF 

CLAIM ONE: 

MONOPOLIZATION 

15 U.S.C. § 2 

99. Plaintiff incorporates by reference and re-alleges the preceding allegations as 

though fully set forth herein. 

100. The relevant product market is the market for the sale of B2B Credit Scores. 

101. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

102. The B2B Credit Score Market is the relevant market. 

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103. Fair Isaac has had and continues to have at least 90% market share in the B2B 

Credit Score Market. 

104. Fair Isaac has had and continues to have monopoly power in the B2B Credit 

Score Market. 

105. Fair Isaac has had and continues to have the power to control prices or exclude 

competition in the B2B Credit Score Market. 

106. Through unlawful, interconnected, and mutually reinforcing anticompetitive and 

exclusionary acts and agreements, Fair Isaac has substantially foreclosed competition in the 

market for B2B Credit Scores in the United States in violation of Section 2 of the Sherman Act, 

15 U.S.C. § 2. 

107. Fair Isaac has demonstrated its ability to control prices and exclude competition 

by raising prices without a corresponding increase in demand and to supracompetitive levels. 

108. Fair Isaac’s monopoly is not due to growth or development because of a superior 

product, business acumen, or historic accident. 

109. Fair Isaac’s monopolization has injured and will continue to injure competition in 

this market. 

110. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

111. The anticompetitive conduct raised the prices for FICO Scores above the 

competitive level and otherwise injured competition without any offsetting procompetitive 

benefit to consumers. 

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112. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 2 of the Sherman Act within the meaning of 

Section 4 of the Clayton Antitrust Act, 15 U.S.C. §15. 

113. Plaintiff and members of the Class are threatened with future injury to their 

business and property by reason of Defendant’s continuing violation of Section 2 of the Sherman 

Act within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. §26. 

CLAIM TWO: 

CONSPIRACY TO MONOPOLIZE 

15 U.S.C. § 2 

114. Plaintiff incorporates by reference and re-alleges the preceding allegations as 

though fully set forth herein. 

115. The relevant product market is the market for the sale of B2B Credit Scores. 

116. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

117. The B2B Credit Score Market is the relevant market. 

118. Fair Isaac has had and continues to have at least 90% market share in the B2B 

Credit Score Market. 

119. Fair Isaac has had and continues to have monopoly power in the B2B Credit 

Score Market. 

120. Fair Isaac has had and continues to have the power to control prices or exclude 

competition in the B2B Credit Score Market. 

121. Through unlawful, interconnected, and mutually reinforcing anticompetitive and 

exclusionary acts and agreements, Fair Isaac has substantially foreclosed competition in the 

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market for B2B Credit Score Market in the United States in violation of Section 2 of the 

Sherman Act, 15 U.S.C. § 2. 

122. Fair Isaac has demonstrated its ability to control prices and exclude competition 

by raising prices without a corresponding increase in demand, and to supracompetitive levels. 

123. Fair Isaac entered into a combination or conspiracy with the Credit Bureaus to 

maintain its monopoly power in the B2B Credit Score Market. Fair Isaac created and maintained 

this conspiracy through a series of agreements with each of the Credit Bureaus. In these 

agreements, the Credit Bureaus and Fair Isaac agreed that the Credit Bureaus would not offer or 

sell VantageScore or any other competing Credit Score to Plaintiff and members of the Class. 

Fair Isaac and the Credit Bureaus further agreed that the Credit Bureaus would act as Fair Isaac’s 

agent in the sale of FICO Scores to Plaintiff and members of the Class. 

124. These agreements foreclosed competition in a substantial portion of the B2B 

Credit Score Market and unlawfully maintained Fair Isaac’s monopoly, resulting in Fair Isaac 

extracting supracompetitive prices for FICO Scores from Plaintiff and members of the Class. 

125. Fair Isaac’s monopoly is not due to growth or development because of a superior 

product, business acumen, or historic accident. 

126. Fair Isaac’s monopolization conspiracy has injured and will continue to injure 

competition in this market. 

127. Fair Isaac has acted with the specific intent of monopolizing the market for B2B 

Credit Scores in the United States. 

128. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

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129. The conspiracy raised the prices for FICO Scores above the competitive level and 

otherwise injured competition without any offsetting procompetitive benefit to consumers. 

130. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 2 of the Sherman Act within the meaning of 

Section 4 of the Clayton Antitrust Act, 15 U.S.C. §15. 

131. Plaintiff and members of the Class are threatened with future injury to their 

business and property by reason of Defendant’s continuing violation of Section 2 of the Sherman 

Act within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. §26. 

CLAIM THREE: 

UNREASONABLE RESTRAINT OF TRADE 

15 U.S.C. § 1 

132. Plaintiff incorporates by reference and re-alleges the preceding allegations as 

though fully set forth herein. 

133. The relevant product market is the market for the sale of B2B Credit Scores. 

134. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

135. The B2B Credit Score Market is the relevant market. 

136. Fair Isaac and the Credit Bureaus have had and continue to collectively have at 

least 90% market share in the B2B Credit Score Market. 

137. Fair Isaac has had and continues to have monopoly power in the B2B Credit 

Score Market. 

138. Fair Isaac has had and continues to have the power to control prices or exclude 

competition in the B2B Credit Score Market. 

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139. Fair Isaac entered into agreements with TransUnion, Experian, and Equifax that 

contained anticompetitive terms whereby each Credit Bureau agreed not to offer or sell 

VantageScore as a competing product to Plaintiff and members of the Class. 

140. The agreements between Fair Isaac and the Credit Bureaus had substantial 

anticompetitive effects. The agreements excluded VantageScore, a significant competitor, from 

a substantial portion of competition in the B2B Credit Score Market. 

141. The agreements raised the price for FICO Scores above the competitive level and 

otherwise injured competition without any offsetting procompetitive benefit to consumers. 

142. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

143. Plaintiff and members of the Class continue to suffer damage, and will continue to 

do so, if Fair Isaac does not cease its anticompetitive conduct. 

144. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 1 of the Sherman Act, within the meaning of 

Section 4 of the Clayton Antitrust Act, 15 U.S.C. §15. 

145. Plaintiff and members of the Class are threatened with future injury to their 

business and property by reason of Defendant’s continuing violation of Section 1 of the Sherman 

Act, within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. § 26. 

VIII. PRAYER FOR RELIEF 

WHEREFORE, Plaintiff, on behalf of itself and members of the Class, respectfully prays 

that This Honorable Court: 

A. Order that this action may be maintained as a class action pursuant to Rules 23(a) 

and (b) of the Federal Rules of Civil Procedure, that it be named a Class Representative, that the 

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undersigned be named Lead Class Counsel, and that reasonable notice of this action, as provided 

by Rule 23(c)(2), be given to members of the Class; 

B. Adjudge that Defendant violated the federal antitrust laws as set forth above; 

C. Award Plaintiff and members of the Class actual, treble, and exemplary damages; 

D. Award Plaintiff and members of the Class attorneys’ fees and costs of suit, 

including costs of consulting and testifying experts; 

E. Award Plaintiff and members of the Class pre- and post-judgment interest; 

F. Enjoin Defendant from its violations of law; and 

G. Grant such other, further and different relief, including structural relief, as may be 

just and proper. 

IX. DEMAND FOR JURY TRIAL 

Under Rule 38(b) of the Federal Rules of Civil Procedure, Plaintiff demands a trial by 

jury as to all issues so triable. 

 

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Dated: April 23, 2020 Respectfully submitted, 

CARLSON LYNCH LLP

Gary F. Lynch 

1133 Penn Avenue, 5th Floor 

Pittsburgh, PA 15222 

Telephone: 412-322-9243 

Facsimile: 412-231-0246 

glynch@carlsonlynch.com 

Katrina Carroll 

111 W. Wacker Drive, Suite 1240 

Chicago, IL 60602 

Telephone: 312-750-1265 

kcarroll@carlsonlynch.com 

MOLOLAMKEN LLP

/s/ Steven F. Molo 

Steven F. Molo 

Lisa W. Bohl 

300 N. LaSalle Street, Suite 5350 

Chicago, IL 60654 

Telephone: 312-450-6700 

Facsimile: 312-450-6701 

smolo@mololamken.com 

lbohl@mololamken.com 

Lauren M. Weinstein 

(pro hac vice forthcoming) 

600 New Hampshire Avenue, N.W., Suite 500 

Washington, D.C. 20037 

Telephone: 202-556-2000 

Facsimile: 202-556-2001 

lweinstein@mololamken.com

Counsel for Plaintiff First Choice Federal Credit Union 

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EXHIBIT C 

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UNITED STATES DISTRICT COURT 

 FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

AMALGAMATED BANK, on behalf of itself and all 

others similarly situated, 

Plaintiff, 

- against - 

FAIR ISAAC CORPORATION,

Defendant. 

Docket No. 

CLASS ACTION COMPLAINT

JURY TRIAL DEMANDED 

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Plaintiff Amalgamated Bank (“Plaintiff”), on behalf of itself and all other similarly situated 

residents of the United States, complains upon knowledge as to itself and its acts and upon 

information and belief as to all other matters, against Defendant Fair Isaac Corporation (“Defendant” 

or “Fair Isaac”) for violations of the Sherman Act and state laws from at least January 1, 2006 through 

the date on which the anticompetitive effects of Defendant’s unlawful conduct ceased, but no sooner 

than the present (the “Class Period”). Based upon personal knowledge, information and belief, 

investigation by counsel, proceedings and admissions made in Fair Isaac Corp. v. Trans Union LLC, 17-

cv-08318 (N.D. Ill.), and related ongoing federal government investigations, Plaintiff alleges: 

INTRODUCTION 

1. “Credit Scores” rank or “score” creditworthiness within a range by applying certain 

algorithms to credit histories. This process results in a three digit Credit Score. Two distinct markets 

exist for Credit Scores in the United States: (1) the market for the sale of Credit Scores to lenders, 

financial institutions, and businesses in making risk management decisions (the “B2B Credit Score 

Market”); and (2) the direct market for the sale of consumers’ own Credit Scores to enable monitoring 

of their own credit records (the “business-to-consumer” or “B2C Credit Score Market”). 

2. This action relates to the B2B Credit Score Market, which Fair Isaac has unlawfully 

monopolized for years due to its dominant position with a 90% market share. 

3. Fair Isaac has leveraged its dominant market position by engaging in anticompetitive 

and exclusionary conduct including suppressing competition, obstructing innovation, and limiting 

access to credit for millions of Americans. Fair Isaac’s conduct is in violation of Sections 1 and 2 of 

the Sherman Act, 15 U.S.C. §§1 and 2, in addition to state antitrust and unfair trade practices laws. 

4. Fair Isaac’s FICO Credit Scores (“FICO Scores”) have had a dominant market 

position for over two decades. Fair Isaac executives, including public affairs manager Craig Watts 

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(“Watts”), have bragged that their FICO Scores are “the 800- pound gorilla”1 and experts have opined 

that Fair Isaac’s FICO Scores are “deeply embedded in the U.S. financial system[.]”2 In 2017, Fair 

Isaac admitted that it has maintained a market share of 90% or more for at least 13 years. Fair Isaac 

advertises that “90% of top lenders use FICO® Scores when making lending decisions.”3 

5. Equifax, Experian, and TransUnion (collectively, the “Credit Bureaus”) are credit 

reporting agencies that collect, standardize, and distribute information concerning consumer credit 

activity. Credit Bureaus sell credit reports and Credit Scores, including Fair Isaac’s FICO Scores, to 

lenders, financial institutions, and other businesses. These businesses use the credit reports and Credit 

Scores to make decisions about whether to extend credit and on what terms. Credit Bureaus sell credit 

reports and Credit Scores to businesses in every state in the United States. Credit Bureaus have long 

acted as Fair Isaac’s agents and co-conspirators to broker sales of FICO scores between businesses 

and Fair Isaac. Fair Isaac has used distribution agreements with the Credit Bureaus to: (1) place 

restrictions on the Credit Bureaus’ ability to develop or distribute their own competitive Credit Scores; 

(2) prohibit Credit Bureaus from individually negotiating royalty prices for FICO Score access; (3) 

charge discriminatory royalty prices for FICO Scores when a Credit Bureau customer purchases a 

FICO Score while providing the consumer with a competing score; and (4) increase the royalty 

prices paid by Credit Bureaus. Despite these restrictions, the Credit Bureaus have agreed to and 

complied with Fair Isaac’s agreement conditions. 

                                                            

1

 Dana Dratch, What Does ‘Good’ Credit Really Mean?, BANKRATE, (published Oct. 30, 3008, 

updated Aug. 5, 2010), https://www.cnbc.com/id/27458815.

2

 Nina Zdinjak, Here is What Newbrook Capital Advisors Thinks of Fair Isaac Corporation (FICO), 

INSIDER MONKEY, (Apr. 15, 2019), https://finance.yahoo.com/news/newbrook-capitaladvisors-thinks-fair-162450887.html.

3 https://www.myfico.com/credit-education/fico-scores-bridge.

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6. In 2006, the Credit Bureaus jointly formed VantageScore Solutions, LLC 

(“VantageScore”), and launched VantageScore, an alternative competitive Credit Score. Since its 

creation, VantageScore was extremely accurate and was competitively priced, making it more attractive 

than Fair Isaac’s FICO products to large numbers of Americans. Now, through its full utilization of 

consumer data from the Credit Bureaus, including rental and utility payments, VantageScore can 

provide Credit Scores for 30 million more Americans than Fair Isaac’s FICO can. If businesses utilized 

VantageScore, because of its additional features, millions of additional creditworthy Americans would 

be able to obtain credit at more favorable rates and at a lower cost. 

7. Seeing the threat from VantageScore to its dominant market position, Fair Isaac has 

acted to discourage widespread adoption of VantageScore. To effectuate this, Fair Isaac has abused 

its monopoly power to prevent the Credit Bureaus from successfully launching a competitive 

alternative to FICO Scores and has utilized a public relations and advertising campaign to disparage 

VantageScore and create doubt about VantageScore’s accuracy with lenders and consumers alike. 

8. Fair Isaac has succeeded in preventing the growth of VantageScore or any other 

potential competing credit scoring system through its exclusionary conduct. By continually 

suppressing competition, Fair Isaac has been able to increase prices for its FICO Scores, d o i n g s o 

m o s t r e c e n t l y i n September 2019. Due to Fair Isaac’s suppression of competition, and its 

insistence that non-compete clauses be included in contractual agreements, VantageScore, or any 

another credit scoring system, was unable to thrive and gain market share despite creation of an 

innovative and arguably, superior product. The existence of VantageScore and similar competitive scoring 

systems would have yielded lower prices paid for B2B Credit Scores by Plaintiff and Class members. 

9. Through its anticompetitive and exclusionary conduct, Fair Isaac has harmed 

businesses by depriving them of competitive pricing and freedom of choice for Credit Score 

instruments that would allow them to evaluate credit risk. Eliminating Fair Isaac’s stranglehold on the 

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market by opening the market to competition is essential to ensure competitive prices, product 

innovation, freedom of choice, and widespread access to credit for all creditworthy Americans. 

10. On February 12, 2018, TransUnion filed antitrust counterclaims for monopolization 

and related claims against Fair Isaac in this District. See Fair Isaac Corp. v. Trans Union LLC, 1:17-cv08318, ECF No. 38 (redacted counterclaims). On March 27, 2019, Judge Sharon Johnson Coleman 

denied Fair Isaac’s motion to dismiss TransUnion’s antitrust counterclaims. See id., ECF No. 96. The 

matter is ongoing. 

11. On March 15, 2020, Fair Isaac disclosed that it w a s n o t i f i e d tw o d a y s 

e a r l i e r t h a t i t was being investigated by the United States Department of Justice Antitrust 

Division for exclusionary conduct relating to the same conduct alleged in the counterclaims upheld by 

Judge Coleman.4

PARTIES 

A. Plaintiff 

12. Plaintiff Amalgamated Bank is a New York state chartered commercial bank and trust 

company with a principal place of business at 275 Seventh Avenue, New York, New York 10011. 

13. Plaintiff is the largest union-owned bank in the United States. Workers United and 

affiliated organizations are the largest shareholders. Plaintiff provides financial services, including 

personal banking services for consumers, and services for businesses, non-profit organizations, and 

institutional investing services. 

14. During the Class Period, Plaintiff directly purchased B2B Credit Scores from 

Defendant and from members of the Credit Bureaus. 

                                                            

4 See Press Release, Fair Isaac Corporation, FICO Statement Regarding Antitrust Investigation, (Mar. 

15, 2020), https://www.prnewswire.com/news-releases/fico-statement-regarding-antitrustinvestigation-301024452.html. 

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15. Plaintiff suffered injury in its business or property as a direct, proximate, and material 

result of Defendant’s violations of law. 

16. Plaintiff is at continual risk of additional injury to its business and property by reason 

of Defendant’s continuing violations of law. 

B. Defendant 

17. Defendant Fair Isaac Corporation is a Delaware corporation, with a principal place of 

business at 181 Metro Drive, Suite 700, San Jose, California 95110. 

JURISDICTION AND VENUE 

18. This Court has jurisdiction over this action pursuant to Sections 1 and 2 of the 

Sherman Antitrust Act, 15 U.S.C. §§1 and 2, and Sections 4 and 16 of the Clayton Antitrust Act, 

15 U.S.C. §§15 and 26. 

19. This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C. 

§§1331, 1332(d), and 1337. 

20. This Court has supplemental jurisdiction over Plaintiff’s state law claims pursuant to 

28 U.S.C. §1367. 

21. Venue is proper in this District pursuant to 15 U.S.C. §§15(a) and 22, and 28 U.S.C. 

§1391(b), (c) and (d). During the Class Period, Defendant resided, transacted business, was found, or 

had agents in the United States, including in this District, and a substantial portion of the affected 

interstate trade and commerce described in this Complaint was carried out in this District. 

22. During the Class Period, Defendant’s conduct was within the flow of, was intended to, 

and did have a substantial effect on the interstate commerce of the United States, including in this 

District. 

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23. During the Class Period, Defendant used the instrumentalities of interstate commerce, 

including interstate wires, United States Postal Service mail, and wireless spectrum to effectuate its 

illegal scheme. 

24. Defendant’s conduct also had a substantial effect on the intrastate commerce of at 

least the following states: Arizona; Arkansas; California; Connecticut; Florida; Hawaii; Illinois; Iowa; 

Kansas; Maine; Maryland; Massachusetts; Michigan; Minnesota; Mississippi; Missouri; Montana; 

Nebraska; Nevada; New Mexico; New York; North Carolina; North Dakota; Oregon; Rhode Island; 

South Carolina; South Dakota; Tennessee; Utah; Vermont; West Virginia; and Wisconsin; as well 

as the District of Columbia. 

25. This Court has personal jurisdiction over Defendant because Defendant utilized this 

District to transact business, maintain substantial contacts, and commit unlawful conduct. Defendant’s 

unlawful scheme was directed at, and had the intended effect of, causing injury to persons residing in, 

otherwise located in, or doing business in this District. 

26. Plaintiff purchased at least one FICO Score from Experian, which employs Credit 

Score business personnel in this District. 

27. Defendant employs Credit Score business personnel in this District. 

28. Defendant is registered to do business in Illinois with the Illinois Secretary of State. 

29. Defendant selected this District to initiate litigation against Trans Union LLC, Case 

No. 1:17-cv-08318, to which this case is filed as related by Plaintiff. 

SUBSTANTIVE ALLEGATIONS 

I. Background 

A. Credit Scores 

30. Credit Scores are three-digit numbers that are meant to assess credit risk. Consumers 

with higher Credit Scores generally pose less credit risk than those with lower Credit Scores. Credit 

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Scores are created through the use of a credit scoring algorithm to provide a consumer credit report. 

Credit Scores are usually paired with “reason codes,” which detail information about what caused 

reductions to a particular consumer’s Credit Score. 

31. In the United States, Credit Scores are the most widely used indicators of consumers’ 

creditworthiness. Financial institutions, lenders, and other businesses use Credit Scores in making 

consumer credit decisions. Consumers rely on Credit Scores to determine their ability to procure a 

mortgage, auto loan, or credit card, in addition to the rate that they will pay. 

32. The Credit Bureaus collect and supply aggregated consumer credit data in consumer 

reports. The Credit Bureaus collect credit and financial data about consumers from creditors, 

collection agencies, governmental entities, public records, and other third parties. The Credit Bureaus 

then compile this information to create a credit file. The Credit Bureaus sell credit reports, which 

include consumer credit file information, to businesses and consumers. 

33. Although Credit Scores are sometimes bundled and sold together with credit reports, 

they are two different products and credit reports can be sold independently of Credit Scores. Credit 

reports have detailed information about the credit activity and current credit situation of consumers. 

A credit report could include information about a consumer’s mortgage payment history, credit card 

balances and payments, and credit inquiries. A Credit Score is based on the information provided in a 

credit report, which ultimately yields a single three-digit number assessment. 

B. The B2B and B2C Credit Score Markets in the United States 

34. In the United States, there are two markets for Credit Scores, the B2B Credit Score 

Market, and the B2C Credit Score Market. B2B Credit Scores and B2C Credit Scores serve different 

purposes and are priced and purchased differently. 

35. Financial institutions, lenders, and other businesses in the B2B Credit Score Market 

use Credit Scores to assess consumer creditworthiness and make lending decisions. These institutions, 

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lenders, and businesses do not consider credit reports or other borrower information to be a substitute 

for Credit Scores. 

36. In contrast, in the B2C Credit Score Market, consumers purchase their own Credit 

Scores to gauge their own creditworthiness and determine how they will be categorized by potential 

lenders and creditors. 

37. The United States is the relevant geographic market in which B2B Credit Scores are 

provided because the restraints on competition contained in Fair Isaac’s contracts relate to the 

provision of B2B Credit Scores to businesses across the United States. 

38. B2B Credit Score Market p u r c h a s e r s include financial institutions, lenders, and 

other businesses that purchase B2B Credit Scores to make risk management decisions (“B2B 

Purchasers”). Financial institutions, lenders, and other businesses that purchase Credit reports from 

Defendant and/or the Credit Bureaus generally do so to: (1) determine the identity and creditworthiness of qualified borrowers to whom a preapproved offer of credit offer will be extended; (2) 

make lending decisions, and (3) evaluate the risk for existing borrowers, including for purposes such 

as offering to extend additional credit or making changes to other account terms. 

39. In contrast, customers in the B2C Credit Score Market purchase Credit Scores to 

assess their likelihood of obtaining credit, otherwise manage their credit, or protect their identity. 

Presently, millions of American consumers have signed up for credit monitoring or identity protection 

services. Many of those credit monitoring accounts provide consumers with their Credit Score. 

40. The credit risk scoring industry, including industry and policy analysts, and investors 

distinguish the B2B Credit Score Market and the B2C Credit Score Market as two distinct markets. 

Fair Isaac also views the B2B Credit Score Market as distinct from the B2C Credit Score Market. In 

its 2019 Form 10-K, Fair Isaac described different components of its Scores reportable segment 

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including its “business-to-business scoring solutions and services” and the “myFICO® solutions for 

consumers.” 

41. The B2B Credit Score Market has high barriers to entry. B2B Purchasers face 

significant “switching costs” if they adopt a new Credit Score that has different score-to-risk 

relationships or that uses different reason codes, regardless of whether it is an updated version of the 

score they already use or an entirely new brand of Credit Score. This is not the case for B2C Credit 

Score Market consumers. Switching costs for B2B Purchasers arise because: (1) employees require 

training in the properties and elements of a new score; (2) B2B Purchasers must verify that the new 

score will adequately predict the creditworthiness of their existing customers; (3) B2B Purchasers 

often conduct extensive and costly validation tests to determine whether the new score is costeffective; and (4) B2B Purchasers often need to update their internal systems to ensure technical 

compatibility between their systems and a new score. 

42. The B2B Credit Score Market is also characterized by network effects. In certain 

industries, such as the industries for mortgages and auto loans, the use of Credit Scores with similar 

score-to-risk relationships and reason codes allows the bundling of mortgage and auto loans from 

different originators into securities that can be sold to investors. Consistent use of a single type of 

Credit Score allows the marketing materials for these securities to include data about the average 

Credit Scores of the borrowers associated with the underlying loans. 

C. Fair Isaac Has Maintained Monopoly Power in the B2B Credit Score Market 

for Decades 

43. Fair Isaac has maintained its monopoly over the B2B Credit Score Market in the 

United States for nearly three decades, largely through the anticompetitive dominant nature of its 

FICO product line, which includes several different types of FICO Scores. Introduced over thirty 

years ago, Fair Isaac’s “FICO Classic” Credit Scores are the most widely known and used B2B 

Credit Scores in the United States. FICO Classic applies an algorithm to each Credit Bureau’s data 

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and generates a score between 300 and 850 that purportedly provides an indication of the individual’s 

credit risk level. FICO Classic also generates “reason codes” that explain why the consumer has not 

been assigned the maximum score of 850. 

44. Fair Isaac does not attempt to hide its B2B Credit Score Market monopoly power. 

Instead, it advertises its monopoly power, stating that 90% of all lending decisions in the United States 

utilize FICO Scores, even boasting on its website that 100 billion FICO Scores have been sold. Fair 

Isaac also brags that its sales are four times the number of McDonald’s worldwide yearly 

sales of hamburgers, and its daily FICO Scores sales are more than double Starbucks’ worldwide 

daily coffee sales.5

45. Similarly, in its 2019 Form 10-K, Fair Isaac described its “FICO Scores” as “the 

standard measure in the U.S. of consumer credit risk” and reported that “FICO Scores are used in 

the majority of U.S. credit decisions, by nearly all of the major banks, credit card organizations, 

mortgage lenders, and auto loan originators.” 

46. Representatives for Fair Isaac, including Watts, have labeled Fair Isaac’s FICO score 

as “the 800- pound gorilla” in the market for B2B Credit Scores,6 and as previously noted, bragged 

about Fair Isaac’s dominant 90% market share. For example, in November 2017, Fair Isaac’s CFO 

and Executive Vice President, Michael Pung, stated that Fair Isaac’s FICO Scores are used by 

nearly every major lender and are the most widely used credit scoring system in the United States. 

47. Fair Isaac representatives have also recognized their benefit from the 

widespread use of FICO Scores throughout many different industries. On November 3, 2011, 

                                                            

5 FICO Knows A Lot About You But What Do You Know About FICO?, ADVISORBOX, 

http://advisorbox.com/fico-knows-lot-know-fico/ (citing http://www.fico.com/en/aboutus#at_glance). 

6 Dana Dratch, What Does ‘Good’ Credit Really Mean?, BANKRATE, (published Oct. 30, 2008, 

updated Aug. 5, 2010), https://www.cnbc.com/id/27458815.

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at Fair Isaac’s Analyst/Investor Day, Fair Isaac’s then-CEO, Mark Greene, explained that the 

network effect of FICO Scores being the industry standard and “having everybody . . . standardize 

on a FICO Score, that’s magic.”7

48. Fair Isaac’s monopoly power in the B2B Credit Score Market for Credit Scores has 

provided it with the power to control prices. Fair Isaac’s CEO, Will Lansing (“Lansing”), has stated 

that in the B2B Credit Score Market, Fair Isaac has the ability to decide where it wants its margins to 

be. 

II. Fair Isaac’s Monopoly in the B2B Credit Score Market Has Eliminated the Chances 

of any Potential Competitors 

49. Nearly 15 years ago, VantageScore introduced the VantageScore Credit Score and 

credit scoring system. VantageScore is a competitor to FICO Scores in the B2B Credit Score Market. 

50. From the time it was first released in March 2006, VantageScore has been able 

to score millions more consumers than the FICO scoring systems. VantageScore had more 

dynamic capabilities because it calculated scores for consumers that had not used credit for up to 

two years. It also had far-reaching access to many more consumers by using utility and telecommunications 

payment histories reported to the Credit Bureaus. In contrast, Fair Isaac’s FICO scoring systems would 

not generate a score if a consumer did not use credit in over six months or if a credit account was 

opened less than six months ago. 

51. Due to its expansive reach, VantageScore now issues Credit Scores for 30 million more 

Americans than traditional FICO scoring systems. Fair Isaac’s FICO Classic credit scoring systems, 

which are still used by many lenders, exclude large numbers of creditworthy Americans that can be 

reliably scored by VantageScore. Roughly 25 percent of American adults, or about 65 million people, 

                                                            

7

 Fair Isaac Corp. – Analyst/Investor Day Transcript, (Nov. 3, 2011), 

https://seekingalpha.com/article/307417-fair-isaac-corp-analyst-investor-day.

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do not have a traditional FICO score. Through widespread usage of VantageScore, the number of 

adults without a Credit Score would be cut nearly in half. Remarkably, approximately ten million of 

those newly scored individuals would be classified as “prime” borrowers that would be extremely 

attractive to financial institutions and lenders. 

52. For any consumers without a Credit Score, it is difficult if not impossible to 

successfully obtain a mortgage, car loan, or reasonable interest rates for personal lines of credit. The 

implications of not having a Credit Score can even affect a consumer’s ability to rent an apartment, 

as Credit Scores are increasingly used by landlords in their tenant screening process. 

53. Low-income and minority consumers make up a disproportionate percentage of the 

individuals excluded by Fair Isaac’s traditional FICO scoring systems. The lack of access for 

these affected individuals results in a greater likelihood of their being denied access to credit cards, 

auto and home loans, and apartment housing. 

54. The Consumer Financial Protection Bureau (“CFPB”) published a report which stated 

that Black and Hispanic consumers are considerably more likely to be credit invisible or have unscored 

credit records than White consumers. About 15 percent of Black and Hispanic consumers are credit 

invisibles compared to just nine percent of White consumers. An additional 13 percent of Black 

consumers and 12 percent of Hispanic consumers have records that cannot be scored under the 

widely-used model, compared to just seven percent of White consumers. CFPB analysis suggests that 

these differences across racial and ethnic groups materialize early in the adult lives of these consumers 

and persist thereafter.8 However, through usage of VantageScore, a score could be calculated for 

                                                            

8 CFPB Report Finds 26 Million Consumers Are Credit Invisible, CFPB, (May 5, 2015), 

https://www.consumerfinance.gov/about-us/newsroom/cfpb-report-finds-26-million-consumersare-credit-invisible/.

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roughly 9.5 million Hispanic and Black consumers who do not currently have a FICO score, with over 

2.5 million of these minority consumers qualifying for “prime” borrowing status. 

55. Despite the tremendous benefits that using VantageScore would provide to millions 

of consumers, Fair Isaac continues to maintain its monopoly position in the B2B Credit Score Market. 

On February 27, 2013, at a Morgan Stanley Technology, Media & Telecom Conference, Lansing 

explained that despite the presence of VantageScore in the market, “there’s not that much competition 

around our [B2B] scores business” because “[t]he FICO scores are very much part of the fabric of the 

banking industry.”9

III. Fair Isaac Has Contracted with the Credit Bureaus as Agents and Co-Conspirators to 

Monopolize the B2B Credit Score Market 

56. Despite the Credit Bureaus’ attempts to compete in the B2B Credit Score Market, due 

to its dominant market position, Fair Isaac is able to employ the Credit Bureaus in its scheme to extend 

the shelf life of its monopoly. Fair Isaac depends on the Credit Bureaus to help foster its relationship 

with B2B Purchasers. Fair Isaac enlists the Credit Bureaus for assistance with the sale of its FICO 

Scores to these B2B Purchasers. 

57. For B2B Purchasers that require a Credit Score, they purchase the report from the 

Credit Bureau, and the Credit Score jointly from the Credit Bureau and Fair Isaac. At times, payment 

may at times occur in a single transaction, but practically speaking, as expressly stated in B2B 

Purchasers’ contract terms, both the Credit Bureau and Fair Isaac serve as the provider of the FICO 

Score. 

                                                            

9

 Morgan Stanley Technology, Media & Telecom Conference Transcript, (Feb. 27, 2013), 

https://seekingalpha.com/article/1231981-fair-isaacs-ceo-presents-at-morgan-stanley-technologymedia-and-telecom-conference-transcript.

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58. B2B Purchasers’ FICO Scores contracts are often referred to as Credit Scoring 

Services Agreements (“CSSAs”). CSSAs provide for both the payment method and fee model for the 

delivery of Credit Score services. 

59. In Plaintiff’s and Class Members’ obtaining of FICO Scores, the Credit Bureaus serve 

as co-conspirators and agents of Fair Isaac. Pursuant to common terms of CSSAs, the Credit Bureaus 

often deliver subscriber invoices for Credit Scores that dictate payment should be made to Fair Isaac. 

IV. Fair Isaac’s Additional Anticompetitive and Exclusionary Conduct 

60. Fair Isaac utilized its monopoly power to coordinate a campaign to eliminate 

competition from VantageScore and has explicitly stated that this is its end goal. On April 23, 2015, 

Lansing informed investors on a quarterly earnings conference call that Fair Isaac’s strategic goal was 

to ensure that “the entire industry adopts FICO scores instead of [other] scores.”10 Remarkably, thanks 

to its dominant position in the B2B Credit Score Market, Fair Isaac has enlisted its competitors, the 

Credit Bureaus, which jointly own and control VantageScore, to sign anticompetitive contracts that: 

(1) prevent them from developing or selling alternative Credit Scores that could be seamlessly 

integrated into lenders’ systems, or at a minimum, could be used interchangeably with FICO Scores; 

(2) prevent them from competing with each other to negotiate better prices from FICO; and (3) create 

a pricing scheme effectively eliminating the possibility that B2B Purchasers choose to use FICO Scores 

in their lending decisions at the same time as providing customers with a competing Credit Score, 

such as VantageScore. Concurrently, Fair Isaac has smeared VantageScore in the media and has made 

false and misleading statements to establish doubt about VantageScore’s accuracy and reliability. 

Through such anticompetitive and exclusionary conduct, Fair Isaac has injured and essentially 

                                                            

10 Fair Isaac’s (FICO) CEO Will Lansing on Q2 2015 Results – Earnings Call Transcript, (Apr. 23, 

2015), https://seekingalpha.com/article/3097846-fair-isaacs-fico-ceo-will-lansing-on-q2-2015-

results-earnings-call-transcript.

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eliminated competition in the B2B Credit Score Market, drastically increased prices for Plaintiff and 

the Class, and severely limited access to credit for millions of Americans. 

A. Fair Isaac and the Credit Bureaus Have Executed Contracts with 

Anticompetitive Terms that Restrict the Credit Bureaus’ Ability to Compete 

and Sell VantageScore 

61. In January 2015, Fair Isaac and TransUnion entered into a contract, the Analytic and 

Data License Agreement. Fair Isaac utilized the December 31, 2014 contract expiration date to 

demand that the parties enter into a new contract rather than simply renew their existing contracts. 

Fair Isaac represented to TransUnion that the other Credit Bureaus, Experian and Equifax, 

already agreed to new contracts with Fair Isaac that were materially similar. If TransUnion did not agree 

to Fair Isaac’s desired terms, it would lose substantial business from customers that depend on FICO 

Scores. On information and belief, the Credit Bureaus all agreed to Fair Isaac’s terms and its plan to 

exclude competitors and maintain its monopoly. 

1. Through the Anticompetitive Agreements Fair Issac Restricted the 

Credit Bureaus’ Ability to Develop or Sell Other Credit Scores 

Compatible with B2B Purchasers’ Existing Systems 

62. Fair Isaac has imposed similar or identical “No Equivalent Products” clauses on each 

of the Credit Bureaus. By imposing the “No Equivalent Products” terms, Fair Isaac has sought to 

eliminate the Credit Bureaus’ ability to offer alternative Credit Score products, such as VantageScore, 

that would allow B2B Purchasers to easily switch from FICO Scores to VantageScore without 

incurring increases in costs to redesign their lending programs and systems, or to use VantageScore in 

addition to or interchangeably with FICO Scores. The Credit Bureaus have agreed to Fair Isaac’s 

demands in these anticompetitive agreements, terms, and the resulting anticompetitive effects. 

63. The “No Equivalent Products” clauses provide that the Credit Bureaus may not 

internally develop a credit scoring system that is aligned to the odds-to-score relationship of any Fair 

Isaac Analytic or that uses more than a limited number of reason codes that “match” reason codes 

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used by any Fair Isaac Analytic. These clauses also prohibit the Credit Bureaus from distributing 

any competing analytic, such as a credit scoring system, that is aligned with FICO Scores or uses too 

many of the same reason codes. These clauses expressly name Vantage Score Solutions LLC as a 

developer of such a scoring system that may not be distributed in the event that VantageScore ever 

offered an “Equivalent Product.” 

64. For example, if a competing Credit Score product used a 750 score to designate a lessthan-one-percent risk of credit delinquency, and if a 750 FICO score also designated the same risk of 

delinquency, then the “No Equivalent Products” clause prevents the Credit Bureaus from distributing 

the competing product. Similarly, if a competing Credit Score product used reason codes that match 

20% or more of the reason codes used by FICO scoring systems, the “No Equivalent Products” clause 

prohibits the Credit Bureaus from distributing the product. 

65. Ultimately, the “No Equivalent Products” clauses prevent the Credit Bureaus from 

developing or selling an alternative to FICO’s Credit Scores that would be compatible with many 

B2B Purchasers’ systems, models, and processes, and would allow B2B Purchasers to have a real choice 

between using FICO Scores and some alternative score. Many B2B Purchasers have expended 

substantial efforts and resources to develop systems, models, and processes that are designed for 

FICO Scores compatibility. B2B Purchasers’ systems, models, and processes are tailored to FICO’s 

odds-to-score relationship, providing a given ratio of non-defaulting consumers to defaulting 

consumers for each given score, and reason codes indicating the particular reasons listed for increased 

risk of default. An example of this tailoring is bank software designed to accept one or more FICO 

Scores and reason codes, that combines this information with internally collected data, and 

automatically produces a lending decision. 

66. The “No Equivalent Products” clauses in contracts with the Credit Bureaus allow Fair 

Isaac to maintain its monopoly. The odds-to-score relationship is simply an arbitrary mapping 

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between credit risk and score and does not constitute protectable intellectual property. Similarly, the 

reason codes that may not be used by any “Equivalent Product” were not invented by Fair Isaac but 

are instead based on well-established industry best practices for lending. 

2. Fair Isaac’s Anticompetitive Agreements Restrict the Credit Bureaus’ 

Ability to Develop or Sell Other Credit Scores Compatible with B2B 

Purchasers’ Existing Systems

67. Fair Isaac’s contracts with each Credit Bureau include a similar or identical “Dynamic 

Royalty Schedule” clause and a similar or identical “Pre-Qualification” royalty category. Through use 

of the “Pre-Qualification” royalty category, Fair Isaac has effectively eliminated lenders’ ability to 

purchase and utilize a FICO score in their lending decision while also providing a consumer with a 

competing Credit Score. This causes lenders to buy Fair Isaac’s FICO Scores exclusively rather than 

consider and potentially purchase competing Credit Scores, such as VantageScore. Due to Fair 

Isaac’s unilateral inclusion of the “Pre-Qualification” royalty category, TransUnion has lost massive 

amounts of sales of VantageScore to major banks so they can provide the scores to consumers. 

68. In the 2015 agreements, Fair Isaac demanded, and the Credit Bureaus have complied 

with, a new “Pre-Qualification” royalty category, which Fair Isaac describes as an End User’s 

qualification of a potential consumer customer for that End User’s own internal lending offering. The 

“Pre-Qualification” royalty category distinguishes between: (1) lenders that use FICO Scores for “PreQualification” without providing any Credit Score or credit data to consumers; and (2) lenders that 

use FICO Scores for “Pre-Qualification” in addition to providing Credit Scores or credit data to 

consumers related to the “Pre-Qualification.” Certain banks and lenders offer consumers 

opportunities to apply to qualify for credit opportunities (e.g., a credit card or loan) and, simultaneously, 

receive their personal Credit Score. In many instances, this offer of a free Credit Score can entice 

consumers to apply for credit opportunities. 

