The Commissioner of the Financial Institutions Division of the Nevada Department of Business and Industry and the Nevada Attorney General have filed a motion to dismiss the lawsuit filed last month in Nevada federal court by three trade groups challenging an amendment to Nevada law that allows an applicant for credit with no credit history to request that the creditor deem the applicant’s credit history to be identical to that of the applicant’s spouse during the marriage. The amendment is contained in Senate Bill 311 which was signed into law by the Nevada Governor on July 1, 2019 and became effective on October 1.
The trade groups also filed a motion for a preliminary injunction. The court extended the time for the defendants to file a response until November 12, 2019 and the plaintiffs have until December 2, 2019 to reply.
The lawsuit includes an allegation that the Nevada law is preempted by the Fair Credit Reporting Act and the Equal Credit Opportunity Act. The trade groups claim that (1) because creditors are not permitted to access a credit report where there is no permissible purpose or consent from the non-applicant, the requirement violates the FCRA, and (2) because creditors are not permitted to obtain information about a non-applicant spouse or former spouse based solely on the applicant’s request, it violates the ECOA/Regulation B prohibition on requesting information on an applicant’s spouse or former spouse.
In their motion to dismiss, the Commissioner and AG argue that the plaintiffs’ claims do not satisfy Article III ripeness standards because there is no history of enforcement and “plaintiffs never explain why this Court should strip the Division of time to evaluate [the amendment] to consider regulations that alleviate the Plaintiffs’ concerns.” The defendants also claim that because the Division rather than the AG has the specific statutory authority to initiate actions to enforce the amendment, the AG is immune from suit.