[hannah]

PROCEDURAL POSTURE: Plaintiff, an individual whose vehicle was involuntarily towed, sought review of a summary judgment from the United States District Court for the Northern District of California granted in favor of defendants, a collection agency and a credit reporting agency, in plaintiff's action alleging violations of the Fair Credit Reporting Act (FCRA), 15 U.S.C.S. § 1681 et seq. The credit reporting agency appealed the denial of a motion to seal documents.

OVERVIEW: A towing company obtained a lien on plaintiff's vehicle, asserted a Cal. Civ. Code § 1368.2 deficiency claim, and transferred the claim to the collection agency. The collection agency then obtained a credit report on plaintiff. The district court relied on Hasbun in holding that the collection agency was authorized to obtain the credit report under 15 U.S.C.S. § 1681b(a)(3)(A) because it was attempting to collect a debt from plaintiff. The court, however, found that the subsequent enactment of the Fair and Accurate Credit Transactions Act of 2003, Pub. L. No. 108-159, 117 Stat. 1952, made it clear that debt collection was a permissible purpose for obtaining a credit report under 15 U.S.C.S. § 1681b(a)(3)(A) only in connection with a "credit transaction" in which a consumer participated directly and voluntarily. Because plaintiff did not voluntarily seek credit, her credit report was improperly obtained. Also, blanket certification did not eliminate all genuine issues of material fact with regard to the credit reporting agency's immunity under 15 U.S.C.S. § 1681e. Finally, the court determined that the "good cause" standard was improper in relation to the sealing of documents.

OUTCOME: The court reversed the district court's summary judgment in favor of defendants and remanded for further proceedings with respect to damages and to the credit reporting agency's liability. The court vacated the district court's order denying the credit reporting agency's motion to seal documents, and it remanded for consideration in light of the proper "compelling reasons" legal standard.

I have attached both the original case and the appeal.