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69. The royalty price associated with a FICO score used for “Pre-Qualification” depends 

on whether other Credit Scores or credit data are provided to consumers. If a lender purchases a 

FICO score for use in “Pre-Qualification” and does not provide any Credit Score or credit data to the 

consumer “in connection” with the “Pre-Qualification,” there is one per-score royalty rate. If the 

lender purchases a FICO score for use in “Pre-Qualification” and provides any other Credit Score to 

the consumer “in connection” with the “Pre- Qualification,” a higher penalty per-score royalty rate is 

imposed. 

70. The penalty rate can be avoided through exclusive purchase of FICO Scores. In 

one example, the B2B Purchaser could purchase a FICO score for use in “Pre-Qualification” and 

provide no Credit Score or credit data to the consumer. In the alternative, the B2B Purchaser could 

purchase a bundled FICO product from Fair Isaac. Fair Isaac offers bundled products to lenders 

that combine the use of Credit Scores by lenders with the provision of Credit Scores to consumers. 

71. No legitimate business justification exists for the penalty rate agreed upon by Fair Isaac 

and the Credit Bureaus when the lender also purchases any other Credit Score to disclose to 

consumers. The only reason for the “Pre-Qualification” royalty category is to drive all B2B Purchasers 

engaging in “Pre-Qualification” to purchase FICO Scores exclusively and make it cost-prohibitive for 

B2B Purchasers engaging in “Pre-Qualification” to purchase a competing Credit Score to disclose to 

consumers. Fair Isaac’s scheme has been hugely successful, with very few B2B Purchasers opting to 

pay the penalty rate. 

3. Fair Isaac Has Extracted Monopoly Prices from B2B Purchasers 

Facilitated by its Anticompetitive Contracts with the Credit Bureaus 

72. In its Agreements, Fair Isaac requires a “Level Playing Field,” in which the prices that 

are made available to one Credit Bureau are made available to all of the Credit Bureaus. Combined 

with the “Dynamic Royalty Schedule” clause, the “Level Playing Field” clause enables Fair Isaac to 

unilaterally increase the royalty prices it charges for FICO Scores. Fair Isaac’s contracts with each of 

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the Credit Bureaus include similar or identical “Dynamic Royalty Schedule” and “Level Playing Field” 

provisions. 

73. B2B Purchasers have paid monopoly prices due to Fair Isaac’s implementation of the 

“Dynamic Royalty Schedule” and “Level Playing Field” provisions in its contracts with the Credit 

Bureaus. These provisions disincentivize the Credit Bureaus from negotiating for a lower price because 

each one knows that even the negotiation is successful, no competitive advantage over the other Credit 

Bureaus will be gained. 

B. Fair Isaac Disparaged VantageScore in an Aggressive Public Relations 

Campaign to Create Doubt About VantageScore’s Viability Among B2B 

Purchasers 

74. Unsatisfied with its successful implementation of anticompetitive restrictions that 

eliminated VantageScore’s ability to compete with FICO, Fair Isaac went even further and waged an 

aggressive public relations campaign to spread false statements and mislead B2B Purchasers about the 

qualities and characteristics of FICO Scores and VantageScore. Fair Isaac has disparaged 

VantageScore by calling it a “Fako” score, falsely claimed that VantageScore is an unreliable measure 

of creditworthiness, and misrepresented VantageScore’s credit scoring system and its overall process. 

75. On December 12, 2017, Fair Isaac placed a full-page advertisement in The Wall Street 

Journal addressed to “Lenders, Policymakers and Consumer Advocates” that criticized VantageScore, 

despite not identifying it by name. The advertisement presented Fair Isaac as independent from the 

Credit Bureaus and stated that Fair Isaac’s FICO Scores have been used by lenders and 

securitization investors for decades. In contrast, the advertisement described an alternative Credit 

Score, owned by the Credit Bureaus as less reliable than FICO Scores in evaluating credit risk. The 

advertisement unambiguously conveyed the false message that VantageScore weakened scoring 

standards, and harmed both consumers and the market, particularly the B2B Credit Score Market. 

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76. Fair Isaac’s advertisement in the Wall Street Journal also directed readers to view a 

Fair Isaac-owned website that connects visitors to articles and blog posts that f u r t h e r disparage 

VantageScore d i r e c t l y by name. A November 15, 2016 blog post asserts: “Despite claims by 

VantageScore, weakening the minimum scoring criteria will not empower millions of low-risk 

mortgage credit seekers.”11

77. Fair Issac’s implication that FICO Classic scoring systems provide Credit Scores for 

as many consumers as VantageScore is erroneous and misleading to the B2B Credit Score Market and 

consumers. As described supra, VantageScore provides Credit Scores for millions of American 

consumers that are not scored by FICO Classic scoring systems. 

78. Fair Isaac’s website includes numerous posts that disparage VantageScore and make 

false or misleading statements about VantageScore’s features. A November 16, 2015 blog post claims 

that “[r]esearch results consistently showed that scoring models relying solely on sparse or old credit 

data were weak and did a poor job forecasting future performance.”12 This statement is false and 

misleading because it attempts to present VantageScore’s scoring model as “weak” and as doing a 

“poor job forecasting future performance” because it considers a consumer’s full credit history even 

if the consumer has not used a traditional credit line in the last six months. Despite Fair Isaac’s claims, 

studies have shown that VantageScore is strongly predictive. 

79. Fair Isaac’s blog post from February 6, 2017 asserts that whereas “FICO Score 9 

differentiates medical from non-medical collections,” “VantageScore does not.”13 Fair Isaac’s 

                                                            

11 Joanne Gaskin, Truth Squad: Will Looser Scoring Standards Help Millions More Americans Get Mortgages?, 

FICO BLOG, (Nov. 15, 2016), https://www.fico.com/blogs/truth-squad-will-looser-scoringstandards-help-millions-more-americans-get-mortgages. 

12 Ethan Dornhelm, Why Bureau Data Alone Can’t Score More Consumers, (Nov. 16, 2015), FICO 

BLOG, https://www.fico.com/blogs/why-bureau-data-alone-can-t-score-more-consumers. 

13 Joanne Gaskin, Truth Squad: Is FICO Score 700 the Same as VantageScore 700?, (Feb. 6, 2017), FICO 

BLOG, https://www.fico.com/blogs/truth-squad-fico-score-700-same-vantagescore-700. 

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statement conveys the false message that VantageScore does not differentiate medical from nonmedical collections. Despite this assertion, the opposite is true. Notably, VantageScore 3.0 was the 

first credit scoring system to address medical debt. VantageScore 4.0, the most recent version of 

VantageScore, distinguishes medical collection accounts from non- medical collection accounts and 

attributes lower penalizes to medical collections than non-medical ones. 

80. Fair Isaac’s campaign against VantageScore has been ongoing for nearly fifteen years. 

In 2006, just months after VantageScore’s launch, Fair Isaac filed a frivolous lawsuit against the 

Credit Bureaus and VantageScore in the United States District Court for the District of Minnesota. 

See Fair Isaac Corp. v. Equifax Inc., No. 06-cv-04112 (D. Minn.). This was the Fair Isaac’s initial attempt 

to eliminate its competitive threat. 

81. Fair Isaac’s lawsuit included claims that the development of VantageScore violated the 

antitrust laws and that the development of VantageScore constituted trademark infringement. In its 

prayer for relief, Fair Isaac sought dissolution of VantageScore. Not only did all of Fair Isaac’s claims 

fail, the jury justly determined that Fair Isaac was the wrongdoer. In support of its trademark 

infringement claim, Fair Isaac had alleged that VantageScore’s 501-990 scoring range constituted 

trademark infringement because it was similar to FICO’s scoring range of 300-850. The Credit Bureaus 

and VantageScore issued counterclaims for fraud on the United States Patent and Trademark Office 

(“PTO”), alleging that Fair Isaac misrepresented to the PTO that only FICO used the 300-850 score 

range. The jury concluded that Fair Isaac committed fraud on the PTO by making false statements in 

its application to register the score range of 300-850 as a trademark. 

82. The public statements described in the foregoing paragraphs were transmitted to and 

seen by a substantial number of businesses and consumers nationwide. 

C. Fair Isaac Eliminates Competition Through its Extensive Anticompetitive and 

Exclusionary Conduct 

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83. Fair Isaac’s exclusionary conduct seeking to maintain and expand its monopoly 

power has harmed for years and continues to harm participants in the B2B Credit Score Market. 

Fair Isaac’s unlawful conduct, including that which has been taken in concert with the Credit Bureaus, 

has eliminated competition in the B2B Credit Score Market by foreclosing opportunities for the Credit 

Bureaus to sell VantageScore or any other similar competitive products. Fair Isaac’s anticompetitive 

and exclusionary conduct has allowed it to maintain its monopoly and charge monopoly prices for 

B2B Credit Scores to B2B Purchasers throughout the Class Period. 

84. Fair Isaac’s conduct, in concert with the Credit Bureaus, including by the contracts 

entered into by the Credit Bureaus, has drastically reduced choice for B2B Purchasers. The 

anticompetitive terms agreed to between Fair Isaac and the Credit Bureaus have frustrated the ability 

of B2B Purchasers to purchase VantageScore or any other competitive Credit Score that could be 

seamlessly integrated into lenders’ existing processes and systems. Fair Isaac’s media and advertising 

campaign against VantageScore has successfully instilled uncertainty, and doubt about VantageScore 

among B2B Purchasers in the marketplace. 

85. Through blog posts and the media, Fair Isaac has spread its message to consumers 

that VantageScore is a “Fako” score solely because it is not a FICO score. In a post on 

thebalance.com that was originally posted in February 2017, and that Fair Isaac continues to display 

today: “If you purchased your Credit Score anywhere but MyFICO.com, then it’s a FAKO score.”14

                                                            

14 Latoya Irby, FICO & FAKO Credit Scores, THE BALANCE, (updated Aug. 18, 2020), 

https://www.thebalance.com/fico-and-fako-credit-scores-960497. 

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CLASS ACTION ALLEGATIONS 

86. Plaintiff brings this action pursuant to Rules 23(a) and (b) of the Federal Rules of Civil 

Procedure, on its own behalf and as representative of the following Class:15

All B2B Purchasers residing in the United States that directly purchased a 

FICO Score from Fair Isaac and/or a Credit Bureau during the Class Period. 

Excluded from the Class are: Defendant, its directors, officers, management, 

employees, subsidiaries, and affiliates. Also expressly excluded from the Class 

are any natural persons that purchased their own Credit Score for personal use 

solely via myFico.com, the Credit Bureaus, or other entities.

87. The Class is so numerous and geographically dispersed that joinder of all members is 

impracticable. While the exact number of Class members is unknown to Plaintiff at this time, 

members of the Class are readily identifiable from information and records in the possession of 

Defendant. 

88. Plaintiff’s claims are typical of the claims of the other members of the Class. Plaintiff 

and members of the Class sustained damages from the same wrongful conduct of Defendant. The 

injuries and damages of each member of the Class were directly caused by Defendant’s wrongful 

conduct in violation of the laws described herein. 

89. Plaintiff will fairly and adequately protect and represent the interests of members of 

the Class. Plaintiff is an adequate representative of the Class and has no interest which is adverse to 

the interests of absent Class members. Plaintiff has retained counsel competent and experienced in 

class action antitrust litigation, including class actions in the financial services industry. 

                                                            

15 Plaintiff has defined the Class based on currently available information and herby reserves the right 

to amend the definition of the Class, including, without limitation, membership criteria and the Class 

Period.

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90. Common questions of law and fact exist as to all members of the Class, which 

predominate over questions affecting solely individual members of the Class. These common 

questions of law include, without limitation: 

1. whether Defendant monopolized, conspired to monopolize, or 

unreasonably restrained trade in violation of federal law; 

2. whether Defendant monopolized, conspired to monopolize, or 

unreasonably restrained trade in violation of certain state antitrust laws; 

3. whether Defendant engaged in unfair or deceptive trade practices in violation 

of certain state laws; 

4. the duration of the alleged unlawful conduct; 

5. injury suffered by Plaintiff and members of the Class; 

6. the appropriate measure of damages suffered by Plaintiff and Class members; 

and 

7. whether Defendant acted or refused to act on grounds generally applicable to 

Class members, thereby making appropriate final injunctive relief or 

corresponding declaratory relief with respect to Class members as a whole. 

91. A class action is superior to other methods for the fair and efficient adjudication of the 

controversy because joinder of all Class members is impracticable. Treatment as a class will permit 

a large number of similarly situated persons to prosecute their common claims in a single forum 

simultaneously, efficiently, and without the duplication of effort and expense that numerous 

individual actions would engender. 

92. Class treatment will also permit the adjudication of claims by many Class members 

who could not afford individually to litigate claims such as those asserted in this Complaint. The cost 

to the court system of adjudication of such individualized litigation would be substantial. The 

prosecution of separate actions by individual members of the Class would create a risk of inconsistent 

or varying adjudications establishing incompatible standards of conduct for the Defendants. 

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93. Plaintiff is unaware of any difficulties that are likely to be encountered in the 

management of this action that would preclude its maintenance as a class action. 

STATUTES OF LIMITATIONS AND TOLLING 

94. The applicable statutes of limitations relating to the claims for relief alleged herein 

were tolled because of fraudulent concealment involving both active acts of concealment by 

Defendant and inherently self-concealing conduct. Due to Defendant’s affirmative acts, 

misrepresentations, and nondisclosures as alleged herein, any applicable statutes of limitation on 

claims asserted by Plaintiff and members of the Class have been and are tolled, and Defendant is 

equitably estopped from raising statutes of limitations as a defense. 

95. Any applicable statutes of limitations were tolled until at least February 12, 2018, the 

date that TransUnion filed its Counterclaim against Defendant. 

96. The federal government’s antitrust investigation of Defendant’s unlawful conduct 

also operates to toll any federal statute of limitations under 15 U.S.C. § 16. 

CLAIMS FOR RELIEF 

FIRST CLAIM FOR RELIEF 

(Monopolization) 

(15 U.S.C. § 2) 

97. Plaintiff hereby incorporates each preceding and succeeding paragraph as though fully 

set forth herein. 

98. The relevant product market is the market for the sale of B2B Credit Scores. 

99. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

100. The B2B Credit Score Market is the relevant market. 

101. Fair Isaac has had and maintains at least 90% market share in the B2B Credit Score 

Market. 

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102. Fair Isaac has had and maintains monopoly power in the B2B Credit Score Market. 

103. Fair Isaac has had and maintains the power to control prices or exclude competition 

in the B2B Credit Score Market. 

104. Fair Isaac, through unlawful, anticompetitive and exclusionary acts and agreements, 

has substantially eliminated any competition in the market for B2B Credit Scores in the United States 

in violation of Section 2 of the Sherman Act, 15 U.S.C. § 2. 

105. Fair Isaac has demonstrated its monopoly position through its ability to control prices 

and exclude competition by raising prices to supracompetitive levels despite no corresponding increase 

in demand. 

106. Fair Isaac’s monopoly power is not due to its growth or development or because of 

a superior product, business acumen, or historic accident. 

107. Fair Isaac’s monopoly of the market has injured and will continue to injure 

competition. 

108. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

109. Fair Isaac’s monopolistic conduct raised the prices for FICO Scores above the 

competitive level and otherwise injured competition without any offsetting procompetitive benefit to 

consumers. 

110. Plaintiff and Class members have been injured in their business or property by 

Defendant’s violation of Section 2 of the Sherman Act within the meaning of Section 4 of the Clayton 

Antitrust Act, 15 U.S.C. § 15. 

111. Plaintiff and Class members are threatened with future injury to their business and 

property by Defendant’s continuing violation of Section 2 of the Sherman Act within the meaning of 

Section 16 of the Clayton Antitrust Act, 15 U.S.C. § 26. 

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SECOND CLAIM FOR RELIEF 

(Conspiracy to Monopolize) 

(15 U.S.C. § 2) 

112. Plaintiff hereby incorporates each preceding and succeeding paragraph as though fully 

set forth herein. 

113. The relevant product market is the market for the sale of B2B Credit Scores. 

114. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

115. The B2B Credit Score Market is the relevant market. 

116. Fair Isaac has had and maintains at least 90% market share in the B2B Credit Score 

Market. 

117. Fair Isaac has had and maintains monopoly power in the B2B Credit Score Market. 

118. Fair Isaac has had and maintains the power to control prices or exclude competition 

in the B2B Credit Score Market. 

119. Fair Isaac, through unlawful anticompetitive and exclusionary acts and agreements, 

has substantially foreclosed competition in the market for B2B Credit Score Market in the United States 

in violation of Section 2 of the Sherman Act, 15 U.S.C. § 2. 

120. Fair Isaac has demonstrated its monopoly position through its ability to control prices 

and exclude competition by raising prices to supracompetitive levels despite no corresponding increase 

in demand. 

121. Fair Isaac entered into a combination or conspiracy with the Credit Bureaus to 

maintain its monopoly power in the B2B Credit Score Market. Fair Isaac created and maintained this 

conspiracy through a series of agreements with each of the Credit Bureaus. In these agreements, 

the parties agreed that the Credit Bureaus would not offer or sell VantageScore or any other competing 

Credit Score to Plaintiff and Class members. Fair Isaac and the Credit Bureaus further agreed that the 

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Credit Bureaus would act as Fair Isaac’s agent in the sale of FICO Scores to Plaintiff and Class 

members. 

122. These agreements eliminated competition in a substantial portion of the B2B Credit 

Score Market and unlawfully allowed Fair Isaac to maintain its monopoly, resulting in Fair Isaac 

receiving supracompetitive prices for FICO Scores from Plaintiff and Class members. 

123. Fair Isaac’s monopoly power is not due to its growth or development or because of 

a superior product, business acumen, or historic accident. 

124. Fair Isaac’s monopoly of the market has injured and will continue to injure 

competition. 

125. Fair Isaac has acted with the specific intent of monopolizing the market for B2B 

Credit Scores in the United States. 

126. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

127. Fair Isaac’s conspiracy to monopolize raised the prices for FICO Scores above 

the competitive level and otherwise injured competition without any offsetting procompetitive benefit 

to consumers. 

128. Plaintiff and Class members have been injured in their business or property by 

Defendant’s violation of Section 2 of the Sherman Act within the meaning of Section 4 of the Clayton 

Antitrust Act, 15 U.S.C. § 15. 

129. Plaintiff and Class members are threatened with future injury to their business and 

property by Defendant’s continuing violation of Section 2 of the Sherman Act within the meaning of 

Section 16 of the Clayton Antitrust Act, 15 U.S.C. § 26. 

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THIRD CLAIM FOR RELIEF 

(Unreasonable Restraint of Trade) 

(15 U.S.C. §1) 

130. Plaintiff hereby incorporates each preceding and succeeding paragraph as though fully 

set forth herein. 

131. The relevant product market is the market for the sale of B2B Credit Scores. 

132. The relevant geographic market for the sale of B2B Credit Scores is the United States. 

133. The B2B Credit Score Market is the relevant market. 

134. Fair Isaac and the Credit Bureaus have had and collectively maintain at least 90% market 

share in the B2B Credit Score Market. 

135. Fair Isaac has had and continues to have monopoly power in the B2B Credit Score 

Market. 

136. Fair Isaac has had and continues to have the ability to control prices and exclude 

competition in the B2B Credit Score Market. 

137. Fair Isaac entered into separate agreements with TransUnion, Equifax, and 

Experian that contained anticompetitive terms whereby each Credit Bureau agreed not to offer or 

sell VantageScore or other competing products to Plaintiff and members of the Class. 

138. Fair Isaac’s agreements with the Credit Bureaus had substantial anticompetitive 

effects. The agreements excluded VantageScore, a significant competitor, from a substantial portion 

of competition in the B2B Credit Score Market. 

139. Fair Isaac’s agreements with the Credit Bureaus raised the price for FICO Scores 

above the competitive level and otherwise injured competition without any offsetting procompetitive 

benefit to consumers. 

140. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

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141. Plaintiff and Class members continue to suffer damage, and will continue to do so, if 

Fair Isaac’s anticompetitive conduct does not cease. 

142. Plaintiff and Class members have been injured in their business or property by 

Defendant’s violation of Section 1 of the Sherman Act, within the meaning of Section 4 of the Clayton 

Antitrust Act, 15 U.S.C. § 15. 

143. Plaintiff and Class members are threatened with future injury to their business and 

property by Defendant’s continuing violation of Section 1 of the Sherman Act, within the meaning of 

Section 16 of the Clayton Antitrust Act, 15 U.S.C. § 26. 

FOURTH CLAIM FOR RELIEF 

(State Antitrust Laws) 

144. Plaintiff hereby incorporates each preceding and succeeding paragraph as though fully 

set forth herein. 

145. By reason of the foregoing alleged herein, Defendant has violated, and Plaintiff and 

members of the Class are entitled to relief pursuant to the antitrust laws of the States of Arizona, 

California, Connecticut, Hawaii, Illinois, Iowa, Kansas, Maine, Maryland, Michigan, Minnesota, 

Mississippi, Nebraska, Nevada, New Mexico, New York, North Carolina, North Dakota, Oregon, 

Rhode Island, South Dakota, Tennessee, Utah, Vermont, West Virginia, and Wisconsin, as well as 

the District of Columbia, as follows: 

i. Arizona Revised Statutes § 44-1401, et seq.; 

ii. California Cartwright Act, California Business & Professions Code § 

16700, et seq.; 

iii. Connecticut Antitrust Act, Conn. Gen. Stat. § 35-24, et seq.; 

iv. District of Columbia Code § 28-4501, et seq.; 

v. Hawaii Revised Statutes § 480-2, et seq.; 

vi. Illinois Antitrust Act, Illinois Complied Statutes § 740, Ill. Comp. Stat. 

1011, et seq.; 

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vii. Iowa Competition Law, Iowa Code § 553.1, et seq.; 

viii. Kansas Statutes Annotated § 50-101, et seq.; 

ix. Maine Revised Statutes Annotated, tit. 10, § 1101, et seq.; 

x. Maryland Code Annotated, Commercial Law, § 11-204, et seq.; 

xi. Michigan Compiled Laws § 445.771, et seq.; 

xii. Minnesota Antitrust Law of 1971, Minnesota Statutes § 325D.49, et 

seq.; 

xiii. Mississippi Code Annotated § 75-21-1, et seq.; 

xiv. Nebraska Revised Statutes § 59-801, et seq.; 

xv. Nevada Revised Statutes Annotated § 598A.010, et seq.; 

xvi. New Mexico Statutes Annotated § 57-1-1, et seq.; 

xvii. New York Donnelly Act, New York General Business Law § 340, et 

seq.; 

xviii. North Carolina General Statutes § 75-1, et seq.; 

xix. North Dakota Century Code § 51-08.1-01, et seq.; 

xx. Oregon Revised Statutes § 646.705, et seq.; 

xxi. Rhode Island General Laws § 6-36-4, et seq.; 

xxii. South Dakota Codified Laws § 37-1-3.1, et seq.; 

xxiii. Tennessee Code Annotated § 47-25-101, et seq.; 

xxiv. Utah Code Annotated § 76-10-3104, et seq.; 

xxv. Vermont Statutes Annotated, tit. 9, § 2451, et seq.; 

xxvi. West Virginia Code § 47-18-1, et seq.; and 

xxvii. Wisconsin Statutes § 133.01, et seq. 

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FIFTH CLAIM FOR RELIEF 

(State Unfair Trade Practices Laws) 

146. Plaintiff hereby incorporates each preceding and succeeding paragraph as though fully 

set forth herein. 

147. By reason of the foregoing alleged herein, Defendant has violated, and Plaintiff and 

Class members are entitled to relief pursuant to the Unfair Trade Practices and Consumer Protection 

Laws of the States of Arkansas, California, Connecticut, Florida, Massachusetts, Missouri, Montana, 

New Mexico, New York, North Carolina, Rhode Island, South Carolina, and Vermont, and the 

District of Columbia, as follows: 

i. Arkansas Code Annotated, § 4-88-101, et seq.; 

ii. California Business and Professions Code § 17200, et seq.; 

iii. Connecticut Unfair Trade Practices Act, Conn Gen. Stat. § 42-110a, et 

seq.; 

iv. District of Columbia Code § 28-3901, et seq.; 

v. Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. § 

501.201, et seq.; 

vi. Massachusetts Consumer Protection Act, Mass. Gen. L. Ch. 93A, et 

seq.; 

vii. Missouri Merchandising Practices Act, Mo. Rev. Stat. § 407.010, et seq.; 

viii. Montana Code, §30-14-103, et seq., and § 30-14-201, et seq.; 

ix. New Mexico Statutes Annotated § 57-12-1, et seq.; 

x. New York General Business Law § 349, et seq.; 

xi. North Carolina General Statutes § 75-1.1, et seq.; 

xii. Rhode Island General Laws § 6-13.1-1, et seq.; 

xiii. South Carolina Code Annotated § 39-5-10, et seq.; and 

xiv. Vermont Statutes Annotated, tit. 9, § 2451, et seq. 

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PRAYER FOR RELIEF 

Plaintiff, on behalf of itself and members of the Class, respectfully demands relief as follows: 

A. That the Court certify this lawsuit as a class action pursuant to Rules 23(a) and (b) of 

the Federal Rules of Civil Procedure, that Plaintiff be designated as Class Representative, that the 

undersigned be named Lead Class Counsel, and that reasonable notice of this action, as provided by 

Rule 23(c)(2), be given to members of the Class; 

B. That Defendant’s unlawful conduct alleged herein be adjudged and decreed to violate 

the federal antitrust laws as set forth herein; 

C. That Defendant’s unlawful conduct alleged herein be adjudged and decreed to violate 

the state antitrust and unfair trade practices laws as set forth herein; 

D. That the Court award Plaintiff and members of the Class actual, treble, and exemplary 

damages; 

E. That the Court award Plaintiff and members of the Class their costs of suit, including 

reasonable attorneys’ fees and expenses, and including expert fees, as provided by law; 

F. That the Court award Plaintiff and members of the Class pre- and post-judgment 

interest at the maximum rate allowable by law; 

G. That the Court enjoin Defendant from its violations of law; and 

H. That the Court directs such further relief as it may deem just and proper. 

DEMAND FOR JURY TRIAL 

Pursuant to Rule 38(b) of the Federal Rules of Civil Procedure, Plaintiff demands a jury trial 

as to all issues triable by a jury. 

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Dated April 24, 2020 

 CAFFERTY CLOBES MERIWETHER & 

 SPRENGEL LLP 

 

 s/ Jennifer W. Sprengel 

 Jennifer W. Sprengel (Ill. Bar No. 06204446) 

150 S. Wacker, Suite 3000 

 Chicago, IL 60606 

 Telephone: 312-782-4880 

 jsprengel@caffertyclobes.com 

 Designated as Local Counsel 

Barbara J. Hart (pro hac vice forthcoming) 

 Christian Levis (pro hac vice forthcoming) 

Frank Strangeman (pro hac vice forthcoming) 

Andrea Farah (pro hac vice forthcoming) 

LOWEY DANNENBERG, P.C. 

44 South Broadway, Suite 1100 

 White Plains, New York 10601 

 Telephone: 914-997-0500 

 bhart@lowey.com 

clevis@lowey.com 

fstrangeman@lowey.com 

 afarah@lowey.com 

 

 Counsel for Plaintiff Amalgamated Bank 

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EXHIBIT D 

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UNITED STATES DISTRICT COURT FOR 

 THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

Alcoa Community Federal Credit Union, on behalf of 

itself and all others similarly situated, 

Plaintiff, 

v. 

FAIR ISAAC CORPORATION, 

Defendant. 

Civil Action No. __________ 

 CLASS ACTION COMPLAINT 

JURY TRIAL DEMANDED 

Plaintiff brings this class action to challenge an anticompetitive scheme by defendant Fair 

Isaac Corporation (“Fair Isaac”) to enhance and maintain Fair Isaac’s monopoly power in the 

U.S. market for business-to-business credit scores (“B2B Credit Scores”) in violation of the 

antitrust laws of the United States. Plaintiff purchased B2B Credit Scores directly from Fair 

Isaac or its co-conspirator agents, during the Class Period (defined below). Plaintiff brings this 

case on behalf of itself and a class of similarly situated direct purchasers of B2B Credit Scores, 

to recover overcharges resulting from the anticompetitive conduct alleged herein. 

INTRODUCTION 

1. Credit scores are derived from the application of algorithms to credit histories and 

are used for the purpose of assessing creditworthiness. There are two distinct domestic markets 

for credit scores: (1) the market for the sale of credit scores to lenders, financial institutions, and 

other businesses (the “B2B Credit Score Market”); and (2) the market for the sale of credit scores 

to consumers to monitor their own credit records (the “business-to-consumer” or “B2C Credit 

Score Market”). 

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2. Fair Isaac’s FICO Credit Scores (“FICO Scores”) have dominated the B2B Credit 

Score Market for decades. Fair Isaac stated in 2017 that it has “maintained a 90-plus percent 

market share for at least 13 years.” Fair Isaac executives have stated that their FICO Scores are 

“the 800-pound gorilla” and are “deeply embedded in the system in North America.” Fair Isaac 

advertises that its FICO Scores are used for 90% of all lending decisions in the United States. 

3. Fair Isaac has enjoyed monopoly power (i.e., the power to control price or exclude 

competition) in the United States B2B Credit Score Market since at least 2006. Fair Isaac has 

unlawfully maintained its monopoly power in the B2B Credit Score Market through 

anticompetitive and exclusionary agreements with TransUnion, Experian, and Equifax. 

TransUnion, Experian, and Equifax are the three dominant credit bureaus (collectively, the 

“Credit Bureaus”) in the U.S. They compile and sell information regarding consumer credit and 

on behalf of Fair Isaac, distribute to lenders, financial institutions, and other businesses Fair 

Isaac’s FICO Scores. The Credit Bureaus also distribute or sell competing B2B Credit Scores. 

Their ability to fairly and effectively do so, however, has been substantially impeded by 

anticompetitive contract terms imposed upon them by Fair Isaac. These anticompetitive contract 

provisions have allowed Fair Isaac to obtain or maintain its monopoly power over the U.S. B2B 

Credit Score Market. 

4. More specifically, the Credit Bureaus have contracted with Fair Isaac in ways that 

restrain the Credit Bureaus’ ability to develop or distribute competitive Credit Scores; prohibit 

the Credit Bureaus from individually negotiating royalty rates for access to FICO Scores; 

require that customers, such as Plaintiff, be charged discriminatory and prohibitively high Fair 

Isaac royalty rates if the customer also acquires a competing Credit Score; and also requires that 

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an increased royalty rate be paid by the Credit Bureaus. The Credit Bureaus have agreed with 

Fair Isaac to these restraints. 

5. The restraints set forth above were designed to impair, and have in fact impaired, 

Fair Isaac’s competition in the U.S. These anticompetitive and exclusionary contract terms have 

impeded the ability of all purchasers to obtain B2B Credit Scores from Fair Isaac’s competitors 

because they require the Credit Bureaus and the customer to incur substantial penalties if the 

Credit Bureau distributes to customers the B2B Credit Scores of Fair Isaac’s competitors. 

6. Fair Isaac has obtained and maintained its monopoly power by engaging in 

anticompetitive and exclusionary conduct including entering into the anticompetitive and 

exclusionary contract terms referenced above. Fair Isaac has suppressed competition, stymied 

innovation, and limited access to credit for millions of Americans – all in violation of Sections 1 

and 2 of the Sherman Act (15 U.S.C. §§ 1, 2), as well as numerous state antitrust and unfair trade 

practices laws. 

7. In 2006, VantageScore Solutions, LLC (“VantageScore”) launched a competitive 

Credit Score it called VantageScore. VantageScore was reliable, competitively priced, and highly 

predictive. Moreover, VantageScore has access to the Credit Bureaus’ consumer data, which far 

exceeds the consumer data available to Fair Isaac. As a result, VantageScore maintains Credit 

Scores for 30 million domestic consumers who do not have FICO scores. VantageScore’s 

product was more widely disseminated, millions of creditworthy consumers who now have 

restrained access to credit would have the opportunity to apply for mortgages, loans, or other 

forms of credit, and at a lower cost. 

8. Fair Isaac responded to VantageScore’s entry into the B2B Credit Score Market by 

engaging in anticompetitive conduct that has persisted for over more than a decade. In particular, 

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Fair Isaac restrained the Credit Bureaus’ ability to distribute VantageScore, and publicly and 

falsely disparaged VantageScore’s viability and reliability, so as to discourage B2B Credit Score 

consumers from purchasing VantageScore. 

9. Fair Isaac’s anticompetitive and exclusionary conduct has prevented the sales 

growth and market penetration that VantageScore would have achieved through competition on 

the merits and discouraged whatever other competition would have emerged. As a result, Fair 

Isaac has been able to significantly raise the price that customers, such as the Plaintiff, paid for 

FICO scores. But for Fair Isaac’s suppression of competition and exclusionary contracts with 

the Credit Bureaus, VantageScore or another credit scoring system would have earned 

substantial market share, which would have resulted in lower prices for B2B Credit Scores for 

Plaintiff and members of the Class. 

10. On March 15, 2020, Fair Isaac disclosed that the Antitrust Division of the United 

States Department of Justice had opened an investigation based at least in part on the 

exclusionary conduct alleged herein.1

 

JURISDICTION AND VENUE 

11. This action arises under sections 1 and 2 of the Sherman Act (15 U.S.C. §§ 1 and 2) 

and section 4 of the Clayton Act (15 U.S.C. § 15(a)) and seeks to recover treble damages, costs 

of suit, and reasonable attorneys’ fees for the injuries sustained by Plaintiff and members of the 

Class (defined below) resulting from Fair Isaac’s anticompetitive conduct. The Court has 

subject matter jurisdiction under 28 U.S.C. §§ 1331, 1337(a), 1407, and 15 U.S.C. § 15. 

1 See Press Release, Fair Isaac Corporation, FICO Statement Regarding Antitrust Investigation, 

https://www.prnewswire.com/news-releases/fico-statement-regarding-antitrust-investigation-301024452.html (Mar. 

15, 2020). 

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12. Venue is proper in this District pursuant to 15 U.S.C. §§ 15(a), 22 and 28 U.S.C. §§ 

1391(b), (c), and (d) because during the Class Period, the Defendant resided, transacted 

business, was found, or had agents in this District, and a substantial portion of the alleged 

activity affected interstate trade and commerce discussed below has been carried out in this 

District. 

13. During the Class Period, Defendant sold B2B Credit Scores in a continuous and 

uninterrupted flow of interstate commerce, including in this District. Defendant’s conduct had 

direct, substantial, and reasonably foreseeable effects on interstate commerce in the United 

States, including in this District. 

14. This Court has in personam jurisdiction over Defendant because it, either directly 

or through the ownership and/or control of its subsidiaries, inter alia: (a) transacted business 

throughout the United States, including in this District; (b) participated in the sale of B2B Credit 

Scores throughout the United States, including in this District; (c) had and maintained 

substantial aggregate contacts with the United States as a whole, including in this District; or (d) 

was engaged in an illegal price-fixing conspiracy or abuse of its monopoly power that was 

directed at, and had a direct, substantial, reasonably foreseeable and intended effect of causing 

injury to, the business or property of persons and entities residing in, located in, or doing 

business throughout the United States, including in this District. Defendant also conducts 

business throughout the United States, including in this District, and has purposefully availed 

itself of the laws of the United States. 

15. By reason of the unlawful activities alleged herein, Defendant substantially affected 

commerce throughout the United States, causing injury to Plaintiff and members of the Class. 

Defendant, directly and through its agents, engaged in activities affecting all states, to restrict 

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output and fix, raise, maintain and/or stabilize prices in the United States for B2B Credit Scores, 

which unreasonably restrained trade and adversely affected the market for B2B Credit Scores. 

16. Defendant’s unlawful conduct described herein adversely affected persons and 

entities in the United States who directly purchased B2B Credit Scores sold by Defendant, 

including Plaintiff and the members of the Class. 

THE PARTIES 

17. Plaintiff Alcoa Community Federal Credit Union is a Federal Credit Union with its 

principal place of business in Benton, Arkansas. Plaintiff makes loans and other credit-related 

facilities available to consumers. During the Class Period, Plaintiff directly purchased B2B 

Credit Scores from Defendant through a Credit Bureau. Plaintiff has been injured in its business 

or property as a proximate result of the unlawful conduct alleged herein. 

18. Defendant Fair Isaac Corporation is a Delaware corporation, with its principal place 

of business in San Jose, California. 

CREDIT BUREAUS 

19. Fair Isaac uses the Credit Bureaus to distribute its B2B Credit Scores to its 

customers. Fair Isaac’s relationship with B2B Purchasers is, therefore, contractually interrelated 

with its relationships with the Credit Bureaus. 

20. When a B2B Purchaser requires a Credit Score, it purchases a report from a Credit 

Bureau, and the Credit Score jointly from Fair Isaac, distributed by the Credit Bureau. Although 

a single transaction may encompass both purchases, the sale of the Fair Isaac Credit Scores to 

B2B Purchasers is made by Fair Isaac. In the alternative, the sale of the Fair Isaac Credit Scores 

is made jointly by both the Credit Bureau and Fair Isaac. 

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21. B2B Purchasers’ contracts for FICO Scores are referenced as Credit Scoring 

Services Agreements (“CSSAs”). CSSAs provide for both the method of payment and fee model 

for the delivery of Credit Score services. They also establish the relationship between Fair Isaac 

and the B2B Purchasers. 

22. For example, the CSSA between Plaintiff and its Credit Bureau, details performance 

due between Plaintiff and Fair Isaac. Plaintiff acknowledges that the FICO Scores are proprietary 

and the intellectual property of Fair Isaac, agrees not to reverse engineer the FICO Scores or 

Models, and agrees only to use them in the manner specifically permitted under the agreement, 

including requiring Plaintiff to explicitly obtain the approval of Fair Isaac for certain uses of the 

FICO Scores. Fair Isaac, in return, grants Plaintiff the limited license for the use of the FICO 

Scores, and issues representations and warranties that the scores are statistically sound and 

empirically derived. Finally, Plaintiff and its Credit Bureau explicitly agree that Fair Isaac has 

unconditional enforceable rights, which survive any termination of the agreement. 

FACTUAL ALLEGATIONS 

Credit Scores 

23. Credit Scores are typically three-digit numbers that are designed to assess credit 

risk. Higher scores generally indicate that a consumer poses less credit risk. Credit Scores are 

produced using credit scoring systems that apply a credit scoring algorithm to a consumer credit 

report. Credit Scores are usually accompanied by “reason codes,” which inform the lender about 

the reasons that contributed most significantly to reducing a particular consumer’s Credit Score. 

24. Credit Scores are the most widely used indicators of consumers’ creditworthiness in 

the United States. Lenders, financial institutions, and other businesses rely on Credit Scores to 

decide whether and on what terms to extend credit to consumers. Consumers, in contrast, rely on 

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Credit Scores to determine whether they will be able to get a mortgage, credit card, auto loan, or 

other credit product and the rate they will pay. 

25. The Credit Bureaus collect and supply aggregated consumer credit data in the form 

of consumer reports. The Credit Bureaus continuously gather credit and financial data about 

consumers from creditors, governmental entities, public records, collection agencies, and other 

third parties. This information is then compiled into a “credit file.” The Credit Bureaus sell credit 

reports, which include information gathered from a consumer’s credit file, to businesses and 

consumers. 

26. While Credit Scores are sometimes sold together with credit reports, credit reports 

are different from Credit Scores and can be sold independently. A credit report is a statement that 

has detailed information about a consumer’s credit activity and current credit situation. A 

consumer’s credit report might, for example, include information about that consumer’s history 

of mortgage payments, credit card balances, credit card payments, and credit inquiries. A Credit 

Score takes the detailed information in a credit report and turns it into a single three-digit 

number. 

Credit Score Markets 

27. There are two distinct markets for Credit Scores in the United States: (1) the B2B 

Credit Score Market and (2) the B2C Credit Score Market. B2B and B2C Credit Scores are 

priced, purchased, and used very differently and serve very different purposes. The lenders, 

financial institutions, and other businesses in the B2B Credit Score Market that purchase and use 

Credit Scores to assess creditworthiness and make decisions about whether and on what terms to 

extend credit or otherwise take on risk do not consider credit reports, insurance scores, or any 

other information about borrowers, to be a substitute for Credit Scores. 

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28. Consumers in the B2C Credit Score Market purchase their own Credit Scores to 

better understand their own creditworthiness and how they likely will be viewed by potential 

lenders. 

