9th Cir. Says CCRAA Permits Private Cause of Action; Section 1785.25(g)’s “Reasonable Procedures” Defense Regulates Both Use of METRO-2 Codes to Transmit Information As Well As the Procedures Employed to Ensure that the Information It Transmitted Was Accurate on the Front End

Bank of America relies on Pulver v. Avco Financial Services, 182 Cal. App. 3d 622 (1986), for the proposition that no private right of action exists with respect to furnishers’ liability under the CCRAA. But Pulver predates the California Legislature’s 1993 amendment to the CCRAA, which introduced § 1785.25(a), a provision specifically designed to create liability for furnishers: “A person shall not furnish information on a specific transaction or experience to any consumer credit reporting agency if the person knows or should know the information is incomplete or inaccurate.” Thus, while Pulver‘s statement that the CCRAA “does not extend liability to one who furnishes information to a credit reporting agency,” id. at 633, was true in 1986, it is no longer true today. Noori’s claim under § 1785.25(a) is not preempted by federal law because the FCRA expressly exempts this provision from federal preemption. 15 U.S.C. § 1681t(b)(1)(F)(ii).  Although the district court correctly assumed that § 1785.25(a) provides a private right of action against furnishers, it erred in its analysis of whether Bank of America’s conduct was protected under § 1785.25(g), the CCRAA’s safe-harbor provision. The district court determined that the safe-harbor provision applied because Bank of America used reasonable procedures (namely, the Metro 2 format) to transmit information concerning Noori’s supposed death to the credit reporting agencies. But that conclusion misses the heart of Noori’s claim. She is not complaining about the manner by which Bank of America transmitted the information to the credit reporting agencies on the back end. Instead, Noori contends that before Bank of America transmitted her information, it failed to employ reasonable procedures on the front end to ensure that the information it transmitted was accurate. We therefore reverse and remand as to this claim so that the district court can determine whether Bank of America had in place reasonable procedures to ensure that the information it transmitted through the Metro 2 format was accurate in the first place.