Julie Rikelman, nominated by President Biden to the First Circuit, wrote a unanimous decision that reversed a lower court and ruled that a victim of improper action by an insurance company could pursue a Fair Credit Reporting Act (FCRA) claim against a corporation that improperly disclosed private information about him to the insurer. The November 2023 decision was in Wiener v MIB Group Inc.
What happened in this case?
Malcolm Wiener had purchased several life insurance policies from AXA Equitable Life Ins. Co. (AXA). After an inadvertent payment error, AXA terminated his policies and sent him an application for reinstatement. But AXA denied his application based on an evaluation from an AXA physician. Wiener later learned that the evaluation had been performed “falsely and negligently.”
AXA also erroneously reported to MIB Group, a corporation that compiles and shares information for insurance companies, that it based its denial of Wiener’s application on “four serious medical conditions” that he “did not actually have.” The “false report rendered Wiener effectively uninsurable” at the appropriate rate.
Wiener sued AXA for negligence. After the end of pretrial discovery, an MIB official worked with AXA to prepare a declaration that disclosed confidential information about Wiener’s insurance application activity that substantially helped AXA’s arguments in the case. Wiener had to incur additional attorneys’ fees and costs to respond. Nevertheless, a jury found in Wiener’s favor.
Wiener then sued MIB, contending that it had violated FCRA by improperly disclosing the confidential information that AXA used against him in his lawsuit. A federal district court judge dismissed the case, claiming that Wiener did not have standing . He appealed to the First Circuit.
How did Judge Rikelman and the First Circuit Rule and Why is it Important?
Judge Rikelman wrote a unanimous opinion that reversed the lower court, ruled that Wiener did have standing to sue, and sent the case back so that he could proceed with his claim against MIB. She acknowledged that in addition to contending that MIB had violated FCRA, Wiener had to demonstrate that he had standing to sue because of injury caused by MIB. Based on the record in the case and applicable precedent, she explained, Wiener clearly had standing to sue based on the additional “out-of-pocket costs” in attorneys’ fees and related costs he had to expend in the AXA litigation because of MIB’s improper disclosure of the confidential information that was used against him.
In addition to giving Wiener a chance to prove his claim against MIB. Judge Rikelman’s opinion is potentially important in other cases by consumers against insurance companies and related corporations, particularly in the First Circuit (including Massachusetts, Maine, New Hampshire, Rhode Island, and Puerto Rico). The ruling makes clear that consumers can sue companies like MIB that improperly disclose confidential information about them to insurance companies. In addition, the decision serves as another reminder of the importance of promptly confirming fair-minded Biden nominees like Judge Rikelman to our federal courts.