29. The United States is the relevant geographic market in which B2B Credit Scores 

are provided. The restraints on competition in the B2B Credit Score Market contained in Fair 

Isaac’s contracts relate to the provision of B2B Credit Scores to businesses throughout the 

United States. 

30. Purchasers in the B2B Credit Score Market are comprised of lenders, financial 

institutions, and other businesses that purchase B2B Credit Scores in order to make risk 

management decisions (“B2B Purchasers”). Lenders, financial institutions, and other businesses 

that purchase Credit Reports from Defendant and/or the Credit Bureaus generally purchase 

Credit Scores in order to determine the credit-worthiness and identity of qualified borrowers to 

whom a preapproved credit offer will be extended (“pre-screening”), make lending decisions 

(“lending”), or review the risk associated with existing borrowers for purposes such as extending 

additional credit or changing other account terms (“account management”). 

31. Customers in the B2C Credit Score Market, in contrast, purchase Credit Scores in 

order to manage their credit, protect their identity, or assess their likelihood of obtaining credit. 

Today, American consumers have signed up for over 160 million credit monitoring or identity 

protection accounts from businesses such as Capital One, Credit Karma, and LifeLock. Many of 

those accounts include access to the consumer’s own Credit Score. 

32. The credit risk scoring industry, industry analysts, policy analysts, and investors 

recognize the B2B Credit Score Market as distinct from the B2C Credit Score Market. Fair Isaac 

also regularly acknowledges that the B2B Credit Score Market is distinct from the B2C Credit 

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Score Market. For example, in its 2019 Form 10-K, Fair Isaac distinguished between its 

“business- to-business scoring solutions and services” and “business-to-consumer scoring 

solutions and services including myFICO solutions for consumers.” 

33. The B2B Credit Score Market is characterized by significant barriers to entry. B2B 

Purchasers encounter significant “switching costs” if they adopt a new Credit Score that has 

different score-to-risk relationships or that uses different reason codes – regardless of whether it 

is an updated version of the score they already use or an entirely new brand of Credit Score 

(unlike consumers in the B2C Credit Score Market). These switching costs arise because 

employees have to be trained in the properties and characteristics of a new score; B2B 

Purchasers must ensure that the new score will be adequately predictive of the creditworthiness 

of their own customer base; B2B Purchasers often conduct extensive, costly, and timeconsuming validation tests to determine whether the new score is cost-effective; and B2B 

Purchasers may need to invest in updating their internal systems to ensure technical 

compatibility between those systems and a new score. 

34. Network effects also characterize the B2B Credit Score Market. For example, in the 

mortgage and auto loan industries the consistent use of particular Credit Scores with similar 

score-to-risk relationships and reason codes facilitates the bundling of large groups of mortgage 

and auto loans from different originators into securities that can be sold to investors. Because of 

the consistent use of a single type of Credit Score, marketing materials for these securities can 

include data on the average and stratified Credit Scores of the borrowers associated with the 

underlying loans. 

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Fair Isaac’s Monopoly Power 

35. Fair Isaac has maintained monopoly power over the B2B Credit Score Market in the 

United States for roughly three decades, largely through the unlawfully achieved dominance of 

its FICO product line, which includes many different types of FICO Scores. Introduced in the 

1980s, Fair Isaac’s “FICO Classic” Credit Scores are the best known and most widely used B2B 

Credit Scores in the United States. FICO Classic applies an algorithm to each Credit Bureau’s 

data and generates a score between 300 and 850 that purports to be an indicator of the 

individual’s credit risk. It also generates a set of “reason codes” that explain the reasons the 

consumer has not been assigned the maximum score. 

36. Fair Isaac advertises its monopoly share of the B2B Credit Score Market. On its 

website, Fair Isaac advertises: 10 billion FICO Scores are sold each year, which is four times the 

number of hamburgers that McDonald’s sells worldwide each year; 27.4 million FICO Scores 

are sold every day, which is over twice the number of cups of coffee Starbucks sells worldwide 

in a day; and 90% of all lending decisions in the United States rely on FICO Scores. 

37. Similarly, in its 2019 Form 10-K, Fair Isaac described its “FICO Scores” as “the 

standard measure in the U.S. of consumer credit risk” and reported that “FICO Scores are used . . 

. by nearly all of the major banks, credit card organizations, mortgage lenders, and auto loan 

originators.” 

38. Fair Isaac representatives have described Fair Isaac’s FICO score as “the 800- 

pound gorilla” in the market for B2B Credit Scores and bragged about Fair Isaac’s 90% market 

share. For example, in November 2017, at the JPMorgan Ultimate Services Investor Conference, 

Fair Isaac’s CFO and Executive Vice President, Michael Pung, stated that Fair Isaac’s FICO 

Scores are: 

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 The “most widely used credit scoring system here in the U.S.”; 

 Used by “[v]irtually every major lender in the U.S.”; and that 

 Fair Isaac has “maintained a 90-plus percent market share for at least . . . 13 

years.” 

39. Fair Isaac representatives have also recognized that FICO Scores have benefited 

from the network effects created by the widespread use of FICO Scores in many industries. For 

example, in November 2011, then-CEO of Fair Isaac, Mark Greene, explained that the “network 

effect” of “FICO Scores . . . being sort of the standard language” and “having everybody . . . 

standardize on a FICO Score, that’s magic.” 

40. Fair Isaac’s monopoly position in the B2B Credit Score Market for Credit Scores 

has given it the power to control prices. Indeed, Fair Isaac’s CEO, Will Lansing, has noted that 

in the B2B Credit Score Market Fair Isaac has “quite a bit of discretion in whether we want our 

margins to be higher or lower or where they are.” Fair Isaac’s monopoly position has also given 

it the power to exclude competition from competitors, such as VantageScore. 

Fair Isaac’s Anticompetitive and Exclusionary Conduct 

41. In March 2006, VantageScore introduced the VantageScore Credit Score and credit 

scoring system. VantageScore is a competitor to FICO Scores in the B2B Credit Score Market. 

42. From the time it was first released in 2006, VantageScore scored millions more 

consumers than the FICO scoring systems. Whereas Fair Isaac’s FICO scoring systems would 

not generate a score if a consumer had not used credit in more than six months or if a credit 

account was fewer than six months old, VantageScore calculated scores for consumers that had 

not used credit for up to two years. It also reached more consumers by using utility and 

telecommunications payment histories when reported to the Credit Bureaus. 

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43. Today, VantageScore scores 30 million more Americans than traditional FICO 

scoring systems. Fair Isaac’s outdated FICO Classic credit scoring systems – which are still used 

by many lenders – exclude many creditworthy Americans that VantageScore can reliably score. 

About one-quarter of American adults – some 65 million people – do not have a traditional FICO 

score. VantageScore is capable of reducing the number of adults without a Credit Score by 

almost half. Ten million of those newly scored individuals are “prime” borrowers that should be 

attractive to traditional lenders. 

44. Without a Credit Score, it is difficult or impossible to apply for or successfully 

obtain a mortgage, car loan, or reasonable interest rates on personal lines of credit. Not having a 

Credit Score can also have drastic effects outside of the credit market. For example, Credit 

Scores are increasingly used by landlords to screen potential tenants. 

45. Those excluded by Fair Isaac’s traditional FICO scoring systems – who face an 

increased risk of being denied access to credit in the form of credit cards, auto and home loans, 

and apartment housing – include disproportionate numbers of low-income and minority 

consumers. 

46. Indeed, one advocacy group focused on making it possible for people with limited 

incomes, especially people of color, to achieve financial security has observed: “Black and 

Hispanic individuals are . . . significantly more likely than white individuals to be credit 

invisible” – meaning that they have “no established credit history,” are “unscored,” and “lack[] 

sufficient or recent enough credit history to be given a [FICO] Credit Score.” VantageScore 

calculates a score for 9.5 million Hispanic and Black consumers who do not have a FICO score, 

including 2.7 million minority consumers who should be considered “prime” borrowers. 

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47. Despite the potential advantages of using VantageScore, Fair Isaac continues to 

maintain its monopoly and monopoly power in the B2B Credit Score Market. In February 2013, 

at a Morgan Stanley Conference, Fair Isaac’s CEO, Will Lansing, explained that despite the 

existence of VantageScore, “there [is] not that much competition around our [B2B] scores 

business” because “FICO scores are very much part of the fabric of the banking industry” and 

“really deeply imbedded.” 

48. Fair Isaac has used its monopoly power to coordinate a multi-faceted campaign to 

prevent and eliminate competition from VantageScore and/or other competitors. Fair Isaac has 

been explicit that this is its goal. In April 2015, Will Lansing informed investors on a quarterly 

earnings conference call that Fair Isaac’s strategic goal was to ensure that “the entire industry 

adopts FICO scores instead of [other] scores.” To achieve this goal, Fair Isaac has enlisted the 

Credit Bureaus to agree to anticompetitive contract terms that: prevent them from developing or 

selling alternative Credit Scores that could be seamlessly integrated into many lenders’ systems 

or used interchangeably with FICO Scores; prevent them from competing with each other to 

negotiate better terms from FICO; and create a pricing scheme that effectively forecloses B2B 

Purchasers from choosing to use FICO Scores in their lending decisions at the same time as 

providing customers with a competing Credit Score, including VantageScore. Fair Isaac also has 

waged a media campaign against VantageScore that makes false and misleading statements 

about the quality and reliability of VantageScore’s Credit Score product. By its anticompetitive 

and exclusionary conduct, Fair Isaac has injured competition in the B2B Credit Score Market, 

increased prices for Plaintiff and the Class, and limited access to credit for millions of 

consumers. 

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Exclusion of Other Credit Scores 

49. Fair Isaac has imposed a similar or identical No Equivalent Products clause on each 

of the Credit Bureaus. By imposing a No Equivalent Products term, Fair Isaac has sought to 

block the Credit Bureaus from offering alternative Credit Score products, such as VantageScore, 

that would allow B2B Purchasers to easily switch from FICO Scores to VantageScore without 

incurring the cost of redesigning their lending programs and systems, or to use VantageScore 

alongside or interchangeably with FICO Scores. The Credit Bureaus have agreed to these 

anticompetitive terms, with the resulting anticompetitive effects. 

50. The No Equivalent Products clause provides that a Credit Bureau may not internally 

develop a credit scoring system that is aligned to the odds-to-score relationship of any Fair Isaac 

Analytic or that uses more than a limited number of reason codes that “match” reason codes used 

by any Fair Isaac Analytic. It also prohibits a Credit Bureau from distributing any competing 

analytic (i.e., credit scoring system) that is aligned with FICO Scores or uses too many of the 

same reason codes, and the clause expressly names VantageScore Solutions LLC as a developer 

of such a scoring system that may not be distributed if VantageScore were to offer an 

“Equivalent Product.” 

51. For example, if a competing Credit Score product used a 700 score to indicate a 

less-than-five-percent risk of credit delinquency, and if a 700 FICO score also indicated the same 

risk of delinquency, then the No Equivalent Products clause prevents a Credit Bureau from 

distributing the competing product. Similarly, if a competing Credit Score product used reason 

codes that match 20% or more of the reason codes used by FICO scoring systems, the No 

Equivalent Products clause prohibits a Credit Bureau from distributing the product. 

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52. The No Equivalent Products clause effectively prevents a Credit Bureau from 

developing (contrary to the original goal of VantageScore and the easy ability to do so) or selling 

an alternative to FICO’s Credit Scores that would (i) be compatible with many B2B Purchasers’ 

systems, models, and processes; and (ii) allow B2B Purchasers to have a legitimate choice 

between using FICO Scores and an alternative score. Many B2B Purchasers have spent 

substantial effort and resources to develop systems, models, and processes that are designed for 

FICO Scores. B2B Purchasers’ systems, models, and processes are tailored to FICO’s odds-toscore relationship (i.e., each given score has a given ratio of non-defaulting consumers to 

defaulting consumers), and reason codes (the particular reasons cited for increased risk of 

default). For example, a bank’s software might be designed to accept one or more FICO Scores 

and reason codes, combine this information with data it collects internally, and automatically 

produce a lending decision. 

53. The No Equivalent Products clause protects and sustains Fair Isaac’s monopoly 

power. The odds-to-score relationship is an arbitrary mapping between risk and score and does 

not reflect protectable intellectual property. Similarly, the reason codes that may not be used by 

an Equivalent Product were not invented by Fair Isaac but reflect well-established industry best 

practices for lending. 

Bundling and Penalty Pricing 

54. Fair Isaac’s contracts with each Credit Bureau include a similar or identical 

Dynamic Royalty Schedule clause and a similar or identical Pre-Qualification royalty category. 

Through the Pre-Qualification royalty category, Fair Isaac has effectively foreclosed lenders 

from purchasing and using a FICO score in their lending decision while also providing a 

consumer with a competing Credit Score, which drives lenders to exclusively purchase Fair 

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Isaac’s FICO Scores and not purchase competing Credit Scores. As a consequence of Fair 

Isaac’s imposition of the Pre-Qualification royalty category, VantageScore has lost sales of 

Credit Scores to major banks to provide to consumers. 

55. In 2015, Fair Isaac and the Credit Bureaus agreed to a new Pre-Qualification royalty 

category, which Fair Isaac defines as an End User’s qualification of a potential consumer 

customer for an End User’s own internal lending offering. This royalty category distinguishes 

between: (1) lenders that use FICO Scores for Pre- Qualification without providing any Credit 

Score or credit data to consumers; and (2) lenders that use FICO Scores for Pre-Qualification 

while also providing Credit Scores or credit data to consumers in connection with the PreQualification. Certain banks and lenders offer consumers opportunities to apply to qualify for 

credit opportunities (e.g., a credit card or loan) and, at the same time, receive their personal 

Credit Score. The offer of a free Credit Score to a consumer can entice consumers to apply for 

credit opportunities. 

56. The royalty price associated with a FICO score used for Pre-Qualification depends 

on whether other Credit Scores or credit data are provided to consumers. If a lender purchases a 

FICO score for use in Pre-Qualification and does not provide any Credit Score or credit data to 

the consumer “in connection” with the Pre-Qualification, there is one per-score royalty rate. If 

the lender purchases a FICO score for use in Pre-Qualification and provides any other Credit 

Score (such as a VantageScore) to the consumer in connection with the Pre- Qualification, there 

is a different per-score royalty rate that is higher – a penalty rate. 

57. The penalty rate can be avoided in one of two ways, both of which involve 

purchasing exclusively FICO Scores. First, the B2B Purchaser could purchase a FICO score for 

use in “Pre-Qualification” and provide no Credit Score or credit data to the consumer. Second, 

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the B2B Purchaser could purchase a bundled FICO product from Fair Isaac. Fair Isaac offers 

bundled products to lenders that combine the use of scores by lenders with the provision of 

scores to consumers. 

58. There is no legitimate business justification for the penalty rate agreed upon by Fair 

Isaac and the Credit Bureaus when the lender also purchases any other Credit Score to disclose to 

consumers. The transparent purpose of the Pre-Qualification royalty category is to drive all B2B 

Purchasers engaging in Pre-Qualification to purchase exclusively FICO Scores and make it costprohibitive for B2B Purchasers engaging in Pre-Qualification to purchase a competing Credit 

Score for disclosure to consumers. This scheme has been effective, and few, if any, B2B 

Purchasers have opted to pay the penalty rate. 

Fair Isaac’s Prices are Supracompetitive 

59. Fair Isaac’s Level Playing Field requires that pricing made available to one Credit 

Bureau be made available to the other Credit Bureaus. Taken together, the Dynamic Royalty 

Schedule and the Level Playing Field clauses enable Fair Isaac to increase above the competitive 

level the royalty prices it charges for FICO Scores. Fair Isaac’s contracts with TransUnion, 

Equifax, and Experian include similar or identical Level Playing Field and Dynamic Royalty 

Schedule provisions. 

60. Fair Isaac has used the Level Playing Field and Dynamic Royalty Schedule 

provisions in its contracts with the Credit Bureaus to extract supracompetitive monopoly prices 

from B2B Purchasers. These provisions disincentivize a Credit Bureau from negotiating for 

lower pricing terms because each knows that even if it succeeds, it will not gain a competitive 

advantage over the other Credit Bureaus. 

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Fair Isaac’s Disparagement of VantageScore 

61. Despite having successfully induced the Credit Bureaus to agree with Fair Isaac to 

restrain VantageScore’s ability to compete with FICO, Fair Isaac has gone further and has waged 

an aggressive campaign to spread false and disparaging statements about VantageScore and 

mislead B2B Purchasers about the qualities and characteristics of FICO Scores and 

VantageScore. In advertisements, letters, and blog posts, Fair Isaac has disparaged VantageScore 

by calling it a “Fako” score, falsely claimed that VantageScore is an unreliable measure of 

creditworthiness, and misrepresented the information considered by VantageScore’s credit 

scoring system. 

62. On December 12, 2017, Fair Isaac took out a full-page advertisement in The Wall 

Street Journal addressed to “Lenders, Policymakers and Consumer Advocates” that disparaged 

VantageScore without identifying it by name. The advertisement contrasted Fair Isaac, which “is 

not owned by the credit bureaus” and whose FICO Scores have been used “by lenders and 

securitization investors for decades,” with an alternative Credit Score, which is “owned by the 

credit bureaus,” is less reliable than FICO Scores in evaluating credit risk, and fails to use “sound 

practices” or “science-based credit evaluation.” To anyone familiar with the market for Credit 

Scores, the advertisement unambiguously conveys the false message that VantageScore is 

“[w]eakening scoring standards, [and] harm[ing] consumers, and the lending system,” 

particularly in the B2B Credit Score Market. 

63. The Wall Street Journal advertisement directed readers to “Learn more at 

FICO.com/independent,” a Fair Isaac-owned website that connects visitors to articles and blog 

posts that disparage VantageScore by name. One such blog post asserts: “Despite claims by 

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VantageScore, weakening the minimum scoring criteria will not empower millions of low-risk 

mortgage credit seekers.” 

64. Moreover, the implication that FICO Classic scoring systems provide Credit Scores 

for as many consumers as VantageScore is false and misleading. VantageScore provides Credit 

Scores for millions of American consumers that are not scored by FICO Classic scoring systems. 

65. Fair Isaac’s website includes numerous posts disparaging VantageScore and making 

false or misleading statements about VantageScore’s features. For example, one blog post claims 

that “[r]esearch results consistently showed that scoring models relying solely on sparse or old 

credit data were weak and did a poor job forecasting future performance.” This statement is false 

and misleading because it conveys the message that VantageScore’s scoring model is “weak” 

and does a “poor job forecasting future performance” because it considers a consumer’s full 

credit history even if the consumer has not used a traditional credit line in the last six months. In 

fact, studies have shown that VantageScore is strongly predictive. 

66. Another blog post claims that whereas “FICO Score 9 differentiates medical from 

non-medical collections,” “VantageScore does not.” This statement conveys the false message 

that VantageScore does not differentiate medical from non-medical collections. In fact, 

VantageScore 3.0 was the first credit scoring system to address medical debt. VantageScore 4.0, 

the most recent version of VantageScore, distinguishes medical collection accounts from nonmedical collection accounts and penalizes medical collections less than non-medical ones. 

67. Fair Isaac’s campaign against VantageScore is not new. In 2006, just months after 

the launch of VantageScore, Fair Isaac filed a meritless lawsuit against the Credit Bureaus and 

VantageScore in the United States District Court for the District of Minnesota. See Fair Isaac 

Corporation v. Equifax Inc., No. 06-cv-04112 (D. Minn.). This was the monopolist’s first 

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attempt to kill the nascent competitor. Fair Isaac’s numerous claims included a claim that the 

development of VantageScore violated the antitrust laws and a claim that the development of 

VantageScore constituted trademark infringement. In its prayer for relief, Fair Isaac sought 

nothing less than the end of VantageScore: it requested that the “Defendants be ordered to 

dissolve VantageScore.” 

68. All of Fair Isaac’s claims failed. In fact, the jury concluded that Fair Isaac was the 

wrongdoer. In support of its trademark infringement claim, Fair Isaac had alleged that 

VantageScore’s use of a scoring range of 501-990 constituted trademark infringement because it 

was similar to FICO’s scoring range of 300-850. The Credit Bureaus and VantageScore 

counterclaimed for fraud on the United States Patent and Trademark Office (“PTO”), alleging 

that Fair Isaac had misrepresented to the PTO that only FICO used the 300-850 score range. The 

jury concluded that Fair Isaac had committed fraud on the PTO by making false statements as 

part of its application to register the score range of 300-850 as a trademark. 

69. The public statements described in the foregoing paragraphs were transmitted to and 

seen by a substantial number of businesses and consumers nationwide. 

Harm to Competition 

70. Fair Isaac’s campaign of anticompetitive and exclusionary conduct to maintain and 

expand its monopoly power has harmed and continues to harm competition and participants in 

the B2B Credit Score Market. Fair Isaac’s unlawful conduct, including that which has been taken 

in concert with the Credit Bureaus, has foreclosed competition in the B2B Credit Score Market 

by restraining the Credit Bureaus from selling VantageScore or any other competitive products. 

The anticompetitive and exclusionary conduct has allowed Fair Isaac to maintain its monopoly 

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power and charge supracompetitive monopoly prices for B2B Credit Scores to B2B Purchasers 

during the Class Period. 

71. Fair Isaac’s conduct, in concert with the Credit Bureaus, has reduced choice for 

B2B Purchasers. The anticompetitive terms to which Fair Isaac and the Credit Bureaus agreed 

have frustrated the ability of B2B Purchasers to purchase VantageScore or any other competitive 

Credit Score that could be seamlessly integrated into lenders’ existing processes and systems. 

Fair Isaac’s disparagement campaign against VantageScore has been successful in sowing fear, 

uncertainty, and doubt about VantageScore in the marketplace and has resulted in fewer sales by 

VantageScore and a lesser degree of competition from VantageScore. 

72. Media sources, financial blogs, and consumers have absorbed Fair Isaac’s false and 

disparaging message that VantageScore is a “Fako” score merely because it is not a FICO score. 

For example, thebalance.com – a website devoted to personal finance issues – posted in February 

2017, and continues to display as of the date of this filing: “If you purchased your Credit Score 

anywhere but MyFICO.com, then it’s a Fako score.” 

FRAUDULENT CONCEALMENT AND TOLLING 

73. A cause of action accrued for Plaintiff each time Fair Isaac and/or a Credit Bureau 

sold a B2B Credit Score to plaintiff at a supracompetitive price made possible by their 

anticompetitive conduct. Each such sale constituted an overt act in furtherance of their 

anticompetitive scheme. Accordingly, Plaintiff is entitled to recover all damages on all sales that 

Fair Isaac and/or its co-conspirators made to Plaintiff at supracompetitive prices within four 

years of the filing of this action. 

74. Due to Fair Isaac’s concealment of its unlawful conduct, however, Plaintiff and 

members of the Class are entitled to recover damages reaching back even beyond the four-year 

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statute of limitations period. Fair Isaac’s violations were not reasonably discoverable until 

February 12, 2018, when TransUnion disclosed the misconduct in a suit against Fair Isaac. 

Plaintiff and members of the Class had no knowledge of the unlawful self-concealing scheme 

and could not have discovered the scheme and conspiracy through the exercise of reasonable 

diligence more than four years before the filing of this action. 

75. That is true, at least in part, because the nature of the scheme was self-concealing 

and because Fair Isaac employed deceptive tactics and techniques of secrecy to avoid detection 

of, and to conceal, its scheme. 

76. Because the scheme was both self-concealing and affirmatively concealed by Fair 

Isaac, Plaintiff and members of the Class had no knowledge of the scheme more than four years 

before the filing of this complaint; nor did they have the facts or information that would have 

caused a reasonably diligent person to investigate. 

77. Plaintiff and members of the class also lacked the facts and information necessary to 

form a good faith basis for believing that any legal violations had occurred. Reasonable diligence 

on the part of Plaintiff and members of the class would not have uncovered those facts more than 

four years before the filing of this complaint. 

78. As a result of Fair Isaac’s fraudulent concealment, all applicable statutes of 

limitations affecting Plaintiff’s and class members’ claims have been tolled. 

79. The federal government’s antitrust investigation of Fair Isaac’s unlawful conduct 

also tolls any federal statute of limitations pursuant to 15 U.S.C. § 16. 

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CLASS ALLEGATIONS 

80. Plaintiff brings this action on behalf of itself and all others similarly situated 

pursuant to Rule 23 of the Federal Rules of Civil Procedure as representative of a class (the 

“Class”) defined as follows: 

All persons or entities in the United States and its territories that purchased B2B 

Credit Scores directly from Fair Isaac and/or a Credit Bureau, or any of their 

respective divisions, subsidiaries, predecessors, or affiliates, during the period 

from January 1, 2006, through such time as the effects of Fair Isaac’s illegal 

conduct have ceased, and excluding all governmental entities, Fair Isaac, and Fair 

Isaac’s divisions, subsidiaries, predecessors, and affiliates. 

81. On information and belief, hundreds or thousands of entities in the U.S. have 

purchased B2B Credit Scores directly from Fair Isaac and/or its co-conspirators, the Credit 

Bureaus. Thus, the Class is so numerous that joinder is impracticable. 

82. Plaintiff’s claims are typical of those of the Class. 

83. Plaintiff and all members of the Class were injured in the form of overcharges by 

the same conduct of the Defendant. 

84. Plaintiff will fairly and adequately protect and represent the interests of the Class. 

The interests of the Plaintiff are not antagonistic to the Class. 

85. Plaintiff is represented by counsel who are experienced and competent in the 

prosecution of complex class action antitrust litigation. 

86. Questions of law and fact common to the members of the Class predominate over 

questions, if any, that may affect only individual members because Fair Isaac has acted and 

refused to act on grounds generally applicable to the entire Class. Such generally applicable 

conduct is inherent in Fair Isaac’s exclusionary and anticompetitive conduct in monopolizing and 

attempting to monopolize the B2B Credit Score Market, as more fully alleged herein. 

87. Questions of law and fact common to the Class include: 

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a. whether Fair Isaac intentionally and unlawfully impaired or impeded competition 

in the B2B Credit Score Market; 

b. whether Fair Isaac maintained or enhanced monopoly power in the B2B Credit 

Score Market through anticompetitive or exclusionary conduct; 

c. whether Fair Isaac engaged in anticompetitive conduct in order to unlawfully 

disadvantage its competitors and maintain monopoly power in the B2B Credit 

Score Market; 

d. whether Fair Isaac had and has monopoly power in the B2B Credit Score Market; 

e. whether Fair Isaac had any legitimate, procompetitive reasons for its conduct; 

f. the effects of Fair Isaac’s anticompetitive conduct on in the B2B Credit Score 

prices; 

g. whether Plaintiff and other members of the Class have been overcharged and thus 

damaged by paying artificially inflated prices for B2B Credit Scores as a result of 

Fair Isaac’s unlawful behavior; and 

h. the proper measure of damages. 

88. Class action treatment is a superior method for the fair and efficient adjudication of 

the controversy in that, among other things, such treatment will permit a large number of 

similarly situated persons to prosecute their common claims in a single forum simultaneously, 

efficiently, and without the unnecessary duplication of effort and expense that numerous 

individual actions would engender. The benefits of proceeding through the class mechanism, 

including providing injured persons or entities with a method for obtaining redress for claims 

that might not be practicable for them to pursue individually, substantially outweigh any 

difficulties that may arise in management of this class action.

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89. Plaintiff knows of no difficulty to be encountered in the maintenance of this action 

as a class action. 

CLAIMS FOR RELIEF

COUNT 1 

Violation of Section 2 of the Sherman Act: Monopolization 

90. Plaintiff incorporates by reference the allegations contained in the preceding 

paragraphs as if fully set forth herein. 

91. The relevant product market is the market for the sale of B2B Credit Scores. 

92. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

93. The B2B Credit Score Market in the United States is the relevant market. 

94. Fair Isaac has had and continues to have at least a 90% market share in the B2B 

Credit Score Market in the United States. 

95. Fair Isaac has had and continues to have monopoly power in the B2B Credit Score 

Market. 

96. Fair Isaac has had and continues to have the power to control prices or exclude 

competition in the B2B Credit Score Market. 

97. Through unlawful, interconnected, and mutually reinforcing anticompetitive and 

exclusionary acts and agreements, Fair Isaac has substantially foreclosed competition in the 

market for B2B Credit Scores in the United States in violation of Section 2 of the Sherman Act, 

15 U.S.C. §2. 

98. Fair Isaac has demonstrated its ability to control prices and exclude competition by 

raising prices without a corresponding increase in demand and to supracompetitive levels. 

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99. Fair Isaac’s monopoly power is not due to growth or development because of a 

superior product, business acumen, or historic accident. 

100. Fair Isaac’s acts of monopolization have injured and will continue to injure 

competition in the relevant market. 

101. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

102. The anticompetitive conduct raised the prices for FICO Scores above the 

competitive level and otherwise injured competition without any offsetting procompetitive 

benefit to consumers. 

103. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 2 of the Sherman Act within the meaning of 

Section 4 of the Clayton Antitrust Act, 15 U.S.C. §15. 

104. Plaintiff and members of the Class are threatened with future injury to their business 

and property by reason of Defendant’s continuing violation of Section 2 of the Sherman Act 

within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. § 26. 

COUNT 2 

Violation of Section 2 of the Sherman Act: Conspiracy to Monopolize 

105. Plaintiff incorporates by reference the allegations contained in the preceding 

paragraphs as if fully set forth herein. 

106. The relevant product market is the market for the sale of B2B Credit Scores. 

107. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

108. The B2B Credit Score Market in the United States is the relevant market. 

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109. Fair Isaac has had and continues to have at least a 90% market share in the B2B 

Credit Score Market. 

110. Fair Isaac has had and continues to have monopoly power in the B2B Credit Score 

Market. 

111. Fair Isaac has demonstrated its ability to control prices and exclude competition by 

raising prices without a corresponding increase in demand and to supracompetitive levels. 

112. Through unlawful, interconnected, and mutually reinforcing anticompetitive and 

exclusionary acts and agreements, Fair Isaac has substantially foreclosed competition in the 

market for B2B Credit Score Market in the United States in violation of Section 2 of the 

Sherman Act, 15 U.S.C. §2. 

113. Fair Isaac combined, conspired or agreed with the Credit Bureaus so as to maintain 

its monopoly power in the B2B Credit Score Market. Fair Isaac created and maintained this 

conspiracy through a series of agreements with the Credit Bureaus. In these agreements, the 

Credit Bureaus and Fair Isaac agreed that the Credit Bureaus would not offer or sell 

VantageScore or any other competing Credit Score to Plaintiff and members of the Class. Fair 

Isaac and the Credit Bureaus further agreed that the Credit Bureaus would act as Fair Isaac’s 

agent in the sale of FICO Scores to Plaintiff and members of the Class. 

114. These agreements foreclosed competition in a substantial portion of the B2B Credit 

Score Market and unlawfully maintained Fair Isaac’s monopoly, resulting in Fair Isaac 

extracting supracompetitive prices for FICO Scores from Plaintiff and members of the Class. 

115. Fair Isaac’s monopoly is not due to growth or development because of a superior 

product, business acumen, or historic accident. 

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116. Fair Isaac’s conspiracy to monopolize has injured and will continue to injure 

competition in this market. 

117. Fair Isaac has acted with the specific intent of monopolizing the market for B2B 

Credit Scores in the United States. 

118. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

119. The conspiracy raised the prices for FICO Scores above the competitive level and 

otherwise injured competition without any offsetting procompetitive benefit to consumers. 

120. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 2 of the Sherman Act within the meaning of 

Section 4 of the Clayton Antitrust Act, 15 U.S.C. § 15. 

121. Plaintiff and members of the Class are threatened with future injury to their business 

and property by reason of Defendant’s continuing violation of Section 2 of the Sherman Act 

within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. § 26. 

COUNT 3 

Violation of Section 2 of the Sherman Act: Attempt to Monopolize 

122. Plaintiff incorporates by reference the allegations contained in the preceding 

paragraphs as if fully set forth herein. 

123. Fair Isaac’s actions as alleged herein constitute attempted monopolization in 

violation of Section 2 of the Sherman Antitrust Act. 

124. Fair Isaac’s activities as alleged herein were and are within the flow of interstate and 

foreign commerce and have substantially adversely affected interstate and foreign commerce. 

125. The relevant product market is the market for the sale of B2B Credit Scores. 

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126. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

127. The B2B Credit Score Market in the United States is the relevant market. 

128. Fair Isaac has had and continues to have at least a 90% market share in the B2B 

Credit Score Market in the United States. 

129. Fair Isaac’s conduct was specifically intended to acquire monopoly power in the 

relevant market. Fair Isaac has acted with the specific intent of monopolizing the market for B2B 

Credit Scores in the United States. 

130. There is a dangerous probability that Fair Isaac will succeed in obtaining monopoly 

power in the relevant market. 

131. Fair Isaac’s monopoly power is not due to growth or development because of a 

superior product, business acumen, or historic accident. 

132. Fair Isaac’s attempt to monopolize has injured and will continue to injure 

competition in this market. 

133. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s attempt to monopolize the relevant market. 

134. Plaintiff and members of the Class are threatened with future injury to their business 

and property by reason of Defendant’s continuing violation of Section 2 of the Sherman Act 

within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. § 26. 

COUNT 4 

Violation of Section 1 of the Sherman Act: Unreasonable Restraint of Trade 

135. Plaintiff incorporates by reference the allegations contained in the preceding 

paragraphs as if fully set forth herein. 

136. The relevant product market is the market for the sale of B2B Credit Scores. 

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137. The relevant geographic market for the sale of B2B Credit Scores is the United 

States. 

138. The B2B Credit Score Market in the United States is the relevant market. 

139. Fair Isaac had and continues to have at least a 90% market share in the B2B Credit 

Score Market in the United States. 

140. Fair Isaac has had and continues to have monopoly power in the B2B Credit Score 

Market. 

141. Fair Isaac has had and continues to have the power to control prices or exclude 

competition in the relevant market. 

142. Fair Isaac entered into agreements with TransUnion, Experian, and Equifax that 

contained anticompetitive and exclusionary terms whereby each Credit Bureau agreed not to 

offer or sell VantageScore as a competing product to Plaintiff and members of the Class. 

143. The agreements between Fair Isaac and the Credit Bureaus had substantial 

anticompetitive effects. The agreements excluded VantageScore, a significant competitor, from a 

substantial portion of competition in the B2B Credit Score Market. 

144. The agreements raised the price for FICO Scores above the competitive level and 

otherwise injured competition without any offsetting procompetitive benefit to consumers. 

145. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate 

commerce and injure competition nationwide. 

146. Plaintiff and members of the Class continue to suffer damage, and will continue to 

do so, if Fair Isaac does not cease its anticompetitive conduct. 

147. Plaintiff and members of the Class have been injured in their business or property 

by reason of Defendant’s violation of Section 1 of the Sherman Act, within the meaning of 

Section 4 of the Clayton Antitrust Act, 15 U.S.C. §15. 

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148. Plaintiff and members of the Class are threatened with future injury to their business 

and property by reason of Defendant’s continuing violation of Section 1 of the Sherman Act, 

within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. § 26. 

COUNT 5 

Violations of State Antitrust Laws 

149. Plaintiff incorporates by reference the allegations contained in the preceding 

paragraphs as if fully set forth herein. 

150. By reason of the foregoing, Defendant has violated, and Plaintiff and members of 

the Class are entitled to relief under, the antitrust laws of the States of Arizona, California, 

Connecticut, Hawaii, Illinois, Iowa, Kansas, Maine, Maryland, Michigan, Minnesota, 

Mississippi, Nebraska, Nevada, New Mexico, New York, North Carolina, North Dakota, 

Oregon, Rhode Island, South Dakota, Tennessee, Utah, Vermont, West Virginia, and Wisconsin, 

as well as the District of Columbia, as follows: 

a. Arizona Revised Statutes § 44-1401, et seq.; 

b. California Cartwright Act, California Business & Professions Code § 16700, et 

seq.; 

c. Connecticut Antitrust Act, Conn. Gen. Stat. 35-24, et seq.; 

d. District of Columbia Code § 28-4501, et seq.; 

e. Hawaii Revised Statutes § 480-2, et seq.; 

f. Illinois Antitrust Act, Illinois Complied Statutes § 740, Ill. Comp. Stat. 1011, et 

seq.; 

g. Iowa Competition Law, Iowa Code § 553.1, et seq.; 

h. Kansas Statutes Annotated § 50-101, et seq.; 

i. Maine Revised Statutes Annotated, tit. 10, § 1101, et seq.; 

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j. Maryland Code Annotated, Commercial Law, § 11-204, et seq.; 

k. Michigan Compiled Laws § 445.771, et seq.; 

l. Minnesota Antitrust Law of 1971, Minnesota Statutes § 325D.49, et seq.; 

m. Mississippi Code Annotated § 75-21-1, et seq.; 

n. Nebraska Revised Statutes § 59-801, et seq.; 

o. Nevada Revised Statutes Annotated § 598A.010, et seq.; 

p. New Mexico Statutes Annotated § 57-1-1, et seq.; 

q. New York Donnelly Act, New York General Business Law § 340, et seq.; 

r. North Carolina General Statutes § 75-1, et seq.; 

s. North Dakota Century Code § 51-08.1-01, et seq.; 

t. Oregon Revised Statutes § 646.705, et seq.; 

u. Rhode Island General Laws § 6-36-4, et seq.; 

v. South Dakota Codified Laws § 37-1-3.1, et seq.; 

w. Tennessee Code Annotated § 47-25-101, et seq.; 

x. Utah Code Annotated § 76-10-3104, et seq.; 

y. Vermont Statutes Annotated, tit. 9, § 2451, et seq.; 

z. West Virginia Code § 47-18-1, et seq.; and 

aa. Wisconsin Statutes § 133.01, et seq. 

COUNT 6 

Violation of State Unfair Trade Practices Laws 

151. Plaintiff incorporates by reference the allegations contained in the preceding 

paragraphs as if fully set forth herein. 

152. By reason of the foregoing, Defendant has violated, and Plaintiff and members of 

the Class are entitled to relief under, the Unfair Trade Practices and Consumer Protection Laws 

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of the States of Arkansas, California, Connecticut, Florida, Massachusetts, Missouri, Montana, 

New Mexico, New York, North Carolina, Rhode Island, South Carolina, and Vermont, as well as 

the District of Columbia, as follows: 

a. Arkansas Code Annotated, § 4-88-101, et seq.; 

b. California Business and Professions Code § 17200, et seq.; 

c. Connecticut Unfair Trade Practices Act, Conn Gen. Stat. § 42-110a, et seq.; 

d. District of Columbia Code § 28-3901, et seq.; 

e. Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. § 501.201, et seq.; 

f. Massachusetts Consumer Protection Act, Mass. Gen. L. Ch. 93A, et seq.; 

g. Missouri Merchandising Practices Act, Mo. Rev. Stat. § 407.010, et seq.; 

h. Montana Code, § 30-14-103, et seq., and § 30-14-201, et seq.; 

i. New Mexico Statutes Annotated § 57-12-1, et seq.; 

j. New York General Business Law § 349, et seq.; 

k. North Carolina General Statutes § 75-1.1, et seq.; 

l. Rhode Island General Laws § 6-13.1-1, et seq.; 

m. South Carolina Code Annotated § 39-5-10, et seq.; and 

n. Vermont Statutes Annotated, tit. 9, § 2451, et seq. . 

PRAYER FOR RELIEF 

 WHEREFORE, Plaintiff prays for relief and judgment as follows:

A. The Court determine that this action may be maintained as a class action pursuant 

to Federal Rule of Civil Procedure 23, that Plaintiff be appointed as class representative, and that 

Plaintiff’s counsel be appointed as counsel for the Class; 

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B. The conduct alleged herein be declared, adjudged, and/or decreed to be unlawful 

under Section 1 and Section 2 of the Sherman Act, 15 U.S.C. §§ 1 and 2. 

C. Plaintiff and the Class recover their overcharge damages, trebled, and the costs of 

the suit, including reasonable attorneys’ fees as provided by law; and 

D. Plaintiff and the Class be granted such other, further, and different relief as the 

nature of the case may require or as may be determined to be just, equitable, and proper by this 

Court. 

