                                                                                                                           Opinions of the United
1996 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


12-6-1996

Philbin v. Trans Union Corp
Precedential or Non-Precedential:

Docket 96-5030




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"Philbin v. Trans Union Corp" (1996). 1996 Decisions. Paper 8.
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                  UNITED STATES COURT OF APPEALS
                      FOR THE THIRD CIRCUIT



                           No. 96-5030


                      JAMES R. PHILBIN, JR.

                                  v.

             TRANS UNION CORPORATION; TRW CREDENTIALS

                             JAMES PHILBIN, JR.,

                                       Appellant


         On Appeal from the United States District Court
                  for the District of New Jersey
                      (D.C. No. 93-cv-02360)


                     Argued October 28, 1996

            BEFORE: SCIRICA and COWEN, Circuit Judges
                   and FEIKENS, District Judge*

                     (Filed December 6, 1996)


Daniel J. de Luca, Esq. (argued)
510 White Horse Pike
Audobon, NJ 08106

          COUNSEL FOR APPELLANT
          James R. Philbin, Jr.

Mark E. Kogan, Esq. (argued)
Marion, Satzberg, Trichon & Kogan
1735 Market Street
3000 Mellon Bank Building
Philadelphia, PA 19103

          COUNSEL FOR APPELLEE
          Trans Union Corporation



*Honorable John Feikens, United States District Judge for the
 Eastern District of Michigan, sitting by designation.
Dorothy A. Kowal, Esq. (argued)
Stoldt & Horan
401 Hackensack Avenue
Hackensack, NJ 07601

          COUNSEL FOR APPELLEE
          TRW Credentials




                             OPINION



COWEN, Circuit Judge.

