What is a class action under the Fair Credit Reporting Act?

A class action is a legal device that allows individuals to recover civil damages without having to file their own individual lawsuits. In a class action lawsuit, a single individual or a small group of individuals, file the suit on behalf of everyone who was injured by the defendant’s illegal behavior. With the court’s approval, those individuals can seek to recover the total amount of money that is owed to everyone in the class. With the supervision of the court, the money that is recovered is distributed to everyone in the class, with the vast majority of class members never having to come to court or do anything else in the lawsuit.

Class actions are especially appropriate when individual damages are small, and where people are unlikely to file their own individual cases.

What is required of the defendant under the Fair Credit Reporting Act?

Under the Fair Credit Reporting Act, defendants can be required to pay statutory damages of between $100 and $1,000 for each willful violation of the Act. Plaintiffs are not required to prove out-of-pocket losses in order to recover statutory damages. Courts routinely recognize that it is unlikely anyone will sue to recover these relatively small amounts, and that class actions are therefore a good mechanism to ensure that defendants (which can be employers and consumer reporting agencies in Fair Credit Reporting Act cases) comply with the law.

What about the courts?

Importantly, courts also recognize the tremendous societal value of class action lawsuits. Often courts authorize class representative awards which allow the individuals who actually brought the lawsuit to be compensated for their time and effort in achieving a recovery on behalf of a larger group. The value of these awards can vary, but in past Fair Credit Reporting Act cases handled by Berger & Montague attorneys the awards have ranged from $500 to $8,000 for the named plaintiff. See Schumpert v. Aldi, Inc., No. 13-cv-2417 (N.D. Ill.) ($500 awarded to named plaintiff); Avila v. Now Health Grp., Inc., No. 14-cv-1551 (N.D. Ill.) ($950 awarded to named plaintiff in settlement with employer, and $1,500 awarded to named plaintiff in settlement with consumer reporting agency); Knights v. Publix Super Markets, Inc., No. 14-cv-720 (M.D. Tenn.) ($1,000 awarded to each named plaintiff); Arocho v. Pepco Holdings, Inc., No. 14-cv-1549 (D.D.C.) ($1,000 awarded to named plaintiff); Regaldo v. Ryder Int. Logistics, Inc., No. 12-cv-5737 (C.D. Cal.) ($1,500 awarded to named plaintiff); Brown v. Delhaize America, LLC, No. 14-cv-195 (M.D.N.C.) ($2,000 awarded to named plaintiff); Singleton v. Domino’s Pizza, LLC, No. 11-cv-1823 (D. Md.) ($2,500 awarded to each named plaintiff); Ernst v. DISH Network, LLC, No. 12-cv-8794 (S.D.N.Y.) ($5,000 awarded to named plaintiff in settlement with consumer reporting agency); Johnson v. Casey’s Mktg. Co., No. 15-cv-3086 (W.D. Mo.) ($7,500 awarded to named plaintiff); Haley v. TalentWise, Inc., No. 13-cv-1915 (W.D. Wash.) ($8,000 awarded to named plaintiff).

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