JURY DEMAND 

 Plaintiff demands trial by jury of all issues so triable. 

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Dated: April 27, 2020 Respectfully submitted, 

 /s/ Paul E. Slater . 

Paul E. Slater 

Joseph M. Vanek 

Michael G. Dickler 

Matthew T. Slater 

SPERLING & SLATER 

55 West Monroe Street 

Suite 3200 

Chicago, IL 60603 

(312) 641-3200 

pes@sperling-law.com 

jvanek@sperling-law.com 

mdickler@sperling-law.com 

mslater@sperling-law.com 

 Linda P. Nussbaum 

Bart D. Cohen 

NUSSBAUM LAW GROUP, P.C. 

1211 Avenue of the Americas, 40th Floor 

New York, NY 10036 

(917) 438-9102 

lnussbaum@nussbaumpc.com 

bcohen@nussbaumpc.com 

Michael L. Roberts 

Karen Sharp Halbert 

ROBERTS LAW FIRM, P.A. 

20 Rahling Circle 

Little Rock, AR 72223 

(501) 821-5575 

mikeroberts@robertslawfirm.us 

karenhalbert@robertslawfirm.us 

Counsel for Plaintiff Alcoa Community 

Federal Credit Union and the Proposed Class

 

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EXHIBIT E 

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

Getten Credit Company, individually and

on behalf of all others similarly situated,

Plaintiff,

v.

FAIR ISAAC CORPORATION,

Defendant.

Civil Action No.

CLASS ACTION COMPLAINT

DEMAND FOR JURY TRIAL

Plaintiff Getten Credit Company brings this class action complaint against Defendant

Fair Isaac Corporation (“Fair Isaac”), on behalf of itself and all entities who paid for a FICO

Score from Defendant and/or a credit bureau in the U.S. from at least as early as January 1, 2006

until the present (the “Class Period”) for commercial use. Plaintiff brings this action under the

Sherman Act and various state antitrust laws against Fair Isaac for injunctive relief and damages,

and demands a trial by jury. Based upon personal knowledge, information and belief,

investigation by counsel, proceedings and admissions made in Fair Isaac Corp. v. Trans Union

LLC, 17-cv-08318 (N.D. Ill.), and related ongoing federal government investigations, Plaintiff

alleges:

NATURE OF ACTION

1. Plaintiff is informed and believes, and thereon alleges, that Fair Isaac has

monopolized, conspired to monopolize, and unreasonably restrained trade in the business-tobusiness market for supplying credit scores to lenders, financial institutions, and other businesses

for risk management decisions ( the “B2B Credit Score Market”).

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2. Fair Isaac’s ubiquitous credit scoring model known as the FICO Score is what

most businesses use to size up the creditworthiness of consumers. Fair Isaac’s FICO Scores have

dominated the market for almost three decades. Defendant has, as its executives have touted,

been able to maintain a 90-plus percent market share in the B2B Credit Score Market for at least

13 years. Defendant achieved this by abusing its illegal monopoly and engaging in

anticompetitive conduct including, but not limited to, exclusionary agreements with credit

bureaus and other distributors of Defendant’s FICO Scores and false and misleading media

campaigns against its competitors.

3. As a result of its illegal actions, Defendant’s unlawful monopoly share has

suppressed competition, stymied innovation, limited access to credit for millions of Americans,

and increased the prices of FICO Scores to the detriment of Plaintiff and Class members.

4. On March 15, 2020, Fair Isaac disclosed in a press release that the Antitrust

Division of the United States Department of Justice had opened an investigation based at least in

part on the exclusionary conduct alleged herein.

JURISDICTION AND VENUE

5. This action arises under sections 1 and 2 of the Sherman Act (15 U.S.C. §§ 1 and

2) and section 4 of the Clayton Act (15 U.S.C. § 15(a)) and seeks to recover treble damages,

costs of suit, and reasonable attorneys’ fees for the injuries sustained by Plaintiff and members of

the Class resulting from Fair Isaac’s anticompetitive conduct. The Court has subject matter

jurisdiction under 28 U.S.C. §§ 1331, 1337(a), 1407, and 15 U.S.C. § 15.

6. Venue is proper in this District pursuant to 15 U.S.C. §§ 15(a), 22 and 28 U.S.C.

§§ 1391(b), (c), and (d) because during the Class Period, the Defendant resided, transacted

business, was found, or had agents in this District, and a substantial portion of the alleged

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activity affected interstate trade and commerce discussed below has been carried out in this

District.

7. During the Class Period, Defendant’s conduct was within the flow of, was

intended to, and did, in fact, have a substantial effect on the interstate commerce of the United

States, including in this District.

8. During the Class Period, Defendant used the instrumentalities of interstate

commerce, including interstate wires, wireless spectrum, and the U.S. mail, to effectuate its

illegal scheme.

9. This Court has personal jurisdiction over Defendant because Defendant transacted

business, maintained substantial contacts, and is located and/or committed unlawful conduct in

this District. The unlawful scheme was directed at, and had the intended effect of, causing injury

to persons residing in, located in, or doing business throughout the United States.

10. Plaintiff purchased at least one FICO Score from Fair Isaac and TransUnion,

which is headquartered in this District. Defendant employs persons who work in its credit score

business in this District. Defendant is also registered to do business in Illinois.

11. Defendant selected this District to institute Case No. 1:17-cv-08318, to which this

case is filed as related by Plaintiff.

PARTIES

A. Plaintiff

12. Plaintiff Getten Credit Company is a corporation with its principal place of

business in Mendota, Minnesota. Plaintiff is a small, family-owned independent finance

company that specializes in helping consumers with various financial needs including debt

consolidation, purchasing vehicles, and rebuilding credit.

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13. During the Class Period, Plaintiff paid for FICO Scores from Defendant and

TransUnion.

B. Defendant

14. Defendant Fair Isaac Corporation is a publicly traded Delaware corporation, with

its principal place of business in San Jose, California. Defendant is a leading data analytics

company focused on credit scoring services. Its FICO Score has become the standard measure of

consumer credit risk in the United States.

FACTUAL ALLEGATIONS

15. As described in greater detail below, Plaintiff has been harmed in several respects

because Fair Isaac and credit bureaus have entered into anticompetitive agreements with the goal

of eliminating all competition in the B2B Credit Score Market. Defendant’s conspiracy has

permitted it to charge supracompetitive prices to credit bureaus and companies that rely on credit

scores, such as Plaintiff, and tilt the table in favor of Defendant’s own credit scoring products

that they develop.

16. In support of Plaintiff’s claims that Defendant have engaged in illegal,

anticompetitive conduct, Plaintiff sets forth below the relevant product market—the B2B Credit

Market—involved in Defendant’s conspiracy; the details of Defendant’s anticompetitive conduct

and the harm to competition caused by Defendant’s anticompetitive conduct; and that there is no

pro-competitive justification for Defendant’s actions.

I. The B2B Credit Market Overview

A. Credit Scores, Reports, and Credit Bureaus

17. Credit scores are designed to assess credit risk and are the most widely used

indicators of consumers’ creditworthiness in the United States. Lenders, financial institutions,

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and other businesses rely on credit scores to decide whether and on what terms to extend credit

to consumers. Consumers, in contrast, rely on credit scores to determine whether they will be

able to get a mortgage, credit card, auto loan, or other credit product and the rate they will pay.

18. Credit reports and credit scores are different; credit scores can be sold together

with credit reports or independently. A credit report is a statement with detailed information

about a consumer’s credit activity and current credit situation, and might, for example, include

information about a consumer’s history of mortgage payments, credit card balances, credit card

payments, and credit inquiries. Credit scoring systems apply an algorithm to the credit report to

produce a credit score. These credit scores are usually three digits and accompanied by “reason

codes,” which inform the lender of significant contributions to the reduction of a consumer’s

credit score.

19. Credit reporting agencies (“credit bureaus”)—which include TransUnion,

Equifax, and Experian—collect and supply aggregated consumer credit data in the form of

consumer reports. The credit bureaus maintain sophisticated databases of consumer credit data to

provide comprehensive information on consumers’ financial behavior by continuously gathering

credit and financial data about consumers from creditors, government entities, public records,

collection agencies, and other third parties. This information is then compiled into a “credit file.”

The credit bureaus sell credit reports, which include information from a consumer’s credit file, to

businesses and consumers.

B. The B2B Credit Score Market is a Distinct Product Market

20. There are two distinct markets for credit scores in the United States: (1) the B2B

Credit Score Market and (2) the B2C (“business-to-consumer”) Credit Score Market. B2B and

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B2C credit scores are priced, purchased, and used very differently and serve very different

purposes.

21. Purchasers in the B2B Credit Score Market are comprised of lenders, financial

institutions, and other businesses that purchase B2B credit scores in order to make risk

management decisions (“B2B Purchasers”). Lenders, financial institutions, and other businesses

that purchase credit reports from Defendant and/or the credit bureaus generally purchase credit

scores in order to determine the credit-worthiness and identity of qualified borrowers to whom a

preapproved credit offer will be extended (“pre-screening”), make lending decisions (“lending”),

or review the risk associated with existing borrowers for purposes such as extending additional

credit or changing other account terms (“account management”).

22. Customers in the B2C Credit Score Market, in contrast, purchase credit scores in

order to manage their credit, protect their identity, or assess their likelihood of obtaining credit.

American consumers often use credit monitoring or identity protection accounts from, for

example, Capital One, Credit Karma, and LifeLock which often include access to the consumer’s

own credit score.

23. The lenders, financial institutions, and other businesses in the B2B Credit Score

Market that purchase and use credit scores to assess creditworthiness and make decisions about

whether and on what terms to extend credit or otherwise take on risk do not consider credit

reports, insurance scores, or any other information about borrowers, to be a substitute for credit

scores.

24. The credit risk scoring industry, industry analysts, policy analysts, and investors

recognize the B2B Credit Score Market as distinct from the B2C Credit Score Market. Fair Isaac

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also regularly acknowledges that the B2B Credit Score Market is distinct from the B2C Credit

Score Market.

25. The B2B Credit Score Market is characterized by significant barriers to entry.

B2B Purchasers encounter significant “switching costs” if they adopt a new credit score that has

different score-to-risk relationships or that uses different reason codes – regardless of whether it

is an updated version of the score they already use or an entirely new brand of credit score

(unlike consumers in the B2C Credit Score Market).

26. Network effects also characterize the B2B Credit Score Market. As more banks

and consumers use a particular type of credit score, that credit score becomes a de facto

“industry standard.”

II. Fair Isaac Has a Monopoly in the B2B Credit Score Market

27. Fair Isaac has maintained a monopoly over the B2B Credit Score Market in the

United States for roughly three decades, largely through the unlawfully achieved dominance of

its FICO product line, which includes many different types of FICO Scores.

28. Introduced in the 1980s, Fair Isaac’s “FICO Classic” credit scores are the best

known and most widely used B2B Credit Scores in the United States. FICO Classic applies an

algorithm to each credit bureau’s data and generates a score between 300 and 850 that purports

to give an indication of the individual’s credit risk. It also generates a set of “reason codes” that

explain the reasons the consumer has not been assigned the maximum score.

29. Fair Isaac advertises its monopoly in the B2B Credit Score Market on its website:

90% of all lending decisions in the United States rely on FICO Scores, 27.4 million FICO Scores

are sold every day, 10 billion FICO Scores are sold each year, and 100 billion FICO Scores sold

to date—making FICO the most used credit score in the world.

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30. Similarly, in its 2019 Form 10-K, Fair Isaac described its “FICO Scores” as “the

standard measure in the U.S. of consumer credit risk” and reported that “FICO Scores are used . .

. by nearly all of the major banks, credit card organizations, mortgage lenders, and auto loan

originators.”

31. Fair Isaac representatives have described Fair Isaac’s FICO score as “the 800-

pound gorilla” in the market for B2B Credit Scores and bragged about Fair Isaac’s 90% market

share. For example, at the JPMorgan Ultimate Services Investor Conference, Fair Isaac’s CFO

and Executive Vice President Michael Pung stated that the FICO scoring system “is the most

widely used credit scoring system here in the U.S.,” “[v]irtually every major lender in the U.S.

[uses] the FICO Score for some sort of credit lending decision,” and Fair Isaac has “maintained a

90-plus percent market share for at least the [last] 13 years.”

32. Fair Isaac representatives have also recognized that FICO scores have benefited

from the network effects created by the widespread use of FICO scores in many industries. For

example, in November 2011, then-CEO of Fair Isaac Mark Greene explained that the “network

effect” of “FICO Scores . . . being sort of the standard language” and “having everybody . . .

standardize on a FICO Score, that’s magic.”

33. Fair Isaac’s monopoly in the B2B Credit Score Market has given it the power to

control prices. Indeed, Fair Isaac’s CEO, Will Lansing, has noted that in the B2B Credit Score

Market Fair Isaac has “quite a bit of discretion in whether we want our margins to be higher or

lower or where they are.”

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III.Fair Isaac’s Anticompetitive Conduct

A. Fair Isaac Has Contracted with Credit Bureaus as Agents and CoConspirators in its Scheme to Monopolize

34. With its dominant position in the B2B Credit Score Market, Fair Isaac uses and

enlists the assistance of the credit bureaus (TransUnion, Equifax, and Experian) to perpetuate

and extend its monopoly. Fair Isaac’s relationship with B2B Purchasers like Plaintiff is often

dependent on B2B Purchasers’ relationships with credit bureaus, who help to facilitate the sale of

Defendant’s FICO Scores.

35. When a B2B Purchaser requires a credit score, it purchases the report from a

credit bureau, and the credit score jointly from the credit bureau and Fair Isaac. Although the

payment may at times occur in a single transaction, the practical reality, as expressly set forth in

contracts governing the sale of credit scores to B2B Purchasers, is that both the credit bureau and

Fair Isaac act as the provider of the FICO Score.

36. B2B Purchasers’ contracts for FICO Scores are often known as Credit Scoring

Services Agreements (“CSSAs”). CSSAs provide for the method of payment and fee model for

the delivery of credit score services and establish the relationship between Fair Isaac and the

B2B Purchasers.

37. For example, the CSSA between Plaintiff, its credit bureau TransUnion, and Fair

Isaac makes clear that the “the Fair Isaac Scores are the property of Fair Isaac and are proprietary

to Fair Isaac” and that Fair Isaac grants to Plaintiff a “limited license to use, internally, the Fair

Isaac Scores solely for the particular purpose . . . for which the Fair Isaac Scores were obtained.”

38. In Plaintiff’s and Class Members’ procurement of FICO Scores, the credit bureaus

act as co-conspirators and agents of Fair Isaac.

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B. Fair Isaac Has Leveraged its Monopoly Power to Eliminate Competition

from VantageScore

39. Fair Isaac has used its monopoly power to coordinate a multi-faceted campaign to

eliminate competition from VantageScore. The anticompetitive agreements that Defendant and

the credit bureaus entered into include contract terms that restrict the credit bureaus’ ability to

compete and sell VantageScore, penalty pricing and bundling to foreclosure competition from

competitors, and permits Fair Isaac to extract monopoly prices.

40. Fair Isaac has been explicit that this is its goal. In April 2015, Will Lansing

informed investors on a quarterly earnings conference call that Fair Isaac’s strategic goal was to

ensure that “the entire industry adopts FICO scores instead of [other] scores.” To achieve this

goal, Fair Isaac has enlisted its competitors (the credit bureaus, which jointly own and control

VantageScore) to agree to anticompetitive contracts that: prevent them from developing or

selling alternative credit scores that could be seamlessly integrated into many lenders’ systems or

used interchangeably with FICO Scores; prevent them from competing with each other to

negotiate prices from FICO; and create a pricing scheme effectively foreclosing B2B Purchasers

from choosing to use FICO Scores in their lending decisions at the same time as providing

customers with a competing credit score, including VantageScore. At the same time, Fair Isaac

has waged a media campaign against VantageScore and made false and misleading statements in

order to sow fear, uncertainty, and doubt about VantageScore’s reliability. By its anticompetitive

and exclusionary conduct, Fair Isaac has injured competition in the B2B Credit Score Market,

increased prices for Plaintiff and the Class, and limited access to credit for millions of

Americans.

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41. In March 2006, VantageScore introduced the VantageScore credit score and

credit scoring system. VantageScore is a competitor to FICO Scores in the B2B Credit Score

Market.

42. From the time it was first released in 2006, VantageScore scored millions more

consumers than the FICO scoring systems. Whereas Fair Isaac’s FICO scoring systems would

not generate a score if a consumer had not used credit in more than six months or if a credit

account was fewer than six months old, VantageScore calculated scores for consumers that had

not used credit for up to two years. It also reached more consumers by using utility and

telecommunications payment histories when reported to the credit bureaus.

43. Today, VantageScore scores 30 million more Americans than traditional FICO

scoring systems. Fair Isaac’s outdated FICO Classic credit scoring systems—which are still used

by many lenders—exclude many creditworthy Americans that VantageScore can reliably score.

About one-quarter of American adults—some 65 million people—do not have a traditional FICO

score. VantageScore is capable of reducing the number of adults without a credit score by almost

half. Ten million of those newly scored individuals are “prime” borrowers that should be

attractive to traditional lenders.

44. Without a credit score, it is difficult or impossible to apply for or successfully

obtain a mortgage, car loan, or reasonable interest rates on personal lines of credit. Not having a

credit score can also have drastic effects outside of the credit market. For example, credit scores

are increasingly used by landlords.

45. Those excluded by Fair Isaac’s traditional FICO scoring systems—who face an

increased risk of being denied access to credit in the form of credit cards, auto and home loans,

and apartment housing—include disproportionate numbers of low-income and minority

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consumers, many of whom VantageScore has calculated scores for, including 2.7 million that

should be considered “prime borrowers.”

46. Despite the advantages of using VantageScore, Fair Isaac continues to have a

monopoly in the B2B Credit Score Market. In February 2013, at a Morgan Stanley Conference,

Fair Isaac’s CEO Will Lansing explained that despite the existence of VantageScore, “there [is]

not that much competition around our scores business” because “FICO scores are very much part

of the fabric of the banking industry” and “really deeply imbedded.”

C. Fair Isaac’s Anticompetitive Agreements Restrict the Credit Bureaus’

Ability to Develop or Sell Other Credit Scores Compatible with B2B

Purchasers’ Existing Systems

47. In January 2015, Fair Isaac and TransUnion entered into a contract, the Analytic

and Data License Agreement. With TransUnion’s prior contracts with Fair Isaac set to expire on

December 31, 2014, Fair Isaac demanded that the parties enter into a new contract rather than

renew their existing contracts. Fair Isaac represented to TransUnion that Experian and Equifax

had already agreed to materially similar new contracts with Fair Isaac. If TransUnion did not

agree to the terms demanded by Fair Isaac, it would lose substantial business from customers that

depend on FICO Scores. On information and belief, TransUnion, Equifax, and Experian all

agreed to Fair Isaac’s plan to exclude competitors and maintain its monopoly.

48. Fair Isaac has imposed a similar or identical “No Equivalent Products” clause on

each of the credit bureaus. By imposing a “No Equivalent Products” term, Fair Isaac has sought

to block the credit bureaus from offering alternative credit score products, such as VantageScore,

that would allow B2B Purchasers to easily switch from FICO Scores to VantageScore without

incurring the cost of redesigning their lending programs and systems, or to use VantageScore

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alongside or interchangeably with FICO Scores. The credit bureaus have agreed to and

acquiesced in these anticompetitive agreements, terms, and resulting anticompetitive effects.

49. The “No Equivalent Products” clause provides that a credit bureau may not

internally develop a credit scoring system that is aligned to the odds-to-score relationship of any

Fair Isaac Analytic or that uses more than a limited number of reason codes that “match” reason

codes used by any Fair Isaac Analytic. It also prohibits a credit bureau from distributing any

competing analytic (i.e., credit scoring system) that is aligned with FICO Scores or uses too

many of the same reason codes, and the clause expressly names Vantage Score Solutions LLC as

a developer of such a scoring system that may not be distributed if VantageScore were to offer

an “Equivalent Product.”

50. For example, if a competing credit score product used a 700 score to indicate a

less-than-five-percent risk of credit delinquency, and if a 700 FICO score also indicated the same

risk of delinquency, then the “No Equivalent Products” clause prevents a credit bureau from

distributing the competing product. Similarly, if a competing Credit Score product used reason

codes that match 20% or more of the reason codes used by FICO scoring systems, the “No

Equivalent Products” clause prohibits a credit bureau from distributing the product.

51. The “No Equivalent Products” clause effectively prevents a credit bureau from

developing (contrary to the original goal of VantageScore and the easy ability to do so) or selling

an alternative to FICO’s credit scores that would (i) be compatible with many B2B Purchasers’

systems, models, and processes; and (ii) allow B2B Purchasers to have a legitimate choice

between using FICO Scores and an alternative score. Many B2B Purchasers have spent

substantial effort and resources to develop systems, models, and processes that are designed for

FICO Scores. B2B Purchasers’ systems, models, and processes are tailored to FICO’s odds-toCase: 1:17-cv-08318 Document #: 198-5 Filed: 05/04/20 Page 14 of 34 PageID #:2811 Case: 1:20-cv-02516 Document #: 13-1 Filed: 05/07/20 Page 167 of 245 PageID #:234 Case: 1:20-cv-02651 Document #: 1 Filed: 05/01/20 Page 13 of 33 PageID #:13
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score relationship (i.e., each given score has a given ratio of non-defaulting consumers to

defaulting consumers), and reason codes (the particular reasons cited for increased risk of

default). For example, a bank’s software might be designed to accept one or more FICO Scores

and reason codes, combine this information with data it collects internally, and automatically

produce a lending decision.

52. The “No Equivalent Products” clause protects and sustains Fair Isaac’s monopoly.

The odds-to-score relationship is an arbitrary mapping between risk and score and does not

reflect protectable intellectual property. Similarly, the reason codes that may not be used by an

“Equivalent Product” were not invented by Fair Isaac but reflect well-established industry best

practices for lending.

D. Agreements Between Fair Isaac and Credit Bureaus Include Provisions

Foreclosing Competition Including Penalty Pricing and Bundling

53. Fair Isaac’s contracts with each credit bureau include a similar or identical

“Dynamic Royalty Schedule” clause and a similar or identical “Pre-Qualification” royalty

category. Through the “Pre-Qualification” royalty category, Fair Isaac has effectively foreclosed

lenders from the ability to purchase and use a FICO score in their lending decision while

providing a consumer with a competing Credit Score, which drives lenders to buy exclusively

Fair Isaac’s FICO Scores and not to purchase competing Credit Scores. As a consequence of Fair

Isaac’s imposition of the “Pre-Qualification” royalty category, TransUnion has lost sales of

VantageScore to major banks to provide to consumers.

54. In 2015, Fair Isaac unilaterally imposed, and the credit bureaus have complied

with, a new “Pre-Qualification” royalty category, which Fair Isaac defines to “mean an End

User’s qualification of a potential consumer customer for an End User’s own internal lending

offering.” This royalty category distinguishes between: (1) lenders that use FICO Scores for

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“Pre- Qualification” without providing any Credit Score or credit data to consumers; and (2)

lenders that use FICO Scores for “Pre-Qualification” while also providing Credit Scores or credit

data to consumers “in connection” with the “Pre-Qualification.” Certain banks and lenders offer

consumers opportunities to apply to qualify for credit opportunities (e.g., a credit card or loan)

and, at the same time, receive their personal Credit Score. The offer of a free Credit Score to a

consumer can entice consumers to apply for credit opportunities.

55. The royalty price associated with a FICO score used for “Pre-Qualification”

depends on whether other Credit Scores or credit data are provided to consumers. If a lender

purchases a FICO score for use in “Pre-Qualification” and does not provide any Credit Score or

credit data to the consumer “in connection” with the “Pre-Qualification,” there is one per-score

royalty rate. If the lender purchases a FICO score for use in “Pre-Qualification” and provides any

other Credit Score (such as a VantageScore) to the consumer “in connection” with the “PreQualification,” there is a different per-score royalty rate that is higher – a penalty rate.

56. The penalty rate can be avoided in one of two ways, both of which involve

purchasing exclusively FICO Scores. First, the B2B Purchaser could purchase a FICO score for

use in “Pre-Qualification” and provide no Credit Score or credit data to the consumer. Second,

the B2B Purchaser could purchase a bundled FICO product from Fair Isaac. Fair Isaac offers

bundled products to lenders that combine the use of scores by lenders with the provision of

scores to consumers.

57. There is no legitimate business justification for the penalty rate agreed upon by

Fair Isaac and the credit bureaus when the lender also purchases any other Credit Score to

disclose to consumers. The transparent purpose of the “Pre-Qualification” royalty category is to

drive all B2B Purchasers engaging in “Pre-Qualification” to purchase exclusively FICO Scores

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and make it cost- prohibitive for B2B Purchasers engaging in “Pre-Qualification” to purchase a

competing Credit Score for disclosure to consumers. This scheme has been effective, and few, if

any, B2B Purchasers have opted to pay the penalty rate.

58. Fair Isaac’s “Level Playing Field,” requires that the prices that are made available

to one credit bureau be made available to the other credit bureaus. Taken together, the “Dynamic

Royalty Schedule” and the “Level Playing Field” clauses enable Fair Isaac to unilaterally

increase the royalty prices it charges for FICO Scores. Fair Isaac’s contracts with TransUnion,

Equifax, and Experian include similar or identical “Level Playing Field” and “Dynamic Royalty

Schedule” provisions.

59. Fair Isaac has used the “Level Playing Field” and “Dynamic Royalty Schedule”

provisions in its contracts with the credit bureaus to extract monopoly prices from B2B

Purchasers. These provisions disincentivize a credit bureau from negotiating for a lower price

because it knows that even if it succeeds, it will not gain a competitive advantage over the other

credit bureaus.

E. Fair Isaac Has Waged a Media Campaign to Discredit VantageScore’s

Reliability Among B2B Purchasers

60. Despite having successfully induced the credit bureaus to agree with Fair Isaac

and with each other to impose restrictions on VantageScore’s ability to compete with FICO, Fair

Isaac has gone even further and waged an aggressive public relations and advertising campaign

to spread false statements, convey false impressions, and mislead B2B Purchasers about the

qualities and characteristics of FICO Scores and VantageScore. In advertisements, letters, and

blog posts, Fair Isaac has disparaged VantageScore by calling it a “Fako” score, falsely claimed

that VantageScore is an unreliable measure of creditworthiness, and misrepresented the

information considered by VantageScore’s credit scoring system.

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61. On December 12, 2017, Fair Isaac took out a full-page advertisement in The Wall

Street Journal addressed to “Lenders, Policymakers and Consumer Advocates” that disparaged

VantageScore without identifying it by name. The advertisement contrasted Fair Isaac, which “is

not owned by the credit bureaus” and whose FICO Scores have been used “by lenders and

securitization investors for decades,” with an alternative Credit Score, which is “owned by the

credit bureaus,” is less reliable than FICO Scores in evaluating credit risk, and fails to use “sound

practices” or “science-based credit evaluation.” To anyone familiar with the market for Credit

Scores, the advertisement unambiguously conveys the false message that VantageScore is

“[w]eakening scoring standards, [and] harm[ing] consumers, and the lending system,”

particularly in the B2B Credit Score Market.

62. The Wall Street Journal advertisement directed readers to “Learn more at

FICO.com/independent,” a Fair Isaac-owned website that connects visitors to articles and blog

posts that disparage VantageScore by name. One such blog post asserts: “Despite claims by

VantageScore, weakening the minimum scoring criteria will not empower millions of low-risk

mortgage credit seekers.”

63. Moreover, the implication that FICO Classic scoring systems provide Credit

Scores for as many consumers as VantageScore is false and misleading. VantageScore provides

Credit Scores for millions of American consumers that are not scored by FICO Classic scoring

systems.

64. Fair Isaac’s website includes numerous posts disparaging VantageScore and

making false or misleading statements about VantageScore’s features. For example, one blog

post claims that “[r]esearch results consistently showed that scoring models relying solely on

sparse or old credit data were weak and did a poor job forecasting future performance.” This

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statement is false and misleading because it conveys the message that VantageScore’s scoring

model is “weak” and does a “poor job forecasting future performance” because it considers a

consumer’s full credit history even if the consumer has not used a traditional credit line in the

last six months. In fact, studies have shown that VantageScore is strongly predictive.

65. Another blog post claims that whereas “FICO Score 9 differentiates medical from

non-medical collections,” “VantageScore does not.” This statement conveys the false message

that VantageScore does not differentiate medical from non-medical collections. In fact,

VantageScore 3.0 was the first credit scoring system to address medical debt. VantageScore 4.0,

the most recent version of VantageScore, distinguishes medical collection accounts from nonmedical collection accounts and penalizes medical collections less than non-medical ones.

66. Fair Isaac’s campaign against VantageScore is not new. In 2006, just months after

the launch of VantageScore, Fair Isaac filed a meritless lawsuit against the credit bureaus and

VantageScore in the United States District Court for the District of Minnesota. See Fair Isaac

Corporation v. Equifax Inc., No. 06-cv-04112 (D. Minn.). This was the monopolist’s first

attempt to kill the nascent competitor. Fair Isaac’s numerous claims included a claim that the

development of VantageScore violated the antitrust laws and a claim that the development of

VantageScore constituted trademark infringement. In its prayer for relief, Fair Isaac sought

nothing less than the end of VantageScore: it requested that the “Defendants be ordered to

dissolve VantageScore.”

67. All of Fair Isaac’s claims failed; in fact, the jury concluded that Fair Isaac was the

wrongdoer. In support of its trademark infringement claim, Fair Isaac had alleged that

VantageScore’s use of a scoring range of 501-990 constituted trademark infringement because it

was similar to FICO’s scoring range of 300-850. The credit bureaus and VantageScore

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counterclaimed for fraud on the United States Patent and Trademark Office (“PTO”), alleging

that Fair Isaac had misrepresented to the PTO that only FICO used the 300-850 score range. The

jury concluded that Fair Isaac had committed fraud on the PTO by making false statements as

part of its application to register the score range of 300-850 as a trademark.

68. The public statements described in the foregoing paragraphs were transmitted to

and seen by a substantial number of businesses and consumers nationwide.

II. Fair Isaac’s Anticompetitive and Exclusionary Conduct Harms Competition

69. Fair Isaac’s campaign of exclusionary conduct to maintain and expand its

monopoly has harmed and continues to harm participants in the B2B Credit Score Market. Fair

Isaac’s unlawful conduct, including that which has been taken in concert with the credit bureaus,

has foreclosed competition in the B2B Credit Score Market by foreclosing opportunities for the

credit bureaus to sell VantageScore or any other competitive products. The anticompetitive and

exclusionary conduct has allowed Fair Isaac to maintain its monopoly and charge monopoly

prices for B2B Credit Scores to B2B Purchasers during the Class Period.

70. Fair Isaac’s conduct, in concert with the credit bureaus, including by the contracts

entered into by the credit bureaus, has reduced choice for B2B Purchasers. The anticompetitive

terms agreed to between Fair Isaac and the credit bureaus have frustrated the ability of B2B

Purchasers to purchase VantageScore or any other competitive Credit Score that could be

seamlessly integrated into lenders’ existing processes and systems. Fair Isaac’s media and

advertising campaign against VantageScore has been successful in sowing fear, uncertainty, and

doubt about VantageScore in the marketplace.

71. Media sources, financial blogs, and consumers have absorbed Fair Isaac’s

message that VantageScore is a “Fako” score merely because it is not a FICO score. For

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example, thebalance.com – a website devoted to personal finance issues – posted in February

2017, and continues to display as of the date of this filing: “If you purchased your Credit Score

anywhere but MyFICO.com, then it’s a Fako score.”

FRAUDULENT CONCEALMENT AND TOLLING

72. A cause of action accrued for Plaintiff each time Fair Isaac and/or a credit bureau

sold a B2B Credit Score to plaintiff at a supracompetitive price made possible by their

anticompetitive conduct. Each such sale constituted an overt act in furtherance of their

anticompetitive scheme. Accordingly, Plaintiff is entitled to recover all damages on all sales that

Fair Isaac and/or its co-conspirators made to Plaintiff at supracompetitive prices within four

years of the filing of this action.

73. Due to Fair Isaac’s concealment of its unlawful conduct, however, Plaintiff and

members of the Class are entitled to recover damages reaching back even beyond the four-year

statute of limitations period. Fair Isaac’s violations were not reasonably discoverable until

February 12, 2018, when TransUnion disclosed the misconduct in a suit against Fair Isaac.

Plaintiff and members of the Class had no knowledge of the unlawful self-concealing scheme

and could not have discovered the scheme and conspiracy through the exercise of reasonable

diligence more than four years before the filing of this action.

74. That is true, at least in part, because the nature of the scheme was self-concealing

and because Fair Isaac employed deceptive tactics and techniques of secrecy to avoid detection

of, and to conceal, its scheme.

75. Because the scheme was both self-concealing and affirmatively concealed by Fair

Isaac, Plaintiff and members of the Class had no knowledge of the scheme more than four years

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before the filing of this complaint; nor did they have the facts or information that would have

caused a reasonably diligent person to investigate.

76. Plaintiff and members of the Class also lacked the facts and information necessary

to form a good faith basis for believing that any legal violations had occurred. Reasonable

diligence on the part of Plaintiff and members of the Class would not have uncovered those facts

more than four years before the filing of this complaint.

77. As a result of Fair Isaac’s fraudulent concealment, all applicable statutes of

limitations affecting Plaintiff’s and Class members’ claims have been tolled.

78. The federal government’s antitrust investigation of Fair Isaac’s unlawful conduct

also tolls any federal statute of limitations pursuant to 15 U.S.C. § 16.

CLASS ACTION ALLEGATIONS

79. Plaintiff brings this action on behalf of itself, and as a class action under the

Federal Rules of Civil Procedure, Rule 23(a) and (b) on behalf of:

All entities who paid for a FICO Score from Defendant and/or a credit bureau in the

United States during the Class Period for commercial use.

80. Specifically excluded from the Class are the Defendant; the officers, directors or

employees of the Defendant; any entity in which the Defendant has a controlling interest; and

any affiliate, legal representative, heir or assign of the Defendant. Also excluded from the Class

are any federal, state or local governmental entities, any judicial officer presiding over this action

and the members of his/her immediate family and judicial staff, any juror assigned to this action.

Also expressly excluded are any natural persons that purchased their own credit score solely via

myFico.com, the credit bureaus, or other entities for their personal use.

81. Members of the Class are readily identifiable from Defendant’s records.

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82. Members of the Class are so numerous that individual joinder of all the members

is impracticable. Although the precise number and identification of Class members is unknown

to Plaintiff at this time and can be ascertained only through appropriate discovery of Defendant.

83. This action is brought and may properly be maintained as a class action pursuant

to the provision of Federal Rules of Civil Procedure 23(a)(1)-(4) and 23(b)(1)-(3). This action

satisfies the numerosity, commonality, typicality, adequacy, predominance, and superiority

requirements of those provisions. Common questions of fact and law exist as to all Class

members which predominate over all questions affecting only individual Class members. These

common legal and factual questions, which do not vary from Class member to Class member,

and which may be determined without reference to the individual circumstances of any Class

member, include the following:

a. whether Defendant monopolized, conspired to monopolize, or

unreasonably restrained trade in violation of certain state antitrust laws;

b. whether Defendant engaged in unfair or deceptive trade practices in

violation of certain state laws;

c. the duration of the alleged unlawful conduct;

d. injury suffered by Plaintiff and members of the Class;

e. damages suffered by Plaintiff and members of the Class;

f. whether Plaintiff and the other members of the Class are entitled to,

among other things, injunctive relief, and if so, the nature and extent of

such injunctive relief; and

g. the appropriate class-wide measure of damages.

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84. These and other questions of law or fact, which are common to the members of

the Class, predominate over any questions affecting only individual Class members.

85. Plaintiff’s claims are typical of the claims of the Class members. Plaintiff and

other Class members must prove the same facts in order to establish the same claims, described

herein, which similarly apply to all Class members.

86. Plaintiff is an adequate representative of the Class because it is a member of the

Class and its interests do not conflict with the interests of the Class members it seeks to

represent. Plaintiff has retained counsel competent and experienced in the prosecution of

complex class action litigation, and together Plaintiff and its counsel intend to prosecute this

action vigorously for the benefit of the Class. The interests of Class members will be fairly and

adequately protected by Plaintiff and its counsel.

87. A class action is superior to other available methods for the fair and efficient

adjudication of this litigation since individual litigation of the claims of all Class members is

impracticable. Even if every Class member could afford individual litigation, the court system

could not. It would be unduly burdensome to the courts, in which individual litigation of

hundreds of cases would proceed. Individual litigation presents a potential for inconsistent or

contradictory judgments, the prospect of a race for the courthouse, and an inequitable allocation

of recovery among those with equally meritorious claims. Individual litigation increases the

expense and delay to all parties and the court system in resolving the legal and factual issues

common to all Class members’ claims relating to Defendant’s unlawful conduct. By contrast, the

class action device presents far fewer management difficulties and provides the benefit of a

single adjudication, economies of scale, and comprehensive supervision by a single court.

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88. The various claims asserted in this action are additionally or alternatively

certifiable under the provisions of Federal Rules of Civil Procedure 23(b)(1) and/or 23(b)(2)

because:

89. The prosecution of separate actions by numerous individual Class members would

create a risk of inconsistent or varying adjudications with respect to individual Class members,

thus establishing incompatible standards of conduct for Defendant;

90. The prosecution of separate actions by individual Class members would also

create the risk of adjudications with respect to them that would, as a practical matter, be

dispositive of the interest of other Class members who are not a party to such adjudications and

would substantially impair or impede the ability of such non-party Class members to protect their

interests; and

91. Defendants have acted on grounds generally applicable to the entirety of the

Class, thereby making appropriate final declaratory and injunctive relief with respect to the

Class as a whole.

CLAIMS FOR RELIEF

COUNT I – MONOPOLIZATION

Violation of the Sherman Act, 15 U.S.C. § 2

92. Plaintiff incorporates by reference the foregoing allegations as if fully set forth

herein.

93. As described above, from at least as early as January 1, 2006 until the present,

Defendant possessed monopoly power in the market for B2B Credit Scores. No other competitor

has been able to restrain Defendant’s ability to charge supracompetitive monopoly prices for its

credit scores during the relevant time period. Fair Isaac had and has the ability to control prices

and exclude competitors.

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94. Fair Isaac willfully and unlawfully maintained its market power in the B2B Credit

Score market by engaging in an anticompetitive scheme to prevent legitimate competition on the

merits. Fair Isaac’s monopoly have been maintained by its anticompetitive conduct and not as a

result of providing a superior product, business acumen, or historical accident.

95. Fair Isaac has demonstrated its ability to control prices and exclude competition

by raising prices without a corresponding increase in demand and to supracompetitive levels.

96. Fair Isaac’s monopoly is not due to growth or development because of a superior

product, business acumen, or historic accident.

97. Fair Isaac’s course of anticompetitive conduct include anticompetitive agreements

with credit bureaus, requiring those entities to exclusively or nearly exclusively exclude

competitors like VantageScore and maintain its monopoly. Collectively, Fair Isaac’s contracts

with credit bureaus substantially foreclose the B2B Credit Score market from actual and

potential competition.

98. There are no valid procompetitive justifications for Defendant’s exclusionary

conduct in the B2B Credit Score market and even if there were (and there are not), any such

procompetitive benefit could have been obtained through less restrictive means.

99. Through unlawful, interconnected, and mutually reinforcing anticompetitive and

exclusionary acts and agreements, Fair Isaac has substantially foreclosed competition in the

market for B2B Credit Scores in the United States in violation of Section 2 of the Sherman Act,

15 U.S.C. § 2.

100. Plaintiff and members of the Class have been injured in their property by

Defendant’s antitrust violations. Their injury consists of having paid, and continuing to pay,

higher prices for B2B Credit Scores than they would have paid absent Defendant’s scheme. Such

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injury is of the type antitrust laws were designed to prevent and flows from that which makes

Defendant’s conduct unlawful. Plaintiffs are the proper entities to bring a private case concerning

this conduct.

