In Sullivan v. Wells Fargo Bank, N.A., No. 19-0234-WS-M, 2019 U.S. Dist. LEXIS 196114 (S.D. Ala. Nov. 12, 2019), Judge Steele allowed a “permissible purpose’ FCRA case past the pleadings stage despite the commercial nature of the transaction.
Entangled with the defendant’s [*16] argument that it did not pull a “consumer report” is the argument that “FCRA does not apply to credit reports pulled for business or commercial purposes.” (Doc. 10 at 7). The Court understands the defendant to assert that, even if the report it received is a “consumer report,” the defendant has a blanket exclusion from liability because it obtained the report to evaluate the plaintiff for a loan to his business. The Court has reviewed the three opinions on which the defendant relies, and a number of others besides. Many of these cases expressly frame the issue as whether a report requested for a business reason can be a “consumer report” as defined by Section 1681d(a)(1).6 Others do not clearly frame the issue but rely on cases addressing the scope of a “consumer report.”7 All such decisions are captured by the analysis in Part I.A. This catalogue appears to cover the waterfront. The vagueness of many opinions, however, leaves open the possibility that some of them base this blanket exclusion on the perceived or assumed will of Congress, untethered to any particular statutory provision. As previously noted, however, “once [Congress] enacts a statute we do not inquire what the legislature meant; we ask only what the statute means.” Epic Systems, 138 S. Ct. at 1631. To the extent these cases rely on general statements from Representative Sullivan, or equally general statements from the 1990 Commentary, they are no more compelling than with respect to the proper construction of the statutory definition of a “consumer report.” Nor has the defendant come to grips with cases such as Ippolito v. WNS, Inc., 864 F.2d 440 (7th Cir. 1988), which expressly contemplate potential FCRA liability in the context of consumer reports obtained for business rather than consumer purposes. Id. at 449, 453. The FTC, moreover, has plainly stated that a requester can be liable for obtaining a consumer report in connection with a transaction regarding the consumer’s business: A lender has a permissible purpose to obtain a consumer report on a consumer in connection with a business credit transaction when the consumer is or will be personally liable on the loan as a co-signer or guarantor …. A lender would not have a permissible purpose to obtain a consumer report on a consumer who will not be personally liable for repayment of the credit (even an individual proprietor, shareholder, director, or officer of a corporation), because this section does not include the extension of credit to commercial entities. Staff Summary, 2012 WL 5879749 at *43; accord id. at *7. Finally, even could its exclusion theory be correct in the abstract, the defendant has not shown that it would apply in the circumstances alleged in the amended complaint. “[S]everal courts have held that where the purpose of a plaintiff’s credit application was to secure credit for business purposes, as opposed to personal, family or household purposes, the reporting agency’s conduct was not covered by the Act.” Natale v. TRW, Inc., 1999 WL 179678 at *3 (N.D. Cal. 1999) (emphasis added). The amended complaint alleges that the plaintiff did not apply for an extension of credit and, on the contrary, forbade the defendant to pull his credit report. The defendant has not explained how any exclusion from FCRA would extend to reports obtained without the consumer’s request for an extension of business credit or business insurance. Permitting such a practice seemingly would open the door to gross abuse, allowing defendants to acquire credit information on any individual with impunity simply by describing their action as in anticipation of some potential, but unrequested, future credit or insurance transaction with the consumer’s business.