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Is the Federal Government Immune From Suit Under the Fair Credit Reporting Act? ...


The Western District of Texas recently considered an issue that’s led multiple circuits in different—and contradictory—directions: does the Fair Credit Reporting Act waive the United States’ sovereign immunity? The plaintiff in Thurston v. Equifax Info. Servs., 2020 U.S. Dist. LEXIS 203511, argued just that.


The plaintiff in this dispute held an account with the Army and Airforce Exchange Service, d/b/a Military Star (“AAFES”), which was among the named defendants. AAFES reported a late payment on the plaintiff’s account to various credit reporting agencies, which the plaintiff disputed. The plaintiff sued the credit reporting agencies and AAFES, alleging violation of the FCRA. AAFES, in turn, moved to dismiss the complaint on the grounds that it was an instrumentality of the federal government and enjoyed sovereign immunity from suit.


The core of the dispute is whether the FCRA’s definition of “person” constitutes a waiver of sovereign immunity. FCRA imposes civil liability on any “person” who willfully or negligently fails to comply with the Act’s requirements. “Person,” in turn, is defined as “any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity.” 15 U.S.C. § 1681a(b). FULL ARTICLE