101. Fair Isaac’s monopolization has injured and will continue to injure competition in

this market. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate

commerce and injure competition nationwide.

102. Plaintiff and members of the Class have been injured in their business or property

by reason of Defendant’s violation of Section 2 of the Sherman Act within the meaning of

Section 4 of the Clayton Antitrust Act, 15 U.S.C. §15. Plaintiff and members of the Class are

threatened with future injury to their business and property by reason of Defendant’s continuing

violation of Section 2 of the Sherman Act within the meaning of Section 16 of the Clayton

Antitrust Act, 15 U.S.C. § 26.

COUNT II – CONSPIRACY TO MONOPOLIZE

Violation of the Sherman Act, 15 U.S.C. § 2

103. Plaintiff incorporates by reference the foregoing allegations as if fully set forth

herein.

104. Fair Isaac entered into a combination or conspiracy with the credit bureaus to

maintain its monopoly power in the B2B Credit Score Market. Fair Isaac created and maintained

this conspiracy through a series of agreements with each of the credit bureaus. In these

agreements, the credit bureaus and Fair Isaac agreed that the credit bureaus would not offer or

sell VantageScore or any other competing Credit Score to Plaintiff and members of the Class.

Fair Isaac and the credit bureaus (the top three being TransUnion, Experian, and Equifax) further

agreed that they would act as Fair Isaac’s agent in the sale of FICO Scores to Plaintiff and

members of the Class.

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105. These agreements foreclosed competition in a substantial portion of the B2B

Credit Score market and unlawfully maintained Fair Isaac’s monopoly, resulting in Fair Isaac

extracting supracompetitive prices for FICO Scores from Plaintiff and members of the Class.

106. Fair Isaac’s monopoly is not due to growth or development because of a superior

product, business acumen, or historic accident.

107. Fair Isaac’s monopolization conspiracy has injured and will continue to injure

competition in this market.

108. Fair Isaac has acted with the specific intent of monopolizing the market for B2B

Credit Scores in the United States.

109. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate

commerce and injure competition nationwide.

110. The conspiracy raised the prices for FICO Scores above the competitive level and

otherwise injured competition without any offsetting procompetitive benefit to consumers.

111. Plaintiff and members of the Class have been injured in their business or property

by reason of Defendant’s violation of Section 2 of the Sherman Act within the meaning of

Section 4 of the Clayton Antitrust Act, 15 U.S.C. §15.

112. Plaintiff and members of the Class are threatened with future injury to their

business and property by reason of Defendant’s continuing violation of Section 2 of the Sherman

Act within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. §26.

COUNT III – UNREASONABLE RESTRAINT OF TRADE

Violation of the Sherman Act, 15 U.S.C. § 1

113. Plaintiff incorporates by reference the foregoing allegations as if fully set forth

herein.

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114. Beginning at a time currently unknown to Plaintiffs, but at least as early as

January 1, 2006, and continuing through the present, the exact dates being unknown to Plaintiff,

Defendant and its co-conspirators entered into a continuing agreement, understanding, and

conspiracy in restraint of trade to artificially fix, raise, and stabilize prices in the B2B Credit

Score Market in violation of Section 1 of the Sherman Act (15 U.S.C. § 1).

115. In formulating and carrying out the alleged agreement, understanding, and

conspiracy, the Defendant and its co-conspirators did those things that they combined and

conspired to do, including but not limited to the acts, practices, and course of conduct set forth

above, and the following, among others: entering into agreements with credit bureaus

TransUnion, Experian, and Equifax that contained anticompetitive terms whereby each credit

bureau agreed not to offer or sell VantageScore as a competing product to Plaintiff and members

of the Class.

116. The combination and conspiracy alleged herein has had the following effects,

among others: (1) price competition in the sale of B2B Credit Scores has been restrained,

suppressed, and/or eliminated in the United States; (2) prices for B2B Credit Scores sold by

Defendant and credit bureaus have been fixed, raised, maintained, and stabilized at artificially

high, non-competitive levels throughout the United States; and (3) those who purchased B2B

Credit Scores from Defendant and credit bureaus have been deprived of the benefits of free and

open competition.

117. The agreements between Fair Isaac and the credit bureaus had substantial

anticompetitive effects. The agreements excluded VantageScore, a significant competitor, from a

substantial portion of competition in the B2B Credit Score Market.

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118. The agreements raised the price for FICO Scores above the competitive level and

otherwise injured competition without any offsetting procompetitive benefit to consumers.

119. Fair Isaac’s exclusionary and anticompetitive acts substantially affect interstate

commerce and injure competition nationwide.

120. Plaintiff and members of the Class continue to suffer damage, and will continue to

do so, if Fair Isaac does not cease its anticompetitive conduct.

121. Plaintiff and members of the Class have been injured in their business or property

by reason of Defendant’s violation of Section 1 of the Sherman Act, within the meaning of

Section 4 of the Clayton Antitrust Act, 15 U.S.C. §15.

122. Plaintiff and members of the Class are threatened with future injury to their

business and property by reason of Defendant’s continuing violation of Section 1 of the Sherman

Act, within the meaning of Section 16 of the Clayton Antitrust Act, 15 U.S.C. §26.

COUNT IV – VIOLATIONS OF STATE ANTITRUST LAWS

123. Plaintiff incorporates by reference and re-alleges the preceding allegations as

though fully set forth herein.

124. By reason of the foregoing, Defendant has violated, and Plaintiff and members of

the Class are entitled to relief under, the antitrust laws of the States of Arizona, California,

Connecticut, Hawaii, Illinois, Iowa, Kansas, Maine, Maryland, Michigan, Minnesota,

Mississippi, Nebraska, Nevada, New Mexico, New York, North Carolina, North Dakota,

Oregon, Rhode Island, South Dakota, Tennessee, Utah, Vermont, West Virginia, and Wisconsin,

as well as the District of Columbia, as follows:

a. Arizona Revised Statutes § 44-1401, et seq.;

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b. California Cartwright Act, California Business & Professions Code § 16700,

et seq.;

c. Connecticut Antitrust Act, Conn. Gen. Stat. 35-24, et seq.;

d. District of Columbia Code § 28-4501, et seq.;

e. Hawaii Revised Statutes § 480-2, et seq.;

f. Illinois Antitrust Act, Illinois Complied Statutes § 740, Ill. Comp. Stat. 1011,

et seq.;

g. Iowa Competition Law, Iowa Code § 553.1, et seq.;

h. Kansas Statutes Annotated § 50-101, et seq.;

i. Maine Revised Statutes Annotated, tit. 10, § 1101, et seq.;

j. Maryland Code Annotated, Commercial Law, § 11-204, et seq.;

k. Michigan Compiled Laws § 445.771, et seq.;

l. Minnesota Antitrust Law of 1971, Minnesota Statutes § 325D.49, et seq.;

m. Mississippi Code Annotated § 75-21-1, et seq.;

n. Nebraska Revised Statutes § 59-801, et seq.;

o. Nevada Revised Statutes Annotated § 598A.010, et seq.;

p. New Mexico Statutes Annotated § 57-1-1, et seq.;

q. New York Donnelly Act, New York General Business Law § 340, et seq.;

r. North Carolina General Statutes § 75-1, et seq.;

s. North Dakota Century Code § 51-08.1-01, et seq.;

t. Oregon Revised Statutes § 646.705, et seq.;

u. Rhode Island General Laws § 6-36-4, et seq.;

v. South Dakota Codified Laws § 37-1-3.1, et seq.;

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w. Tennessee Code Annotated § 47-25-101, et seq.;

x. Utah Code Annotated § 76-10-3104, et seq.;

y. Vermont Statutes Annotated, tit. 9, § 2451, et seq.;

z. West Virginia Code § 47-18-1, et seq.; and

aa. Wisconsin Statutes § 133.01, et seq.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff, on behalf of itself and all others similarly situated, prays that:

1. The Court determine that this action may be maintained as a class action pursuant

to Rule 23(b)(2) of the Federal Rules of Civil Procedure with respect to Plaintiff’s claims for

injunctive relief, and Rule 23(b)(3) of the Federal Rules of Civil Procedure with respect to the

claims for damages, and declaring Plaintiff as the representative of the Class and its counsel as

counsel for the Class;

2. The Court declare the conduct alleged herein to be unlawful in violation of the

laws as set forth above;

3. Plaintiff and each member of the Class recover punitive and treble damages to the

extent such are provided by the law;

4. Defendant be enjoined from continuing the illegal activities alleged herein;

5. Plaintiff and the Class recover their costs of suit, including reasonable attorneys’

fees and expenses as provided by law;

6. Pre- and post-judgment interest, to the extent allowable; and

7. Such other and further relief as this Court deems just and proper.

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JURY DEMAND

Plaintiff, on behalf of itself and all others similarly situated, hereby demands a trial by

jury as to all issues so triable.

Dated: May 1, 2020 Respectfully submitted,

/s/ Kenneth A. Wexler

Kenneth A. Wexler

Melinda J. Morales

Michelle Perkovic

WEXLER WALLACE LLP

55 W. Monroe Street, Suite 3300

Chicago, IL 60603

Telephone: (312) 346-2222

kaw@wexlerwallace.com

mjm@wexlerwallace.com

mp@wexlerwallace.com

Dennis Stewart

GUSTAFSON GLUEK PLLC

600 B Street

17th Floor

San Diego, CA 92101

Telephone: (619) 595-3200

dstewart@gustafsongluek.com

Daniel E. Gustafson

Daniel C. Hedlund

Michelle J. Looby

Joshua J. Rissman

Ling S. Wang

GUSTAFSON GLUEK PLLC

Canadian Pacific Plaza

120 South Sixth Street, Suite 2600

Minneapolis, MN 55402

Telephone: (612) 333-8844

Fax: (612)

dgustafson@gustafsongluek.com

dhedlund@gustafsongluek.com

mlooby@gustafsongluek.com

jrissman@gustafsongluek.com

lwang@gustafsongluek.com

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Garrett D. Blanchfield

Brant D. Penney

REINHARDT, WENDORF & BLANCHFIELD

332 Minnesota Street. Suite W-1050

St. Paul, MN 55101

Tel: (651) 287-2100

Fax: (651) 287-2103

g.blanchfield@rwblawfirm.com

b.penney@rwblawfirm.com

Counsel for Plaintiff and the Proposed Class

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EXHIBIT F 

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1 

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS 

SKY FEDERAL CREDIT UNION, 

Plaintiff, 

v. 

FAIR ISAAC CORPORATION, 

Defendant. 

Case No. 1:20-cv-02114 

Honorable Edmond E. Chang 

DEFENDANT FAIR ISAAC CORPORATION’S MOTION TO REASSIGN 

AND CONSOLIDATE RELATED CASES 

Pursuant to Local Rule 40.4 and Fed. R. Civ. P. 42(a)(2), Defendant Fair Isaac Corporation 

(“FICO”), by and through its undersigned counsel, respectfully requests that this Court designate 

First Choice Federal Credit Union v. Fair Isaac Corp., No. 1:20-cv-02516, and Alcoa Community 

Federal Credit Union v. Fair Isaac Corp., No. 1:20-cv-02259, as related cases to this action, and 

reassign those cases to Judge Chang, as the presiding Judge over the lowest-filed related case. As 

discussed below, the complaints filed in the First Choice and Alcoa cases are materially identical 

to the complaints filed in this action and in another case that is already pending before Judge 

Chang, Amalgamated Bank v. Fair Isaac Corp., No. 1:20-cv-02533. All four complaints 

(collectively, the “Related Actions”) also seek to certify the same putative class. 

In addition, in the interests of judicial and party economy, FICO further requests that 

following reassignment the Court consolidate the Related Actions into No. 1:20-cv-02114 and 

order plaintiffs to file a consolidated complaint or direct counsel representing the parties in these 

cases to meet and confer and propose a schedule for plaintiffs to file a consolidated complaint. 

In further support of this motion, FICO states as follows: 

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1. On April 2, 2020, Sky Federal Credit Union filed a complaint against FICO in the 

instant action. Dkt. 1. The complaint brought claims under the Sherman Act for monopolization, 

conspiracy to monopolize, and unreasonable restraint of trade in the market for business to 

business (“B2B”) credit scores, as well as parallel claims under state law. 

2. On April 23, 2020, First Choice Federal Credit Union filed a materially identical 

complaint against FICO, First Choice Federal Credit Union v. Fair Isaac Corp., No. 1:20-cv02516 (N.D. Ill.), bringing monopolization, conspiracy to monopolize, and unreasonable restraint 

of trade claims in the same market and based on the same contractual provisions. A copy of the 

complaint is attached hereto as Exhibit A. The First Choice case is pending before Chief Judge 

Pallmeyer. 

3. On April 24, 2020, Amalgamated Bank filed another materially identical complaint 

against FICO, Amalgamated Bank v. Fair Isaac Corp., No. 1:20-cv-02533 (N.D. Ill.), bringing the 

same monopolization, conspiracy to monopolize, and unreasonable restraint of trade claims as in 

First Choice and Sky Federal. A copy of the Amalgamated Bank complaint is attached hereto as 

Exhibit B. The case is pending before Judge Chang and thus does not need to be reassigned. 

4. On April 27, 2020, Alcoa Community Federal Credit Union filed a fourth 

materially identical complaint against FICO, Alcoa Community Federal Credit Union v. Fair Isaac 

Corp., No. 1:20-cv-02259 (N.D. Ill.), bringing the same monopolization, conspiracy to 

monopolize, and unreasonable restraint of trade claims as in the foregoing cases, as well as an 

attempted monopolization claim. A copy of the complaint in Alcoa is attached as Exhibit C. The 

Alcoa case is pending before Judge Norgle. 

5. Under LR 40.4(b), “[a] case may be reassigned to the calendar of another judge if 

it is found to be related to an earlier-numbered case assigned to that judge.” Cases are related if 

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(among other things) they (a) involve some of the same issues of fact or law, or (b) in class action 

suits, if one or more of the classes involved is the same. LR 40.4(a). The decision to reassign cases 

is within the discretion of the Court. See Gautreaux v. Chicago Housing Authority, 2013 WL 

5567771, at *3 (N.D. Ill. Oct. 9, 2013). 

(a) All of the Related Actions involve the same issues of fact and law. Each 

brings identical claims for monopolization, conspiracy to monopolize, and unreasonable restraint 

of trade. See Ex. A ¶¶ 99-145; Ex. B ¶¶ 97-143; Ex. C ¶¶ 90-121, 135-148; Dkt. 1 ¶¶ 101-147. In 

particular, each complaint challenges the same provisions in FICO’s agreements with credit 

bureaus as the source of the allegedly anticompetitive restrictions. See Ex. A ¶¶ 99-145; Ex. B ¶¶ 

97-143; Ex. C ¶¶ 90-121; Dkt. 1 ¶¶ 101-147. Each complaint’s allegations are otherwise materially 

similar, with multiple passages that appear to be copied verbatim from each other. See generally

Dkt. 1 and Ex. A-C. 

(b) In addition, all plaintiffs in the Related Actions seek to represent an identical 

class of “B2B Purchasers residing in the United States that directly purchased a FICO Score from 

Fair Isaac and/or a Credit Bureau during the Class Period.” Ex. A ¶ 84; Ex. B ¶ 86; Dkt. 1 ¶ 86; 

see also Ex. C ¶ 80 (defining the class as “[a]ll persons or entities in the United States and its 

territories that purchased B2B Credit Scores directly from Fair Isaac and/or a Credit Bureau . . . .”). 

6. Related cases may be reassigned to the judge overseeing the lowest-numbered case 

if (i) both cases are pending in this Court; (ii) the handling of both cases by the same judge is likely 

to result in a substantial saving of judicial time and effort; (iii) the earlier case has not progressed 

to the point where designating a later filed case as related would be likely to delay the proceedings 

in the earlier case substantially; and (iv) the cases are susceptible of disposition in a single 

proceeding. LR 40.4(b). Under this test, reassignment of the Related Actions to Judge Chang, who 

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is presiding over the lowest-numbered case (Sky Federal) as well as the Amalgamated Bank case, 

will best facilitate the just and efficient resolution of these actions. 

(i) All of the Related Actions are pending in this Court. 

(ii) Reassignment of the Related Actions before Judge Chang will result in 

substantial judicial economy, especially in light of the identical class definitions in the complaints, 

whereas allowing these cases to proceed separately would create a significant risk of duplicate 

motions practice and inconsistent judgments within this district. 

(iii) Designating and transferring First Choice and Alcoa would not delay 

proceedings in any of the Related Actions. Pursuant to the Court’s April 17 order and Third 

Amended General Order 20-0012 issued by Chief Judge Pallmeyer on April 24, FICO’s response 

to the complaint in Sky Federal is not due until June 23, 2020 and the initial status conference is 

currently scheduled for June 2. FICO waived service in the First Choice case, making its response 

to the complaint currently due on June 23. FICO has not yet been served or asked to waive service 

in Amalgamated Bank or Alcoa. 

(iv) Given the nearly complete overlap in allegations and claims, the Related 

Actions can be resolved in a single proceeding through a coordinated motion to dismiss and, if 

necessary, coordinated discovery, summary judgment, class certification, and trial. 

7. The cover sheet in the Sky Federal action identifies another case, Fair Isaac Corp. 

v. TransUnion LLC, No. 1:17-cv-08318 (N.D. Ill.), as potentially related. See Dkt. 2. The 

TransUnion case is currently pending before Judge Coleman. FICO does not believe transfer of 

the Related Actions to Judge Coleman is appropriate under LR 40.4(b) for two reasons. 

(a) First, the Related Actions raise numerous issues not present in the 

TransUnion litigation and vice versa. TransUnion started as a commercial dispute between FICO 

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and TransUnion for breach of contract, violation of the Copyright Act, and other asserted claims. 

In response to FICO’s claims, TransUnion filed a number of counterclaims, including 

monopolization under Section 2 of the Sherman Act, breach of contract, Lanham Act and false 

advertising claims, and a request for contract reformation. See No. 1:17-cv-08318, Dkt. 38 (public 

redacted version). Unlike the antitrust claims in the Related Actions, TransUnion does not bring 

any Section 1 claims or a conspiracy to monopolize claim. Indeed, according to the plaintiffs in 

the Related Actions, one of FICO’s alleged co-conspirators is TransUnion. By the same token, the 

TransUnion case raises a host of contract and other questions not present in the Related Actions. 

Moreover, unlike the Related Actions, the TransUnion case is not a putative class action. 

Because of these factual and procedural differences, FICO does not believe that having the 

same judge handle the Related Actions and TransUnion would lead to substantial savings of 

judicial time and effort. See, e.g., Martin v. Midland Funding LLC, 2011 WL 3876965, at *2 (N.D. 

Ill. Aug. 31, 2011) (declining to reassign cases where “aside from a single cause of action against 

the same defendant, the cases are very different”); Teamsters Local 705 Pension v. A.D. Conner, 

Inc., 2011 WL 1674839, at *2 (N.D. Ill. May 4, 2011) (same where cases would require “different 

legal findings and damages calculations”); Hollinger Int’l, Inc. v. Hollinger, Inc., 2004 WL 

1102327, at *3 (N.D. Ill. May 5, 2004) (same where cases involved distinct claims and one would 

“require the Court to decide whether to certify a class” while the other would not); cf. Karamelion 

LLC v. Elexa Consumer Prods., Inc., No. 1:19-cv-6329 (N.D. Ill.), Dkt. 23 (Jan. 29, 2020) (Chang, 

J.) (declining to reassign where, though there “is some overlap in the asserted claims and the 

anticipated defenses,” “it is not likely that a single trial would be convened to resolve the dispute”). 

(b) Second, unlike the Related Actions, which have not progressed beyond the 

recent filing of the complaints, the TransUnion case has been pending for three years. Written 

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6 

discovery and document production in TransUnion is scheduled for substantial completion in June, 

and would have been completed sooner but for automatic extensions issued in response to the 

COVID-19 pandemic. The parties also were in the midst of preparing for an upcoming mediation 

before Magistrate Judge Jantz in April before it was taken off calendar in light of the pandemic; a 

telephonic hearing is currently scheduled to proceed on May 4. 

Given the advanced state of the TransUnion litigation and these impending deadlines, 

FICO expects that reassignment of the Related Actions to Judge Coleman would delay the 

proceedings in TransUnion substantially. See, e.g., Williams v. Walsh Construction, 2007 WL 

178309, at *2-3 (N.D. Ill. Jan. 16, 2007) (declining to reassign case where the parties in the first 

case had unsuccessfully attempted settlement and discovery was shortly scheduled to close). 

8. Finally, the Court has authority to consolidate separately captioned lawsuits into 

one case when, as here, the actions “involve a common question of law or fact.” Fed. R. Civ. P. 

42(a)(2). “The question of whether to grant consolidation is a matter of discretion for the trial 

court” and “[i]n exercising that discretion, a court should consider whether the 

proposed consolidation would promote convenience and judicial economy, and whether it would 

cause prejudice to any party.” Sylverne v. Data Search. N.Y., Inc., 2008 WL 4686163, at *1 (N.D. 

Ill. May 28, 2008) (citations omitted). Because consolidation would promote significant party and 

judicial economy and would not prejudice any party, FICO asks that the Court order consolidation 

of the cases discussed herein and direct plaintiffs to file a consolidated complaint. See N. Miami 

Beach Gen. Employees Retirement Fund v. Parkinson, 2011 WL 12465137, at *3 (N.D. Ill. July 

5, 2011) (ordering consolidation of related class actions and filing of consolidated complaint); see 

also Smith v. State Farm Mut. Automobile Ins. Co., 301 F.R.D. 284, 286 (N.D. Ill. 2014) (ordering 

plaintiffs to file consolidated complaint following consolidation of separate class actions). 

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7 

9. Prior to filing this motion, counsel for FICO conferred with counsel for plaintiffs 

in the Related Actions. Plaintiffs have advised FICO that they do not oppose reassignment and 

consolidation of these actions before the same District Judge, are amenable to filing a consolidated 

complaint, and agree that FICO’s responsive pleading obligations should be suspended pending 

the filing of a consolidated complaint. However, plaintiffs contend that the Related Actions should 

be re-assigned to Judge Coleman, who as discussed is presiding over Fair Isaac Corp. v. 

TransUnion LLC, 1:17-cv-08318 (N.D. Ill.). FICO disagrees, and respectfully submits that the 

actions should be consolidated before Judge Chang for the reasons set forth above. 

CONCLUSION 

For the foregoing reasons, FICO respectfully requests that this Court enter an order: 

(a) Finding that First Choice Federal Credit Union v. Fair Isaac Corp., No.

1:20-cv-02516 (N.D. Ill.), and Alcoa Community Federal Credit Union v. Fair Isaac Corp., No. 

1:20-cv-02559 (N.D. Ill.), are related cases to this action; 

(b) Transferring First Choice and Alcoa to Judge Chang for further proceedings 

pursuant to L.R. 40.4(d); 

(c) Consolidating this action and the First Choice, Amalgamated Bank, and

Alcoa actions (collectively, the “Related Actions”) into the lowest-numbered case, No. 1:20-cv02114; and 

(d) Directing plaintiffs in the Related Actions to file a consolidated complaint, 

or directing counsel for the parties to meet and confer regarding a proposed schedule for the 

plaintiffs in the Related Actions to file a consolidated complaint. 

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8 

Dated: April 29, 2020 Respectfully submitted, 

/s/ Britt M. Miller 

Michael A. Olsen 

Britt M. Miller 

J. Gregory Deis 

Matthew D. Provance 

MAYER BROWN LLP 

71 South Wacker Drive 

Chicago, IL 60606 

(312) 782-0600 

molsen@mayerbrown.com 

bmiller@mayerbrown.com 

gdeis@mayerbrown.com 

mprovance@mayerbrown.com 

Counsel for Defendant Fair Isaac 

Corporation 

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9 

CERTIFICATE OF SERVICE 

I, Britt M. Miller, an attorney, hereby certify that on April 29, 2020, I caused a true and 

correct copy of the foregoing DEFENDANT FAIR ISAAC CORPORATION’S MOTION TO 

REASSIGN AND CONSOLIDATE RELATED CASES to be filed and served electronically 

via the Court’s CM/ECF system. 

In addition, a courtesy copy of this filing has been delivered by electronic mail to counsel 

of record in First Choice Federal Credit Union v. Fair Isaac Corp., No. 1:20-cv-02516 (N.D. Ill.), 

Alcoa Community Federal Credit Union v. Fair Isaac Corp., No. 1:20-cv-02259 (N.D. Ill.), and 

Amalgamated Bank v. Fair Isaac Corp., No. 1:20-cv-02533 (N.D. Ill.). 

 /s/ Britt M. Miller 

Attorney for Fair Isaac Corporation 

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EXHIBIT G 

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John Bjork

 Cited

As of: May 4, 2020 2:17 PM Z

KPASA, LLC v. United States

United States District Court for the Northern District of Illinois, Eastern Division

May 13, 2004, Decided ; May 17, 2004, Docketed 

No. 04 C 109 

Reporter

2004 U.S. Dist. LEXIS 8720 *; 93 A.F.T.R.2d (RIA) 2004-2294

KPASA, LLC, Petitioner, v. UNITED STATES OF 

AMERICA, Respondent.

Disposition: [*1] Petitioner's motion to consolidate 

granted. 

Core Terms

consolidation, cases, reassignment, summons, 

petitions, summonses, contends, handling, motions

Case Summary

Procedural Posture

Petitioner corporate taxpayer filed a motion, pursuant to 

Fed. R. Civ. P. 42, to consolidate its action against 

respondent United States, which sought to quash a 

summons, with two other cases brought by corporate 

taxpayers against the government, which also sought to 

quash summonses.

Overview

The Internal Revenue Service issued summonses to an 

accounting firm, requesting the production of documents 

concerning the taxpayer and two other taxpayers. All 

three taxpayers filed actions on the same day, seeking 

to quash the summonses. Although the government did 

not oppose consolidation, it claimed that all three cases 

should be stayed pending proper service of process and 

that reassignment of all three cases should be made to 

another federal district judge, who presided over an 

earlier-filed, allegedly related case. In granting the 

motion to consolidate, the court held that it could think of 

no compelling reason, even if proper service had not yet 

been effected, for staying the case and declining to 

consolidate three cases that the parties agreed should 

be consolidated. The court held that, if the government 

decided to challenge service in all three cases, 

consolidation of the cases would facilitate a more 

economical and expeditious handling of that challenge, 

as it would take the form of a single motion to dismiss. 

The court also held that it would be improper to rule 

upon the relatedness of the three cases to the earlierfiled case.

Outcome

The court granted the taxpayer's motion to consolidate.

LexisNexis® Headnotes

Civil Procedure > Trials > Consolidation of Actions

HN1[ ] Trials, Consolidation of Actions

See Fed. R. Civ. P. 42.

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John Bjork

Civil Procedure > Trials > Consolidation of Actions

Governments > Courts > Judges

Civil Procedure > Judicial 

Officers > Judges > General Overview

HN2[ ] Trials, Consolidation of Actions

U.S. Dist. Ct., N.D. Ill., E. Div., R. 40.4(a), defines when 

cases are "related" and sets forth the circumstances 

under which reassignment of cases is appropriate. In 

part, it provides that two or more civil cases are related 

if they involve some of the same issues of fact or law or 

grow out of the same transaction or occurrence. It 

further provides that a case may be reassigned to the 

calendar of another judge if it is related to an earliernumbered case assigned to that judge and: (1) both 

cases are pending in the court; (2) the handling of both 

cases by the same judge is likely to result in a 

substantial saving of judicial time and effort; (3) the 

earlier case has not progressed to the point where 

designating a later filed case as related would be likely 

to delay the proceedings in the earlier case 

substantially; and (4) the cases are susceptible of 

disposition in a single proceeding. U.S. Dist. Ct., N.D. 

Ill., E. Div., R. 40.4(b). Finally, the rule sets forth certain 

requirements for motions to reassign and provides that 

such motions must be presented to the district judge 

presiding over the lowest-numbered case among the 

cases targeted for consolidation. U.S. Dist. Ct., N.D. Ill., 

E. Div., R. 40.4(c), (d).

Tax Law > ... > Audits & 

Investigations > Administrative Summons > Third 

Party Summonses

Tax Law > ... > Audits & 

Investigations > Administrative Summons > General 

Overview

HN3[ ] Administrative Summons, Third Party 

Summonses

See 26 U.S.C.S. § 7609(b)(2)(B).

Civil Procedure > Trials > Consolidation of Actions

HN4[ ] Trials, Consolidation of Actions

General commentary to U.S. Dist. Ct., N.D. Ill., E. Div., 

R. 40.4, concerning the timing of motions to reassign, by 

its terms, does not prohibit the reassignment or 

consolidation of cases prior to the filing of a responsive 

pleading.

Counsel: For KPASA INC, plaintiff: Robert E. 

McKenzie, Richard Keith Hellerman, Patrick John 

Cotter, Arnstein & Lehr, Chicago, IL. David D Aughtry, 

Chamberlain, Hrdlicka, White, Williams and Martin, 

Atlanta, GA. 

Judges: David H. Coar, United States District Judge. 

Opinion by: David H. Coar

Opinion

MEMORANDUM OPINION AND ORDER

Petitioner KPASA, LLC filed a Petition to Quash 

Summons issued by respondent United States of 

America. 1 Petitioner has now moved pursuant to Fed. 

R. Civ. P. Rule 42 to consolidate the instant case with 

SRK Wilshire Partners v. United States of America

(Case No. 04 C 110) and Shahid R. Khan and Ann C. 

Khan v. United States of America (Case No. 04 C 115), 

both of which are also pending in the United States 

District Court for the Northern District of Illinois. For the 

foregoing reasons, this court grants petitioner's motion 

to consolidate.

 [*2] I. Background

1 Although the parties, in their submissions to the court, have 

designated KPASA, LLC "plaintiff" and the United States 

"defendant," due to the nature of this action, these parties are 

more properly described as "petitioner" and "respondent," 

respectively.

2004 U.S. Dist. LEXIS 8720, *1

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A. The Three Petitions to Quash

KPASA commenced the instant action on January 8, 

2004. On the same day, SRK Wilshire Partners and the 

Khans commenced their respective actions against the 

United States by filing Petitions to Quash Summons, as 

well. As explained by petitioner, KPASA, SRK Wilshire 

Partners, and the Khans are all related entities. 

Moreover, all three entities are represented by the same 

counsel in their respective actions. 2

 [*3] Petitioner contends that all three actions emanate 

from the same set of operative facts and seek the same 

remedy. A cursory review of the three petitions supports 

petitioner's characterization. Specifically, on or about 

December 19, 2003, the Internal Revenue Service 

("IRS") issued summonses to BDO Seidman, the public 

accounting firm utilized by KPASA, SRK Wilshire 

Partners, and the Khans to handle their accounting 

needs. The IRS summonses requested production of 

documents concerning KPASA, SRK Wilshire Partners, 

and the Khans (including their tax returns), as well as 

testimony concerning the requested documents. Each of 

the three actions seeks an order quashing the 

respective underlying summonses, and the three 

actions are premised on precisely the same legal 

grounds (i.e., that the summonses were issued for an 

improper purpose, improperly seek documents that are 

not relevant to the IRS' determinations, seek information 

already within the IRS' possession, do not comply with 

administrative and statutory requirements, seek 

privileged information and materials, etc.).

B. KPASA's Motion to Consolidate

KPASA seeks the consolidation of the three abovereferenced actions. [*4] First, KPASA contends that all 

three actions share common questions of fact and law 

2 In an affidavit submitted with petitioner's reply memorandum, 

petitioners' counsel testified that he made an inquiry at the 

Clerk's Office of the United States District Court for the 

Northern District of Illinois concerning the proper procedure for 

service of the underlying Petitions to Quash. He further 

testified that the Clerks' Office unequivocally advised him that 

it would not issue a summons for a petition to quash an IRS 

summons and that the proper method of service of such a 

petition to quash was service with the petitions of notices of 

motion advising the government of the date and time for 

presentment of the petitions.

and involve the same issues as to the propriety of the 

IRS' summonses. Moreover, it notes that all three 

actions involve the same respondent and the same 

attorneys. Finally, petitioner argues that consolidation of 

the three matters and resolution of the same before this 

court (which presides over the first-filed of the three 

cases) is in the best interests of all the parties and 

serves the interest of judicial economy. On these 

grounds, petitioner contends that the three actions may 

be consolidated in line with the standard set forth in 

Rule 42 of the Federal Rules of Civil Procedure.

C. The United States' Response

In its "Memorandum of Law in Opposition to [KPASA's] 

Motion to Consolidate," the government expressly states 

that it does not oppose consolidation of the above three 

actions (i.e., Case Nos. 04 C 109, 04 C 110, and 04 C 

115). (Mem., p.1) ("the United States does not oppose 

consolidation of these three cases"). See also Mem., p. 

2. The government nonetheless raises two collateral 

points, purportedly in opposition to petitioner's [*5] 

motion: (1) all three cases should be stayed pending 

proper service of process; and (2) "if and when a proper 

motion to reassign has been made," reassignment of all 

three cases should be made to the Honorable Judge 

James F. Holderman, who presides over an earlier-filed, 

allegedly related case also pending in the United States 

District Court for the Northern District of Illinois, United 

States v. BDO Seidman, LLP (Case No. 02 CV 4822) 

("the BDO case"). See Mem., p. 1. Implicit in the 

government's arguments is its assent to the notion that 

the three actions are related and should be 

consolidated.

II. Relevant Standards

Rule 42 of the Federal Rules of Civil Procedure provides 

that "HN1[ ] when actions involving a common 

question of law or fact are pending before the court, it 

may order a joint hearing or trial of any or all the matters 

in issue in the actions; it may order all the actions 

consolidated; and it may make such orders concerning 

proceedings therein as may tend to avoid unnecessary 

costs or delay." Fed. R. Civ. P. 42(a). Local Rule 40.4 is 

also relevant to the disposition of KPASA's [*6] motion, 

as it HN2[ ] defines when cases are "related" and sets 

forth the circumstances under which reassignment of 

cases is appropriate. In relevant part, it provides that 

two or more civil cases are related if they "involve some 

of the same issues of fact or law" or "grow out of the 

2004 U.S. Dist. LEXIS 8720, *2

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same transaction or occurrence." L.R. 40.4(a). It further 

provides that a case may be reassigned to the calendar 

of another judge if it is related to an earlier-numbered 

case assigned to that judge and: "(1) both cases are 

pending in this Court; (2) the handling of both cases by 

the same judge is likely to result in a substantial saving 

of judicial time and effort; (3) the earlier case has not 

progressed to the point where designating a later filed 

case as related would be likely to delay the proceedings 

in the earlier case substantially; and (4) the cases are 

susceptible of disposition in a single proceeding." L.R. 

40.4(b). Finally, this Local Rule sets forth certain 

requirements for motions to reassign and provides that 

such motions must be presented to the district judge 

presiding over the lowest-numbered case among the 

cases targeted for consolidation. See L.R. 40.4(c) & (d).

III. Analysis

 [*7] A. The Parties and the Court Agree that the 

Cases Are Related and that Consolidation and 

Reassignment Are Appropriate.

As set forth above, the United States has expressly 

declined to interpose any objection to the consolidation 

of these three cases and, in fact, has conceded that 

they are related and should be consolidated. Against the 

backdrop of the parties' unequivocal agreement on this 

point, the court also agrees and finds that the three 

cases are related and should be consolidated.

First, these three cases clearly "involve a common 

question of law or fact." See Rule 42(a). All three 

petitions challenge the enforceability of the December 

2003 summonses issued by the IRS to BDO Seidman 

requesting documents relating to the three petitioners 

(related entities) and do so on precisely the same legal 

grounds. Consolidating these actions will also serve the 

interest of judicial economy, in that it will prevent 

duplication of judicial effort in handling what will likely be 

the same or similar legal issues. Moreover, 

consolidation and reassignment of the actions is 

consistent with Local Rule 40.4(a), in that the actions 

"involve some of the same issues of fact or law" 

and [*8] "grow out of the same transaction or 

occurrence." L.R. 40.4(a). Reassignment is also 

appropriate under the criteria set forth in L.R. 40.4(b), as 

all three cases are pending in the United States District 

Court for the Northern District of Illinois, the handling of 

these cases by the same judge is likely to result in a 

substantial saving of judicial time and effort, no delay 

will result from consolidation and reassignment (as all 

three cases are at precisely the same stage of 

litigation), and the cases are susceptible of disposition in 

a single proceeding. Based upon these considerations, 

and after consulting with the judges presiding over the 

other two cases, this court concludes that the cases are 

related and that consolidation and reassignment are 

appropriate.

B. The United States' Collateral Arguments Are 

Irrelevant to the Court's Disposition of KPASA's 

Motion.

Notwithstanding its lack of any objection to the 

consolidation of the three cases, the United States 

contends that it has not yet been properly served and 

offers this purported fact as a basis for staying or 

dismissing the instant proceeding, in lieu of granting 

KPASA's motion at this time. 3 Citing Fed. R. Civ. P. 

Rule 4(i)(1)(A) [*9] , the government contends that 

service upon the United States may be commenced 

only by properly serving the United States with a copy of 

both a complaint and a summons. The government 

further contends that this requirement applies with equal 

force to a petition to quash an IRS summons. As 

support for this proposition, the government cites two 

cases from outside of the Seventh Circuit -- Smith v. 

Rossotte, 250 F. Supp. 2d 1266, 1268 (D. Oregon 2003)

(granting motion to dismiss petition to quash notice of 

levy issued by IRS on account of the petitioner's failure 

to properly serve the United States in the manner 

prescribed by Rule 4); and Kish v. United States, No. 

1:95:MC:109, 1996 U.S. Dist. LEXIS 2530, at *3-4 (W.D. 

Mich. 1996) (recommending that petition to quash IRS 

summons be dismissed based upon the petitioner's 

failure to serve the United States in the manner 

prescribed by Rule 4).

 [*10] Here, the government apparently is not 

quarreling with how (i.e., by mail, etc.) or upon whom 

(i.e., which person and/or office) KPASA sought to effect 

service, but only with the fact that the petition was not 

accompanied by a summons. That is, the government 

premises its contention that KPASA failed to comply 

3 The United States contends that, with respect to all three of 

the related actions filed on January 8, 2004, it has not yet 

answered because it has not yet been served with process. 

Regardless of the government's strategic representations 

herein, at least one reason that it has not yet filed a 

responsive pleading in the instant case is that this court 

ordered that the time for doing so be held in abeyance until the 

court ruled on KPASA's pending motion to consolidate.

2004 U.S. Dist. LEXIS 8720, *6

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with the dictates of Rule 4(i)(1) solely upon KPASA's 

failure to serve a summons. On that basis, the 

government requests that the instant action be 

dismissed or stayed pending effective service.

However, KPASA contends that its service upon the 

United States complied with the requirements of section 

7609, which authorizes and governs both the issuance 

of IRS summonses and petitions to quash the same. 

Section 7609 provides, in pertinent part, as follows:

HN3[ ] (2) Proceeding to quash.

. . .

(B) Requirement of notice to person summoned 

and to Secretary. If any person begins a proceeding 

under subparagraph (A) with respect to any 

summons, not later than the close of the 20-day 

period referred to in subparagraph (A) such person 

shall mail by registered or certified mail a copy of 

the petition to the person summoned and to such 

office as the Secretary may direct in the [*11] 

notice referred to in subsection (a)(1).

26 U.S.C. § 7609(b)(2)(B). Citing the squarely on-point 

decision in Vano v. United States, 181 F. Supp. 2d 956, 

958 (N.D. Ind. 2001), KPASA contends that petitions to 

quash IRS summonses need not be accompanied by 

service of a summons because section 7609 does not 

so require and, instead, sets forth specific procedural 

requirements for service of petitions to quash, with 

which KPASA complied in this case. 4 See also Jones v. 

United States, No. 03 C 2876, 2003 U.S. Dist. LEXIS 

20854, at *4 (N.D. Ill. Sept. 26, 2003) ("it appears . . . 

that § 7609(b)(2)(B) governs [the petitioner's action to 

quash IRS summons], not Rule 4") (J. Holderman).