     Plaintiff James R. Philbin, Jr. appeals two orders of the
district court, the first dated November 29, 1994, and the second
and final order dated December 8, 1995, granting summary judgment
in favor of the defendants. This appeal raises issues regarding
the elements of a cause of action pursuant to § 607(b) of the
Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681e(b), and the
nature of plaintiff's burden in demonstrating a prima facie case
pursuant to such a cause of action, questions we have not yet had
occasion to address. For the reasons that follow, the judgment
of the district court is affirmed in part, reversed in part, and
remanded for further proceedings.
                                I.
     At some unspecified point in time, defendant Trans Union
Corp. ("TUC"), a credit reporting service, prepared a credit
report regarding Philbin that erroneously stated he was subject
to a tax lien in the amount of approximately $9500. Apparently,
TUC had him confused with his father, James R. Philbin, Sr.
Plaintiff states in an affidavit that he has never been
delinquent on any financial obligation. App. at 8. That
statement has never been shown to be false, nor has it ever been
denied by defendants. Philbin first notified TUC of the error in
April of 1990. TUC corrected the error and added a notation to
the credit report reading: "Do not confuse with father James
Philbin Sr different address different social security number."
App. at 14.
     Defendant TRW Credentials, Inc. ("TRW") had also apparently
prepared a false credit report on Philbin, although there is no
evidence of what inaccuracies it contained. In the spring of
1990, Philbin's attorney wrote a letter to TRW demanding that it
correct its report. Philbin apparently did not have any further
complaints with TRW until approximately two-and-a-half years
later.
     In July of 1990, Philbin applied for and was denied credit
at Macy's department store. The reasons given were that his
"credit profile shows delinquent past or present credit
obligations with others" and "insufficient favorable credit
experience." App. at 15. Macy's relied in whole or in part on
the TUC report. Philbin requested and received a copy of his
credit report from TUC, which he concedes was wholly accurate.
     In February of 1992, Philbin applied for and was denied a
$1500 loan by Household International Company. The decision was
based in whole or in part on information received from TUC, but
Household gave no reasons for its decision. That April, Philbin
filed a complaint against TUC with the New Jersey Department of
Law and Public Safety. That agency forwarded Philbin's complaint
to the Federal Trade Commission ("FTC"). Two months later,
Philbin was denied a loan of approximately $10,000 from Bayview
Marina based in whole or in part on information received from
TUC. The reason given was "insufficient credit file." App. at
25.
     That November, Philbin was denied credit from four different
credit granting agencies. Philbin's application for a credit
card from Circuit City electronics store was denied by the First
North American National Bank, based in whole or in part on
information received from TUC. The reasons given for the denial
were "number of other recent credit inquiries" and "high
utilization of bankcard credit lines." App. at 31. He applied
for a credit card from Sears department store and was denied
credit based in whole or in part on information received from
both TUC and TRW. The reasons given were "unfavorable credit
history," "number of credit bureau inquiries," and "number of
open accounts." App. at 27. He was denied a Best Products
credit card from Bank One based in whole or in part on
information received from TUC. The reasons given were
"sufficient pay history not established," and "limited credit
experience." App. at 28. Finally, Philbin was denied a credit
card by Citibank based in whole or in part on information
received from TRW. The reason given was that "a delinquent
credit obligation[] was recorded on [the] credit bureau report."
App. at 44.
     Fearing that these successive denials of credit were due to
inaccuracies in his credit reports, Philbin requested a copy of
his report from both TUC and TRW. TRW promptly sent him a copy
of his report, which Philbin concedes contained no inaccuracies,
indicating no delinquencies and listing six open accounts.
     Ten days after the request to TUC was made, TUC informed him
that the address he had provided them did not match the address
in their records and requested that he send them proof of
residence. The address to which he wished the report sent was
the same address to which the 1990 report had been sent.
However, other evidence in the record reflects that Philbin used
two addresses. Philbin complied and, several weeks later, he
received a copy of his TUC report. It erroneously stated that he
had been released from a $9580 tax lien. Philbin states that he
notified TUC about the error immediately.
     In May of 1993, after having filed the complaint in the
instant litigation, Philbin applied for a $5000 loan from
Nation's Credit, which informed him that it was inclined to deny
