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Equifax lost the lawsuit. So why won't they pay up?

Equifax owes money to a guy whose private info was compromised last fall. Why won't it pay up?

Equifax owes money to a guy whose private info was compromised last fall. Why won't it pay up? AP

Daniel’s credit score is excellent. He runs his own business, so he needs it to be. So he was livid as he was typing his name and social security number into Equifax’s crisis response site.

One click of the “enter” key would determine whether he was one of the 147 million Americans whose private information had been left vulnerable to hackers. In a second, he’d know if he’d kept his credit score immaculate for nothing.

He clicked. Yes. His private information had indeed been cast into the ether of the internet.

That was when Daniel (not his real name; he asked to use a pseudonym) decided he was going to sue the pants off of Equifax.

Equifax is one of the “big three” credit reporting agencies, along with Experian and TransUnion. It makes its money by learning as much as it can about you -- your social security number, your medical history, your income -- tying it up in a bow, and selling it to banks and mortgage lenders.

Equifax knows these private details not because you told it, but because you told your employer, or your bank, or your credit card company. Over 75 percent of Fortune 500 companies do business with Equifax.

Last fall, the Atlanta-headquartered company announced it had royally screwed up. Some employee had neglected to install a patch on its storage system, and as a result, all that private info – Daniel’s included – had been stolen.

He solicited the services of acquaintance and Minneapolis-based attorney David Madgett, who convinced the jury to side with Daniel in district court.

Equifax was ordered to pay $7,200, enough for Daniel to purchase identity theft insurance for “quite a few years,” Madgett says, which “seems reasonable enough.”

“We were pretty happy with that,” he says. “Obviously, we thought it could be a little higher, but still.”

He may have spoken too soon. So far, months after the verdict, Equifax has refused to pay. Madgett says he sent Equifax’s attorney, Christopher Haugen, “dozens of emails” with no response.

“We’re going on 90 days where they’re refusing to comply with the judge’s ruling,” Madgett says. Haugen declined to comment on this story.

Most egregious, however, is what Madgett says Haugen is claiming as Equifax’s excuse: On September 11, Haugen filed a financial disclosure form stating that 75 percent of the company's after-tax earnings is exempt and cannot be used to pay its debts. The claim suggests Equifax is unable to pay because it can't afford to; paying the agreed upon amount would force Equifax to part with money it needs to survive.

Why does Haugen believe Equifax can claim this? Madgett has no idea.

“It’s completely absurd,” Madgett says. “They know they’re liable, and they know they owe to a lot of Americans.”

Madgett is hoping Equifax will be held in contempt of court. If enough time passes with no response, no action, no nothing, that’s entirely possible. In the meantime, $7,200 worth of identity theft insurance is on hold -- and whatever reckoning, if any, comes after that.

“It’s shocking,” Madgett says of Equifax’s handling of the situation. “But I guess it’s not surprising.”