Plaintiffs' California State Law Cause Of Action Not Preempted By The FCRA

Brown v. Mortensen, 51 Cal. 4th 1052 (Cal. 2011)

Facts: Plaintiffs sued Mortensen, a debt collector, alleging violations of the California Confidentiality of Medical Information Act, related to the debt collector's disclosure of Plaintiffs' and their children's medical information to the CRAs. Mortensen argued that those claims were preempted because the operative complaint stated that Plaintiffs complained to the CRAs that the disclosures were inaccurate and, alternatively, because the Plaintiffs' claims rest on the idea that Defendant misled the CRAs by incorrectly implying either that Plaintiffs' children owed a debt or that their medical records were in some way relevant to Plaintiffs' disputed debt. Defendant argued that Plaintiffs' allegations brought the claim within § 1681s-2(a)'s regulation of furnisher accuracy and thus § 1681t(b)(1)(F)'s preemptive scope. The trial court and court of appeal concluded that Plaintiffs' claims were preempted by the FCRA. The California Supreme Court reversed the lower courts and concluded that Plaintiffs' state law claims, as pleaded, were not preempted because they involved issues neither of accuracy nor of credit dispute resolution and therefore did not involve the same subject matter as § 1681s-2.

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