California Federal Court Approves FCRA Class Action Settlement
The Eastern District of California recently approved a $1.375 million settlement between a certified class of former employee plaintiffs and an employer defendant. The class consisted of all individuals who worked for the defendant between March 30, 2013 and May 1, 2018. The defendant was alleged to have misused FCRA consent forms to improperly run background checks, along with a series of wage and hour violations under California law.
In Carrasco v. Romanoff Floor Covering, Inc., 2021 U.S. Dist. LEXIS 84502 (E.D. Cal. Apr. 28, 2021), the court granted final approval over the above-referenced settlement. Per the preliminary settlement approval, set out in Bailey v. Romanoff Floor Covering, Inc., 2020 U.S. Dist. LEXIS 125694, at *3 (E.D. Cal. July 15, 2020), the 2,989-member FCRA class received 30% of the net settlement amount, and the 702-member California class asserting wage and hour claims received 70% of the net settlement amount. Administrative costs and attorney fees amounted to $388,750, reducing the net settlement to $986,250. Ultimately, the FCRA settlement netted each class member approximately $99, and the wage and hour settlement netted each class member approximately $983.
Relatively speaking, the FCRA settlement was significantly smaller than the class’s wage and hour settlement, but did allow the class to litigate in federal court and benefit from federal class certification procedures under Rule 23. FCRA defendants should be on the lookout for efforts to bootstrap federal consumer privacy statutes to largely state-law claims to obtain federal jurisdiction, and think creatively about ways to ensure litigation occurs in their preferred venue.