| Entities | American Financial Services Association (AFSA) (7) Center for Survivor Agency and Justice (CSAJ) (1) Maine (6) Maine Coalition to End Domestic Violence (MCEDV) (1) |
| Laws | |
| Topics and Issues | Economic abuse (2) Medical debt (38) Preemption (11) |
In September 2019, CDIA filed suit against the State of Maine, challenging the validity of two new provisions of state law that (1) Change the way medical debt is reported to credit bureaus; and (2) Limit the reporting of adverse information about a consumer if that consumer was a victim of economic abuse. These new provisions in Maine are preempted by the FCRA. On November 25, the OAG and the Superintendent filed an answer to CDIA’s complaint.
The two laws CDIA challenged were L.D. 110, An Act Regarding Credit Ratings Related to Overdue Medical Expenses, codified at Chapter 77, and L.D. 748, An Act to Provide Relief to Survivors of Economic Abuse, codified at Chapter 407.
In April 2020, CDIA filed a motion for judgment and Maine filed a motion for judgment. Filing an amicus brief in support of CDIA’s motion is the American Financial Services Association (“AFSA”). Filing amici in support of the state’s motion are the Center for Survivor Agency and Justice (“CSAJ”), the Maine Coalition to End Domestic Violence (“MCEDV”), and the National Consumer Law Center (“NCLC”).
On Oct. 8, 2020, the District Court granted CDIA’s motion for judgment and, in a strong opinion, found that the 2019 changes to the state’s FCRA are preempted by the federal FCRA.
Citing four federal cases, Virginia Uranium, Capron, Tobin, and Kansas v. Garcia, the Court said that “’[t]he Supremacy Clause supplies a rule of priority. It provides that the ‘Constitution, and the Laws of the United States which shall be made in Pursuance thereof,’ are ‘the supreme Law of the Land . . . any Thing in the Constitution or Laws of any state to the Contrary notwithstanding.’ This Clause gives Congress ‘the power to preempt state law,’ which Congress may exercise either expressly or impliedly.’” (citations omitted). The Court looked at our broad reading of subject matter preemption and the state’s narrow view of that provision. The Court found that a broad reading of subject matter preemption is necessary because the language of the statute “reflect[s] an affirmative choice by Congress to set “uniform federal standards” regarding the information contained in consumer credit reports.” The Court cited Aldaco v. RentGrow where the 7th Circuit found that that subject matter preemption “assures that the [FCRA] establishes uniform federal standards for contents of credit reports—unless a state law in force in 1996 provides otherwise.’”
In January 2021, Maine filed its appeal with the U.S. Court of Appeals for the First Circuit. On January 26, 2020, an amicus was filed in support of the state by the National Consumer Law Center (NCLC) and Maine Equal Justice.
In January 2021, the state filed its brief with the U.S. Court of Appeals for the First Circuit, which was followed by an amicus brief jointly filed by the National Consumer Law Center (NCLC), Maine Equal Justice, and the Maine Coalition to End Domestic Violence (MCEDV). In February 2021, CDIA filed its brief with the appellate court, followed by a March 2021 amicus brief jointly filed by the American Financial Services Association (AFSA) and the U.S. Chamber of Commerce. The state filed a reply in March 2021.
In June 2021, the U.S. Court of Appeals for the First Circuit heard oral argument in CDIA v. Frey. The state’s argument begins at 0:01. Argument for amici for the state, Chi Chi Wu for the National Consumer Law Center, begins at 10:30. Argument for CDIA begins at 16:58. Argument for amici for CDIA, AFSA and the U.S. Chamber of Commerce begins at 29:19. Rebuttal from the state begins at 36:45.
On February 10, 2022, the First Circuit issued its opinion reversing and remanding the case.
On March 10, 2022, CDIA filed a Petition for Rehearing en banc with the U.S. Court of Appeals for the First Circuit.
On July 5, 2022, the U.S. Court of Appeals for the First Circuit denied CDIA’s Petition for Rehearing.
In September 2022, CDIA filed a motion with the U.S. Supreme Court for an extension of time to file a writ petition. That motion, which was granted, adds an additional 30 days, to November 2, 2022.
In September 2022, the U.S. District Court for the District of Maine granted CDIA’s motion that stayed CDIA v. Frey pending resolution of CDIA’s petition for writ of certiorari with the U.S. Supreme Court.
In November 2022, CDIA filed a petition for cert to the U.S. Supreme Court asking the Court to overturn the 1st Circuit’s opinion reversing the district court’s grant of CDIA’s motion for judgment. CDIA’s brief pointed out that
The Fair Credit Reporting Act (‘FCRA’) sets forth uniform standards governing the content of consumer reports throughout the country. To preserve that uniformity, FCRA expressly preempts state laws that impose additional requirements on the content of consumer reports. Congress was emphatic: “No requirement or prohibition may be imposed under the laws of any State … with respect to any subject matter regulated under … section 1681c of this title, relating to information contained in consumer reports.” 15 U.S.C. §1681t(b)(1)(E). Despite that clear command, Maine enacted two laws imposing its own rules on whether and how certain types of debt may be reported. The district court had no trouble concluding that those laws are preempted by FCRA. The First Circuit disagreed, narrowly construing FCRA to preempt state laws only if they regulate the specific issues that Congress addressed in §1681c, rather than the subject matter addressed in that section—namely, “information contained in consumer reports.” That cramped interpretation cannot be squared with the statutory text, this Court’s preemption precedent, or the decisions of other circuits interpreting 15 U.S.C. §1681t(b)(1). And the decision re-opens the door for a patchwork of state regulation of reports that Congress wanted governed by uniform standards nationwide.
On December 7, 2022, two amici were filed in support of CDIA’s petition for cert (No. 22-471). One amicus was filed by ACA International, and a second amicus was filed by the U.S. Chamber of Commerce, the American Financial Services Association (AFSA), the American Bankers Association (ABA), the National Association of Federally-Insured Credit Unions (NAFCU), and the Bank Policy Institute (BPI). Brownstein posted a blog about the amici filings.
On January 10, 2023, Maine filed its brief in opposition to CDIA’s petition for cert.
On January 25, CDIA filed its reply brief to Maine’s brief in opposition to CDIA’s petition for cert.
Counsel for CDIA, Paul Clement of Clement & Murphy; counsel for Maine, Christopher C. Taub, Office of the Attorney General; ACA International, Julian Richard Ellis, Jr., Brownstein Hyatt Farber Schreck, LLP; Counsel for U.S. Chamber of Commerce, et al., Misha Tseytlin of Troutman Pepper Hamilton Sanders LLP.
On February 21, 2023, the U.S. Supreme Court denied CDIA’s petition for cert.
On May 8, 2023, CDIA filed its second motion for judgment on the record with the U.S. District Court for the District of Maine. On June 5, 2023, Maine filed its opposition to CDIA’s second motion for judgment on the record. On June 20, CDIA filed its reply.
On January 9, 2024, the U.S. District Court issued its memorandum of decision and order.
Resources:
- U.S. Supreme Court page