Credit Reporting Litigation to Rise Further Given State Laws

Fair Credit Reporting Act litigation continued to increase last year as the industry saw several significant judicial developments.

As the credit reporting industry evolves in 2026, we anticipate an increased focus on state-level regulatory frameworks—and various challenges to those rules.

Litigation in the industry will likely keep rising at the federal level. However, federal regulatory activity will likely remain dormant, as the Consumer Financial Protection Bureau has paused or cut back enforcement actions.

Here are some significant developments in 2025, along with predictions for what 2026 may hold.

Litigation Volume

FCRA cases continued to see a significant increase in year-over-year volume last year. FCRA filings were up 37.4% for the period of January–November 2025 when compared with that same period in 2024, according to a recent report by WebRecon. The lack of any legislative amendments to the act likely means it will remain fertile ground for litigation this year.

Inaccurate Reporting Claims

During 2025, several courts of appeal weighed in on the standard to evaluate accuracy under the FCRA, including whether disputes over the legal validity of reported information could serve as a basis for a claim under the act.

In Reyes v. Equifax Info. Servs., L.L.C., for instance, a plaintiff alleged that a consumer reporting agency violated 15 USC Section 1681i by continuing to report a delinquent credit card account in her consumer file after she disputed the underlying charges as fraudulent.

Following unauthorized charges on her credit card, the plaintiff stopped making payments on her account and maintained that the outstanding charges were fraudulent. The furnisher then charged off the account and reported the unpaid balance after it determined the charges weren’t fraudulent.

The plaintiff then initiated several disputes, and each time the credit reporting agency sent the disputes to the furnisher, which verified its reporting as accurate. The plaintiff then sued, and the US Court of Appeals for the Fifth Circuit affirmed the district court’s grant of summary judgment in favor of the credit reporting agency.

The Fifth Circuit held that a plaintiff can’t use Section 1681i’s reinvestigation procedures to collaterally attack the validity of a debt, citing cases from other circuits requiring disputed information to be objectively and readily verifiable. The Fifth Circuit joined other circuits in holding that credit reporting agencies aren’t required to investigate the legal validity of disputed debts under the FCRA.

Notably, other circuit courts have disagreed, setting up a distinct circuit split that will likely widen in 2026 and may ultimately require US Supreme Court resolution.

Reinvestigation Requirements

Several 2025 appellate opinions illustrate how courts are reshaping core FCRA duties and defenses. In Suluki v. Credit One Bank, NA, the Second Circuit emphasized that furnishers owe consumers a reasonable, not perfect, investigation under the FCRA and affirmed summary judgment where the bank had a well-documented, multistep investigative process.

Over the next year, we expect defendants to rely more heavily on detailed investigation records to defeat FCRA dispute investigation claims—especially in identity theft disputes, which continue to be a common theme in litigation.

‘Concrete Injury’

Courts last year grappled with what constitutes a “concrete injury” sufficient to satisfy Article III standing, particularly in cases involving FCRA claims.

For example, the Eleventh Circuit clarified in two decisions last year that a consumer’s “self inflicted” harm—such as the self-imposed expenditure of time and money to correct a credit report—doesn’t, by itself, constitute a concrete injury sufficient to establish Article III standing. The court further held that speculative allegations of future harm, such as an increased risk of identity theft, are insufficient to confer standing.

We anticipate that courts this year will further scrutinize Article III standing—including speculative claims of future or manufactured harm in FCRA cases—as they have since the Supreme Court’s 2021 decision in TransUnion LLC v. Ramirez.

State Law Predictions

At the state level, legislation continues to move forward in ways that will affect consumer reporting agencies and the users of their services. For example, starting in April, New York will prohibit most employers from using an applicant’s or employee’s credit history for employment-related decisions.

While certain challenges to those laws are anticipated, including on the grounds of federal preemption, consumer reporting agencies and their customers must monitor state law developments and tailor their systems to implement their chosen compliance strategies.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

Timothy St. George is a partner at Troutman Pepper Locke who focuses on issues relating to the Fair Credit Reporting Act and employment background screening, as well as class action litigation.

David Anthony is a partner at Troutman Pepper Locke who represents companies in highly regulated industries, including consumer financial services companies.

Scott Kelly is a partner at Troutman Pepper Locke who focuses on issues involving consumer data and privacy.

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