Wood Smith Henning & Berman partners Frances O'Meara and Mindy Bae have secured two significant victories defeating claims brought under California's Investigative Consumer Reporting Agencies Act (ICRAA), a statute that has rapidly emerged as a major source of high-volume, high-risk litigation targeting landlords and property management companies.
In a series of coordinated lawsuits, plaintiffs alleged that landlords violated the ICRAA by failing to include required disclosures in rental applications. Each plaintiff sought statutory damages of up to $10,000 per violation, creating substantial exposure even in the absence of actual harm. Within weeks of each other, WSHB obtained summary judgment in two separate jurisdictions, with the courts ruling that the plaintiffs lacked standing to pursue their claims.
Prior to these rulings, plaintiffs did not need to prove actual harm. Simply filing a lawsuit and alleging that a rental application failed to include statutorily required language, or that a box was not provided for an applicant to check, was enough to trigger strict liability claims under the statute. For example, an action involving 50 tenants from a single apartment complex culminated in a settlement demand of $500,000 plus attorney fees.
"These ICRAA cases are fast becoming the new ADA tester litigation in California," said Bae. "They are copy-paste complaints seeking strict liability damages from property owners and managers, regardless of actual harm. Fortunately, the courts are beginning to scrutinize standing and reject claims with no real injury."
In the most recent cases, the court granted summary judgment after finding that the plaintiffs lacked standing to bring their ICRAA claims. The defense introduced arguments setting forth that plaintiffs submitted zero evidence of their actual damages as a result of the alleged ICRAA violations.
ICRAA, found in Civil Code §§1786 et seq., governs how investigative consumer reports may be obtained and used. Even minor procedural violations can expose defendants to liability for statutory damages of $10,000 per person, attorney's fees, and potentially punitive damages.
"What makes this wave of cases particularly concerning for the defense is the scale," said O'Meara. "There are at least five coordinated proceedings pending in Los Angeles County alone, involving over 1,000 plaintiffs, with more copycat cases already emerging."
These cases are often filed as individual actions, not class actions, meaning that each named plaintiff can seek $10,000 in damages, magnifying exposure across portfolios of multifamily housing or property management clients.
"WSHB's recent wins provide a strong template for defending against ICRAA claims under these circumstances," added O'Meara. "Courts are not accepting statutory damage claims without real evidence of harm. We expect this trend to continue, and we're working closely with our clients to replicate these results."
For carriers, property owners, and third-party administrators facing similar ICRAA claims, WSHB offers strategic litigation counsel grounded in recent courtroom success.
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