 [*12] At this juncture, it is unnecessary for the court to 

4 Claiming that Vano was wrongly decided, the government 

argues that section 7609 merely interposes an additional 

jurisdictional threshold to bring a petition to quash (i.e., that 

the petition must be filed within 20 days of receipt of notice of 

the administrative summons), but does not alter the service 

requirements. This court finds the government's anemic 

argument on this point much less persuasive than the two 

district court cases from within this Circuit that reached the 

opposite conclusion. Moreover, only one of the two cases from 

outside of this Circuit cited by the United States (Kish) even 

dealt with a petition to quash an IRS summons, and the 

magistrate judge in that case did not mention section 7609 in 

analyzing the propriety of service there (rendering that 

decision relatively less persuasive herein, as well).

add its voice to the dissonant authority concerning 

whether section 7609 exclusively establishes the 

service requirements for petitions to quash IRS 

summons or whether section 7609 and Rule 4 together 

establish those requirements. This is so because the 

government has failed to cite any authority for the rather 

illogical proposition that all three cases should be 

stayed, and not yet consolidated, pending proper 

service of process. Indeed, this court can think of no 

compelling reason, even if proper service has not yet 

been effected, for staying the instant case and declining 

to consolidate three cases that the parties agree should 

be consolidated. To the contrary, even if service was 

improper, consolidation of the cases would better serve 

the interests of judicial economy. If the government 

decides to properly challenge petitioners' service in all 

three cases, consolidation of the cases would facilitate a 

more economical and expeditious handling of that 

challenge, as it would take the form of a single motion to 

dismiss.

The only other obstacle thrown up by the government to 

consolidation of the three cases and the 

concomitant [*13] reassignment of the two later-filed 

cases is a rather confusing dual contention. The 

government argues that a motion to reassign should 

generally follow the service of responsive pleadings 

(suggesting, therefore, that reassignment here is not yet 

proper) and that, once proper service has occurred in 

the present case, all three cases should be consolidated 

with the BDO case (a two-year old case currently before 

Judge Holderman).

The government's circuitous attack upon the 

consolidation of these three actions and their 

reassignment before this court is unavailing. First, HN4[

] the Local Rule's general commentary concerning the 

timing of motions to reassign, by its terms, does not 

prohibit the reassignment or consolidation of cases prior 

to the filing of a responsive pleading. Further, in quoting 

this Local Rule, the government conspicuously omitted 

language expressing its general purpose -- i.e., "In order 

that all parties to a proceeding be permitted to respond 

on the questions of relatedness and possible 

reassignment, such motions should not generally be 

filed until after the answer or motions in lieu of answer 

have been filed in each of the proceedings involved." LR 

40.4(c)(2) (emphasis [*14] added). That interest is 

simply not implicated here, where the United States has 

clearly weighed in on the issue of the cases' relatedness 

and has, in fact, agreed that the cases are related and 

should be consolidated.

2004 U.S. Dist. LEXIS 8720, *10

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Moreover, it would be entirely improper for this court, at 

this point in the litigation or ever, to rule upon the 

relatedness of these three cases to the BDO case 

and/or, on that basis, to consolidate the three cases with 

the BDO case. The BDO case was initiated by the 

United States' filing on July 9, 2002 of a Petition to 

Enforce Internal Revenue Service Summons and is 

currently pending before Judge Holderman. 5 Under the 

Local Rule cited by the government, a motion for 

reassignment may only "be filed with the judge before 

whom the lowest-number case of the claimed related 

set is pending" -- with respect to the BDO case, Judge 

Holderman. LR 40.4(c)(2). In any event, the government 

has not filed a motion to consolidate the three cases 

with the BDO case and/or to reassign the consolidated 

action to Judge Holderman, and the possibility that it 

may choose to do so in the future presents no bar to this 

court's consolidation of the three cases on KPASA's 

motion for the [*15] same.

IV. Conclusion

For the foregoing reasons, this court finds that Case 

Nos. 04 C 109, 04 C 110, and 04 C 115 are related and 

should be consolidated, with the consolidated action to 

be reassigned to this court. Consistent with Local Rule 

40.4, the court will forward a copy of this decision to the 

Executive Committee, along with a request for 

reassignment, as set forth herein.

David H. Coar

United States District Judge

Dated: May 13, 2004

End of Document

5 In that case, which was filed approximately one and a half 

years prior to the instant case and the other two related cases 

filed on that date, the United States seeks to enforce a series 

of twenty summonses issued on May 2, 2002.

2004 U.S. Dist. LEXIS 8720, *14

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EXHIBIT H 

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John Bjork

 Neutral

As of: May 4, 2020 2:19 PM Z

Murry v. America's Mortg. Banc, Inc.

United States District Court for the Northern District of Illinois, Eastern Division

February 27, 2004, Decided ; March 1, 2004, Docketed 

03 C 5811 

Reporter

2004 U.S. Dist. LEXIS 3148 *; 2004 WL 407010

WILLIE C. MURRY and WYLODEAN MURRY, 

Plaintiffs, v. AMERICA'S MORTGAGE BANC, INC.; 

THE LOAN ARRANGER, INC.; CLEARWATER TITLE 

COMPANY; PARAGON HOME LENDING, LLC; 

HOMECOMINGS FINANCIAL NETWORK, INC., 

MICHAEL ROBINS; and JOHN DOES 1-5; Defendants.

Subsequent History: Dismissed by, in part Murry v. 

America's Mortg. Banc, Inc., 2004 U.S. Dist. LEXIS 

12045 (N.D. Ill., June 25, 2004)

Disposition: [*1] Motion granted. 

Core Terms

cases, Mortgage, reassignment, charges, title 

insurance, finance charge, financed

Case Summary

Procedural Posture

In a putative class action, plaintiff homeowners sued 

defendants, a mortgage broker, a title company, an 

individual, three mortgage companies, and five John 

Does, alleging violations of the 15 U.S.C.S. § 1637 of 

the Truth in Lending Act (TILA), Federal Reserve Board 

Regulation Z, 12 C.F.R. § 226.13, and § 2 of the Illinois 

Consumer Fraud Act (ICFA), 815 Ill. Comp. Stat. 505/2. 

Defendants moved for reassignment of the case.

Overview

Defendants argued that the present case and another 

case were related within meaning of U.S. Dist. Ct., N.D. 

Ill., R. 40.4(a). The present case met the requirement or 

relatedness under Rule 40.4(a). It was undisputed that 

both cases involved some of the same issues of law. 

Plaintiffs in both cases allege that the mortgage broker, 

in procuring a mortgage loan for each plaintiff, 

overstated the amount financed and understated the 

finance charge in violation of TILA and ICFA. Thus, any 

resolution of both disputes would necessarily require a 

determination of the legality of the same defendants' 

actions under the same statutes and regulations. The 

present case also satisfied the four requirements of U.S. 

Dist. Ct., N.D. Ill., R. 40.4(b).

Outcome

Defendants' motion for reassignment was granted.

LexisNexis® Headnotes

Civil Procedure > Trials > Consolidation of Actions

HN1[ ] Trials, Consolidation of Actions

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Under U.S. Dist. Ct., N.D. Ill., R. 40.4(a), cases may be 

related if they involve any one of the following 

conditions: (1) the cases involve the same property; (2) 

the cases involve some of the same issues of fact or 

law; (3) the cases grow out of the same transaction or 

occurrence; or (4) in class action suits, one or more of 

the classes involved in the cases is or are of the same.

Banking Law > Consumer Protection > Truth in 

Lending > General Overview

Civil Procedure > Trials > Consolidation of Actions

HN2[ ] Consumer Protection, Truth in Lending

Once relatedness is established under U.S. Dist. Ct., 

N.D. Ill., R. 40.4(a), the case or cases may be 

reassigned if all four of the following criteria are met: (1) 

both cases are pending in the United States District 

Court for the Northern District of Illinois, (2) 

reassignment will result in substantial saving of judicial 

resources, (3) reassignment will not cause a substantial 

delay, and (4) it is possible for disposition of both cases 

in a single proceeding. U.S. Dist. Ct., N.D. Ill., R. 

40.4(b).

Civil Procedure > Trials > Consolidation of Actions

HN3[ ] Trials, Consolidation of Actions

U.S. Dist. Ct., N.D. Ill., R. 40.4 does not require 

complete identity of issues in order for cases to be 

considered related.

Counsel: For WILLIE C MURRY, WYLODEAN 

MURRY, plaintiffs: Cathleen M. Combs, Daniel A. 

Edelman, James O. Latturner, Francis Richard Greene, 

Edelman, Combs & Latturner, Chicago, IL.

For AMERICA'S MORTGAGE BANC, INC, defendant: 

Tod H. Rottman, Best, Vanderlaan & Harrington, 

Chicago, IL. James S Kreamer, Aaron C McKee, Baker, 

Sterchi & Cowden, Kansas City, MO.

For LOAN ARRANGER, INC., THE, CLEARWATER 

TITLE COMPANY, MICHAEL J ROBINS, defendants: 

Raymond John Ostler, John Joseph Lydon, Gomberg, 

Shafman, Gold & Ostler, P.C., Chicago, IL.

For PARAGON HOME LENDING, LLC, defendant: 

Daniel Joseph Neppl, Jamie A. Robinson, Michael Best 

& Friedrich, LLC, Chicago, IL.

For HOMECOMINGS FINANCIAL NETWORK, INC., 

defendant: Arthur F. Radke, Richard Eric Gottlieb, Ralph 

T. Wutscher, Julie C Keller, Dykema Gossett PLIC, 

Chicago, IL. Miles W Hughes, Dykema Gossett, 

Chicago, IL. 

Judges: HON. RONALD A. GUZMAN, United States 

Judge. 

Opinion by: RONALD A. GUZMAN

Opinion

MEMORANDUM OPINION AND ORDER

This matter is before the Court on The Loan Arranger, 

Inc., Clearwater Title Company, Inc., Michael Robins, 

and BWM Mortgage, LLC's motion for a finding of 

relatedness and motion to reassign [*2] the present 

case with Blondell Greenleaf v. BWM Mortgage, LLC

(03 C 6186) pursuant to Northern District of Illinois Local 

Rule 40.4 ("LR 40.4"). For the reasons set forth herein, 

the Court grants the motion.

BACKGROUND

In the instant case, Willie and Wylodean Murry, on 

behalf of themselves and a putative class of similarly 

situated individuals, defendants America's Mortgage 

Banc, Inc., The Loan Arranger, Inc., Clearwater Title 

Company, Paragon Home Lending, LLC, Homecomings 

Financial Network, Inc., Michael Robins, and five John 

Doe defendants. There are two putative classes. Class 

A consists of all who obtained loans from America's 

Mortgage Banc secured by their residences, on or after 

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a date three years before the instant action was 

commenced, involving Loan Arranger and Clearwater 

Title, where the charge for title insurance was excluded 

from the finance charge. Class B consists of all who 

obtained loans secured by their residences, on or after 

three years before this action was commenced, 

involving Loan Arranger and Clearwater, where the 

charge for title insurance was excluded from the finance 

charge.

Prior to April 3, 2002, the Murrys hired Loan Arranger as 

a mortgage [*3] loan broker. On April 3, 2002, the 

Murrys closed on a loan that was arranged by Loan 

Arranger and that was secured by their primary 

household residence. The Murrys received a Truth in 

Lending Statement from America's Mortgage Banc, Inc. 

that listed charges in the amount of $ 1,145 for obtaining 

title insurance from Clearwater Title. This amount was in 

addition to title insurance charges of $ 450 to Lakeshore 

title. America's Mortgage Banc, Inc. did not label these 

charges as "finance charges," but rather included them 

in the total amount financed. Clearwater Title is a 

company under common ownership with the Loan 

Arranger. The Murrys contend that these charges were 

unreasonable and duplicitous and were included in an 

overstated amount financed to disguise compensation 

that was being paid to Loan Arranger in violation of, 

inter alia, 15 U.S.C. § 1637 of the Truth in Lending Act 

("TILA"), Federal Reserve Board Regulation Z, 12 

C.F.R. § 226.13, and Section 2 of the Illinois Consumer 

Fraud Act ("ICFA"), 815 ILL. COMP. STAT. 505/2. They 

now seek rescission of the mortgage loan transactions, 

damages in the [*4] form of attorney's fees, and other 

statutory damages on behalf of all putative class 

members.

Greenleaf v. BWM Mortgage, LLC (03 C 6186), pending 

before Judge Amy St. Eve, is a putative class action 

brought by a plaintiff against defendants BWM 

Mortgage, LLC ("BWM"), Lenders Network USA, Inc., 

Clearwater Title Co., The Loan Arranger, Inc., Michael 

Robins, and five John Doe defendants. Ms. Greenleaf 

hired Loan Arranger to act as a mortgage loan broker. 

On or about September 11, 2002, Loan Arranger 

arranged for such a loan from BWM that was to be 

secured by the plaintiff's household residence.

Not unlike the Murrys, Greenleaf now alleges that Loan 

Arranger understated the finance charge amount and 

overstated the amount financed. On a Truth In Lending 

Statement received from BWM, there are charges in the 

amount of $ 540 to Lakeshore and $ 800 to Clearwater, 

both for title insurance. Ms. Greenleaf alleges that these 

charges are likewise duplicitous and, in light of what 

Chicago Title charges for the same title insurance, 

unreasonably high. The inclusion of these charges in 

the amount financed was designed to disguise 

compensation paid to Loan Arranger, in violation of 15 

U.S.C. § 1637 [*5] of the TILA, 12 C.F.R. § 226.13, and 

Section 2 of ICFA, 815 ILL. COMP. STAT. 505/2. Ms. 

Greenleaf also seeks the same remedies, in the form of 

rescission of the transaction, attorney's fees, and 

statutory damages.

ANALYSIS

The applicable Local Rule of the Northern District of 

Illinois is LR 40.4, which provides for reassignment of 

cases as related. HN1[ ] Under LR 40.4(a), cases may 

be related if they involve any one of the following 

conditions:

(1) the cases involve the same property;

(2) the cases involve some of the same issues of 

fact or law;

(3) the cases grow out of the same transaction or 

occurrence; or

(4) in class action suits, one or more of the classes 

involved in the cases is or are of the same.

LR 40.4(a). HN2[ ] Once relatedness is established, 

the case or cases may be reassigned if all four of the 

following criteria are met: (1) both cases are pending in 

this court; (2) reassignment will result in substantial 

saving of judicial resources; (3) reassignment will not 

cause a substantial delay; and (4) it is possible for 

disposition of both cases in a single proceeding. LR 

40.4(b).

The present [*6] case meets the requirement of LR 

40.4(a) for relatedness. It is undisputed that both cases 

involve some of the same issues of law. Plaintiffs in both 

cases allege that Loan Arranger, in procuring a 

mortgage loan for each plaintiff, overstated the amount 

financed and understated the finance charge in violation 

of TILA and ICFA. Thus, any resolution of both disputes 

will necessarily require a determination of the legality of 

the same defendants' actions under the same statutes 

and regulations. What's more, HN3[ ] the rule does not 

require complete identity of issues in order for cases to 

be considered related. See, e.g., Fairbanks Capital 

Corp. v. Jenkins, 2002 U.S. Dist. LEXIS 26297, No. 02 

C 3930, 2002 WL 31655277, at *2 (N.D. Ill. Nov. 25, 

2002). Finally, the Murry Class B, all those who 

procured loans through Loan Arranger, includes the 

entire Greenleaf class.

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The present case also satisfies the requirements of LR 

40.4(b). There is no question that the first of these 

requirements has been met because both of these 

cases are pending before this Court. The second 

requirement under LR 40.4(b) has been met as well 

because reassignment of the Greenleaf case to this 

Court's docket will result [*7] in substantial time savings 

and promote judicial economy. With the reassignment of 

Greenleaf, only one judge will need to rule on the 

dispositive motions filed by defendants Homecoming 

Financial Network and Mortgage Lenders Network. In 

both cases the plaintiffs will be filing motions for Class 

Certification that will likely involve substantially identical 

briefs and issues because the same law firm represents 

the plaintiffs in both cases subject to this motion.

The third requirement, that the earliest case has not 

progressed too far, has also been satisfied. Murry is still 

in the preliminary stages, and discovery has just begun. 

Reassignment of Greenleaf to this Court's docket would 

not, at this point, cause any substantial delay that would 

otherwise prejudice the resolution of the respective 

parties' dispute. Finally, the fourth requirement, that it be 

possible for both cases to be disposed of in a single 

proceeding, has been met. Both Murry and Greenleaf

require a determination of whether Loan Arranger's 

pricing schedules are allowable under TILA, Federal 

Reserve Board Regulation Z, and ICFA. Moreover, the 

Greenleaf class is subsumed in Murry Class B. [*8] 

Thus, it is clear that the cases are susceptible of 

disposition in a single proceeding.

CONCLUSION

For the reasons set forth above, the Court grants 

defendants' motion for a finding that case nos. 03 C 

5811 and 03 C 6186 are related within the meaning of 

LR 40.4(a) [doc. no. 31-1] and grants defendants' 

motion for reassignment of case no. 03 C 6186 to this 

Court's docket pursuant to LR 40.4(b) [doc. no. 31-2].

SO ORDERED

HON. RONALD A. GUZMAN

United States Judge

2/27/04 

End of Document

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EXHIBIT I 

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 Caution

As of: May 4, 2020 2:21 PM Z

Fairbanks Capital Corp. v. Jenkins

United States District Court for the Northern District of Illinois, Eastern Division

November 25, 2002, Decided ; December 3, 2002, Docketed 

Case No. 02 C 3930 

Reporter

2002 U.S. Dist. LEXIS 26297 *; 2002 WL 31655277

FAIRBANKS CAPITAL CORP., Plaintiff, vs. JOHNNY 

JENKINS and ANNIE J. WESSON-JENKINS, 

Defendants. JOHNNY JENKINS and ANNIE J. 

WESSON-JENKINS, Counterclaimants, vs. 

FAIRBANKS CAPITAL CORP. and NATIONSCREDIT 

FINANCIAL SERVICES CORP., d/b/a EQUICREDIT 

CORPORATION OF ILLINOIS, Counterdefendants.

Prior History: Fairbanks Capital Corp. v. Jenkins, 225 

F. Supp. 2d 910, 2002 U.S. Dist. LEXIS 19640 (N.D. Ill., 

2002)

Disposition: [*1] Defendants' motion and second 

motion to designate Case Nos. 02 C 5023, 02 C 6059 

and 02 C 7262 as related to present case granted. 

Core Terms

cases, reassignment, confirmation, mortgage, 

defendants', rescind, non-rescission, foreclosure, 

borrowers

Case Summary

Procedural Posture

Plaintiff lender sued defendant mortgagors, seeking to 

foreclose on a mortgage. The mortgagors asserted a 

Truth in Lending Act (TILA) affirmative defense, and 

filed a counterclaim for damages under the TILA. The 

mortgagors moved pursuant to U.S. Dist. Ct., N.D. Ill., 

R. 40.4(c), to find that three later-filed cases pending 

before other judges were related, and moved for 

reassignment of those cases to the court's docket.

Overview

All of the cases at issue were pending in the court, and 

the first of the cases to be filed had not progressed past 

the discovery stage. The court likewise believed that 

significant judicial efficiency would result from having 

one judge handle all four of the cases. None of the 

cases could be disposed of without determining the 

legality of the alleged practice regarding non-rescission 

"confirmation" at the time of the loan. Finally, all of the 

cases were reasonably subject to disposition in a single 

proceeding. Even though the lender was entitled to 

prosecute its foreclosure claim against the mortgagors, 

that claim could not be determined without addressing 

the TILA issue raised as part of the mortgagors' 

affirmative defense of rescission. Determination of the 

common TILA issues raised in all four cases, whatever 

the outcome, would be outcome-determinative of the 

cases, and the evidence regarding the manner in which 

each of the borrowers allegedly was required to sign the 

non-rescission confirmation was likely to be admissible 

in the other cases pursuant to Fed. R. Evid. 404(b) to 

show modus operandi and/or the absence of mistake or 

accident.

Outcome

The mortgagors' motion was granted.

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LexisNexis® Headnotes

Civil Procedure > Preliminary 

Considerations > Venue > Multidistrict Litigation

HN1[ ] Venue, Multidistrict Litigation

U.S. Dist. Ct., N.D. Ill., R. 40.4(a) states that two or 

more civil cases may be related if they involve the same 

property, the same issues of fact or law, arise from the 

same transaction or occurrence, or, in the case of class 

action suits, involve the same classes. U.S. Dist. Ct., 

N.D. Ill., R. 40.4(a)(1)-(4).

Banking Law > Consumer Protection > Truth in 

Lending > General Overview

Civil Procedure > Preliminary 

Considerations > Venue > Multidistrict Litigation

HN2[ ] Consumer Protection, Truth in Lending

U.S. Dist. Ct., N.D. Ill., R. 40.4(a) does not require 

complete identity of issues in order for cases to be 

considered related.

Civil Procedure > Preliminary 

Considerations > Venue > Multidistrict Litigation

HN3[ ] Venue, Multidistrict Litigation

Under U.S. Dist. Ct., N.D. Ill., R. 40.4(b), reassignment 

may be ordered if four criteria are met as to all of the 

cases in question: they are pending in the court; the 

handling of all the cases by the same judge is likely to 

result in a substantial saving of judicial time and effort; 

the earliest case has not progressed to far that 

designating later cases as related would likely delay 

substantially the proceedings in the earliest case; and 

the cases are susceptible of disposition in a single 

proceeding. U.S. Dist. Ct., N.D. Ill., R. 40.4(b)(1)-(4).

Civil Procedure > Preliminary 

Considerations > Venue > Multidistrict Litigation

HN4[ ] Venue, Multidistrict Litigation

Reassignment of cases as related does not inexorably 

lead to their consolidation for all purposes.

Banking Law > Consumer Protection > Truth in 

Lending > General Overview

Civil Procedure > Preliminary 

Considerations > Venue > Multidistrict Litigation

HN5[ ] Consumer Protection, Truth in Lending

Although U.S. Dist. Ct., N.D. Ill., R. 40.4(b) requires a 

showing that the cases to be reassigned be susceptible 

of determination in a single proceeding with the earlier 

case already pending on the judge's docket, it does not 

require proof that the cases can or should be 

consolidated. Rather, the rule requires only a finding 

that the cases are "susceptible" (that is, capable) of 

determination in a single proceeding.

Counsel: For FAIRBANKS CAPITAL CORP., plaintiff: 

Renee Meltzer Kalman, Thomas James Donahue, 

Michael Steven Fisher, Erik Edward Blumberg, Ryan 

Gray Krueger, Marc D. Engel, Kenneth James Johnson, 

Alycia Alexandra Fitz, Fisher & Fisher, P.C., Chicago, 

IL.

For FAIRBANKS CAPITAL CORP., plaintiff: Bonita L. 

Stone, James W. Hutchison, Fritz Edward Berckmueller, 

Katten Muchin Zavis Rosenman, Chicago, Il.

For FAIRBANKS CAPITAL CORP., plaintiff: Donald C. 

Brown, David M Souders, Sandra L Brickel, Weiner, 

Brodksy, Sidman & Kider, Washington, DC.

For JOHNNY JENKINS, ANNIE J WESSON-JENKINS, 

defendants: Cathleen M. Combs, Daniel A. Edelman, 

James O. Latturner, Jennifer S Cichowski, Edelman, 

Combs & Latturner, Chicago, IL.

For JOHNNY JENKINS, ANNIE J WESSON-JENKINS, 

2002 U.S. Dist. LEXIS 26297, *1

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defendants: Adela Casandra Lucchesi, Rock, Fusco & 

Garvey, Chicago, IL.

For JOHNNY JENKINS, ANNIE J WESSON-JENKINS, 

counter-claimants: Cathleen M. Combs, Daniel A. 

Edelman, James O. Latturner, Jennifer S Cichowski, 

Edelman, Combs & Latturner, Chicago, IL.

For [*2] JOHNNY JENKINS, ANNIE J WESSONJENKINS, counter-claimants: Adela Casandra Lucchesi, 

Rock, Fusco & Garvey, Chicago, IL.

For FAIRBANKS CAPITAL CORP., counter-defendant: 

Fritz Edward Berckmueller, Bonita L. Stone, James W. 

Hutchison, Katten Muchin Zavis Rosenman, Chicago, Il.

For FAIRBANKS CAPITAL CORP., counter-defendant: 

Donald C. Brown, David M Souders, Sandra L Brickel, 

Weiner, Brodksy, Sidman & Kider, Washington, DC.

For NATIONSCREDIT FINANCIAL SERVICES 

CORPORATION, counter-defendant: Craig Allen Varga, 

Paul N. Barger, Varga, Berger, Ledsky, Hayes & Casey, 

Chicago, IL.

For FAIRBANKS CAPITAL CORP., counter-defendant: 

Renee Meltzer Kalman, Thomas James Donahue, 

Michael Steven Fisher, Erik Edward Blumberg, Ryan 

Gray Krueger, Marc D. Engel, Kenneth James Johnson, 

Alycia Alexandra Fitz, Fisher & Fisher, P.C., Chicago, 

IL. 

Judges: MATTHEW F. KENNELLY, United States 

District Judge. 

Opinion by: MATTHEW F. KENNELLY

Opinion

MEMORANDUM OPINION AND ORDER

MATTHEW F. KENNELLY, District Judge:

Fairbanks Capital Corp., the assignee of a mortgage of 

real estate given to secure payment of a promissory 

note, sued the mortgagors, Johnny Jenkins and Annie 

Wesson-Jenkins, seeking [*3] to foreclose on the 

mortgage. The case was filed in this Court based on 

diversity of citizenship. In their answer, the defendants 

asserted as an affirmative defense that they were 

entitled under the Truth in Lending Act to rescind the 

transaction and were exercising that right. They also 

counterclaimed against Fairbanks and Nationscredit 

Financial Services Corp. (which does business as 

EquiCredit Corp. of Illinois), the original mortgagee, for 

damages under the TILA. The Court previously denied 

Fairbanks' motion to strike the affirmative defense and 

dismiss the counterclaim. Fairbanks Capital Corp. v. 

Jenkins, 225 F. Supp. 2d 910, 2002 WL 31260011 (N.D. 

Ill. Oct. 9, 2002).

The defendants have now moved this Court pursuant to 

Northern District of Illinois Local Rule 40.4(c) to find that 

three later-filed cases pending before other judges of 

the Court are related to this one and for that reason to 

request reassignment of those cases to this Court's 

docket. Fairbanks and EquiCredit have objected to the 

motion. For the reasons stated below, the Court grants 

defendants' motion.

The defendants' TILA claim involves EquiCredit's 

alleged violation of TILA provisions [*4] requiring that 

they be given notice of their right to rescind the 

transaction within three business days. See 15 U.S.C. § 

1635; 12 C.F.R. § 226.23. Defendants contend that a 

document they were asked to sign at closing purportedly 

"confirming" that they were not rescinding was invalid 

because it improperly negated their right to rescind. This 

TILA violation, defendants contend, had the effect of 

giving them an extended three-year period in which to 

rescind, see 15 U.S.C. § 1635(f); 12 C.F.R. § 226.23(a), 

which they contend can be asserted against an 

assignee like Fairbanks. See 15 U.S.C. § 1641(c). As 

noted earlier, they seek rescission of the transaction as 

well as damages and attorney's fees.

McWethy v. Nationscredit Financial Services Corp., 

Case No. 02 C 7262, pending before Judge Robert 

Gettleman, is a putative class action brought on behalf 

of eight named plaintiffs (two individual mortgagors and 

three groups of dual mortgagors) who are parties to 

mortgage loans made by EquiCredit and assigned to 

Fairbanks. The defendants are Nationscredit [*5] d/b/a 

EquiCredit Corp. of Illinois, EquiCredit Corp. of Missouri; 

2002 U.S. Dist. LEXIS 26297, *1

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EquiCredit Corp. of America; and Fairbanks. The 

plaintiffs' complaint asserts claims under TILA and the

Illinois Consumer Fraud Act arising from EquiCredit's 

alleged practice of requiring borrowers to sign 

confirmation forms effectively giving up their right to 

rescind.

Brown v. Nationscredit Financial Services Corp., Case 

No. 02 C 5023, pending before Judge William Hibbler, is 

a putative class action brought by a single plaintiff 

against Nationscredit d/b/a EquiCredit Corp. of Illinois; 

EquiCredit Corp. of America; and Fairbanks. The 

plaintiff, a homeowner who obtained a mortgage loan 

from EquiCredit (and assigned to Fairbanks) in order to 

finance improvements to his home, alleges TILA and 

ICFA violations based on the practice of requiring 

borrowers to "confirm" their non-rescission at the time of 

the transaction. He also alleges that the loan was 

subject to the Home Ownership and Equity Protection 

Act, which he says EquiCredit violated by failing to 

make certain HOEPA-required disclosures.

Finally, Brown v. Nationscredit Financial Services Corp.,

Case No. 02 C 6059, pending before Judge Charles 

Norgle, is [*6] brought on behalf of two plaintiffs against 

Nationscredit d/b/a EquiCredit Corp. of Illinois; 

EquiCredit Corp. of America; and Fairbanks. The 

plaintiffs, who obtained a mortgage loan from EquiCredit 

which was assigned to Fairbanks, alleges violations of 

TILA and ICFA arising from the previously-mentioned 

practice of requiring borrowers to "confirm" nonrescission at the time of the transaction.

The plaintiffs in all of the cases that are subject to this 

motion are represented by the same law firm. As best 

we can tell, all of the Nationscredit / EquiCredit entities 

in all of the cases are represented by a single law firm, 

and Fairbanks is likewise represented by the same law 

firm in all of the cases.

HN1[ ] Local Rule 40.4(a) states that two or more civil 

cases may be related if they involve the same property, 

the same issues of fact or law, arise from the same 

transaction or occurrence, or, in the case of class action 

suits, involve the same classes. N.D. Ill. LR 40.4(a)(1)-

(4). EquiCredit and Fairbanks do not argue that the 

cases are not related within the meaning of Rule 

40.4(a), and even if they had done so, the Court would 

find that the criteria of Rule 40.4(a)(2) have been met, 

as [*7] the cases involve the same issues of law. There 

is no question that each of these cases will involve the 

issue of the legality, under TILA and ICFA, of 

EquiCredit's alleged practice of requiring borrowers to 

sign non-rescission "confirmations." HN2[ ] The Rule 

does not require complete identity of issues in order for 

cases to be considered related.

EquiCredit and Fairbanks' challenge to defendants' 

motion turns on the application of Local Rule 40.4(b), 

which provides the criteria for determining whether 

assignment of related cases to the judge with the 

lowest-numbered case is appropriate. HN3[ ] Under 

Rule 40.4(b), reassignment may be ordered if four 

criteria are met as to all of the cases in question: they 

are pending in this Court; the handling of all the cases 

by the same judge is likely to result in a substantial 

saving of judicial time and effort; the earliest case has 

not progressed to far that designating later cases as 

related would likely delay substantially the proceedings 

in the earliest case; and the cases are susceptible of 

disposition in a single proceeding. N.D. Ill. LR 

40.4(b)(1)-(4). There is no question that the first and 

third of these criteria are met here; all of the cases [*8] 

are pending in this Court, and Fairbanks Capital Corp. v. 

Jenkins, the first of the cases to be filed, has not 

progressed all that far: the Court has ruled on a motion 

to dismiss the counterclaim, and discovery has just 

gotten started.

The Court likewise believes that significant judicial 

efficiency will result from having one judge handle all 

four of the cases. None of the cases can be disposed of 

without determining the legality of EquiCredit's alleged 

practice regarding non-rescission "confirmation" at the 

time of the loan, as well as the consequences of that 

practice vis-a-vis Fairbanks as assignee. Reassignment 

of all of the cases to this Court's calendar will permit 

these issues to be briefed and determined once, rather 

than four separate times, which will result in a 

substantial saving of judicial time and effort -- not to 

mention a substantial saving of the parties' and their 

counsels' time and effort. The overall administration of 

justice will likewise be enhanced by having a single 

judge determine this issue in all four of the cases. 

Indeed, the Court of Appeals for the Seventh Circuit 

recently criticized the judges of this Court for permitting 

numerous lawsuits involving [*9] TILA and ICFA-related 

challenges to the practices of "payday loan" companies 

to proceed along different tracks before different judges, 

resulting in numerous and disparate decisions, as well 

as multiple appeals. Smith v. Check-N-Go of Illinois, 

Inc., 200 F.3d 511, 513 n.* (7th Cir. 1999). The criticism 

was not entirely justified, as none of the parties in any of 

those cases had sought reassignment under Local Rule 

40.4 or on any other basis. But the same, of course, 

cannot be said here.

2002 U.S. Dist. LEXIS 26297, *5

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Finally, all of the cases are reasonably subject to 

disposition in a single proceeding. EquiCredit and 

Fairbanks argue strenuously that the fact that the case 

already pending on this Court's docket is, unlike the 

other cases, a mortgage foreclosure case, requires 

denial of defendants' motion for reassignment. They 

contend that a mortgagee is "the master of his 

complaint" and is entitled to proceed with the 

foreclosure without the annoyance of extraneous 

matters. But even though Fairbanks is entitled to 

prosecute its foreclosure claim against the Jenkins 

defendants, that claim cannot be determined without 

addressing the TILA issue raised as part of defendants' 

affirmative defense of [*10] rescission. Thus the Court 

will be required to consider that issue in Fairbanks v. 

Jenkins whether or not the other cases are reassigned 

to this Court. Determination of that same issue in four 

cases simultaneously is not likely to prolong the time 

needed to consider it; the same lawyers appear in all 

the cases, which can and will be briefed jointly on the 

common issues. The HOEPA issue raised in one of the 

Brown cases likely can be determined at the same time 

and thus likewise does not undercut the Court's ability to 

resolve all of the cases simultaneously.

Fairbanks and Nationscredit also argue that Illinois' 

mortgage foreclosure laws preclude the assertion of a 

class action as part of a counterclaim by the 

mortgagor/defendant. But that is not a necessary result 

of reassignment; the Jenkins defendants have not 

asserted a class claim; and HN4[ ] reassignment of 

cases as related does not inexorably lead to their 

consolidation for all purposes. And HN5[ ] although 

Rule 40.4(b) requires a showing that the cases to be 

reassigned be susceptible of determination in a single 

proceeding with the earlier case already pending on the 

judge's docket, it does not require proof that the cases 

can or [*11] should be consolidated. Rather, the Rule 

requires only a finding that the cases are "susceptible" 

(that is, capable) of determination in a single 

proceeding. The Court finds that this is so. 

Determination of the common TILA / ICFA issues raised 

in all four cases, whatever the outcome, will be 

outcome-determinative of McWethy and both Brown

cases 1 as well as in Fairbanks v. Jenkins (in which the 

1 One of the Brown cases also involves a HOEPA claim, but 

this involves the same evidence as the TILA claim, and it likely 

can and will be determined together with that claim. The 

presence of the HOEPA claim thus does not suggest that the 

cases are not susceptible of being determined in a single 

proceeding.

primary defense to foreclosure is the alleged TILA 

violation). Moreover, as defendants argue, the evidence 

regarding the manner in which each of the borrowers 

allegedly was required to sign the non-rescission 

confirmation is likely to be admissible in the other cases 

pursuant to Federal Rule of Evidence 404(b) to show 

modus operandi and/or the absence of mistake or 

accident.

 [*12] Conclusion

For the reasons stated above, the Court finds that Case 

Nos. 02 C 5023, 02 C 6059, and 02 C 7262 are related 

to the present case within the meaning of Local Rule 

40.4(a) and that reassignment of those cases to this 

Court's docket is appropriate under Local Rule 40.4(b) 

and therefore grants defendants' motion and second 

motion to designate those cases as related to this one 

[docket items 22-1, 25-1]. The appropriate request will 

be submitted to the Executive Committee. This case (as 

well as the others, assuming they are reassigned by 

then) is set for a status hearing on December 19, 2002 

at 9:30 a.m.

MATTHEW F. KENNELLY

United States District Judge

Date: November 25, 2002 

End of Document

2002 U.S. Dist. LEXIS 26297, *9

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John Bjork

 Caution

As of: May 4, 2020 2:22 PM Z

Martin v. Midland Funding LLC

United States District Court for the Northern District of Illinois, Eastern Division

August 31, 2011, Decided; August 31, 2011, Filed

11 C 3104

Reporter

2011 U.S. Dist. LEXIS 97789 *; 2011 WL 3876965

NICHOLAS MARTIN, individually and on behalf of a 

class, Plaintiff, vs. MIDLAND FUNDING LLC, 

Defendant.

Subsequent History: Transferred by In re Midland 

Credit Mgmt., 2011 U.S. Dist. LEXIS 118987 (J.P.M.L., 

Oct. 11, 2011)

Core Terms

cases, reassign, Local Rule, purported, cellular 

telephone, discovery

Counsel: [*1] For Nicholas Martin, on behalf of himself 

and others similarly situated, Plaintiff: Alexander Holmes 

Burke, LEAD ATTORNEY, Burke Law Offices, LLC, 

Chicago, IL.

For Midland Funding, LLC, Defendant: Theodore Wilson 

Seitz, LEAD ATTORNEY, Dykema Gossett, PLLC, 

Lansing, MI; James Michael Golden, Renee Lynn 

Zipprich, Dykema Gossett PLLC, Chicago, IL.

Judges: Charles P. Kocoras, United States District 

Judge.

Opinion by: Charles P. Kocoras

Opinion

ORDER

CHARLES P. KOCORAS, District Judge:

This case comes before the Court on Defendant 

Midland Funding, LLC's ("Midland") motion to reassign 

and consolidate a later-filed matter pursuant to Northern 

District of Illinois Local Rule 40.4(c). For the reasons 

stated below, the motion is denied.

Midland asks the Court to reassign and consolidate 

Scardina v. Midland Credit Management, No. 11-cv3149 (N.D. Ill.) (Lindberg, J.) ("Scardina"), with the 

instant matter before this Court, Martin v. Midland 

Funding, LLC, No. 11-cv-3104 (N.D. Ill.) (Kocoras, J.) 

("Martin"). Plaintiff Dave Scardina ("Scardina") objects. 

To resolve the pending motion, a summary of the two 

cases is necessary.

On May 10, 2011, Plaintiff Nicholas Martin ("Martin") 

filed a purported class action against Midland. The 

amended [*2] complaint asserts class claims under the 

Telephone Consumer Protection Act, 47 U.S.C. § 227

("TCPA"), and the Fair Debt Collection Practices Act, 15 

U.S.C. § 1692 ("FDCPA"). Martin seeks to hold Midland 

liable for calling class members' cellular telephones 

using an automatic telephone dialing system or 

prerecorded or artificial voice. Martin purports to 

represent individuals who resided in Illinois between 

January 1, 2008, and November 24, 2008, received 

calls during that same time period, and had an alleged 

debt obtained by Midland during that same time period. 

The Martin action is currently pending before this Court.

One day later, on May 11, 2011, Scardina filed a 

purported class action against Midland, as well as 

Midland Credit Management, Inc. ("MCM") and Encore 

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Capital Group, Inc. ("Encore"). Scardina asserts a class 

claim under the TCPA and seeks to hold all three 

defendants liable. Scardina seeks to hold MCM liable for 

calling class members' cellular telephones using an 

automatic telephone dialing service or an artificial or 

prerecorded voice without their prior express consent. 

Scardina also seeks to hold Midland, the owner of the 

debt, vicariously liable. Finally, Scardina [*3] seeks to 

hold Midland's parent, Encore, liable for raising the 

capital for the predictive dialing equipment and directing 

MCM to use the equipment. Scardina purports to 

represent individuals with Illinois cellular telephone 

numbers who received automated calls between May 

11, 2007, and May 31, 2011. The Scardina action is 

currently pending before Judge Lindberg.

Any party may file a motion for reassignment based on 

the relatedness of two or more cases. N.D. Ill. L.R. 

