The Credit Bureaus Defense Strategy of Attrition and Delay
The credit bureaus have for a long time issued a defense strategy of attrition and delay. Why? They make more money off of people with bad credit than they do off of those with a positive credit history. A person with bad credit will pull their report 10X more often than someone with a 720 plus credit score.
Experian, Equifax, and TransUnion, or "The Big Three" has had their defense strategy criticized by Judge Posner of the 7th Circuit and stated that they are "investing in developing a reputation intended to deter plaintiffs."
This was an important reason why the 7th Circuit upheld $372,000 with only $10,000 in punitive damages (a 37-to-1 ratio).
Consumers need to urge the courts to follow Judge Posner in recognizing that that is a deliberate game played by the credit bureaus and the credit reporting agencies and that the expected outcome of that game will be high punitive damages.
Here is the actual statement;
"Finally, if the total stakes in the case were capped at $50,000 (2 x [$5,000 + $20,000]), the plaintiffs might well have had difficulty financing this lawsuit. It is here that the defendant's aggregate net worth of $1.6 billion becomes relevant. A defendant's wealth is not a sufficient basis for awarding punitive damages."
That would be biased and would infringe upon the rule of law by making the punishment depend on class rather than behavior. This is where wealth enables the credit bureaus to mount an extremely aggressive and expensive defense against suits. In turn, this may make it difficult for the consumer to find a lawyer willing to handle their case, involving as it does only modest stakes, for the usual 33-40 percent contingency fee.
In other words, the credit bureaus are continually investing time and money to develop a reputation that intends to discourage consumers from filing suit.
State Farm Mutual Automobile Ins. Co. v. Campbell, supra, 123 S.Ct. at 1525; BMW of North America, Inc. v. Gore, supra, 517 U.S. at 591, 116 S.Ct. 1589 (concurring opinion); Zazu Designs
v. L'Oreal, S.A., 979 F.2d 499, 508-09 (7th Cir.1992).