In Jones v. Sterling Infosystems, 1:14cv3076 (S.D.N.Y. 2016), the district court recently denied class certification against a background screening company that was alleged to have violated 15 U.S.C. § 1681k(a) by not sending out the notice envisioned under § 1681k(a)(1) at the time that criminal record information was transmitted to employers.
The court denied class certification based on the individualized inquiries necessary in the context of the issues of “incompleteness” and the defendant’s asserted lack of “strict procedures,” both of which are elements of a plaintiff’s claim under 15 U.S.C. § 1681k(a).
With respect to the former issue of “incompleteness,” the Court held that the completeness analysis is driven by “current public record status” of the record at the time it was reported, rather than any personal identifiers associated with the record. The court then denied class certification on the basis that the issue would represent an “intensively individualized analysis” to determine completeness of the relevant criminal records across the members of the putative class.
With respect to the “strict procedures” issue, the court noted that the defendant had presented uncontradicted evidence that “its procedures have changed over time.” The court then held that “each individual class member would have to prove that the procedures used to generate his or her report were not ‘strict procedures’ and that Sterling was, at the time it generated that class member’s report, acting willfully in not having strict procedures.”
The plaintiff recently petitioned the Second Circuit to review the decision denying class certification. That petition remains pending.
Troutman Sanders LLP has extensive experience in background screening litigation, including class actions. We will continue to monitor this decision and relevant developments.