him the loan based in whole or in part on information received
from TUC and TRW. He obtained from Nation's Credit a copy of
the TUC report. Like the report he received directly from TUC
the previous year, it erroneously stated that he had been
released from a $9580 tax lien. Philbin also obtained the TRW
report from Nation's Credit. That report, in addition to
containing correct information regarding him, erroneously listed
twelve open accounts, one currently delinquent account, and four
past delinquent accounts. This information apparently pertained
to Philbin's father, not to him.
     On April 22, 1993, Philbin filed the instant suit in the
Superior Court of New Jersey, Camden County, charging TUC and TRW
with violations of the FCRA. He claimed that as a result of the
inaccurate reporting of his credit history and the subsequent
denials of credit, he suffered "deep humiliation and
embarrassment . . . and will continue to suffer injury to his
credit, reputation and financial standing." App. at 3, 5. He
stated in an affidavit that he has suffered the humiliation and
embarrassment of not being able to purchase items necessary to
his business without the help of his father. App. at 8.
Finally, he stated that he "suffered economic injury from the
inability to establish credit so that [he] can pursue investment
opportunities in real property." App. at 8.
     TUC and TRW removed the case to the district court. They
subsequently moved for summary judgment dismissing the complaint
pursuant to Fed. R. Civ. P. 56 on the grounds that Philbin had
not produced sufficient evidence to make out a prima facie case
of either willful or negligent noncompliance with § 1681e(b). On
November 29, 1994, the district court granted TRW's motion for
summary judgment; granted TUC's motion for summary judgment on
the issue of willful noncompliance with § 1681e(b); and denied
TUC's motion for summary judgment on the issue of negligent
noncompliance with § 1681e(b).
     In preparation for trial, the parties filed a Joint Pre-
Trial Order, paragraph six of which stated: "None of the letters
from the creditors . . . mentions a tax lien as a reason for
denial of credit." TUC's Mem. of Law at 6. Based on this, TUC
moved for reconsideration of the portion of its motion for
summary judgment that had been denied. On reconsideration, the
district court held that, pursuant to the stipulation contained
in the Joint Pre-Trial Order, Philbin would not be able to
produce any evidence that the denials of credit by the credit
granting agencies were caused by the inaccurate entry on the TUC
report. The district court concluded that he would therefore not
be capable of sustaining his burden of proof on at least one
element of his prima facie case. Accordingly, the district court
vacated that portion of its November 29, 1994, order denying
summary judgment to TUC, granted TUC's motion for summary
judgment, and dismissed the complaint. This appeal followed.
                               II.
     The FCRA was enacted in order to ensure that "consumer
reporting agencies adopt reasonable procedures for meeting the
needs of commerce for consumer credit, personnel, insurance, and
other information in a manner which is fair and equitable to the
consumer, with regard to the confidentiality, accuracy,
relevancy, and proper utilization of such information." 15
U.S.C. § 1681(b). The FCRA was prompted by "congressional
concern over abuses in the credit reporting industry." Guimond
v. Trans Union Credit Information Co., 45 F.3d 1329, 1333 (9th
Cir. 1995); see also St. Paul Guardian Ins. Co. v. Johnson, 884
F.2d 881, 883 (5th Cir. 1989). In the FCRA, Congress has
recognized the crucial role that consumer reporting agencies play
in collecting and transmitting consumer credit information, and
the detrimental effects inaccurate information can visit upon
both the individual consumer and the nation's economy as a whole.
See 15 U.S.C. § 1681(a)(1), (3).
     Title 15 U.S.C. § 1681e(b) provides: "Whenever a consumer
reporting agency prepares a consumer report it shall follow
reasonable procedures to assure maximum possible accuracy of the
information concerning the individual about whom the report
relates." It is undisputed that TUC and TRW are "consumer
reporting agenc[ies]" within the terms of 15 U.S.C. § 1681a(f),
the credit reports they produced are "consumer report[s]" within
the meaning of § 1681a(d), and Philbin is a "consumer" for
purposes of § 1681a(c). Sections 1681n and 1681o of Title 15
respectively provide private rights of action for willful and
negligent noncompliance with any duty imposed by the FCRA and
allow recovery for actual damages and attorneys fees and costs,
as well as punitive damages in the case of willful noncompliance.
See Casella v. Equifax Credit Information Servs., 56 F.3d 469,
473 (2d Cir. 1995), cert. denied, 116 S.Ct. 1452 (1996); Guimond,
45 F.3d at 1332; Henson v. CSC Credit Servs., 29 F.3d 280, 284
(7th Cir. 1994); Cahlin v. General Motors Acceptance Corp., 936
F.2d 1151, 1156 & n.4 (11th Cir. 1991).
                                A.
