A federal judge in Detroit has tossed out a suit accusing an area Ford store of knowingly violating the Fair Credit Reporting Act by running a credit check on a customer's husband.
U.S. District Judge Nancy Edmunds also refused to allow Jonathan Khoury to amend his lawsuit to charge Suburban Ford of Sterling Heights, Mich., and Ford Motor Credit Co. of negligently obtaining his credit report without a "permissible purpose."
The dispute arose in December 2012 when Khoury, who works for Ford Motor Co., went to the dealership with his wife so she could buy a vehicle. His name and driver's license number -- but not Social Security number -- were included in some of the paperwork in the deal file to ensure her eligibility for a Ford employee discount, according to court papers.
Suburban acknowledged that its finance manager initially entered Khoury's name instead of his wife's on the credit application and that his credit report was run. But the dealership insisted in court papers that it was done inadvertently and "quickly realized and corrected," calling it a "harmless human error."
When Khoury learned of the credit check, he asked Suburban to remove it from his credit report.
His wife was approved for financing and there were no allegations of any problems with the vehicle, a 2013 Explorer.
His suit based on the Fair Credit Reporting Act alleged that the defendants knowingly obtained the credit report, obtained it under false pretenses and without a permissible purpose, and invaded his financial privacy. He later withdrew all but the first claim.
Dealership lawyer Suzanne Bartos of Detroit called it "a simple human clerical error" that was realized and corrected within 20 minutes.
Khoury, Bartos said, "was trying to capitalize on it, and his attorney was trying to capitalize on it."
Khoury rejected the dealership's offer to settle the case for $500. Suburban rejected his counteroffer to settle for $7,500, according to the decision.
Suburban and Ford Credit asked Edmunds to throw out the remaining claim. In its filing, the store said that the "training and procedures of the dealership negate any willful noncompliance."
For example, Suburban said that all new F&I personnel "receive a 101-page manual regarding the various state and federal consumer privacy laws," that employees receive ongoing training, and that the store's compliance officer conducts periodic audits "to ensure compliance with the consumer privacy laws."
In her decision, Edmunds found no evidence that the dealership knowingly violated the law, saying that its mistake does not rise to a level of willful or reckless conduct under the Fair Credit Reporting Act.
In addition, Edmunds said Khoury failed to offer "a legitimate reason for his delay" in seeking to change his theory of liability from a willful violation to a negligent violation of the Fair Credit Reporting Act.
Khoury's lawyer did not reply to requests for comment.