Circuit Split Widens on Sovereign Immunity for FCRA Damages

The United States Court of Appeals for the District of Columbia, has deepened a split among federal appellate courts, holding that government agencies can be sued under the Fair Credit Reporting Act (“FCRA”), 15 U.S.C.A. § 1681. The DC Circuit joined the Seventh Circuit in holding that Congress waived the federal government’s sovereign immunity under the FCRA, disagreeing with the Fourth and Ninth Circuits, which have found no such waiver.

In Mowrer v. U.S. Dept. of Transportation, two truck drivers sued the U.S. Department of Transportation (“DOT”), alleging that DOT’s provision of their driving records to prospective employers violated the FCRA. The United States District Court for the District of Columbia dismissed the FCRA claim, finding that the DOT was not a “consumer reporting agency” as defined by the FCRA.

On appeal, the DC Circuit affirmed the finding that the Department of Transportation and its agencies were not consumer reporting agencies. Before reaching that question, however, the Court first addressed whether Congress had waived the federal government’s sovereign immunity from damages claims under the FCRA. Finding that the FCRA subjected any “person” to damages, and noting that the term person includes “any…government or governmental subdivision or agency, or other entity,” the DC Circuit held that the FCRA explicitly waived sovereign immunity, agreeing with the Seventh Circuit. While the Court noted the disagreement of the Fourth and Ninth Circuit, it found that “their reasoning is unpersuasive.”

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