Hageman v. Twin City Chrysler-Plymouth, Inc.

WELLS, Judge.

A motion for a directed verdict presents the question of whether the evidence, considered in the light most favorable to plaintiff, will justify a verdict in defendant’s favor. Snow v. Power Co., 297 N.C. 591, 256 S.E. 2d 227 (1979). Defendant argued at the close of trial, and contends now in his brief, that plaintiffs evidence failed to establish any actionable claim or violation of the FCRA as a matter of law. We agree.

The main bulk of FCRA requirements are imposed on consumer reporting agencies, and only four sections of the Act place requirements on persons who are not consumer reporting agencies: §§ 1681d, 1681m, 1681q and 1681r. Rice v. Montgomery Ward & Co., Inc., 450 F. Supp. 668 (M.D.N.C. 1978). Plaintiff in the present case alleges a violation of § 1681q, which provides as follows:

Any person who knowingly and willfully obtains information on a consumer from a consumer reporting agency under false pretenses shall be fined not more than $5,000 or imprisoned not more than one year, or both.²

It has been held that § 1681q requires that “users of consumer information” refrain from obtaining consumer credit information from credit reporting agencies under false pretense. Hansen v. Morgan, 582 F. 2d 1214 (9th Cir. 1978). A violation of § 1681q forms a basis of liability under either § 1681n or § 1681o. Id. Thus, § 1681q makes “users of consumer information” amenable to civil suit. Plaintiff in the present case contends that defendant is a “user” within the meaning of the FCRA because, by taking and transmitting to CCC a credit application, it caused CCC to obtain a consumer credit report to use for the purpose of making a credit determination that benefitted defendant by financing the latter’s customers. However, we hold that defendant was not a “user” within the meaning of the FCRA.

A “user” is one who obtains consumer credit information from a consumer reporting agency for the purpose of making some determination, typically in order to decide whether to advance credit. In the present case, the Credit Bureau of Winston-Salem was the consumer reporting agency, and CCC was the “user.” It was CCC who solicited and obtained information for the purpose of determining whether to extend credit to plaintiff. Defendant Twin City sells and leases cars. As a service to its customers and in order to assist them in securing financing, defendant frequently forwards credit applications to entities such as CCC. However, defendant Twin City makes no credit determination. It does not use, or even see, the consumer credit information gathered. Since defendant is not a “user” of consumer information within the meaning of the FCRA, it is not liable as a “user” under § 1681q of the Act.

We find support for our decision in Rush v. Macy’s New York, Inc., 775 F. 2d 1554 (11th Cir. 1985). In that case, Macy’s furnished information to Credit Bureau, Inc., a consumer reporting agency. On the basis of the information supplied, Credit Bureau gave plaintiff the lowest possible credit rating, and plaintiff sued both Macy’s and Credit Bureau. The court held that a department store which did no more than furnish information to a credit reporting agency is not a “user” of credit information within the meaning of the FCRA. Id. By analogy, an automobile dealer that merely transmits credit applications to a third party is also not a “user” under the Act.

No error.

Chief Judge HEDRICK and Judge COZORT concur.

2 . Under § 1681a, a “person” means any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity.