The Fair Credit Reporting Act authorizes victims of false credit reporting to sue the “person” who made the false report for the damages the report has caused. The Act defines “person” broadly to include any “government or governmental subdivision or agency.” In Department of Agriculture Rural Development Rural Housing Service v. Kintz, decided on February 8, 2024, the Court ruled that these provisions of the Act clearly reflected Congress’s intent to waive the federal government’s sovereign immunity from lawsuits when the government itself is charged with issuing a false credit report. The Court therefore unanimously voted to dismiss the federal government’s sovereign immunity defense in that case.
COMMENT: The Court overlooked, probably because no one brought it up, the Appropriations Clause of the United States Constitution. That Clause reads “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law….” U.S. Const., Art. I, § 9, Clause 7. The Appropriations Clause of the Constitution clearly precludes court-ordered damage awards directly against the federal government and Congress may not waive the protection extended by that Clause. Despite its unanimity, the Court made an erroneous decision in this case.
Dan Rhea
RECENT RULINGS 