Dispute over data storage: NOYB announces lawsuit against Schufa

In mid-July, research by the Süddeutsche Zeitung with NDR and WDR showed that the credit agency Schufa stores historical data, such as information about old loans, seizures or even personal bankruptcies, for up to ten years. The European data protection authority NOYB then warned Schufa in August. According to data protection rules, such information would have to be deleted after a certain period of time. Now the dispute is going to court.

Schufa “decisively rejects” NOYB’s allegations and, according to its own statements, refused to issue a cease-and-desist declaration until September 9th. In a 26-page letter to the NOYB, Schufa had its lawyers reject the demand for cease-and-desist declarations. The credit agency had already emphasized at the end of August: “We will defend the storage of historical data in court – even if we go to the Federal Court of Justice again.”

Schufa Holding AG argues that it stores historical data “precisely in order to meet legal and regulatory requirements”. The data would be stored “in accordance with the legal requirements and the storage periods agreed with the data protection authorities”. Historical data is required in order to develop scientifically reliable credit ratings (scores) and to check their quality.

If Schufa loses in court, the consequences would be enormous

The NOYB reacted immediately: "This makes it certain: NOYB will file an injunction. Interested parties can also continue to register for a possible class action lawsuit." Schufa’s arguments are “completely grotesque,” ​​says NOYB chairman Max Schrems. "Apparently Schufa believes that it is some kind of semi-divine institution that is above European laws. We look forward to putting an end to this."

If the data protection officers are proven right in court, this could have massive financial consequences for the credit agency. Since Schufa claims to have stored credit-related information on around 68 million people, even a small compensation amount per capita could result in total claims of astronomical amounts.