February 5, 2023

Volume XIII, Number 36

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February 03, 2023

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Make It Clear, Make It Broad: The D.C. District Court Determines A Plaintiff Has Standing To Pursue FCRA Claims Against His Former Employer Based On A Background Check Used To Justify His Termination

The latest entry in a nearly decade-long dispute between a plaintiff and his former employer and manager, Mattiaccio v. DHA Grp., Inc., 2020 U.S. Dist. LEXIS 129464 (D.D.C. July 21, 2020) is an in-depth analysis of standing under the FCRA in the face of unclear pleading by a pro se litigant.

The Mattiaccio plaintiff was terminated by the defendants based on alleged misconduct.  The defendants claims that they performed pre- and post-employment background checks to investigate employee misconduct, which is normally exempt from the FCRA.  However, the plaintiff alleged that these background checks were retaliation for a complaint he had filed against the defendants.

Relevant to our interests, plaintiff brought two FCRA claims.  The first was an allegation that the defendants lacked “proper authorization” under Section 1681b(b)(2)(A) of the FCRA to perform the background checks, because the authorizations for the checks were not clearly formatted.  The court determined that this was a bare procedural violation insufficient to give plaintiff standing to bring this claim, as he failed to allege any actual injury from this unclear formatting.

The second claim was construed by the court as an allegation that the plaintiff did not authorize a post-employment background check under § 1681b(b)(2)(A), and was not given a summary of rights or a chance to review his consumer report before he was terminated based on the post-employment background check, in violation of § 1681b(b)(3)(A).

Defendants had plaintiff sign separate authorizations for each background check, and provided signed copies of both as evidence.  The plaintiff claimed that the signed authorization for the post-employment background check (the results of which were used to justify his termination) was falsified.  Because there was still a material factual dispute regarding the validity (rather than the formatting) of this authorization, the court determined that a defendant’s unauthorized obtaining of a consumer report was an injury in fact, giving plaintiff standing.

Likewise, the court rejected defendants’ argument that their failure to provide a summary of rights or permit the plaintiff to review the report before defendants terminated him was another bare procedural violation.  Defendants apparently did not dispute the violation, but instead argued that a plaintiff could not be injured if he sought only statutory and punitive damages without alleging that the information was false.  The court rejected this argument, finding that the purpose of these protections is to provide a right of review, regardless of accuracy.  Accordingly, plaintiff had standing to pursue this claim.

This case is now headed to trial.  The lesson here for employers?  Ensure that your authorizations and disclosures are clear, contain the appropriate scope for all investigations you might perform, and that you provide your employees with the information obtained from consumer reports before taking adverse action based on that information.

© Copyright 2023 Squire Patton Boggs (US) LLPNational Law Review, Volume X, Number 218

About this Author

Jesse Taylor Associate  Columbus complex contract, franchise law, qui tam litigation

Jesse Taylor practices in state and federal court, with experience in complex contract and franchise law and qui tam litigation.

Prior to joining Squire Patton Boggs, he worked as a litigation associate in another top 20 international law firm. Previously, Jesse served as a law clerk to the Honorable Judith E. Levy, US District Court, Eastern District of Michigan, and to the Honorable James G. Carr, US District Court, Northern District of Ohio. In addition to his law firm experience and clerkships, Jesse worked as the online communications director for the Office of the...