Known as the Hillis lawsuit, this class action lawsuit may change the way credit bureaus market their products. The lawsuit accused Equifax of violating terms of the Credit Repair Organization Act in its marketing of consumer products.
Equifax and Fair Isaac Corporation entered into a class action settlement that has received final approval from the court. In this settlement, Equifax has agreed to avoid using certain words or phrases in conjunction with their consumer products until September 6, 2009.
These are the agreed upon terms for marketing as a result of the settlement:
- In any sentence that contains the words score or rating, they cannot use the terms improve, enhance, boost, raise or increase.
- These phrases are prohibited:
- credit repair
- credit rebuilding
- credit fix
- repair your credit
- fix your credit
- No sentence may contain the words advice, tips, suggestions or instructions in the same phrase as improving, enhancing, boosting, raising or increasing a credit score or credit rating.
- The simulated score generator used by Equifax cannot suggest that it is an equivalent predictor of one’s credit score.
This settlement limits the marketing capabilities of Equifax directly, but any failure by Experian or TransUnion to voluntarily comply likely would result in similar lawsuits. Expect all three credit bureaus to follow similar paths as they try to get around the constraints placed by this settlement.
