A federal judge on Wednesday reduced a jury’s punitive damages award against Equifax from more than $18 million to $1.62 million, after finding that the jury’s award was unconstitutionally excessive despite Equifax’s “reprehensible” conduct in violating the Fair Credit Reporting Act.
Plaintiff Julie Miller sued Equifax under FCRA for failing to correct mistakes in the Miller’s credit report. Among other things, FCRA requires consumer reporting agencies to “follow reasonable procedures to assure maximum possible accuracy of the information” in a consumer credit report and, when a consumer disputes information in a report, to “conduct a reasonable reinvestigation to determine whether the disputed information is inaccurate.”
It was undisputed that Equifax had merged the plaintiff’s file with that of a different person, who had the same name and a similar Social Security number as Miller but a significantly worse credit record. At trial, an Equifax executive testified that such file mergers occurred with “regularity.” Moreover, although Miller complained to Equifax and sought to have her file corrected for two years, Equifax argued in court that its policy was to take such corrective actions only after a civil action is filed.
Last summer, a jury awarded Miller $180,000 in compensatory damages, based in part on Miller’s emotional-injury claims, as well as $18.42 million in punitive damages. Judge Anna J. Brown, of the U.S. District Court for the District of Oregon, concluded that “Equifax’s conduct was sufficiently reprehensible to support a substantial award of punitive damages.” However, the jury’s 102:1 ratio of punitive damages to compensatory damages was unconstitutionally excessive in light of Supreme Court precedents holding that due process generally limits punitive awards to single-digit multiples of compensatory damages. Accordingly, Judge Brown reduced the punitive award against Equifax to $1.62 million, nine times the compensatory damages awarded by the jury.