High Court Won’t Review Immunity Under Credit-Reporting Law

Justice Clarence Thomas argued the financial ramifications of the dispute are huge, with the federal government responsible for the vast majority of student loans nationwide.

(AP Photo/Mike Stewart, File)

WASHINGTON (CN) – Drawing a dissent from a pair of conservative justices, the Supreme Court said Monday it won’t decide whether the Fair Credit Reporting Act allows consumers to sue federal government agencies.

Justice Clarence Thomas, joined by Justice Brett Kavanaugh, dissented from the high court’s denial of a petition to hear a case brought by Anthony Robinson, who says he is a victim of identity theft.  

The Department of Education refused to remove an allegedly fraudulent federal student loan from his credit report and reported the account to credit bureaus, according to court records, which Robinson claimed was a violation of the FCRA. He pointed to a provision in the law that says any “person” who does not comply with the law is liable to consumers for damages.

But the Fourth Circuit found the statute’s language did not waive the government’s sovereign immunity preventing it from being sued under the FCRA.

Thomas wrote in his dissent that the Supreme Court’s decision not to hear Robinson’s appeal means it won’t resolve a circuit split.

Like the Fourth Circuit, the Ninth Circuit has held that the FCRA’s civil enforcement provisions don’t waive sovereign immunity, while the Seventh Circuit ruled the opposite and found the government isn’t immune from such lawsuits.

“The question whether sovereign immunity has been waived is one of critical importance to any functioning government, but particularly to a democratic republic,” Thomas wrote. “This is especially true when it comes to suits for money damages, because ‘the allocation of scarce resources among competing needs and interests lies at the heart of the political process.’”

Thomas rejected the Department of Education’s argument that the circuit split will resolve itself, noting that the Seventh Circuit recently reaffirmed its position.

Highlighting the financial implications of the dispute, the dissent states that the federal government is responsible for 90% of student loans nationwide “in a market that has tripled between 2007 and 2018, from $500 billion to a staggering $1.5 trillion.”

“These ramifications are magnified here because the fed­eral government’s potential liability under the FCRA is substantial,” Thomas wrote. “As the nation’s primary student-loan lender, it is one of the largest furnishers of credit information in the country.”

Quinn Lobato, an attorney with the Lobato Law group representing Robinson, did not immediately respond to a request for comment Monday. The federal government also did not respond to a request for comment.

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