On February 27, the U.S. District Court for the Western District of New York dismissed a pro se consumer’s lawsuit against an insurer for alleged credit reporting violations under the FCRA, granting 45 days to amend the complaint. The consumer, who initiated the case in state court in July 2024 seeking $1 million in damages, alleged that after purchasing — and shortly thereafter canceling — a renters insurance policy in January 2022, the insurer reported an open balance to credit reporting agencies in September 2023 despite having received payment. She claimed that the inaccurate reporting lowered her credit score, caused stress and health issues, and led to multiple denials when she attempted to refinance a loan. She further alleged that the insurer shared her information with a third-party debt collector, which then appeared on her credit report.

The insurer removed the case to federal court and moved to dismiss, asserting that the complaint failed to state a viable claim under the FCRA. The court agreed, holding that the complaint failed to allege that a credit reporting agency had notified the insurer of a dispute concerning the reported balance — a prerequisite for triggering the FCRA’s investigative duty and sustaining a private claim under Section 1681s-2(b), the only provision that supports a private right of action. The court also rejected potential state law claims, finding that inaccurate credit reporting alone does not constitute the “extreme and outrageous” conduct required for intentional infliction of emotional distress under state law, and that the complaint did not satisfy any recognized theory for negligent infliction of emotional distress. The court granted the consumer 45 days to file an amended complaint that alleges facts establishing a viable FCRA claim — specifically, that the insurer received notice of a credit dispute from a credit reporting agency and failed to investigate — and that clarifies whether the referenced debt collector is a separate entity intended as an additional defendant.