Richardson v. Fleet Bank

In 1988 Denise and Robert Richardson (plaintiffs) took out a $50,000 loan from Shawmut Bank of Hampshire County (Shawmut). For four years, the Richardsons made monthly payments greater than their minimum required payments, but Shawmut failed to properly record the extra payments. The Richardsons filed a lawsuit against Shawmut, and the parties settled the case in 1994 after Shawmut agreed to release the Richardsons from their remaining $20,000 obligation on the loan. Despite the settlement, Shawmut classified the $20,000 release as a charge-off—erroneously indicating to debt collectors and credit-reporting agencies that the Richardsons were severely delinquent on the loan—and debt collectors attempted to collect the disputed debt. In 1995 Shawmut agreed to notify credit-reporting agencies of its error and to change the status of the loan as being paid. In 1996 Fleet Bank (Fleet) (defendant) acquired Shawmut. Fleet continued to report the discharged loan as a charge-off. The Richardsons contacted Equifax (defendant), a credit-reporting agency, and requested that Equifax investigate the Richardsons’ Fleet account. Equifax relied solely on documents provided by Fleet and continued to report the loan as a charge-off. In 1999 the Richardsons filed a lawsuit against Equifax and Fleet in state court, alleging that Equifax had violated the Fair Credit Reporting Act by failing to ensure accurate credit reporting and failing to properly reinvestigate the Richardsons’ account after they disputed information provided by Fleet. Equifax removed the case to federal district court and moved for summary judgment, arguing that it had fulfilled all its duties imposed under the Fair Credit Reporting Act.