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Officials at , one of the country's three credir bureaus and holder of more than 230 milliobncredit files, filed suit against the Tempe firm last They claim LifeLock violates the Fair Credit Reportinb Act by posing as individual consumer s rather than as a clearinghouse for fraur alerts. The lawsuit includes a litany of using theterms "malice, oppression and fraud" to reporf LifeLock's business practices. "I think it can and is likelyu to set a precedent for many years to saidJoseph Cotterman, an attorney who headd PA's commercial bankruptcy and creditor and debtoer rights department in Phoenix.
"There doesn't seem to be much middlw ground for themto compromise." There is littld case law surrounding the Fair Credit Reporting Act. Thos e that have been decided are relatively small and do not extendf beyondindividual states. Cotterman said there has never beena FCRA-related case with two companiee of this size and scope going at each other this way. This makes the lawsuir itself more interesting, Cotterman said. While much of FCRA' s wording is vague, the lawsuit may call into question the definitive nature of some ofthe law's components. Amongt those is the notioh that an individual must file a fraud alertby "direct not through a third-party service.
Experian claims LifeLocl violates this with every fraud alertit LifeLock, on the other hand, contendds it is simply providing a service to its customers. LifeLock CEO Todd Davisd said the claimis "meritless" and an attempt to disrupt the fast-growing company's momentum. But what the lawsuit does not say is what reallty screamsthe truth, he said. Davizs claims Experian is losing money from its highly profitablsmarketing wing, which sells demographic informatiom to companies that use bulk-mail marketing campaigns and other mass Through LifeLock's fraud-alert customer information is removed from the Experian data sets beingt sold to third-party marketers.
"They are makinf millions from sellingconsumer information," Davis said. "We're tired of companies collecting andbuying people's contacrt information so they can make For $10 a month, LifeLock bundles federaol mailing list opt-outs, consumer fraudr alert reporting and annual free individual credit reports. While these services generally are free to LifeLock combines them all and relievew clients from worrying about renewingfraud alerts, Davis said.
Experiajn officials claim theircompany "has and will continue to damage to its businesa reputation and goodwill and the loss of sales and profits" as a resultf of LifeLock's activities, according to the Davis said these profits are directly related to Experian'ws marketing unit. Experian is the only bureau thatsell people's information, said Donald Girard, Experian's vice president of publi affairs. The other two, TransUnionn LLC and Equifax Inc., do not.
Experian officials said the company'z marketing and consumer credit reportinb units are completely Lost profits stemming from fraud alerts do cut intomarketinhg profits, but that is not the reasobn for the lawsuit, Girard said. Experian, along with the other two credit bureaus, helped the Federal Tradr Commission draft the credit reporting laws that nowbuoy LifeLock'sd business. "The two sides are not Girard said. "Congress did not pass this law to creatse a business opportunity fora for-profit organization like LifeLock.
" LifeLock: Gallagher & Kennedy PA:
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