Kaplan v TransUnion

Federal Rule of Civil Procedure 23(b)(3) allows courts to certify class actions when common questions of law or fact predominate over individual issues. Courts must also find that a class action offers a fairer and more efficient way to resolve the dispute than individual lawsuits. In addition, the proposed class must meet Rule 23(a)’s four requirements: numerosity, commonality, typicality, and adequate representation.

In 2024, Lesley Kaplan sued TransUnion, alleging that it violated FCRA by failing to block allegedly fraudulent information from consumers’ credit reports after receiving identity theft reports. Kaplan alleged that an unknown individual used her Wells Fargo credit card for unauthorized transactions in 2023, including a charge that later appeared on her TransUnion report. After Kaplan submitted police and Federal Trade Commission identity theft reports and requested removal, TransUnion denied the request, conducted a reinvestigation, and concluded the charge was legitimate. Kaplan later resolved the issue with Wells Fargo, but continued pursuing claims against TransUnion and sought certification of a nationwide class.

On May 1, 2026, Judge Wendy Beetlestone of the Eastern District of Pennsylvania granted class certification, allowing Kaplan to represent approximately 281,000 consumers. The court found that Rule 23(a) commonality was satisfied because the case presents a shared question: whether TransUnion violated FCRA by failing to block allegedly fraudulent information after receiving required documentation. On May 13, 2026, TransUnion petitioned the Third Circuit for interlocutory review under Rule 23(f).

On May 20, 2026, ABA filed an amicus brief urging the Third Circuit to grant TransUnion’s petition for review. In its brief, ABA argued that the district court improperly certified a class that includes uninjured individuals, defeating predominance under Federal Rule of Civil Procedure 23(b)(3), and urged review to protect the integrity of Consumer Reporting Agencies’ (CRAs) information. On June 25, 2026, the Third Circuit granted TransUnion’s petition.

In its most recent amicus brief, ABA argued that the district court erred in certifying a class that includes uninjured individuals, which defeats predominance. ABA emphasized that Rule 23(b)(3)’s predominance requirement is not satisfied when individualized proceedings are needed to determine injury, as is plainly true of this class. ABA explained that each class member must prove that TransUnion’s failure to promptly block disputed information caused actual harm. To assess these claims, courts would need to examine whether TransUnion shared the disputed information, whether that disclosure caused harm, and whether the delay in blocking the information caused the injury. ABA maintained that these individual inquiries would require separate proceedings and prevent common issues from predominating. ABA also noted that even if the district court misread FCRA’s blocking rules, courts would still need to assess whether TransUnion properly denied each request and whether that denial caused harm.

ABA also asserted that the district court’s standing analysis is fundamentally flawed. ABA explained that the court focused only on Kaplan’s alleged injuries and failed to assess whether other class members suffered actual harm. The court found that Kaplan suffered harm from wasted time, emotional distress, and TransUnion’s disclosure of inaccurate credit information to Barclays. However, ABA noted that TransUnion shared Kaplan’s credit report with Barclays before she submitted her block request. Therefore, TransUnion’s failure to block the information could not have caused that harm. ABA also maintained that wasted time and emotional distress alone do not necessarily meet Article III’s requirement for concrete injury. Further, the district court failed to show that other class members suffered similar harm or that TransUnion shared their disputed information after receiving block requests. ABA stressed that courts would need to review each class member’s circumstances to determine whether an injury occurred.

Additionally, ABA highlighted that certifying a class rife with uninjured members harms defendants and injured class members alike. ABA explained that overly broad classes increase litigation costs and potential damages, which can pressure defendants to settle even when they have valid defenses. ABA also warned that including uninjured individuals in a class reduces the amount of compensation available to those who suffered actual harm. When uninjured members share in a settlement, they reduce the amount that injured members receive. ABA further noted that including uninjured members increases the risk that courts may later decertify the class or reject its claims. This risk may pressure class counsel to accept a lower settlement, leaving injured members with less compensation. ABA emphasized that Rule 23 requires courts to determine whether common issues predominate before they certify a class to prevent these outcomes.

Finally, ABA argued that the district court’s statutory analysis threatens the integrity of CRA’s, harming businesses and consumers alike. ABA explained that the district court misread the FCRA when it required CRAs to block disputed information before reviewing the validity of a consumer’s request. ABA warned that this approach could increase credit washing, a practice in which individuals use false identity theft claims to remove accurate information from their credit reports. ABA noted that the Federal Trade Commission has taken action against credit repair schemes that use this practice. ABA also cited a sharp rise in consumer complaints and growing concerns about false reports. ABA maintained that requiring CRAs to block information before reviewing requests would make credit reports less accurate and reliable. As a result, lenders could struggle to assess credit risks, while consumers could face greater challenges obtaining credit.