     The parties agree that a case of negligent noncompliance
with § 1681e(b) consists of four elements: (1) inaccurate
information was included in a consumer's credit report; (2) the
inaccuracy was due to defendant's failure to follow reasonable
procedures to assure maximum possible accuracy; (3) the consumer
suffered injury; and (4) the consumer's injury was caused by the
inclusion of the inaccurate entry. See Morris v. Credit Bureau
of Cincinnati, Inc., 563 F. Supp. 962, 967 (S.D. Ohio 1983);
Bryant v. TRW, Inc., 487 F. Supp. 1234, 1238 (E.D. Mich. 1980),
aff'd, 689 F.2d 72 (6th Cir. 1982). Defendants do not dispute
they both produced at least one report that contained inaccurate
information about Philbin. Nor do they contest that Philbin's
emotional distress damages are cognizable. See Guimond, 45 F.3d
at 1333; Stevenson v. TRW Inc., 987 F.2d 288, 296 (5th Cir.
1993); Millstone v. O'Hanlon Reports, Inc., 528 F.2d 829, 834-35
(8th Cir. 1976). Moreover, TUC apparently concedes that Philbin
has satisfied his burden on summary judgment of producing facts
from which a reasonable jury could infer that it did not follow
reasonable procedures. As other courts have held, "[a]llowing
inaccurate information back onto a credit report after deleting
it because it is inaccurate is negligent." Stevenson, 987 F.2d
at 293; see also Morris, 563 F. Supp. at 968.
     As their main contention, both defendants urge that Philbin
has failed to produce sufficient evidence from which a reasonable
trier of fact could conclude that the inaccuracies in the reports
were the cause of Philbin's damages. TRW additionally contends
that Philbin has failed to produce any evidence that it failed to
follow reasonable procedures. We address these contentions in
reverse order.
                                1.
                      Reasonable Procedures
     Reasonable procedures are those that "`a reasonably prudent
person would [undertake] under the circumstances.'" Stewart v.
Credit Bureau, Inc., 734 F.2d 47, 51 (D.C. Cir. 1984) (per
curiam) (quoting Bryant v. TRW, Inc., 689 F.2d 72, 78 (6th Cir.
1982)) (alteration added). "Judging the reasonableness of a[
credit reporting] agency's procedures involves weighing the
potential harm from inaccuracy against the burden of safeguarding
against such inaccuracy." Id.
     TRW urges that Philbin must come forward with affirmative
proof that it failed to use reasonable procedures to assure
maximum accuracy and that he has failed to do so. It cites a
number of cases for the proposition that the FCRA "does not make
reporting agencies strictly liable for all inaccuracies" that
appear on a consumer report it prepares. Cahlin, 936 F.2d at
1156; see also Stewart, 734 F.2d at 51; Bryant, 689 F.2d at 78;
Thompson v. San Antonio Retail Merchants Ass'n, 682 F.2d 509, 513
(5th Cir. 1982) (per curiam); Equifax, Inc. v. Federal Trade
Commission, 678 F.2d 1047, 1049 (11th Cir. 1982); Hauser v.
Equifax, Inc., 602 F.2d 811, 814 (8th Cir. 1979); Neptune v.
Trans Union Corp., 1993 WL 505601, at *2 (E.D. Pa. Dec. 8, 1993),
aff'd, 27 F.3d 558 (3d Cir. 1994); Hussain v. Carteret Sav. Bank,
F.A., 704 F. Supp. 567, 569 (D.N.J. 1989).
     TRW accurately states that consumer reporting agencies are
liable only when inaccuracies are the result of their failure to
follow reasonable procedures. However, this statement gives
little guidance as to the nature of the plaintiff's burden of
proof on the "reasonable procedures" issue on a motion for
summary judgment. We must determine the nature and quantum of
proof, if any, beyond the mere fact of an inaccuracy, that a
plaintiff must provide in order for a reasonable trier of fact to
conclude that reasonable procedures were not followed.
     We are guided in this endeavor by those courts of appeals
that have addressed this question. We note, however, that there
is a divergence among the approaches those courts have taken. In
Stewart, 734 F.2d at 51 n.5, the Court of Appeals for the
District of Columbia Circuit noted that although it was unaware
of any cases "directly addressing who has the burden of proving
reasonableness of procedures, courts have generally assumed that
burden falls on the plaintiff" (citing Hauser, 602 F.2d at 814-
15; Morris, 563 F. Supp. at 968; Alexander v. Moore & Assocs.,
Inc., 553 F. Supp. 948, 954 (D. Haw. 1982)). Accordingly, it
held that
                    a plaintiff cannot rest on a showing of a
                    mere inaccuracy, shifting to the defendant
                    the burden of proof on the reasonableness of
                    procedures for ensuring accuracy: There is
                    no indication that Congress meant to so shift
                    the nominal plaintiff's burden of proof as to
                    requisite components of a claim based on a
                    statutory violation. Thus, we conclude that
                    a plaintiff must minimally present some
                    evidence from which a trier of fact can infer
                    that the consumer reporting agency failed to
                    follow reasonable procedures in preparing a
                    credit report.