40.4(c). The party moving for reassignment must show 

that the standards in Local Rule 40.4(a) and 40.4(b) are 

satisfied. According to Local Rule 40.4(a), two or more 

civil cases may be related if one or more of the following 

conditions are met: (1) the cases involve the same 

property; (2) the cases involve some of the same issues 

of fact or law; (3) the cases grow out of the same 

transaction or occurrence; or (4) in class action suits, 

the classes are the same. Pursuant to Local Rule 

40.4(b), the court may reassign a case related to an 

earlier-numbered case if: (1) both cases are pending in 

this Court; (2) the handling of both cases by the same 

judge is likely to result in a substantial saving of judicial 

time and effort; [*4] (3) the earlier case has not 

progressed to a point where designating a later-filed 

case as related would likely substantially delay the 

proceedings in the earlier case; and (4) the cases are 

susceptible of disposition in a single proceeding.

Midland argues that the cases are related under Local 

Rule 40.4(a) because the cases involve some of the 

same issues of fact or law and the classes are the 

same. Because Martin and Scardina both assert class 

claims under the TCPA against Midland, some common 

issues of fact and law exist. However, aside from a 

single cause of action against the same defendant, the 

cases are very different. First, Scardina, unlike Martin, 

asserts a TCPA claim against two additional 

defendants, MCM and Encore, and has a different 

theory regarding each defendant's liability. Martin did 

not sue MCM, the licensed debt collector, or Encore, the 

parent allegedly directing MCM's use of predictive 

dialing equipment. Thus, some discovery relating to 

MCM's and Encore's involvement in Scardina will not be 

relevant in Martin.

Second, unlike Scardina, Martin asserts an additional 

class claim under the FDCPA. The FDCPA claim 

involves factual issues wholly unrelated to the TCPA 

claim. [*5] In particular, Martin's FDCPA claim deals 

with false representations Midland allegedly made to 

consumer reporting agencies regarding the character, 

amount, or legal status of Martin's purported debt. 

Martin's FDCPA claim thus varies the scope of 

discovery in Martin.

Finally, the class definitions substantially differ. The 

class in Martin includes individuals who: (1) resided in 

Illinois between January 1, 2008, and November 24, 

2008; (2) received calls during that same time period; 

and (3) had an alleged debt obtained by Midland during 

that same time period. Thus, class discovery in Martin

will focus on the purported class members' residences, 

the time of the calls, and the time Midland obtained the 

alleged debts. Different from Martin, the class in 

Scardina includes individuals with Illinois cellular 

telephone numbers who received automated calls 

between May 11, 2007, and May 31, 2011. Thus, class 

discovery in Scardina will focus on the purported class 

members' cellular telephone numbers, not their 

residences, and whether they received calls between 

May 11, 2007, and May 31, 2011, a much broader time 

frame. Further, inclusion in the Scardina class, unlike 

the Martin class, does not [*6] depend on when 

Midland obtained the alleged debt. For these reasons, 

Martin and Scardina are not sufficiently related for 

reassignment under Local Rule 40.4(a).

Even if the cases were sufficiently related under Local 

Rule 40.4(a), Midland has not shown that the cases 

satisfy the standard in Local Rule 40.4(b). For the 

reasons stated above, the handling of both cases by the 

same judge will not likely result in a substantial saving of 

judicial time and effort and the cases are not susceptible 

to disposition in a single proceeding. Moreover, 

reassignment would likely delay the proceedings in 

Scardina, since the deadline for the close of discovery is 

approximately one month away, September 28, 2011.

For the foregoing reasons, the Court denies Midland's 

motion to reassign and consolidate Scardina with 

Martin.

/s/ Charles P. Kocoras

Charles P. Kocoras

United States District Judge

Dated: August 31, 2011

2011 U.S. Dist. LEXIS 97789, *2

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End of Document

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John Bjork

No Shepard’s SignalTM

As of: May 4, 2020 2:23 PM Z

Teamsters Local 705 Pension v. A.D. Conner, Inc.

United States District Court for the Northern District of Illinois, Eastern Division

May 4, 2011, Decided; May 4, 2011, Filed

10 C 6352

Reporter

2011 U.S. Dist. LEXIS 47853 *; 2011 WL 1674839

TEAMSTERS LOCAL 705 PENSION and, HEALTH 

FUND TRUSTEES, Plaintiffs, v. A.D. CONNER, INC., 

an Illinois corporation, Defendant.

Core Terms

cases, Consolidate, saving, judicial time

Counsel: [*1] For Local 705 International Brotherhood 

of Teamsters Pension Fund, Local 705 International 

Brotherhood of Teamsters Health and Welfare Fund, 

Trustee Joseph Bakes, Trustee Stephen FG Bridge, 

Trustee Juan Campos, Trustee Gregory R Foster, 

Trustee William Keenan, Trustee John Naughton, 

Trustee Stephen E Pocztowski, Trustee Phillip D. 

Stanoch, Plaintiffs: Catherine Marie Chapman, Patrick 

N. Ryan, Baum Sigman Auerbach & Neuman, Ltd., 

Chicago, IL.

For A.D. Conner, Inc., Defendant: L. Steven Platt, LEAD 

ATTORNEY, Pedersen & Houpt, Chicago, IL.

Judges: RONALD A. GUZMAN, District Judge.

Opinion by: RONALD A. GUZMAN

Opinion

MEMORANDUM OPINION AND ORDER

Before the Court is defendant A.D. Conner, Inc.'s motion 

to consolidate pursuant to Local Rule ("LR") 40.4

Teamsters Local Union 705 v. A.D. Conner, Inc., 10 C 

6916, ("the Teamsters case"), which is currently pending 

before Judge Kennelly, with this case. For the following 

reasons, the Court denies the motion.

Background

In the Teamsters case, the Teamsters Union has sued 

defendant for allegedly failing to provide its union 

employees with the sixty-day pre-firing notice before its 

closing as required by the Worker Adjustment and 

Retraining Notification ("WARN") Act, 29 U.S.C. § 2101, 

et. seq. [*2] (Def.'s Mot. Consolidate Ex. A, Compl. at ¶ 

19.) In this case, Teamsters' pension and health fund 

trustees ("the Funds"), have sued defendant alleging 

that it was delinquent in making required payments to 

the Funds in violation of the Employee Retirement 

Income Security Act ("ERISA") of 1974, 29 U.S.C. §§ 

1132, 1145, because it apparently no longer had money 

to continue its operations, and therefore had to close its 

doors (defendant's parent company, which owns 100% 

of it, filed for bankruptcy a week after defendant 

terminated its operations). (Pls.' Resp. Def.'s Mot. 

Consolidate ("Funds' Resp.") at 1- 2, n.4.)

Discussion

Before a case may be reassigned under LR 40.4, the 

movant must first show that the cases are "related." LR 

40.4(a). Two cases may be related if, among other 

things, the cases "involve some of the same issues of 

fact or law" or the "cases grow out of the same 

transaction or occurrence." LR 40.4(a). Both criteria are 

satisfied here. First, both cases grow out of defendant 

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John Bjork

terminating its operations as discussed above. Second, 

both cases involve some of the same issues of fact 

regarding damages. Both claims will require the use of 

the same collective bargaining agreement [*3] to 

calculate unpaid fringe benefits and possibly accrued 

vacation pay that both plaintiffs allege they are owed 

under either ERISA or the WARN Act. (Def.'s Mot. 

Consolidate Ex. A, Compl. at 4; Funds' Resp. at 5, n.8.) 

Therefore, the first hurdle of Local Rule 40.4 is satisfied.

Next, related cases may be reassigned under LR 

40.4(b) if each of the following criteria is met:

(1) both cases are pending in this Court;

(2) the handling of both cases by the same judge is 

likely to result in a substantial saving of judicial time 

and effort;

(3) the earlier case has not progressed to the point 

where designating a later filed case as related 

would be likely to delay the proceedings in the 

earlier case substantially; and

(4) the cases are susceptible of disposition in a 

single proceeding.

LR 40.4(b). And under LR 40.4(c), the moving party has 

an obligation to specifically identify in its motion why 

each of the four conditions of LR 40.4(b) is met. See 

Sunstar, Inc. v. Alberto-Culver Co., No. 01 C 0736, 01 C 

5825, 2003 U.S. Dist. LEXIS 13492, 2003 WL 

21801428, at *3 (N.D. Ill. Aug. 1, 2003). Here, the 

defendant has failed to articulate why this case satisfies 

any of the conditions set forth in section (b) of LR 40.4

(or section (a) [*4] for that matter). Rather the movant, 

after quoting the entire LR, repeatedly makes 

conclusory assertions that both cases concern the 

"same common operative set of facts and 

circumstances" and that the two cases are "related." 

(Def.'s Mot. Consolidate at 2-3.) Nothing in the motion, 

for instance, articulates how the handling of both cases 

by the same judge would result in substantial saving of 

judicial time and effort or how the Court could resolve 

the two cases in a single proceeding. Failure to satisfy 

this pleading requirement, in and of itself, serves as 

adequate grounds for denying the motion. See, e.g., 

Lawrence E. Jaffe Pension Plan v. Household Int'l, Inc., 

No. 02 C 5893, 2003 U.S. Dist. LEXIS 7466, 2003 WL 

21011757, at *3 (N.D. Ill. May 5, 2003) (denying a 

motion to reassign because movant failed to articulate 

why the four conditions of LR 40.4(b) were met as 

required by LR 40.4(c)); Davis v. Quebecor World, No. 

01 C 8014, 2002 U.S. Dist. LEXIS 267, 2002 WL 27660, 

at *3 (N.D. Ill. Jan. 10, 2002) (same); Daniels v. 

Pipefitters' Ass'n Local Union No. 597, 174 F.R.D. 408, 

411 (N.D. Ill. 1997) (same).

Nevertheless, even if defendant had satisfied the 

pleading requirement of LR 40.4(c), plaintiffs argue that 

the motion should be [*5] denied because the second 

and forth conditions of LR 40.4(b) are not satisfied. 

(Funds' Resp. at 6-7.) The Court agrees. First, as to the 

second condition, the causes of action are 

fundamentally distinct as they are brought by two 

different plaintiffs, pursuant to two different statutes, and 

each requires proof of different factual elements. One of 

the cases involves the Funds suing for unpaid 

contributions under ERISA, while the other case 

involves the Teamsters Union suing for back pay and 

other benefits on behalf of defendant's employees under 

the WARN Act. (Id. at 7.) Further, defendant has alleged 

certain defenses in its answer to the Teamsters' 

complaint that only apply to WARN Act cases. (Def.'s 

Answer at 5-6.) Although there would be some saving of 

judicial time and effort because there are some common 

issues of fact regarding damages, such saving would be 

minimal at best because ultimately each case will 

require different discovery, legal findings and damages 

calculations. See Hollinger Int'l, Inc. v. Hollinger, Inc., 

No. 04 C 0698, 2004 U.S. Dist. LEXIS 7883, 2004 WL 

1102327, at *3 (N.D. Ill. May 5, 2004) (finding that 

although cases involve some of the same factual issues, 

resolving the issues together [*6] will not result in 

substantial judicial savings because each will require 

different discovery and legal findings); Clark v. Ins. Car 

Rentals, Inc., 42 F. Supp. 2d 846, 848 (N.D. Ill. 1999)

(finding that there would be no substantial saving of 

judicial time because most of the time will be spent on 

issues not common to both cases). Accordingly, the 

Court finds that its handling of both cases would not 

result in a substantial saving of judicial time and effort.

Second, the fourth condition is satisfied if there are 

some issues of both law and fact that are the same in 

the related case. See Lawrence E. Jaffe Pension Plan, 

2003 U.S. Dist. LEXIS 7466, 2003 WL 21011757, at *3

(citing cases). Here, there are no common issues of law, 

and the fact issues differ substantially. The crux of this 

case is whether defendant was required to make 

contributions to the Funds per their collective bargaining 

agreement and whether it failed to do so. The crux of 

the Teamsters' case is whether defendant failed to 

provide its employees with the statutorily-required notice 

of its closing. (Funds' Resp. at 4-5.) Because the causes 

of action are fundamentally distinct and involve 

predominately different issues of fact, it is unlikely that 

 [*7] the Court could dispose of both cases in a single 

proceeding. See Clark, 42 F. Supp. 2d at 849 (finding 

that where issues of law and fact were distinct, 

summary judgment motions would be unique to each 

2011 U.S. Dist. LEXIS 47853, *2

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John Bjork

case). Accordingly, because defendant has failed to 

satisfy LR 40.4(b) and (c), the Court denies defendant's 

motion to consolidate.

Conclusion

Based on the foregoing analysis, the Court denies 

defendant's motion to consolidate [doc. no. 16]. 

Defendant has two weeks from the date of this 

Memorandum Opinion and Order to file its answer.

SO ORDERED

ENTER: May 4, 2011

/s/ Ronald A. Guzman

RONALD A. GUZMAN

District Judge

End of Document

2011 U.S. Dist. LEXIS 47853, *7

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John Bjork

 Neutral

As of: May 4, 2020 2:25 PM Z

Hollinger Int'l, Inc. v. Hollinger, Inc.

United States District Court for the Northern District of Illinois, Eastern Division

May 3, 2004, Decided ; May 5, 2004, Docketed 

Case No. 04 C 0698 

Reporter

2004 U.S. Dist. LEXIS 7883 *; 2004 WL 1102327

HOLLINGER INTERNATIONAL, INC., Plaintiff, v. 

HOLLINGER, INC., et al., Defendants.

Subsequent History: Petition dismissed by Hollinger 

Int'l v. Hollinger Inc., 2004 U.S. Dist. LEXIS 20825 (N.D. 

Ill., Oct. 8, 2004)

Disposition: [*1] Defendant's motion for finding of 

relatedness and reassignment of actions denied. 

Core Terms

class action, cases, reassign, saving

Case Summary

Procedural Posture

Defendant corporation filed a motion, pursuant to U.S. 

Dist. Ct., N.D. Ill., R. 40.4, for a finding of relatedness 

and reassignment of shareholder class actions in 

connection with a derivative action the corporation filed 

against defendant controlling shareholders.

Overview

The corporation alleged that the controlling 

shareholders breached their common law fiduciary 

duties and were unjustly enriched by accepting improper 

payments from the corporation. Subsequent to the filing 

of the derivative action, purchasers of the corporation's 

stock brought class actions alleging misconduct under 

federal and Illinois securities laws against the 

corporation, the controlling shareholders, and the 

corporation's auditor and board members. The court 

held that although the derivative action and the class 

actions involved some of the same factual issues, 

resolving those issues together would not have resulted 

in substantial judicial savings, as required by U.S. Dist. 

Ct., N.D. Ill., R. 40.4(b)(2). The actions involved 

fundamentally distinct claims -- breach of common law 

duties and securities law claims -- which required 

different discovery and legal findings. The class actions 

required the court to decide whether to certify a class 

and which attorney to appoint as class counsel. Such a 

determination, which was not required in the derivative 

action, would have required discovery and substantial 

time to brief all the relevant legal and factual issues.

Outcome

The court denied the corporation's motion for a finding 

of relatedness and reassignment of actions.

LexisNexis® Headnotes

Civil Procedure > ... > Venue > Federal Venue 

Transfers > General Overview

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John Bjork

HN1[ ] Venue, Federal Venue Transfers

Whether to reassign a case under U.S. Dist. Ct., N.D. 

Ill., R. 40.4 lies within the sound discretion of the court.

Civil Procedure > ... > Venue > Federal Venue 

Transfers > General Overview

HN2[ ] Venue, Federal Venue Transfers

To have a case reassigned based on relatedness, the 

moving parties must meet the requirements of both U.S. 

Dist. Ct., N.D. Ill., R. 40.4(a) and (b).

Civil Procedure > ... > Venue > Federal Venue 

Transfers > General Overview

HN3[ ] Venue, Federal Venue Transfers

U.S. Dist. Ct., N.D. Ill., R. 40.4(a) and (b) states that two 

or more civil cases may be related if at least one of the 

conditions are met: (1) the cases involve the same 

property; (2) the cases involve some of the same issues 

of fact or law; (3) the cases grow out of the same 

transaction or occurrence; or (4) in class action suits, 

one or more of the classes involved in the cases is or 

are of the same. U.S. Dist. Ct., N.D. Ill., R. 40.4(a). The 

second and more onerous of the reassignment criteria 

states that a case may be reassigned only if each of the 

following criteria are met: (1) both cases are pending in 

the court; (2) the handling of both cases by the same 

judge is likely to result in a substantial saving of judicial 

time and effort; (3) the earlier case has not progressed 

to the point where designating a later filed case as 

related would be likely to delay the proceedings in the 

earlier case substantially; and (4) the cases are 

susceptible of disposition in a single proceeding. U.S. 

Dist. Ct., N.D. Ill., R. 40.4(b).

Counsel: For HOLLINGER INTERNATIONAL, INC., 

plaintiff: Ian Simmons, O'Melveny & Myers, Washington, 

DC. Jonathan Rosenberg, Andrew J Geist, O'Melveny & 

Myers, New York, NY. Mark V. Chester, Steven 

Lawson, Joan M. Meyers, Johnson & Colmar, Chicago, 

IL. Henry C Thumann, O'Melveny & Myers LLP, 

Washington, DC.

For HOLLINGER INC., defendant: Nathan P. Eimer, 

Andrew George Klevorn, Adam B. Deutsch, Vanessa G 

Jacobsen, Eimer Stahl Klevorn & Solberg, LLP, 

Chicago, IL.

For RAVELSTON CORPORATION LIMITED, THE, 

RAVELSTON MANAGEMENT, INC., defendants: Brian 

L. Crowe, Cary E. Donham, Douglas Michael Ramsey, 

Shefsky & Froelich, Ltd, Chicago, IL.

For CONRAD M BLACK, defendant: Paula Enid Litt, 

Veronica Gomez, Lisa Beth Swedenborg, Schopf & 

Weiss, Chicago, IL. Laurent S Wiesel, John L Warden, 

Robin D Fessel, Sullivan & Cromwell, New York, NY. 

David H Braff, Sullivan and Cromwell, New York, NY. 

James V Masella, III, Sullivan & Cromwell, New York, 

NY.

For F DAVID RADLER, defendant: Greg A Danilow, 

Richard A Rothman, Weil, Gotshal & Manges, New 

York, NY. Anthony Albanese, Weil, Cotshal & Manges 

LLP, New York, NY. Joseph [*2] J. Duffy, Stetler & 

Duffy, Ltd., Chicago, IL.

For JOHN A BOULTBEE, defendant: Stephen C. Voris, 

Burke, Warren, MacKay & Serritella, P.C., Chicago, IL. 

Ira Lee Sorkin, Donald A Corbett, Carter, Ledyard & 

Milburn, New York, NY. 

Judges: BLANCHE M. MANNING, U.S. DISTRICT 

JUDGE. 

Opinion by: BLANCHE M. MANNING

Opinion

MEMORANDUM AND ORDER

The Present matter comes before this Court on 

Defendant Hollinger, Inc.'s ("Inc.")' Motion for Finding of 

Relatedness and Reassignment of Actions. Pursuant to 

Local Rule 40.4, Inc. seeks to have the following 

2004 U.S. Dist. LEXIS 7883, *1

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shareholder class actions ("the Class Actions") assigned 

to this Court: Teachers Retirement System of Louisiana 

v. Black, et al., No. 04 C 0834 (Judge Coar); Mozingo v. 

Black, et al., No. 04 C 1276 (Judge Manning); and 

Washington Area Carpenters Pension and Retirement 

Fund v. Hollinger International, Inc., No. 04 C 2505 

(Judge Anderson). 1 For the Reasons set forth below, 

this Court DENIES this motion on the grounds the Court 

does not find that all four of the requirements in Local 

Rule 40.4(b) are met.

 [*3] Plaintiff Hollinger International, Inc. 

("International") brought this diversity action against its 

controlling shareholders, which includes Inc., the 

Ravalston Corporation, and Conrad Black, and three 

other related entities and persons ("the International 

Action"). International alleges that Defendants breached 

their common law fiduciary duties and were unjustly 

enriched by accepting improper payments from 

International, including "non-compete" payments and 

"management service fee payments." In all, 

International seeks to recover over $ 200 million in 

alleged wrongful payments.

Subsequent to the filing of the International Action, 

purchasers of International's stock brought the Class 

Actions alleging misconduct under Federal and Illinois 

securities laws against International, the International 

Action Defendants, International's former outside 

auditor, and International's current and former board 

members. The Class Action Plaintiffs seek to certify a 

class consisting of all purchasers of International stock 

during the relevant time period. The Class Action 

Plaintiffs also seek to recover the dilution in value of 

their shares caused by alleged fraudulent and 

misleading statements [*4] by International and its 

directors, owners, and auditors, which allegedly stem 

from the "non-compete" payments and "management 

service fee payments" made to the International 

Defendants.

HN1[ ] Whether to reassign a case under Local Rule 

40.4 lies within the sound discretion of this Court. Clark 

v. Ins. Car Rentals Inc., 42 F. Supp. 2d 846, 847 (N.D. 

Ill. 1999). HN2[ ] To have a case reassigned based on 

relatedness, the moving parties must meet the 

requirements of both Local Rule 40.4(a) and (b). 

Lawrence E. Jaffe Pension Plan v. Household Int'l, Inc., 

2003 U.S. Dist. LEXIS 7466, No. 02 C 5893, 2002 WL 

21011757, at *1 (N.D. Ill. May 5, 2003). Local Rule 

1 The Plaintiffs in case Nos. 04 C 0834 and 04 C 1276 have 

joined in Inc.'s motion.

40.4(a) HN3[ ] states that "two or more civil cases may 

be related if" at least one of the conditions are met:

(1) the cases involve the same property;

(2) the cases involve some of the same issues of 

fact or law;

(3) the cases grow out of the same transaction or 

occurrence; or

(4) in class action suits, one or more of the classes 

involved in the cases is or are of the same.

Local Rule 40.4(a).

The second and more onerous of the reassignment 

criteria, see, e.g., Clark, 42 F. Supp. 2d at 848, states 

that a case may [*5] be reassigned only if "each of the 

following criteria are met":

(1) both cases are pending in this Court;

(2) the handling of both cases by the same judge is 

likely to result in a substantial saving of judicial time 

and effort;

(3) the earlier case has not progressed to the point 

where designating a later filed case as related 

would be likely to delay the proceedings in the 

earlier case substantially; and

(4) the cases are susceptible of disposition in a 

single proceeding.

Local Rule 40.4(b).

Here, although International admits that all the actions 

"involve, at least in part, [the International Defendants'] 

misconduct in diverting International's assets to their 

own uses through improper non-competition fees and 

excessive management fees," it contends that factor (2)-

(4) of Local Rule 40.4(b) are not met because "there are 

vast differences between the substantive claims, 

remedies, and defenses" in the International Action and 

the Class Actions.

In support of this contention, International cites 

Lawrence Jaffe Pension Plan, 2003 U.S. Dist. LEXIS 

7466, 2002 WL 21011757, a case in which Judge 

Guzman denied a motion to reassign a shareholder 

class action and a corporate derivative [*6] action, on 

the grounds that subsections (b)(2) and (4) of Local 

Rule 40.4 were not met. 2 The plaintiff in the derivative 

2 The Court notes that Lawrence Jaffe Pension Plan is the only 

case in this district which involved a Local Rule 40.4 motion to 

reassign a shareholder class action and a corporate derivative 

action. Although Inc. attempts to distinguish this case, this 

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action alleged that corporate officers of the defendant 

corporation breached their duties of loyalty and due care 

and were unjustly enriched by wasting corporate assets. 

2003 U.S. Dist. LEXIS 7466, [WL] at *1. In the 

shareholder class action, the plaintiffs alleged that the 

CEO and CEO made material misrepresentations in 

violation of federal securities law. Id. In finding that the 

two cases where related under Local Rule 40.4(a), the 

Court found that both actions involved "some common 

issues of fact," namely that the underlying wrong doing 

in each case was the same. Id.

Judge Guzman, however, found [*7] that reassignment 

would not result in "substantial saving of judicial time 

and effort," as required by subsection (b)(2). 2003 U.S. 

Dist. LEXIS 7466, [WL] at *2. In making this finding, the 

court noted that the two actions "are fundamentally 

distinct" in that the class action alleges violations of 

federal securities law on behalf of a class of stock 

purchasers, while the derivative action alleges common 

law breach of fiduciary duty violations. Id. This 

distinction was important because the facts required to 

prove a federal securities violation "are clearly 

substantially different" than the facts needed to hold the 

defendants liable for breach of fiduciary duty. Id. The 

court also noted that while the cases included some of 

the same defendants, there were numerous defendants 

named in the derivative action not named in the 

securities action. Id. Consequently, Judge Guzman held 

that his "handling of both cases would not be likely to 

result in substantial saving of judicial time and effort." 3

Id.

 [*8] The Court also found that subsection (b)(4) was 

not met because the two actions "are fundamentally 

distinct . . . making it extremely unlikely that the court 

could dispose of both cases in a single proceeding . . . . 

[in that] any motions for summary judgment would be 

unique to each particular case." 2003 U.S. Dist. LEXIS 

7466, [WL] at *3. Accordingly, Judge Guzman denied 

the motion to reassign.

Here, this Court finds that, similar toLawrence Jaffe 

Pension Plan, the criteria of Local Rule 40.4(b) are not 

met. Although the International Action and the Class 

Actions involve some of the same factual issues, 

resolving these issues together will not result in 

Court finds it closely analogous to the present matter.

3 In making this finding, Judge Guzman acknowledged that 

"there would be some degree of savings of judicial time and 

effort," but not "substantial savings" as required by subsection 

(b)(2).

substantial judicial savings, as required by subsection 

(b)(2). The actions involve "fundamentally distinct" 

claims -- breach of common law duties and securities 

law claims -- which will require different discovery and 

legal findings. For example, the International Action is 

an action by International seeking recovery of the funds 

allegedly misappropriated by the International 

Defendants, while the Class Actions seek redress for 

the loss in value of the class members' stock. These 

different forms of relief will require different discovery 

and will [*9] require this Court to make distinct factual 

and legal findings. Likewise, the Class Actions will 

require the Court to decide whether to certify a class 

and which attorney to appoint as class counsel. Such a 

determination, which is not required in the International 

Action, will, in most likelihood, require discovery and 

substantial time to brief all the relevant legal and factual 

issues. Similarly, while the International Action names 

six defendants, the Class Actions seek recovery from 

not only these six but from International, its former 

outside auditor, and its current and former board 

members. Consequently, this Court finds granting the 

motion to reassign will not likely result in substantial 

judicial savings, as required by subsection (b)(2).

Accordingly, this Court DENIES the Motion for Finding 

of Relatedness and Reassignment of Actions.

CONCLUSION

For the reasons discussed, the Court DENIES the 

Motion for Finding of Relatedness and Reassignment of 

Actions. It is so ordered.

BLANCHE M. MANNING

U.S. DISTRICT COURT JUDGE

DATE: 5-3-04 

End of Document

2004 U.S. Dist. LEXIS 7883, *6

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EXHIBIT M 

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UNITED STATES DISTRICT COURT

FOR THE Northern District of Illinois − CM/ECF LIVE, Ver 6.3.1

Eastern Division

Karamelion LLC

Plaintiff,

v. Case No.: 1:19−cv−06329

Honorable Edmond E. Chang

Elexa Consumer Products, Inc.

Defendant.

NOTIFICATION OF DOCKET ENTRY

This docket entry was made by the Clerk on Wednesday, January 29, 2020:

 MINUTE entry before the Honorable Edmond E. Chang: On consideration of the

joint motion [21] to reassign Karamelion v. Fibar USA, Case No. 19−cv−6330, the Court

denies the motion. Although it certainly is understandable why the parties filed the

motion, Local Rule 40.4(b)(4) is not satisfied here. Specifically, the cases are not

"susceptible of disposition in a single proceeding." It is true that there is some overlap in

the asserted claims and the anticipated defenses, but it is not likely that a single trial would

be convened to resolve the dispute as to both Defendants, because they have different

products. It is worth noting that, in some patent cases asserting infringement of the same

patent against separate defendants, the District Court has granted requests for consolidated

pretrial discovery (and sometimes has done so sua sponte) and, if appropriate,

consolidated claim construction, all under Internal Operating Procedure 13(e) (available

online at the same page as the Local Rules). That might be appropriate at some point for

these two cases (after the dismissal−motion practice in the Fibar case, assuming the

motion is denied), so the parties may consider that possibility later (and nothing prevents

the parties in both cases from coordinating as much as practicable amongst themselves).

But the motion to reassign [21] is denied. Mailed notice(mw, )

ATTENTION: This notice is being sent pursuant to Rule 77(d) of the Federal Rules of

Civil Procedure or Rule 49(c) of the Federal Rules of Criminal Procedure. It was

generated by CM/ECF, the automated docketing system used to maintain the civil and

criminal dockets of this District. If a minute order or other document is enclosed, please

refer to it for additional information.

For scheduled events, motion practices, recent opinions and other information, visit our

web site at www.ilnd.uscourts.gov.

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John Bjork

 Caution

As of: May 4, 2020 2:26 PM Z

DBD Franchising, Inc. v. DeLaurentis

United States District Court for the Northern District of Illinois, Eastern Division

June 23, 2009, Decided; June 23, 2009, Filed

No. 09 C 669

Reporter

2009 U.S. Dist. LEXIS 52890 *; 2009 WL 1766751

DBD FRANCHISING, INC. and DINNER BY DESIGN, 

INC., Plaintiffs, v. SHARYN M. DeLAURENTIS, 

Defendant.

Core Terms

cases, reassignment, collusion, parties, diversity 

jurisdiction, magistrate judge, motion to dismiss, 

diverse, incorporation, transfers, district judge, 

dissolved, subject matter jurisdiction, assigned, single 

proceeding, shareholder, reasons, argues, courts

Case Summary

Procedural Posture

Plaintiff Wisconsin corporations filed suit against 

defendant for breach of contract. Before the court was 

plaintiffs' motion for reassignment and defendant's 

motion to dismiss pursuant to Fed. R. Civ. P.12(b)(1).

Overview

Plaintiffs asserted subject matter jurisdiction based on 

diversity of the parties. In her motion to dismiss, 

defendant argued that the shareholders converted one 

corporation's state of incorporation to Wisconsin and 

transferred the dissolved a second corporation's Illinois' 

assets from one shareholder to the newly incorporated 

Wisconsin corporation in an attempt to manufacture 

diversity. The court found that defendant had not offered 

any evidence to indicate that plaintiffs' change in 

corporate status was undertaken solely to fabricate 

diversity jurisdiction, other than pointing to the 

suspicious timing and circumstances of the transfers. 

Additionally, one of the shareholders explained that 

plaintiffs had physically moved to Wisconsin, were not 

conducting business in Illinois, and had intended to 

change their corporate status for some time. Next, the 

court found that plaintiffs satisfied N.D. Ill. Loc. R. 40.4's 

requirements for reassignment. The court was 

convinced that judicial economy required that the two 

cases be decided by the same judge. The court 

reasoned that the two cases involved interpretation of 

the same Agreement and involved similar questions of 

fact and law.

Outcome

Plaintiffs' motion was granted. Defendant's motion was 

denied.

LexisNexis® Headnotes

Civil Procedure > ... > Subject Matter 

Jurisdiction > Jurisdiction Over Actions > General 

Overview

Evidence > Burdens of Proof > Allocation

Civil Procedure > ... > Responses > Defenses, 

Demurrers & Objections > Motions to Dismiss

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HN1[ ] Subject Matter Jurisdiction, Jurisdiction 

Over Actions

Fed. R. Civ. P. 12(b)(1) requires dismissal of claims 

over which the federal court lacks subject matter 

jurisdiction. Jurisdiction is the power to decide, and must 

be conferred upon the federal courts. In reviewing a 

Rule 12(b)(1) motion to dismiss for lack of subject 

matter jurisdiction, the court may look beyond the 

complaint to pertinent evidence submitted by the 

parties. The plaintiff faced with a properly supported 

Rule 12(b)(1) motion to dismiss bears the burden of 

proving that the jurisdictional requirements have been 

met.

Civil Procedure > Parties > Joinder of 

Parties > Collusive Joinder

Civil Procedure > ... > Jurisdiction > Diversity 

Jurisdiction > General Overview

HN2[ ] Joinder of Parties, Collusive Joinder

Pursuant to 28 U.S.C.S. § 1332, the district courts have 

original jurisdiction over civil actions between citizens of 

different states in which the amount in controversy 

exceeds $ 75,000. 28 U.S.C.S. § 1332(a). A corporation 

is deemed to be a citizen of both the state where it is 

incorporated and the state where it maintains its 

principal place of business, and citizenship is 

determined as of the date the lawsuit is filed. 28 

U.S.C.S. § 1332(c)(1). Additionally, 28 U.S.C.S. § 1359

provides that a district court shall not have jurisdiction of 

a civil action in which any party, by assignment or 

otherwise, has been improperly or collusively made or 

joined to invoke the jurisdiction of such court. 28 

U.S.C.S. § 1359.

Business & Corporate 

Law > Corporations > Dissolution & 

Receivership > General Overview

HN3[ ] Corporations, Dissolution & Receivership

Whatever assets a dissolved corporation has belong to 

the former shareholders, subject to the rights of 

creditors.

Business & Corporate 

Law > Corporations > Dissolution & 

Receivership > General Overview

HN4[ ] Corporations, Dissolution & Receivership

See 805 ILCS 5/12.30(c)(1).

Business & Corporate Law > ... > Dissolution & 

Receivership > Termination & Winding 

Up > General Overview

HN5[ ] Dissolution & Receivership, Termination & 

Winding Up

All corporate formalities must be adhered to throughout 

the winding down process until the ultimate distribution 

of the proceeds of the sale to the shareholders. To treat 

corporate funds as personal funds at this stage of the 

wind down ignores the superior rights of creditors, 

employees, and others who have claims against the 

corporation.

Civil Procedure > Parties > Joinder of 

Parties > Collusive Joinder

Civil Procedure > ... > Jurisdiction > Diversity 

Jurisdiction > General Overview

HN6[ ] Joinder of Parties, Collusive Joinder

28 U.S.C.S. § 1359 prohibits diversity jurisdiction when 

an assignor assigns a legal claim but retains an interest 

in that claim, the assignee had no previous connection 

to the assigned claim, and the assignment was made 

solely to create diversity jurisdiction.

Civil Procedure > Parties > Joinder of 

Parties > Collusive Joinder

Civil Procedure > ... > Jurisdiction > Diversity 

Jurisdiction > General Overview

HN7[ ] Joinder of Parties, Collusive Joinder

A corporation's transfer of its assets to a newly created 

diverse corporation, followed by the dissolution of the 

former, non-diverse corporation, was not collusive and 

did not prohibit diversity jurisdiction under 28 U.S.C.S. § 

1332.

2009 U.S. Dist. LEXIS 52890, *52890

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Civil Procedure > Parties > Joinder of 

Parties > Collusive Joinder

Evidence > Inferences & 

Presumptions > Presumptions

Civil Procedure > ... > Jurisdiction > Diversity 

Jurisdiction > General Overview

Evidence > Inferences & 

Presumptions > Presumptions > Rebuttal of 

Presumptions

HN8[ ] Joinder of Parties, Collusive Joinder

Some circuits have adopted a presumption that 

transfers and assignments between related entities are 

collusive. This presumption of collusion can only be 

rebutted by offering evidence that the transfer was 

made for a legitimate business purpose unconnected 

with the creation of diversity jurisdiction. The Seventh 

Circuit, however, has explicitly rejected the adoption of 

such a presumption.

Civil Procedure > Parties > Joinder of 

Parties > Collusive Joinder

Civil Procedure > ... > Jurisdiction > Diversity 

Jurisdiction > General Overview

HN9[ ] Joinder of Parties, Collusive Joinder

In rejecting a presumption of collusion for assignments 

or transfers between related parties, the Seventh Circuit 

instructs courts to make a factual determination of 

whether the assignment was collusive, in the relevant 

sense of being motivated by the assignor's desire to 

obtain access to a federal court under the diversity 

jurisdiction.

Civil Procedure > Judicial 

Officers > Judges > General Overview

Governments > Courts > General Overview

HN10[ ] Judicial Officers, Judges

N.D. Ill. Loc. R. 40.4 provides a mechanism for parties 

to request the reassignment of a later-filed case to a 

judge presiding over an earlier-filed, related case. N.D. 

Ill. Loc. R. 40.4. Typically, such a motion for 

reassignment is presented to the judge presiding over 

the lower-numbered case. N.D. Ill. Loc. R. 40.4(c). 

However, where the lower-numbered case is assigned 

to a magistrate judge on the consent of the parties and 

the higher-numbered case is assigned to a district 

judge, the motion is presented to the district judge. N.D. 

Ill. Loc. R. 40.4(c). In order for the court to grant a 

motion for reassignment, the movant must first 

demonstrate that one of the following conditions is 

satisfied: (1) the cases involve the same property; (2) 

the cases involve some of the same issues of fact or 

law; (3) the cases grow out of the same transaction or 

occurrence; or (4) in class action suits, one or more of 

the classes involved in the cases is or are the same.

Civil Procedure > Judicial 

Officers > Judges > General Overview

Governments > Courts > General Overview

HN11[ ] Judicial Officers, Judges

N.D. Ill. Loc. R. 40.4(b) requires that: (1) both cases are 

pending in the court; (2) the handling of both cases by 

the same judge is likely to result in a substantial saving 

of judicial time and effort; (3) the earlier case has not 

progressed to the point where designating a later filed 

case as related would be likely to delay the proceedings 

in the earlier case substantially; and (4) the cases are 

susceptible of disposition in a single proceeding. N.D. Ill. 

Loc. R. 40.4(b).

Civil Procedure > Judicial 

Officers > Magistrates > Trial by Consent

HN12[ ] Magistrates, Trial by Consent

Magistrate judges are authorized to conduct any or all 

proceedings in a jury or nonjury civil matter with the 

consent of the parties and when they have been 

specially designated to exercise such jurisdiction by the 

district court. 28 U.S.C.S. § 636(c)(1); Fed. R. Civ. P. 

73. Without such consent, a magistrate judge does not 

have full authority to issue dispositive orders, conduct 

trial, or enter final judgment. Consent can only be 

vacated when a party shows extraordinary 

circumstances. Fed. R. Civ. P. 73(b)(3).

2009 U.S. Dist. LEXIS 52890, *52890

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Governments > Courts > Rule Application & 

Interpretation

HN13[ ] Courts, Rule Application & Interpretation

A local rule may not be inconsistent with the 

Constitution, a statute of the United States, or with a 

national rule governing the conduct of litigation in the 

United States courts.

Counsel: [*1] For DBD Franchising, Inc., Dinner by 

Design, Inc., Plaintiffs: Jonathan M. Cyrluk, Joseph J. 

Duffy, LEAD ATTORNEYS, Stetler & Duffy, Ltd., 

Chicago, IL; Henry M. Baskerville, Stelter & Duffy, Ltd., 

Chicago, IL.

For Sharyn M. DeLaurentis, Defendant: William Gibbs 

Sullivan, LEAD ATTORNEY, Mason N. Floyd, Martin, 

Brown & Sullivan, Ltd., Chicago, IL.

Judges: Honorable Marvin E. Aspen, United States 

District Judge.

Opinion by: Marvin E. Aspen

Opinion

MEMORANDUM OPINION AND ORDER

Plaintiffs DbD Franchising, Inc., a Wisconsin corporation 

("DbDFI - Wisconsin"), and Dinner by Design, Inc., also 

a Wisconsin corporation ("DbD - Wisconsin") 

(collectively, the "DbD Plaintiffs") filed a complaint for 

breach of contract against Defendant, Sharyn 

DeLaurentis, on February 2, 2009. Presently before us 

is the DbD Plaintiffs' motion for reassignment as related 

and DeLaurentis's motion to dismiss pursuant to Federal 

Rule of Civil Procedure 12(b)(1). For the following 

reasons, we deny DeLaurentis's motion and grant the 

DbD Plaintiffs' motion.

