Fair Credit Reporting Act does not preempt state law claims alleging that debt collector illegally disclosed confidential patient information to consumer reporting agencies. Roberta Brown v. Stewart Mortensen, (No. S180862 California Supreme Court, June 16, 2011).
In this case, the California Supreme Court addressed the remedies available to a patient when a debt collector, acting on behalf of a medical professional, is alleged to have disclosed confidential patient medical information to various consumer reporting agencies in the course of a dispute
over an alleged medical debt. Plaintiff, a dental patient, refused to pay for dental services related to a crown that he claimed he never agreed to pay for. The dentist referred the debt to a collection agency (Defendant). The debt collection agency disclosed the contents of the patient’s dental charts to three major consumer reporting agencies. The patient ultimately sued the defendant, alleging violations of the California Confidentiality of Medical Information Act (Act). The trial court sustained a demurrer and the Court of Appeal affirmed finding that the Fair Credit Reporting Act (FCRA) preempted all state law claims arising from the furnishing of information to consumer reporting agencies.
The Supreme Court reversed and remanded the matter. It found that the FCRA imposed affirmative duties on furnishers such as the defendant to ensure that commercial credit information is maintained in a manner that is fair with regard to its confidentiality. Notwithstanding, the FCRA would only preempt State law claims insofar they as arose out of a duty to provide accurate information or to take action upon which notified of a dispute. The plaintiff’s complaint was neither based on accuracy, nor a credit dispute resolution and thus the FCRA was found not to preempt the plaintiff’s State law claims.