          Id. at 51 (footnote omitted) (emphasis added).
     However, the court went on to hold that, in order to satisfy
this "minimal[]" burden, "a plaintiff need not introduce direct
evidence of unreasonableness of procedures: In certain
instances, inaccurate credit reports by themselves can fairly be
read as evidencing unreasonable procedures, and . . . in such
instances plaintiff's failure to present direct evidence will not
be fatal to his claim." Id. at 51-52 (emphasis added). While
the Stewart court did not definitively spell out what those
"certain instances" were, it did give some guidance. For
example, it cited with approval Bryant, 487 F. Supp. at 1242, in
which the court concluded that inconsistencies between two
different reports concerning the plaintiff "imposed a duty on the
reporting agency to verify the information in those reports."
Stewart, 734 F.2d at 52. The court also approvingly cited
Morris, 563 F. Supp. at 968, in which the court likewise found
"the existence of . . . two similar files [on plaintiff] to be a
sufficient indicium of unreasonable procedures to satisfy the
plaintiffs' `burden.'" Stewart, 734 F.2d at 52. The D.C.
Circuit concluded: "Certainly . . . inconsistencies between two
files or reports involving less fundamental inaccuracies [than a
falsely reported wage earner plan] can provide sufficient grounds
for inferring that an agency acted negligently in failing to
verify information." Id.
     In an even broader holding, the Court of Appeals for the
Ninth Circuit recently wrote:
                    In order to make out a prima facie violation
                    under § 1681e(b), a consumer must present
                    evidence tending to show that a credit
                    reporting agency prepared a report containing
                    inaccurate information. The FCRA does not
                    impose strict liability, however -- an agency
                    can escape liability if it establishes that
                    an inaccurate report was generated despite
                    the agency's following reasonable procedures.

