Alert July 01, 2008

Eighth Circuit Holds that Creditors’ Mailers Meet FCRA “Firm Offer” Requirements

In a consolidated appeal, the Eighth Circuit affirmed district court judgments in favor of Countrywide Home Loans, Inc. and Capital One Auto Finance, Inc. in putative class actions asserting violations of the prescreening requirements of the Fair Credit Reporting Act. The appellants contended that FCRA requires that a creditor’s prescreened mailing contain material terms of the product offered so that it would qualify as a common law offer, but the Eighth Circuit rejected the argument as inconsistent with the plain language of FCRA. The Eighth Circuit instead held that FCRA is satisfied so long as a creditor honors its firm offer of credit. In so doing, the Court aligned itself with recent decisions from the First and Seventh Circuits, as well as federal district courts, that have reached a similar conclusion.

Goodwin Procter partner Tom Hefferon represented Countrywide. Click here for a copy of Poehl v. Countrywide Home Loans, Inc., No. 07-2988; Ludditt-Poehl v. Capital One Auto Finance, Inc., No. 07-3249 (8th Cir. June 19, 2008).