New Court Of Appeal Rulings Find Actual Damages Not Required To Litigate Consumer Reporting Violations In California

Two California Courts of Appeal recently held that plaintiffs need not prove actual harm to bring a claim under the state's Investigative Consumer Reporting Agencies Act (ICRAA). These holdings expose California employers, landlords and any entity that procures investigative consumer reports to claims seeking, at a minimum, $10,000 per violation.

ICRAA, Cal. Civ. Code § 1786 et seq., is one of California's counterparts to the federal Fair Credit Reporting Act. It governs investigative consumer reports that include information about a person's “character, general reputation, personal characteristics, or mode of living.” In contrast to the California Consumer Credit Reporting Agencies Act, which governs consumer reports bearing on a consumer's creditworthiness, ICRAA applies in employment, housing and insurance contexts. It requires entities requesting investigative consumer reports to provide clear, conspicuous and standalone disclosures to consumers and to obtain written consent before procuring such reports. Consumers may recover the greater of actual damages or $10,000 for any violation.

In Parsonage v. Wal‑Mart Associates, Inc., No. D083831, 2026 Cal. App. LEXIS 79 (Cal. Ct. App. Feb. 4, 2026), the Fourth Appellate District determined that ICRAA's drafters envisioned situations involving no actual damages. It also concluded from ICRAA's legislative history that the statute was intentionally crafted to be more stringent than its federal counterpart and to act as a deterrent. In Yeh v. Barrington Pacific, LLC (2026) 117 Cal.App.5th 1303, the Second Appellate District ruled similarly and emphasized that ICRAA's remedy—actual damages or  $10,000, whichever is greater—confirms that $10,000 is an alternative recovery available even when no actual damages exist. Both courts held that ICRAA contains no requirement that a plaintiff demonstrate tangible harm.

Notably, both courts distinguished recent California Court of Appeal decisions requiring a “concrete injury” to sue under the federal Fair Credit Reporting Act, concluding the reasoning in these cases was not applicable to ICRAA. See Limon v. Circle K. Stores Inc.  (2022) 84 Cal.App.5th 671; Muha v. Experian Info. Solutions, Inc.  (2024) 106 Cal.App.5th 199. In explaining why, the Fourth District wrote that the California Legislature “intended ICRAA to provide more stringent consumer protections than the FCRA and to serve as a deterrent. It specifically was enacted to correct shortcomings of the FCRA, including the requirement of proving actual damages.” Parsonage, 2026 Cal. App. LEXIS 79, *31. The Second District reached the same conclusion, noting that “key differences” in the “purposes and language” of the FCRA and ICRAA “significantly affect the standing they offer consumers.” Yeh, 117 Cal.App.5th at 1323.

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