          Guimond, 45 F.3d at 1333 (emphasis added) (citation and footnote
omitted); see also id. at 1334 ("Guimond has made out a prima
facie case under § 1681e(b) by showing that there were
inaccuracies in her credit report."). Similarly, the Court of
Appeals for the Eleventh Circuit wrote:
                    In order to make out a prima facie violation
                    of [§ 1681e(b)], the Act implicitly requires
                    that a consumer must present evidence tending
                    to show that a credit reporting agency
                    prepared a report containing "inaccurate"
                    information. . . . The Act, however, does
                    not make reporting agencies strictly liable
                    for all inaccuracies. The agency can escape
                    liability if it establishes that an
                    inaccurate report was generated by following
                    reasonable procedures, which will be a jury
                    question in the overwhelming majority of
                    cases. Thus, prior to sending a [§ 1681e(b)]
                    claim to the jury, a credit reporting agency
                    can usually prevail only if a court finds, as
                    a matter of law, that a credit report was
                    "accurate."

           Cahlin, 936 F.2d at 1156 (emphasis added) (footnotes omitted).
     The language from Guimond and Cahlin may be interpreted in
two different ways. A broader reading is that, once a plaintiff
demonstrates inaccuracies in a credit report, the burden shifts
to the defendant to prove as an affirmative defense the presence
of reasonable procedures. But see Stewart, 734 F.2d at 51 n.5
(citing 15 U.S.C. §§ 1681d(c) and 1681m(c) for the proposition
that Congress "`knew how' to shift the burden of proof from
plaintiff to defendant by explicitly doing so").
     A somewhat narrower, and more plausible, reading is that a
plaintiff may present his case to the jury on the issue of
reasonable procedures merely by showing an inaccuracy in the
consumer report and nothing more, but the burden does not shift
to the defendant. Rather, a jury may, but need not, infer from
the inaccuracy that the defendant failed to follow reasonable
procedures.
     This position imposes a less stringent burden on the
plaintiff than does the position taken in Stewart, which requires
some unspecified quantum of evidence beyond a mere inaccuracy,
such as the existence of a second report, inconsistent with the
first, in order for a plaintiff to survive summary judgment. On
the other hand, it does not entirely relieve the plaintiff of his
burden of proving to the jury a lack of reasonable procedures and
instead impose on the defendant an affirmative obligation to
prove that reasonable procedures were in place.
     This "middle position" is akin to the common law rule of resipsa
loquitur, which permits but does not require the jury to
infer negligence from certain predicate facts. See Restatement
(Second) of Torts § 328 D (1965).             The justification for
importing
                     such a rule into the FCRA context would be that, as in
the
                     traditional res ipsa situation, the inaccuracy has
been caused by
                     an instrumentality under the exclusive control of the
defendant.
                     Such a defendant is in a far better position to prove
that
                     reasonable procedures were followed than a plaintiff
is to prove
                     the opposite.
                          Pursuant to either reading of Guimond and Cahlin,
once a
                       plaintiff has demonstrated inaccuracies in the report,
a
                       defendant could prevail on summary judgment only if it
were to
                       produce evidence that demonstrates as a matter of law
that the
                       procedures it followed were reasonable.    See, e.g.,
Henson, 29
                       F.3d at 285 ("[A]s a matter of law, a credit reporting
agency is
                       not liable under the FCRA for reporting inaccurate
information
                       obtained from a court's Judgment Docket, absent prior
notice from
                       the consumer that the information may be
inaccurate.").
                            Having discussed these three possibilities (that
a plaintiff
                       must produce some evidence beyond a mere inaccuracy in
order to
                       demonstrate the failure to follow reasonable
procedures; that the
                       jury may infer the failure to follow reasonable
procedures from
                       the mere fact of an inaccuracy; or that upon
demonstrating an
                       inaccuracy, the burden shifts to the defendant to
prove that
                       reasonable procedures were followed), we find it
unnecessary to
                       decide among them.   Pursuant to either reading of
Guimond and
                       Cahlin, plaintiff has produced sufficient evidence to
survive
                       summary judgment on the issue of reasonable procedures
merely by
                       demonstrating that there were inaccuracies in the TRW
report.
                       Moreover, even under the rule enunciated in Stewart,
plaintiff
                       has produced sufficient evidence from which a
reasonable trier of
                       fact could infer that TRW did not follow reasonable
procedures.
                       The court there stated that "[i]n certain instances,
inaccurate
                       credit reports by themselves can fairly be read as
evidencing
                       unreasonable procedures."   Stewart, 734 F.2d at 52.
As one
                       specific example of such an instance, the court
posited that
                       where there exist two or more inconsistent reports,
and the
                      inconsistency relates to inaccurate information
contained in at
                      least one of the reports, a jury could reasonably
conclude that
                      the defendant failed to follow reasonable procedures.
                           Here, TRW issued two reports that were
inconsistent with
                       each other. Unquestionably, one was inaccurate.    The
             inconsistencies related to the inaccurate information.
Pursuant
                      to Stewart, and a fortiori pursuant to either of the
two readings
                      of Guimond and Cahlin, these facts alone are
sufficient to allow
                      a jury to infer that TRW did not follow reasonable
procedures.
                                            2.
                                        Causation
                           Both TUC and TRW contend that there is no
evidence that the
                      inaccuracy of the credit reports, even if the result
of
                      unreasonable procedures, caused Philbin's injuries.
Given the
                      existence of one accurate and one inaccurate report
prepared by
                      each agency, they claim that there is no evidence from
which a
                      reasonable trier of fact could infer both (1) that the
credit
                      granting agencies utilized the inaccurate as opposed
to the
                      accurate versions; and (2) even assuming that the
inaccurate
                     versions were used, that the inaccurate entries were
the cause of
           the denial of credit.
                          The district court agreed with defendants and
granted
                     summary judgment on this basis, holding that a
"plaintiff must
                     establish that `the denial was not caused by factors
other than
                     the alleged inaccurate entry.'" Philbin v. Trans Union
Corp., No.
                     93-cv-2360 (JBS), at 13 (D.N.J. Dec. 8, 1995)
("Philbin II")
                     (quoting Neptune, 1993 WL 505601 at *2)); Philbin v.
Trans Union
                     Corp., No. 93-cv-2360 (JBS), at 11 (D.N.J. Nov. 29,
1994)
                     ("Philbin I") (quoting Neptune, 1993 WL 505601 at
*2)); see alsoEvans v. Credit Bureau, 904 F. Supp. 123, 126 (W.D.N.Y.
1995);
                   Pendleton v. Trans Union Systems Corp., 76 F.R.D. 192,
195 (E.D.
                   Pa. 1977) ("[A] consumer who was denied credit must
show that the
                   denial was caused by inaccurate entries . . . rather
than by
                   correct adverse entries or any other factors.").
                        Although the district court did not say so
explicitly, it
                   appears that it concluded that Philbin could not show
that the
                   inaccurate information was the "but for" cause of his
injury,
                   because he could not show that the harm would not have
occurred
                   absent the inaccurate entry.   While we agree with the
district
                   court that a FCRA plaintiff must prove causation by a
                   preponderance of the evidence, we disagree that
Philbin has
                   failed to produce sufficient facts from which a
reasonable jury
                   could find that defendants' alleged negligence caused
his
                   injuries.   A comparison of the record here with the
facts of the
                   cases relied upon by the district court and defendants
bears this
                   out.
                          In Neptune, that court did indeed find that
plaintiff had
                   not established "that the denial [of credit] was not
caused by
                   factors other than the alleged inaccurate entry."
1993 WL 505601
                   at *2. However, it noted:
                   It is undisputed that at the time plaintiff
                   claims he was denied credit based on TUC's
                   violations of the Fair Credit Reporting Act,
                   he was in default on an obligation to re-pay
                   a student loan, he was in default on an
                   obligation to re-pay a commercial loan from
                   ITT Financial Services, he was failing to
                   comply with a court order requiring him to
                   pay child support, and he had virtually no
                   income and no assets.