BACKGROUND

1

In 2003, Julie Duffy incorporated Dinner by Design, Inc. 

in Illinois ("DbD - Illinois"). (DbD Resp. to DeLaurentis's 

Mot. to Dismiss at 3 (hereinafter, "DbD Resp."), Ex. A, 

Julie Duffy Decl. P 2.) DbD - Illinois provided ready-tocook meals to its customers. (Compl. P 1; DbD Resp. at 

3.) At the time of its incorporation, Julie Duffy and her 

husband, Patrick Duffy, lived in Illinois. (DbD Resp. at 

3.) In 2004, Julie Duffy incorporated DbD Franchising, 

Inc. as an Illinois corporation ("DbDFI - Illinois"), for the 

purpose of franchising the Dinner by Design concept 

(DbDFI - Illinois and DbD - Illinois are collectively 

referred to as the "Illinois companies"). (Id.) DbDFI - 

Illinois sold approximately 90 franchises over the next 

two years. [*3] (Id.) However, in 2006, the Duffys sold 

their business to DeLaurentis, pursuant to a written 

agreement ("Agreement"). (Compl. P 1.) Although 

DeLaurentis purchased the Illinois companies' assets, 

Julie Duffy remained the sole shareholder of both Illinois 

companies, whose only asset appears to be their 

Agreement with DeLaurentis. (See DbD Resp. at 4; 

DeLaurentis Reply at 4.)

In February 2008, the Duffys moved to Sister Bay, 

Wisconsin. (DbD Resp. at 4.) The DbD Plaintiffs 

contend that when the Duffys moved to Wisconsin, the 

Illinois companies also moved. (Id.) The Illinois 

companies did not maintain an office in Illinois and all 

decisions related to the companies were made in 

Wisconsin. (Id.) On April 2, 2008, the Duffys voluntarily 

dissolved DbD - Illinois, but left the status of DbDFI - 

Illinois untouched. (Id. at 5.) Some time before 

November 2008, the Duffys discussed whether to 

transfer DbDFI - Illinois' state of incorporation to 

Wisconsin and decided to do so. (Id. at 4.) However, the 

Duffys did not actually complete the transfer of 

1 We may consider matters outside the pleading when 

"resolving factual questions pertaining to jurisdiction." English 

v. Cowell, 10 F.3d 434, 437 (7th Cir. 1993); Capitol Leasing 

Co. v. FDIC, 999 F.2d 188, 191 (7th Cir. 1993) [*2] (quoting 

Grafon Corp. v. Hausermann, 602 F.2d 781, 783 (7th Cir. 

1979) ("'The district court may properly look beyond the 

jurisdictional allegations of the complaint and view whatever 

evidence has been submitted on the issue to determine 

whether in fact subject matter jurisdiction exists.'"). Because 

we must determine whether we have subject matter 

jurisdiction to hear this case, the facts described are taken 

from both the complaint and additional filings.

2009 U.S. Dist. LEXIS 52890, *52890

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incorporation until January 8, 2009, when DbDFI - 

Illinois filed a Certificate of Conversion with the 

Wisconsin Department of Financial Institutions, 

 [*4] which created DbDFI - Wisconsin. (Id. at 5, Ex. E.) 

Similarly, on January 7, 2009, Julie Duffy incorporated a 

new corporation in Wisconsin, DbD - Wisconsin. (Id. at 

6.) Simultaneously, Julie Duffy and the dissolved DbD - 

Illinois agreed to transfer their rights and obligations 

under the Agreement with DeLaurentis to DbD -

Wisconsin. (Id.) The Duffys claim that they converted 

DbD - Illinois and incorporated DbD -Wisconsin because 

they moved to Wisconsin, their principal place of 

business was Wisconsin, and because they wanted the 

companies to enjoy the same benefit of diversity 

jurisdiction as they would receive in a suit against 

DeLaurentis. (Id. at 6; Patrick Duffy Decl. PP 20, 22.)

Meanwhile, on November 26, 2008 -- after DbD - Illinois 

was dissolved, but before either DbDFI - Illinois was 

converted to DbDFI - Wisconsin or DbD -Wisconsin was 

incorporated -- DeLaurentis filed a three-count 

complaint against the Duffys for fraud, violation of the 

Illinois Deceptive Business Practices Act ("IDBPA"), and 

rescission of contract, in the Circuit Court of Lake 

County, Illinois (the "DeLaurentis action"). (DeLaurentis 

Mem. in Support of Mot. to Dismiss at 2 (hereinafter, 

"DeLaurentis Mem.").) [*5] On January 9, 2009, the 

Duffys removed that case to the Northern District of 

Illinois. See DeLaurentis v. Patrick & Julie Duffy, No. 09 

C 133 (N.D. Ill.). (DeLaurentis Mem. at 3; DbD Mot. for 

Reassignment P 3 (hereinafter, "DbD Mot.").) The DbD 

Plaintiffs are not parties to that action, as DeLaurentis 

sued the Duffys individually. In their Rule 26(f) Report 

submitted on January 28, 2009, the parties in the 

DeLaurentis action consented to the jurisdiction of a 

United States magistrate judge and the case was 

reassigned to Magistrate Judge Mason. (Report of Rule 

26(f) Planning Meeting, Dkt. No. 11, No. 09 C 133; 

3/6/2009 Order, No. 09 C 133.) The DbD Plaintiffs filed 

the suit before us on February 2, 2009. In it, they allege 

that DeLaurentis breached the Agreement. (Id. PP 14-

21.) On March 19, 2009, the DbD Plaintiffs filed a 

motion for reassignment as related, asking us to 

reassign this case to Judge Mason. On March 31, 2009, 

DeLaurentis moved to dismiss the case for lack of 

subject matter jurisdiction.

ANALYSIS

I. DeLaurentis's Motion to Dismiss Pursuant to Rule 

12(b)(1)

HN1[ ] Rule 12(b)(1) requires dismissal of claims over 

which the federal court lacks subject matter jurisdiction. 

Jurisdiction [*6] is the "power to decide," and must be 

conferred upon the federal courts. In re Chicago, Rock 

Island & Pacific R.R. Co., 794 F.2d 1182, 1188 (7th Cir. 

1986). In reviewing a 12(b)(1) motion to dismiss for lack 

of subject matter jurisdiction, the court may look beyond 

the complaint to pertinent evidence submitted by the 

parties. See United Transp. Union v. Gateway W. Ry. 

Co., 78 F.3d 1208, 1210 (7th Cir. 1996). The plaintiff 

faced with a properly supported 12(b)(1) motion to 

dismiss bears the burden of proving that the 

jurisdictional requirements have been met. See Kontos 

v. U.S. Dep't of Labor, 826 F.2d 573, 576 (7th Cir. 

1987).

Plaintiffs have asserted subject matter jurisdiction based 

on diversity of the parties. (Compl. P 5.) HN2[ ] 

Pursuant to 28 U.S.C. § 1332, the district courts have 

original jurisdiction over civil actions between citizens of 

different states in which the amount in controversy 

exceeds $ 75,000. 28 U.S.C. § 1332(a). A corporation is 

deemed to be a citizen of both the state where it is 

incorporated and the state where it maintains its 

principal place of business, and citizenship is 

determined as of the date the lawsuit is filed. 2 See 28 

U.S.C. § 1332(c)(1); Aurora Loan Servs., Inc. v. 

Craddieth, 442 F.3d 1018, 1025 (7th Cir. 2006); 

 [*7] Johnson v. Wattenbarger, 361 F.3d 991, 993 (7th 

Cir. 2004). Additionally, 28 U.S.C. § 1359 provides that 

"[a] district court shall not have jurisdiction of a civil 

2 Because we determine jurisdiction at the time the suit was 

filed, the pertinent question is whether the DbD Plaintiffs were 

properly citizens of Wisconsin on the date the suit was filed, 

not whether the parties to the underlying transactions were, at 

the time the transaction was entered into, citizens of 

Wisconsin. DeLaurentis apparently argues that because DbD - 

Illinois and DbDFI - Illinois were incorporated in Illinois when 

they executed the Agreement, they cannot subsequently 

change their state of corporation in a manner that [*8] would 

permit diversity jurisdiction. (See DeLaurentis Mem. at 6 

(explaining that because "the Agreement clearly identifies the 

sellers as Illinois corporations" and that "[n]o Wisconsin 

corporations was a party to the Agreement . . . [,] [t]he 

allegations of diversity are a contrivance to invoke jurisdiction 

in this Court").) This argument is incorrect. As explained 

herein, we must make a factual determination of whether the 

change in corporate status was collusive. See Herzog 

Contracting Corp. v. McGowen Corp., 976 F.2d 1062, 1066-67 

(7th Cir. 1992).

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action in which any party, by assignment or otherwise, 

has been improperly or collusively made or joined to 

invoke the jurisdiction of such court." 28 U.S.C. § 1359. 

In her motion to dismiss, DeLaurentis argues that the 

Duffys converted DbDFI's state of incorporation to 

Wisconsin and transferred the dissolved DbD - Illinois' 

assets from Julie Duffy to the newly incorporated DbD - 

Wisconsin 3 in an attempt to manufacture diversity in 

contravention to § 1359. (DeLaurentis Mem. at 9.) We 

disagree.

In Kramer v. Caribbean Mills, 394 U.S. 823, 89 S. Ct. 

1487, 23 L. Ed. 2d 9 (1969), the Supreme Court held 

that HN6[ ] § 1359 prohibited diversity jurisdiction 

when an assignor assigns a legal claim but retains an 

interest in that claim, the assignee had no previous 

connection to the assigned claim, and the assignment 

was made solely to create diversity jurisdiction. Id. at 

827-28, 89 S. Ct. at 1487. Kramer explicitly stated that 

its holding did not affect "cases in which this Court has 

held that where [*11] the transfer of a claim is absolute, 

with the transferor retaining no interest in the subject 

matter, then the transfer is not 'improperly or collusively 

3 The DbD Plaintiffs argue that the assets of DbD - Illinois 

transferred to its sole shareholder, Julie Duffy, after it was 

dissolved. (DbD Resp. at 10 (citing Dubey v. Abam Bldg. 

Corp., 266 Ill. App. 3d 44, 47, 639 N.E.2d 215, 218, 203 Ill. 

Dec. 176 (1st Dist. 1994) (HN3[ ] "Whatever assets a 

dissolved corporation has belong to the former shareholders, 

subject to the rights of creditors.").) Thus, they argue that 

because Julie Duffy was a citizen of Wisconsin, even if the 

transfer of assets to DbD - Wisconsin is considered collusive 

under § 1359, diversity jurisdiction would still be proper 

because Julie Duffy would have been the proper plaintiff prior 

to the asset [*9] transfer. (DbD Resp. at 10.) DeLaurentis 

disagrees, contending that Julie Duffy could not assume 

ownership of the dissolved corporation's assets until the 

completion of the winding up process. (DeLaurentis Resp. at 7 

(citing 805 ILCS 5/12.30(c)(1) (HN4[ ] "Dissolution of a 

corporation does not: [t]ransfer title to the corporation's 

assets."); Lasday v. Weiner, 273 Ill. App. 3d 461, 466, 652 

N.E.2d 1198, 1201, 210 Ill. Dec. 222 (1st Dist. 1995) (HN5[ ] 

"All corporate formalities must be adhered to throughout the 

winding down process until the ultimate distribution of the 

proceeds of the sale to the shareholders. . . . To treat 

corporate funds as personal funds at this stage of the wind 

down ignores the superior rights of creditors, employees, and 

others who have claims against the corporation.").

We find this point immaterial. To the extent that Julie Duffy did 

not assume ownership over DbD - Illinois' assets because 

corporate formalities were not satisfied, both Julie Duffy and 

DbD - Illinois were parties to the sale of DbD - Illinois' assets 

made,' regardless of the transferor's motive." Id. at 828 

n.9, 89 S. Ct. at 1490. This statement affirmatively 

included Black & White Taxi Cab Co. v. Brown & Yellow 

Taxi Cab Co., 276 U.S. 518, 48 S. Ct. 404, 72 L. Ed. 

681 (1928). See Kramer, 394 U.S. at 828 n.9, 89 S. Ct. 

at 1490 (citing Black & White Taxi Cab). In Black & 

White Taxi, 4 the Supreme Court concluded that HN7[

] a corporation's transfer of its assets to a newly created 

diverse corporation, followed by the dissolution of the 

former, non-diverse corporation, was not collusive and 

did not prohibit diversity jurisdiction under § 1332. 276 

U.S. at 524, 48 S. Ct. at 405. It further instructed courts 

not to inquire into the motives of the parties where "[t]he 

succession and transfer were actual, not feigned or 

merely colorable." Id.

Since Kramer, HN8[ ] some circuits have adopted a 

presumption that transfers and assignments between 

related entities are collusive. See, e.g., Toste Farm 

Corp. v. Hadbury, Inc., 70 F.3d 640, 643-44 (1st Cir. 

1995) (applying an "elevated scrutiny to assignments 

between affiliated parties"); Nike, Inc. v. Comercial 

Iberica de Exclusivas Deportivas, S.A., 20 F.3d 987, 

991-92 (9th Cir. 1994) (adopting a presumption of 

collusion for assignments from a non-diverse subsidiary 

to a diverse parent corporation); Prudential Oil Corp. v. 

Phillips Petroleum Co., 546 F.2d 469, 476 (2d Cir. 1976)

(presuming collusion where non-diverse parent 

company assigns claims to a diverse subsidiary that 

to DbD - Wisconsin. (DbD Resp., Ex. F (listing DbD - Illinois as 

the "Seller," Julie Duffy as the "Shareholder," and DbD - 

Wisconsin as the "Buyer").) Therefore, we are concerned 

 [*10] with whether this asset sale and the conversion of 

DbDFI -Wisconsin's state of incorporation are collusive under 

§ 1359. DeLaurentis's conclusory arguments that "money was 

drained out of" DbD - Illinois prior to the sale of its assets to 

DbD - Wisconsin in an attempt to create a judgment proof, 

shell corporation are inappropriate without citing any authority 

for those statements. (DeLaurentis Reply at 9.) Because the 

DbD Plaintiffs provided similar reasons for converting DbDFI - 

Illinois to a Wisconsin corporation as they have for 

establishing DbD - Wisconsin and transferring DbD - Illinois' 

assets to it, we consider the two actions jointly in determining 

whether diversity jurisdiction is prohibited by § 1359.

4 Although Black & White Taxi preceded the enactment of § 

1359, it interpreted one of § 1359's predecessor statutes, 26 

U.S.C. § 80 (1940 ed.). Black & White Taxi, 276 U.S. at 524, 

48 S. Ct. at 405 (citing 28 U.S.C. § 80); see Kramer, 394 U.S. 

at 826-27, 89 S. Ct. at 1489 [*12] (explaining that "decisions 

of [the Supreme Court] under the other predecessor statute, 

28 U.S.C. § 80 (1940 ed.), seem squarely in point" in 

analyzing § 1359).

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"engaged in no business other than the prosecution of 

that claim"). This presumption of collusion can only be 

rebutted "by offering evidence that the transfer was 

made for a legitimate business purpose unconnected 

with the creation of diversity jurisdiction." Prudential Oil 

Corp., 546 F.2d at 476. The Seventh Circuit, however, 

has explicitly rejected the adoption [*13] of such a 

presumption. 5 Herzog, 976 F.2d at 1067; see also 

Ambrosia Coal & Constr. Co. v. Pages Morales, 482 

F.3d 1309, 1314 (11th Cir. 2007) (adopting the 

reasoning of the Seventh Circuit and rejecting a 

presumption).

HN9[ ] In rejecting a presumption of collusion for 

assignments or transfers between related parties, 

Herzog instructs courts to make a factual determination 

of whether the assignment was collusive, "in the 

relevant sense of being motivated by the assignor's 

desire to obtain access to a federal court under the 

diversity jurisdiction." Herzog, 976 F.2d at 1066. In 

Herzog, the plaintiff's non-diverse subsidiary assigned 

promissory notes issued by the defendant to the 

plaintiff. Id. The notes could only be collected by filing a 

lawsuit, and the assignment of the notes created 

diversity jurisdiction. Id. at 1066-67. The Seventh Circuit 

admitted that "the timing of the assignment in relation to 

the parties' dispute and to the law suit[] emit[ed] an odor 

of collusion." Id. at 1067. However, it recognized that 

 [*14] the district judge "was not required -- perhaps was 

not permitted -- to disregard the sworn evidence to the 

contrary submitted by [the plaintiff] and not countered by 

any evidence submitted by [the defendant]." Id. The 

plaintiff had submitted affidavits stating that the 

assignment was not made to create diversity, "but to 

facilitate the provision of additional capital" to its 

subsidiary. Id. at 1066. The court doubted the true value 

of the assignment, but refused to apply an inference of 

collusion simply because the parties were under 

common ownership. Id. at 1066. It reasoned that 

"Congress could if it wanted adopt a rule forbidding the 

conferral of diversity jurisdiction by assignment to an 

affiliated corporation but it has not done so and we are 

given no urgent reason to try to do so in its place even 

to the extent of creating a soft rule, that is, a 

presumption." Id.

Under Herzog, we are convinced that jurisdiction is 

proper. The DbD Plaintiffs concede that one reason for 

5 Accordingly, DeLaurentis's attempted reliance on Prudential 

Oil Corp. and other similar cases applying the presumption of 

collusion (DeLaurentis Reply at 12-13) is misplaced.

the transfer of DbDFI - Illinois' state of incorporation and 

the creation of DbD - Wisconsin was to ensure diversity 

jurisdiction in a suit against DeLaurentis. (DbD Resp. at 

6.) However, they also claim that there [*15] were other 

reasons for the transfer. For example, Patrick Duffy 

explains that the DbD Plaintiffs had physically moved to 

Wisconsin, were not conducting business in Illinois, and 

had intended to change their corporate status for some 

time. (DbD Resp., Ex. C, Patrick Duffy Decl. PP 20, 22.) 

Although we recognize that the Illinois companies had 

no ongoing business and their only assets were their 

rights under the Agreement with DeLaurentis, we cannot 

disregard the sworn statements that they caused the 

incorporation of the companies in Wisconsin for reasons 

other than just the establishment of diversity jurisdiction. 

See Herzog, 976 F.2d at 1067.

We acknowledge that there are factually similar cases 

from other circuits that have adopted the opposite 

conclusion. See Toste Farm, 70 F.3d at 643-45 (holding 

that where the main asset transferred to a diverse 

corporation is the legal claim and the new corporation 

did not have any ongoing activities after the transfer, 

other than the pursuit of the legal claim, the transfer was 

made for collusive purposes and diversity jurisdiction 

was prohibited by § 1359); Greater Dev. Co. of Conn., 

Inc. v. Amelung, 471 F.2d 338, 338 (1973) (same). But 

see Piermont Heights, Inc. v. Dorfman, 820 F. Supp. 99, 

100 (S.D.N.Y. 1993) [*16] (holding that the transfer of 

plaintiff's state of incorporation to a diverse state was 

not collusive); Franco, Lewis & Co. v. Callahan, No. 94 

C 1027, 1994 WL 744304, at *15 (D.N.J. Aug. 22, 1994)

(reasoning that "a company which abandons its 

residency and associated privileges in one state for 

another should not be restrained by a residency status it 

no longer enjoys"). Those cases applied a presumption 

of collusion in cases like this one, where transfers were 

made between related parties. See, e.g., Toste Farm, 

70 F.3d at 643-44. Because the Seventh Circuit has 

rejected such a presumption, the reasoning in those 

cases is not directly applicable here. DeLaurentis has 

not offered any evidence to indicate that the DbD 

Plaintiffs' change in corporate status was undertaken 

solely to fabricate diversity jurisdiction, other than 

pointing to the suspicious timing and circumstances of 

the transfers. Under Herzog, that is insufficient to 

overcome the Dbd Plaintiffs' sworn statements. Because 

diversity jurisdiction is not prohibited by § 1359, we deny 

DeLaurentis's motion to dismiss.

II. The DbD Plaintiffs' Motion for Reassignment as 

Related

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HN10[ ] Local Rule 40.4 provides a mechanism for 

parties [*17] to request the reassignment of a later-filed 

case to a judge presiding over an earlier-filed, related 

case. L.R. 40.4. Typically, such a motion for 

reassignment is presented to the judge presiding over 

the lower-numbered case. Id. at 40.4(c). However, 

where, as here, the lower-numbered case is assigned to 

a magistrate judge on the consent of the parties and the 

higher-numbered case is assigned to a district judge, 

the motion is presented to the district judge. Id. In order 

for us to grant a motion for reassignment, the movant 

must first demonstrate that one of the following 

conditions is satisfied: "(1) the cases involve the same 

property; (2) the cases involve some of the same issues 

of fact or law; (3) the cases grow out of the same 

transaction or occurrence; or (4) in class action suits, 

one or more of the classes involved in the cases is or 

are the same." Id. at 40.4(a).

The DbD Plaintiffs move to reassign the case before us 

to Magistrate Judge Mason as related to the 

DeLaurentis action. (DbD Mot. at 2.) In DeLaurentis,

Sharyn and Salvatore DeLaurentis, Jr. sued the Duffys 

for fraud, violation of the IDBPA, and rescission of 

contract. (DbD Mot., Ex. 1, DeLaurentis Compl.) Those 

claims [*18] arise from DeLaurentis's Agreement to 

purchase the assets of the Illinois companies. (Id.) In 

the case before us, the DbD Plaintiffs have sued 

DeLaurentis for breach of the same Agreement. (Compl. 

PP 22-27.) Although DeLaurentis attempts to argue that 

the conditions in L.R. 40.4(a) are not satisfied 

(DeLaurentis Resp. to DbD Plaintiff's Mot. for 

Reassignment at 6-7 (hereinafter DeLaurentis Resp.)), 

she admits that the earlier-filed "action arose from the 

same transaction" as the action before us (DeLaurentis 

Mem. at 2). Given that the actions in both cases arose 

from the same transaction -- the Agreement -- L.R. 

40.4(a) has been met.

Before we can grant the motion for reassignment, 

however, the movant must also demonstrate that each 

of the criteria in L.R. 40.4(b) is met. HN11[ ] L.R. 

40.4(b) requires that:

(1) both cases are pending in this Court; (2) the 

handling of both cases by the same judge is likely 

to result in a substantial saving of judicial time and 

effort; (3) the earlier case has not progressed to the 

point where designating a later filed case as related 

would be likely to delay the proceedings in the 

earlier case substantially; and (4) the cases are 

susceptible of disposition in [*19] a single 

proceeding.

L.R. 40.4(b). The first requirement is satisfied -- both 

cases are pending in the Northern District of Illinois. The 

second criteria is also met. The disposition of both 

cases will require a court to consider the meaning of 

and the facts surrounding the Agreement. If one judge 

handles both cases, judicial resources will be saved. 

DeLaurentis's argument that this condition is not 

satisfied is not persuasive. First, her argument makes 

no mention of judicial efficiency. Instead, she argues 

that "[w]hen the Illinois corporation known as Dinner by 

Design, Inc. is designated as a plaintiff in this action, or 

a defendant in the action pending before Judge Mason, 

subject matter will be destroyed." (Id.) However, the 

DbD Plaintiffs are not attempting to add DbD - Illinois as 

a party to either action. Instead, they are attempting to 

reassign this case, which does not include DbD Illinois 

as a party, to Judge Mason. This reassignment would 

not consolidate the two cases into one. Compare Fed. 

R. Civ. P. 42 with L.R. 40.4. Furthermore, we agree with 

the DbD Plaintiffs that DeLaurentis is merely attempting 

to present further arguments in support of her motion to 

dismiss, which [*20] we have denied. Accordingly, the 

second requirement is satisfied.

The third requirement is also satisfied. Both cases are 

fairly recent cases, only having been filed in the last six 

months. Although Judge Mason has issued some 

rulings in the case pending before him, none of those 

rulings have been dispositive. Furthermore, neither case 

has progressed past the motion to dismiss stage, "no 

discovery has been conducted and little judicial effort 

has been expended thus far." Global Patent Holdings, 

LLC v. Green Bay Packers, Inc., No. 00 C 4623, 2008 

U.S. Dist. LEXIS 33296, 2008 WL 1848142, at * 4 (N.D. 

Ill. Apr. 23, 2008). Finally, we are satisfied that the 

fourth factor has also been met. The fourth factors 

require that "the cases [be] susceptible of disposition in 

a single proceeding." L.R. 40.4(b)(4). The DbD Plaintiffs 

argue that this factor is met and explain that had 

DeLaurentis sued them instead of the Duffys, the claims 

would have actually been compulsory counterclaims. 

(DbD Mot. P 16.) However, the Plaintiffs argue that the 

case cannot be disposed of in a single proceeding 

because they will not consent to the jurisdiction of a 

magistrate judge in this case, which they contend is 

required. (DeLaurentis Resp. [*21] at 10.) We will 

address that argument further below. As an initial 

matter, we think that both cases are susceptible to 

disposition in a single proceeding. Both cases involve 

essentially the same parties, similar factual issues, and 

the same Agreement. Additionally, we think it is highly 

likely that the same witnesses will be called in both 

cases. Accordingly, it appears that the cases are 

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susceptible to disposition in a single proceeding.

The crux of DeLaurentis's opposition to the DbD 

Plaintiffs' motion is that the earlier-filed case is before a 

magistrate judge on the consent of the parties and that, 

although she consented to have that case heard by 

Judge Mason, she has not and will not give consent for 

this case to be heard by Judge Mason. (DeLaurentis 

Resp. at 5-6.) HN12[ ] Magistrate judges are 

authorized to "conduct any or all proceedings in a jury or 

nonjury civil matter" with "the consent of the parties" and 

when they have been "specially designated to exercise 

such jurisdiction by the district court." 28 U.S.C. § 

636(c)(1); see also Fed. R. Civ. P. 73. Without such 

consent, a magistrate judge does not have full authority 

to issue dispositive orders, conduct trial, or enter final 

judgment. [*22] See Roell v. Withrow, 538 U.S. 580, 

582-83, 123 S. Ct. 1696, 1699-1700, 155 L. Ed. 2d 775 

(2003) (holding that such consent can be inferred); Heft 

v. Moore, 351 F.3d 278, 281 (7th Cir. 2003). Consent 

can only be vacated "when a party shows extraordinary 

circumstances." Fed. R. Civ. P. 73(b)(3); Lorenz v. 

Valley Forge Ins. Co., 815 F.2d 1095, 1097 (7th Cir. 

1987) (holding that allowing plaintiffs to amend their 

complaint to request $ 10,000,000 in punitive damages 

when the original complaint only sought $ 150,000 in 

punitive damages did not constitute extraordinary 

circumstances).

DeLaurentis argues that interpreting L.R . 40.4 to allow 

the reassignment of a case pending before a district 

judge to a magistrate judge presiding over a related 

case without the parties' consent is impermissible 

because it conflicts with 28 U.S.C. § 636. (DeLaurentis 

Resp. at 5 (citing Fed. R. Civ. P. 83 ("A local rule must 

be consistent with . . . federal statutes and rules.") and 

United States v. Claros, 17 F.3d 1041, 1044-45 (7th Cir. 

1994) (HN13[ ] "A local rule may not be inconsistent 

with the Constitution, a statute of the United States, or 

with a national rule governing the conduct of litigation in 

the United States courts.").) [*23] She further argues 

that the drafters of L.R. 40.4 recognized the limitations 

that § 636 places on magistrate judges, as 

demonstrated by the exception they created for filing a 

motion for reassignment before the district judge 

presiding over the later-filed case when the earlier-filed 

case is before a magistrate judge on consent. 

(DeLaurentis Resp. at 5-6.) We disagree with 

DeLaurentis's argument that this exception 

demonstrates the drafter's knowledge that reassigning a 

case as related to a magistrate judge without their 

consent is prohibited by statute. Instead, the fact that 

the drafters included such an exception regarding where 

to file a motion demonstrates that they considered this 

situation and decided not to prohibit such a 

reassignment in its entirety. We have found no case law 

and the parties have not presented any authority 

addressing whether reassignment of a related case to a 

magistrate judge is inappropriate where the parties, 

although having consented in the earlier case, have not 

consented to the magistrate judge's jurisdiction for the 

later case. Because the two cases involve interpretation 

of the same Agreement and involve similar questions of 

fact and law, and the [*24] DbD Plaintiffs have satisfied 

L.R. 40.4's requirements for reassignment as related, 

we are convinced that judicial economy requires that 

they be decided by the same judge. Accordingly, the 

case is reassigned to Judge Mason. 6

CONCLUSION

For the reasons set forth above, we deny DeLaurentis's 

motion to dismiss and grant the DbD Plaintiffs' motion to 

reassign.

/s/ Marvin E. Aspen

Honorable Marvin E. Aspen

United States District Judge

Date: June 23, 2009

End of Document

6 We note that Judge Bucklo, the district judge assigned to the 

first-filed action, may decide, either "[o]n [her] own for good 

cause" or if DeLaurentis shows "extraordinary circumstances," 

to vacate the referral to Judge Mason. See Fed. R. Civ. P. 

73(b)(3).

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 Cited

As of: May 4, 2020 2:28 PM Z

Williams v. Walsh Constr.

United States District Court for the Northern District of Illinois, Eastern Division

January 16, 2007, Decided 

No. 05 C 6807 

Reporter

2007 U.S. Dist. LEXIS 3970 *; 2007 WL 178309

ALPHONSO WILLIAMS, Plaintiff, v. WALSH 

CONSTRUCTION, Defendants.

Core Terms

cases, reassignment, discovery, allegations, scheduled, 

savings

Counsel: [*1] For Alphonso Williams, Plaintiff: Michael 

Irving Leonard, LEAD ATTORNEY, Meckler, Bulger & 

Tilson, Chicago, IL.

For Walsh Construction, Defendant: Tom H. 

Luetkemeyer, LEAD ATTORNEY, Scott M Gilbert, 

Hinshaw & Culbertson LLP, Chicago, IL; Aimee 

Elizabeth Delaney, Hinshaw & Culbertson, Chicago, IL. 

Judges: JOHN W. DARRAH, United States District 

Court Judge. 

Opinion by: JOHN W. DARRAH

Opinion

MEMORANDUM OPINION AND ORDER

Plaintiff, Alphonso Williams, filed suit against Defendant, 

Walsh Construction, alleging race discrimination, 

harassment, and retaliation in violation of Title VII of the 

Civil Rights Act of 1964. Presently before the Court is 

Defendant's Motion for Reassignment of an allegedly 

related case pursuant to Local Rule 40.4.

BACKGROUND

On December 1, 2005, Williams filed suit in this Court 

against his former employer, Walsh Construction ("the 

Williams case"). Williams alleged that he was employed 

by Walsh from September 2000 until his termination on 

February 10, 2002. At the time of his termination, 

Williams was a Labor Supervisor. Based on Williams' 

race, African-American, Walsh: reduced his hours of 

work; denied him the means to perform his duties, 

including tools [*2] and a truck to carry tools; treated 

non-African-American employees more favorably; 

denied Williams' incentive and bonus pay; and forced 

Williams to single out other African-American 

employees for termination. Williams' claims are: race 

discrimination, harassment, and retaliation in Violation 

of Title VII and 42 U.S.C. § 1981.

In early 2006, the parties in the Williams case engaged 

in settlement negotiations, which were unsuccessful. 

Thereafter, the case was scheduled for a April 30, 2007 

jury trial, with discovery closing on December 26, 2006, 

and a pretrial conference scheduled for April 26, 2007.

On July 28, 2006, Wallace Bolden and eleven other 

named plaintiffs filed a class-action complaint against 

Walsh ("the Class Action"). This later suit, 06 C 4104, 

was assigned to Judge Joan H. Lefkow. The named 

plaintiffs in the Class Action were laborers, labor 

supervisors, and labor foremen. The Class Action 

alleges that Walsh discriminated against AfricanAmerican employees from January 2001 though the 

present by laying-off, discharging, constructively 

discharging, and/or failing to hire African-Americans. 

The eleven counts of the Class Action are race 

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discrimination, [*3] retaliation, and termination in 

violation of Title VII and 42 U.S.C. § 1981. The 

allegations that form the basis of the claims include: a 

hostile work environment, disparate impact, denial of 

overtime, receipt of more dangerous assignments 

because of race, retaliation for complaining of sexual 

harassment, and refusal to hire or rehire based on race.

Pursuant to Judge Lefkow's October 31, 2006 Minute 

Order, non-expert class-certification discovery for the 

Class Action is to be completed by June 15, 2007; and 

plaintiffs' motion for class certification is to be briefed as 

follows: motion to be filed by November 16, 2007, 

response due by December 14, 2007, and reply brief 

due by January 28, 2008.

Williams and the Class Action plaintiffs oppose 

reassignment of the Class Action.

LEGAL STANDARD

In reviewing a motion to reassign a case on the basis of 

relatedness, the moving party must satisfy the 

requirements of both LR 40.4(a) and 40.4(b). Hollinger 

Int'l, Inc. v. Hollinger, Inc., 2004 U.S. Dist. LEXIS 7883, 

2004 WL 1102327, at *1 (N.D. Ill. May 5, 2004)

(Hollinger). The court has discretion to reassign the 

case pursuant to LR 40.4. Clark v. Ins. Car Rentals Inc., 

42 F. Supp. 2d 846, 847 (N.D. Ill. 1999) [*4] (Clark). 

Under LR 40.4(a), "[t]wo or more civil cases may be 

related if: "(1) the cases involve the same property; (2) 

the cases involve some of the same issues of fact or 

law; (3) the cases grow out of the same transaction or 

occurrence; or (4) in class-action suits, one or more of 

the classes involved in the cases is or are of the same." 

LR 40.4. Only one of the above conditions must be met 

to satisfy LR 40.4(a).

Once the cases are determined to be related under LR 

40.4(a), LR 40.4(b) requires more stringent criteria for 

the case to qualify for reassignment. See Clark, 42 F. 

Supp. 2d at 848. LR 40.4(b) requires that to be 

reassigned: "(1) both cases are pending in this Court; 

(2) the handling of both cases by the same judge is 

likely to result in a substantial saving of judicial time and 

effort; (3) the earlier case has not progressed to the 

point where designating a later-filed case as related 

would be likely to substantially delay the proceedings in 

the earlier case; and (4) the cases are susceptible of 

disposition in a single proceeding." Under 40.4(b)(2), the 

judicial savings alleged by the moving party must be 

substantial; a mere assertion that some judicial [*5] 

time and effort would be saved by reassignment is 

insufficient. Hollinger, 2004 U.S. Dist. LEXIS 7883, 2004 

WL 1102327 at *2 (citing Lawrence E. Jaffe Pension 

Plan v. Household Int'l, Inc., 2003 U.S. Dist. LEXIS 

7466, 2003 WL 21011757 at *2 (N.D. Ill. May 5, 2003)). 

Likewise, if the cases will require different discovery, 

legal findings, defenses or summary judgment motions, 

it is unlikely that reassignment will result in a substantial 

judicial savings. See Hollinger, 2004 U.S. Dist. LEXIS 

7883, 2004 WL 1102327 at*2; Donahue v. Elgin 

Riverboat Resort, 2004 U.S. Dist. LEXIS 19362, 2004 

WL 2495642 at * 1 (N.D. Ill. Sept. 28, 2004) (Donahue). 

Also, cases are rarely susceptible to disposition in one 

proceeding pursuant to 40.4(b)(4) where the cases 

involve unique issues of law and fact and those unique 

characteristics are dominant. See Mach. Movers, 

Riggers & Mach. Erectors, Local 136 Defined 

Contribution Ret. Fund v. Joseph/Anthony, Inc., 2004 

U.S. Dist. LEXIS 13631, 2004 WL 1631646 at *4 (N.D. 

Ill. July 16, 2004) (Machinery Movers) (citing Clark, 42 

F. Supp. 2d at 849); see also Donahue, 2004 U.S. Dist. 

LEXIS 19362, 2004 WL 2495642 at * 1 (motion to 

reassign denied where all cases involved Title VII 

claims, but each [*6] case was based on a unique set 

of facts different from every other case involved).

In addition, LR 40.4(c) requires that a motion to 

reassign: "(1) set forth the points of commonality of the 

cases in sufficient detail to indicate that the cases are 

related within the meaning of section (a) and (2) indicate 

the extent to which the conditions required by section 

(b) will be met if the cases are found to be related." 

These provisions "impose an obligation on the moving 

party to specifically identify why each of the four 

conditions under LR 40.4(b) is met." Mach. Movers, 

2004 U.S. Dist. LEXIS 13631, 2004 WL 1631646 at *3 

(N.D. Ill. July 16, 2004); Lawrence E. Jaffe Pension 

Plan, 2003 U.S. Dist. LEXIS 7466, 2003 WL 21001757 

at *3. Thus, a motion for reassignment may be denied if 

a party fails to sufficiently plead each of 40.4(b)'s 

requirements. Mach. Movers, 2004 U.S. Dist. LEXIS 

13631, 2004 WL 1631646 at *3.

ANALYSIS

Both cases involve some of the same issues of fact or 

law; accordingly, the cases are related under LR 

40.4(a). However, Walsh has failed to demonstrate that 

the cases satisfy all of the requisite criteria of LR 

40.4(b). While the cases are both pending in court in 

this district, Walsh has [*7] failed to demonstrate that: 

(1) handling of both cases would likely result in a 

2007 U.S. Dist. LEXIS 3970, *2

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John Bjork

substantial savings of judicial time and effort; (2) the 

Williams case has not progressed to a point where 

reassigning the later-filed case would likely substantially 

delay the proceedings in the Williams case; and (3) the 

cases are susceptible of disposition in a single 

proceeding.

Walsh argues that reassigning the Class Action would 

likely result in a substantial savings of judicial time and 

effort because of the similar allegations and claims 

between the plaintiffs. While some of the claims and 

allegations are similar in both suits, the Class Action 

contains allegations and claims that are not present in 

the Williams suit. The most obvious distinction is the 

extensive discovery and motion practice involved in the 

class allegations that are not present in the Williams 

case. Furthermore, in light of the different claims and 

specific supporting allegations, a finding in one case 

would not likely be dispositive of any issues in the other 

cases. See Donahue, 2004 U.S. Dist. LEXIS 19362, 

2004 WL 2495642 at *3. Thus, the cases are not likely 

to reach disposition in a single proceeding.

More significantly, the Williams [*8] case has 

progressed to a point where reassigning the Class 

Action would substantially delay the proceedings in the 

Williams case. The parties in the Williams case have 

unsuccessfully attempted to settle the case. Discovery 

in the Williams case is scheduled to close December 26, 

2006; and trial is scheduled for April 30, 2007. On the 

other hand, non-expert class discovery for the Class 

Action is not scheduled to close until June 15, 2007; and 

the motion for class certification will not be fully briefed 

until January 28, 2008. Accordingly, without 

reassignment, the Williams case is scheduled to 

progress through trial before non-expert class discovery 

is scheduled to close and more than six months before 

the motion for class certification will be decided. Clearly, 

reassignment would result in a significant delay in the 

Williams case if the class-action discovery, briefing and 

certification schedule were imposed on this case 

through reassignment of Judge Lefkow's case to this 

Court.

Based on the above, LR 40.4(b) has not been met. 

Accordingly, Walsh's Motion for Reassignment is 

denied.

CONCLUSION

For the reasons stated above, Walsh's Motion for 

Reassignment is denied.

Dated: [*9] January 16, 2007

JOHN W. DARRAH

United States District Court Judge 

End of Document

2007 U.S. Dist. LEXIS 3970, *7

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UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

FAIR ISAAC CORPORATION, 

Plaintiff/Counterclaim Defendant, 

v. 

TRANS UNION LLC, 

Defendant/Counterclaim Plaintiff. 

Case No. 1:17-cv-08318 

Honorable Sharon Johnson Coleman 

[PROPOSED] ORDER 

Having considered the Movants’ Motion to Reassign Cases as Related (the “Motion”) 

and finding that the Class Actions1 are related to this case within the meaning of Local Rule 

40.4, the Court GRANTS the Motion. 

IT IS SO ORDERED this ____ day of ___________________, 2020. 

____________________________________ 

Honorable Sharon Johnson Coleman, 

U.S.D.J. 

1 The “Class Actions” are Sky Federal Credit Union v. Fair Isaac Corp., No. 20-cv-02114; 

First Choice Federal Credit Union v. Fair Isaac Corp., No. 20-cv-02516; Amalgamated Bank v. 

Fair Isaac Corp., No. 20-cv-02533; Alcoa Community Federal Credit Union v. Fair Isaac Corp., 

No. 20-cv-02559; and Getten Credit Company v. Fair Isaac Corp., No. 20-cv-02651.

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