DIVORCE ATTORNEYS AND THE FAIR CREDIT REPORTING ACT

Laura W. Morgan, Senior Attorney, National Legal Research Group
Executive Editor, Divorce Litigation

You are a domestic relations attorney representing a client in a divorce proceeding. Because you are principled and much prefer settling cases than trying them, you enter into negotiations with opposing counsel to come up with a fair equitable distribution, spousal support, child support, and child custody award.

After some time negotiating, you and opposing counsel come up with an agreement that the parties can live with. You are somewhat concerned, however, that the opposing party might not be able to live up to the terms of the agreement, given the amount of debt each party must ultimately bear. You decide to obtain a credit report on the other party, and so request one from the major credit reporting agencies.

According to a new decision from the Eighth Circuit Court of Appeals, you have committed a willful violation of the Fair Credit Reporting Act, 15 U.S.C. § 1681. In Bakker v. McKinnon, No. 97-3267 (8^th Cir. August 21, 1998), Ms. McKinnon, attorney for the plaintiffs in a medical malpractice case, obtained the credit report on the defendant dentist, Dr. Bakker, in an effort to force settlement. The doctor sued for violation of the FCCA and for invasion of privacy. The federal district court found in favor of the doctor, and the court of appeals affirmed. The Circuit Court held that an attorney cannot be said to have a "legitimate business need" under the act for the credit report, because the only recognized legitimate business needs recognized under the act are to determine an individual’s eligibility for credit, insurance, or employment. Concern about whether an individual can pay a judgment does not come within that rubric. See also Federal Trade Commission, Compliance with the Fair Credit Reporting Act (2d ed. 1973) ("legitimate business need" does not include an attorney investigating prospective jurors).

Laura W. Morgan is a Senior Attorney in Family Law at the National Legal Research Group, in Charlottesville, Virginia, a firm that writes memoranda and briefs for attorneys nationwide. Ms. Morgan is the author of "Child Support Guidelines: Interpretation and Application," and is currently Chair of the Child Support Committee of the American Bar Association Family Law Section. She can be reached at: goddess@supportguidelines.com, or phone 1-800-727-6574 or 1-804-977-5690

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