Justices Uphold 2-Year Deadline on Suing Credit Raters November 14, 2001 By LINDA GREENHOUSE WASHINGTON, Nov. 13 - Federal law gives people whose credit ratings have been damaged by a credit reporting company's mistake only two years from the date of the mistake to file a lawsuit, the Supreme Court ruled today, even if the mistake does not come to light until later. The vote was 9 to 0. The decision, the first of the new term, interpreted the Fair Credit Reporting Act of 1970, which requires credit reporting companies to maintain "reasonable procedures" to assure the reliability of the information they compile and transmit. The law was invoked in this case by a victim of identity theft who learned too late that an impostor with a similar name and with access to her Social Security number and California driver's license had been able to fool TRW Inc., then one of the major credit reporting companies, into issuing a report that let the impostor get cable television service. The impostor, Andrea Andrews, fell behind in her cable account, leaving the victim, Adelaide Andrews, unaware of the cloud on her credit rating until she tried to refinance her mortgage. By the time Adelaide Andrews sued TRW in 1996 for failing to take reasonable steps - like verifying not only the Social Security and license numbers but birth date, address and first name of the applicant - to make sure it was issuing a report for the right person, more than two years had passed since the faulty report had been issued. The federal district court in Los Angeles dismissed the suit on the ground that the two-year statute of limitations had expired. But the United States Court of Appeals for the Ninth Circuit, in San Francisco, reinstated it, ruling that the two years should be counted from the time the injury was discovered and not from the date of the action said to have violated the credit reporting act. The Bush administration and consumer groups urged the court to uphold the appeals court's interpretation to carry out the pro-consumer intent of the law. "Although Congress expected potential plaintiffs to be diligent in pursuing suspected claims, there is no reason to think that it intended to impose a limitation period that would begin to run against claims that even a diligent consumer had no reason to suspect," the administration said in a brief it filed in May. But writing for the court, Justice Ruth Bader Ginsburg said the Supreme Court could not create an exception to the statute of limitations that Congress had chosen. The Fair Credit Reporting Act contains one explicit exception; in cases of "willful misrepresentation" by the reporting company, the two-year limit is to be counted from the plaintiff's discovery of the misrepresentation. All nine justices agreed that this sole explicit exception should be interpreted to rule out the judicial creation of other exceptions. Justice Ginsburg cited a general principle of statutory interpretation that calls for statutes to be interpreted so that no clause is rendered superfluous. She said that for the court to formulate a "discovery rule" for the Fair Credit Reporting Act, under which the statute of limitations would count from the plaintiff's discovery of injury, would make the explicit exception for misrepresentation "entirely superfluous in all but the most unusual circumstances." She said the court would "distort" the law's text "by converting the exception into the rule." Justices Antonin Scalia and Clarence Thomas agreed with the result in the case, TRW Inc. v. Andrews, No. 00-1045, but declined to sign the Ginsburg opinion. In a separate opinion by Justice Scalia, these two said the majority should have gone further to make clear that there is no "general federal rule" that counts the statute of limitations from the time of discovery. Justice Ginsburg said that "this case does not oblige us to decide" the broader question. After the events in the case, TRW transferred its credit reporting business to Experian Information Solutions Inc. Adelaide Andrews also sued another credit reporting company, the Trans Union Corporation, which settled the case before the district court's ruling.