A new putative class action lodged in California federal court against Paramount Pictures Corporation made it the latest employer to be accused of violating the Fair Credit Reporting Act by obtaining credit reports from current and prospective employees without adequate disclosure of their rights under the FCRA. The lawsuit alleges that the company has a standardized practice of obtaining consumer reports for employment purposes, but that its disclosure form is not “in a document that consists solely of the disclosure,” as required by the FCRA.
The lawsuit claims that the named plaintiff, who applied for a job with the company in February 2011, was presented with a disclosure and authorization form in his employment application saying he gave permission to ex-employers and other people to provide Paramount with “any and all information concerning my previous employment and any other pertinent information.” That portion of the application also said that upon signing the application, he released from liability all parties that gave the information to Paramount, and released the movie company from liability for any use or disclosure of the information. Plaintiff alleges that including that language violated the FCRA mandate that the disclosure about obtaining a credit report be separate, the suit claimed. The Complaint, which seeks punitive and statutory damages, seeks to certify a nationwide class.
The suit is one of a number of such recently-filed lawsuits alleging that companies violated this provision of the FCRA. For instance, as we previously reported, Whole Foods Market Group, Inc. was also recently hit with putative class actions for allegedly violating the FCRA. Additionally, in November, a Tennessee federal judge finally approved a roughly $6.8 million settlement that put to rest a class action involving similar claims against Publix Super Markets.
Troutman Sanders LLP has extensive experience in FCRA litigation and compliance with respect to challenged disclosure forms. This growing body of lawsuits challenging employer disclosure forms warrants careful review of such forms by companies. Troutman Sanders will continue to monitor this area of law.