Summary:
In this defamation and unfair trade practices case, six related real estate companies sued Dun & Bradstreet (“D&B”), alleging that the business credit reporting giant published misleading and false credit assessments—labeling them high or moderate risk, including outdated or erroneous legal filings, and creating damaging implications regarding their creditworthiness. The District Court for the Middle District of North Carolina dismissed the complaint with prejudice under Rule 12(b)(6), finding the statements non-defamatory and the Plaintiffs unable to demonstrate injury under the North Carolina Unfair and Deceptive Trade Practices Act (“UDTPA”). The Fourth Circuit affirmed, holding that the proposed amended complaint failed to cure the deficiencies and was futile.
Specifically, the Fourth Circuit found that:
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The statements in D&B’s reports, such as classifications of legal actions and business risk ratings, were accompanied by disclaimers and date stamps that would lead a reasonable reader to understand the possibility of outdated information.
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The Plaintiffs’ claims of implied defamatory meaning were not supported by factual allegations to plausibly establish falsity or harm.
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The UDTPA claims failed due to the absence of “actual injury,” as reputational harm alone—especially where defamation claims fail—cannot support UDTPA liability.
Having failed to cure these issues through a proposed amended complaint, the Plaintiffs also lost their appeal of the district court’s refusal to permit amendment and the original dismissal with prejudice.
Commentary:
While Carroll did not involve the Fair Credit Reporting Act (FCRA), its reasoning maps closely onto FCRA jurisprudence—particularly in emphasizing:
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the importance of context and substantial accuracy;
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the legitimacy of relying on public records;
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the necessity of alleging and proving actual harm;
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and the sharp boundary between commercial and consumer reporting.
In practice, Carroll serves as a reminder that pleading vague allegations about “false credit information” may not survive in any forum—state or federal—unless grounded in specific, provable facts tied to a cognizable injury under the correct statute.
See also the law review article by Christopher Hampson, Defamation, Bankruptcy & the First Amendment,
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