Class Certification Allowed Even in Cases With Small Damages


Chicago and Oak Brook-based Lubin Austermuehle has recently been working on a proposed class action consumer protection case with national reach, in tandem with colleagues in Maryland. Our case alleges violations of the Fair Credit Reporting Act, a federal law regulating when and how credit reporting agencies may provide information about consumers to third parties like marketing companies. The FCRA requires that credit agencies may only give out consumers’ information if they have written permission or to companies that will extend a “firm offer of credit” to the consumers.

Our proposed lead plaintiff received a flyer offering him an automotive loan from a company that turned out to allegedly have nothing to do with the offer. That is, there was no firm offer of credit, in violation of the FCRA. It’s important that our plaintiff suffered no actual financial damage due to this privacy violation, fortunately. However, under the FCRA, he doesn’t need to if the violation of the law was “willful.” Instead, he may sue for “statutory damages,” an amount of money set by law, as well as the cost of attorneys’ representation and any punitive damages the court decides to impose to punish illegal or very unethical behavior by the defendant.

The statutory damages authorized by the FCRA are very small by the standards of modern litigation — $100 to $1,000 per person. In fact, this amount is so small that it might discourage both plaintiffs and their lawyers from pursuing a case, given the small reward. However, a proposed class action changes that landscape dramatically. In a class action, plaintiffs with the same complaint share the same lawyers, in essence pooling their resources. In doing so, they also pool the money they stand to win, from which the lawyers are paid. This allows them to move forward with a claim they might otherwise have had to abandon — giving them greater access to justice.

In fact, even though a case with small damages might seem inappropriate for class-action status, it is actually one of the most appropriate cases for that status. We were able to make that argument to the court, citing multiple cases from around the United States federal courts, including cases from here in the Seventh Circuit and the greater Chicago area. The case is still pending, but we are confident about the facts and the quality of the legal work on our side of this case.

In addition to regulating how your information is disclosed to marketers and companies, the Fair Credit Reporting Act lays down rules for how credit reporting agencies should handle disputes, errors and negative information on your credit. Based in Oak Brook and Chicago, and serving people in Naperville, Wheaton, greater Chicago and throughout Illinois, our class action lawyers handle both FCRA lawsuits and consumer class actions and other types of class actions. To learn more about how you can fight for your rights please contact us for a free evaluation of your case.

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