          Id. The court in addition noted how unusual it was for a
plaintiff to contend that he had been denied credit due to an
inaccurate credit report while at the same time applying for and
receiving leave to proceed in forma pauperis. See id. at *1-2.
Thus, the court's statement regarding the plaintiff's burden vis-
à-vis the causation issue must be read in light of the fact that
there were indisputably numerous additional reasons plaintiff
could have been denied credit.
     Similarly, in Evans, 904 F. Supp. at 126, the defendant
introduced affidavit testimony from an employee of the credit
granting agency that plaintiff had been denied a loan because he
had filed for bankruptcy within two years prior to the loan
application. The presence of undisputed, correct, adverse
information on the credit report, along with the unrebutted
testimony of one responsible for the credit-granting decision,
arguably supports the conclusion that no reasonable jury could
conclude that the presence of inaccurate entries on the reports
made a difference as to the decision whether to grant or deny
credit.
     In Cahlin, 936 F.2d at 1156, 1161, the Eleventh Circuit
upheld a grant of summary judgment to the defendant only after
all of the credit grantor's records had been subpoenaed and there
was no indication that an adverse credit report prepared by the
defendant had ever been used in making the credit decision, much
less any indication that such a report had been a causal factor
in the decision. See also Wood v. Holiday Inns, Inc., 508 F.2d
167, 172 (5th Cir. 1975).
     In contrast with these cases, the facts of the instant case
more closely resemble those in Lendino v. Trans Union Credit
Information Co., 970 F.2d 1110, 1111-12 (2d Cir. 1992), in which
adverse outdated information was included on one of three credit
reports concerning the plaintiff prepared by the defendant, in
violation of 15 U.S.C. § 1681c. The other two reports contained
"no delinquent credit accounts or any other adverse information."
Id. at 1112. The plaintiff was denied credit by Bloomingdale's
department store after its credit department reviewed one or more
of the three reports, but it is unclear which of the reports it
had seen. See id. at 1112-13. Although the only report that
indicated it had been accessed by Bloomingdale's was one of the
valid versions, the plaintiff testified that an employee of the
defendant told him that Bloomingdale's had obtained all three
reports. See id. at 1112. The district court granted summary
judgment to the defendant based on the conclusion that there was
no evidence that the credit grantor had seen the invalid version
of the report. See id. at 1111-12.
     The Second Circuit reversed, holding that a reasonable jury
could indeed infer that Bloomingdale's had seen the invalid
report and denied plaintiff credit based on that report, because
"[t]here is, at least on the present record, no other evidence
which reasonably demonstrates why Bloomingdale's rejected
Lendino's credit application." Id. at 1113. At oral argument,
counsel for TUC was unable persuasively to distinguish Lendinofrom the
instant case.
     Here, the district court originally held that because the
accurate report prepared by TUC appeared to contain no delinquent
accounts, and because Philbin stated in his affidavit that he has
never been delinquent on an account (which statement is not
disputed by defendants), Philbin could convince a jury, "by
process of elimination," Philbin I at 19, that the credit
granting agencies must have both used the inaccurate report and
considered the inaccurate information on that report in reaching
their decisions to deny credit. On reconsideration, however, in
light of the stipulation in the Joint Pre-Trial Order that none
of the rejection letters specifically cites the erroneous
information, the district court reversed itself and granted
summary judgment to TUC.
     With respect to TRW, the report Philbin received in November
of 1992, contemporaneously with the denials of credit from Sears
and Citibank, was concededly correct. The inaccurate TRW report,
which he received from a credit granting agency, was received six
months later. The district court concluded that Philbin's
contention that Sears and Citibank used the inaccurate report
rather than the accurate one was sheer speculation, and therefore
granted summary judgment to TRW.
     As a preliminary matter, we must acknowledge that we are at
a loss to explain the consequence ascribed by the district court
to the stipulation in the Joint Pre-Trial Order that none of the
rejection letters specifically cites the inaccurate information.
At the time of its initial determination, discovery was complete
and Philbin had failed to submit any deposition or affidavit
testimony of those individuals who had made the decisions to deny
him credit. Thus, both initially and on reconsideration, the
rejection letters (which omit to state that the erroneous entry
was the cause of the denial of credit), the fact that the
accurate reports contained no adverse information, Philbin's
statement that he had never been delinquent on an account, and
the "process of elimination" argument to be drawn from this
evidence were all that Philbin could have presented to a jury.
Yet these were deemed sufficient initially as against TUC and
insufficient on reconsideration.
     More fundamentally, the district court erred by assuming
that Philbin could satisfy his burden only by introducing direct
evidence that consideration of the inaccurate entry was crucial
to the decision to deny credit. While Philbin's case might have
been stronger had he deposed or taken affidavits of those
responsible for the decision, such evidence is not essential to
make out a prima facie case pursuant to § 1681e(b). We deem it
sufficient that, as with most other tort actions, a FCRA
plaintiff produce evidence from which a reasonable trier of fact
could infer that the inaccurate entry was a "substantial factor"
that brought about the denial of credit. Restatement (Second) of
Torts § 431(a); Keeton et al., Prosser and Keeton on Torts § 41, at
266-68 (5th ed. 1984) [hereinafter Prosser & Keeton]. Philbin has
met that burden in this instance as to each of the six credit
denials encompassed by his complaint.
     Because the accurate reports apparently contained no adverse
information and because it is undisputed that Philbin has never
been delinquent on a credit obligation, when Sears denied him
credit because of an "unfavorable credit history," App. at 27, a
reasonable jury certainly could infer that Sears was referring to
the inaccurate adverse information contained in the inaccurate
reports. See Lendino, 970 F.2d at 1113.
     Household International gave no reason for the denial of
credit. Again, however, given the absence of correct, adverse
information concerning Philbin, a trier of fact could reasonably
infer, by necessary implication, that the inaccurate adverse
information must have played a substantial role in its decision
to deny credit.
     Finally, three credit grantors -- Bayview Marina, Bank One,
and First North American Bank -- gave reasons for denying credit
that appear to be innocuous. These include: "insufficient
credit file," "sufficient pay history not established," "limited
credit experience," "number of other recent credit inquiries,"
and "high utilization of bankcard credit lines." App. at 25, 28,
31. While these present a closer question, we conclude that a
trier of fact could reasonably infer that the inaccurate adverse
information included on the inaccurate credit report was an
additional, unstated reason for the credit denials. Moreover, as
to Bank One, which stated that it denied credit because of
Philbin's lack of credit history, one could infer that this lack
of a credit history was itself due, at least in part, to his
inability to get credit because of the inaccurate reports.
     Philbin's case against TRW is somewhat more attenuated than
his case against TUC, given that the inaccurate report surfaced
some six months after the denial of credit by Sears and Citibank.
However, we find that evidence of the existence of two
inconsistent reports within six months of each other allows a
reasonable trier of fact to infer that the two reports existed
simultaneously in November of 1992, at the time of the denials of
credit. This, taken along with the fact that the accurate report
apparently contained no information adverse to Philbin and the
undisputed fact that he has never been delinquent on any credit
obligation, would allow a reasonable trier of fact to infer both
that Citibank and Sears saw the inaccurate TRW report and that
the inaccurate information was a substantial factor in bringing
about the denial of credit. See Lendino, 970 F.2d at 1113. This
is especially true given that the reasons supplied by Sears for
the denial included "unfavorable credit history," and the reason
supplied by Citibank was "a delinquent credit obligation[] was
recorded on [the] credit bureau report." App. at 27, 44.
     We note also that the district court's language might be
understood as imposing a burden on a FCRA plaintiff of proving
that the inaccurate information was the sole cause of the denial
of credit. We reject such a view as inconsistent with
traditional notions of tort law and the reality of human
decision-making. While a plaintiff must prove that the
inaccurate entry was "a substantial factor in bringing about" the
denial of credit, Restatement (Second) of Torts § 431(a), he need not
eliminate the possibility that "correct adverse entries or any
other factors," Pendleton, 76 F.R.D. at 195, also entered into
the decision to deny credit. See Cahlin, 936 F.2d at 1161
(plaintiff "bears the burden of proving that [defendant's] credit
report was a causal factor in the denial of" credit) (emphasis
added); Stewart, 734 F.2d at 54 ("[A] trier of fact could
reasonably conclude that [defendant] denied [plaintiff]
membership at least in part because of the adverse credit report,
and summary judgment was inappropriate.") (emphasis added); seealso
Prosser & Keeton § 41, at 268 ("If the defendant's conduct was
a substantial factor in causing the plaintiff's injury, it
follows that he will not be absolved from liability merely
because other causes have contributed to the result . . . .").
     Forcing a plaintiff affirmatively to rule out other
explanations for the credit denial ignores the fact that
decisions to deny credit will frequently have more than one
cause. For example, in some instances the inaccurate entry and
another factor may each, considered separately, be insufficient
to have caused the denial of credit but when taken together are
sufficient. Each may then be considered a substantial factor in
bringing about the denial of credit and therefore a cause of
plaintiff's injury. See Prosser & Keeton § 41, at 266-67 & n.25.
     Courts have recognized that where a decision-making process
implicates a wide range of considerations, all of which factor
into the ultimate decision, it is inappropriate to saddle a
plaintiff with the burden of proving that one of those factors
was the cause of the decision. See, e.g., Price Waterhouse v.
Hopkins, 490 U.S. 228, 241, 244, 109 S.Ct. 1775, 1785, 1787
(1989) (plurality opinion) (finding that "Title VII [of the Civil
Rights Act of 1964] meant to condemn even those decisions based
on a mixture of legitimate and illegitimate considerations," and
concluding that Title VII plaintiff must show illegitimate
consideration "played a motivating part in an employment
decision"); Village of Arlington Heights v. Metropolitan Housing
Development Corp., 429 U.S. 252, 265-66, 97 S.Ct. 555, 563 (1977)
(plaintiff claiming equal protection violation need not "prove
that the challenged action rested solely on racially
discriminatory purposes" but only that such a purpose was "a
motivating factor in the decision"). Indeed, where multiple
factors exist, any inquiry into the cause of a decision would be
a meaningless endeavor. See Price Waterhouse, 490 U.S. at 247,
109 S.Ct. at 1788-89 (plurality opinion).
     We hasten to add that the burden of proving causation
remains with the plaintiff at all times and never shifts to the
defendant. We conclude however that even on this sparse record,
a reasonable trier of fact could infer that the inaccurate
entries were a substantial factor in bringing about Philbin's
injuries. Accordingly, Philbin has produced evidence sufficient
to satisfy his burden of proving a prima facie case of negligent
noncompliance with 15 U.S.C. § 1681e(b) as to each defendant.
                                B.
     By contrast, we agree with the district court that Philbin
has not produced sufficient evidence of willful noncompliance
with § 1681e(b) to survive summary judgment. To show willful
noncompliance with the FCRA, Philbin must show that defendants
"knowingly and intentionally committed an act in conscious
disregard for the rights of others," but need not show "malice or
evil motive." Pinner v. Schmidt, 805 F.2d 1258, 1263 (5th Cir.
1986), cert. denied, 483 U.S. 1022, 107 S.Ct. 3267 (1987); seealso
Casella, 56 F.3d at 476.
     Philbin claims that TUC is liable for a willful violation
because he notified it of the error several times and TUC failed
to correct it. However, after the first notification, in 1990,
TUC did remove the erroneous information for a period of time.
Moreover, he contends that his filing of a complaint with the FTC
gave TUC notice a second time, but there is no evidence that TUC
had notice of the complaint. There appears to be one instance --
in November of 1992 -- when he notified TUC that, despite the
earlier correction, the error re-appeared, and TUC failed to
correct it. This, however, falls short of evidence of a willful
violation.
     Philbin also claims that TUC's refusal to send him a copy of
his credit report in November of 1992 evidences a willful
violation. However, it appears that TUC merely desired to verify
his address. Moreover, the record reflects that Philbin had two
mailing addresses, and so TUC's concern appears to be bona fide.
After receiving verification of his address, TUC eventually sent
him a copy of the report. Its actions do not rise to the level
of a "willful misrepresentation[] or concealment[]" that
justifies finding a willful violation. Pinner, 805 F.2d at 1263;
cf. Millstone, 528 F.2d at 834.
     Philbin's case against TRW for a willful violation is even
weaker. He claims that after the 1990 letter and the 1992 filing
with the FTC, TRW had notice of the inaccuracies and nonetheless
circulated the inaccurate report. However, there is no evidence
that the alleged errors that precipitated the 1990 letter are the
same as those that appeared on the 1993 report. Moreover, the
1990 letter is so far removed temporally from the 1993 report
that it would strain the concept of notice to conclude that the
former provided notice of errors in the latter. Further,
Philbin's FTC filing concerned his problems only with TUC, not
TRW. There is, therefore, no evidence of willful behavior on the
part of TRW.
                                III.
     The order of the district court, dated November 29, 1994,
granting summary judgment to both defendants as to the claims for
willful noncompliance with § 1681e(b) will be affirmed. The
orders dated November 29, 1994, and December 8, 1995, granting
summary judgment to defendants as to the claims for negligent
noncompliance with § 1681e(b) will be reversed. The matter is
remanded to the district court for further proceedings consistent
with this opinion.
     Costs taxed against appellees.
