15 U.S.C. § 1681t(a).[vii] See 15 U.S.C. § 1681b(b).[viii] See id.

Following the discharges, Ocwen obtained the borrower’s credit reports. The borrowers, eight in total, sued Ocwen in a putative class action, alleging that it willfully violated the FCRA by obtaining their consumer reports without a permissible purpose, in alleged violation of 15 U.S.C. §1681b(f)(1).The U.S. District Court for the District of Nevada granted Ocwen’s motion for summary judgment. In doing so, it relied on a prior unpublished decision from the Ninth Circuit, Vanamann v. Nationstar Mortgage, LLC, 775 F. App’x 260 (9th Cir. 2018).

Id. at 1550. The real question here is whether Mitchell has alleged a “concrete” injury.Mitchell suggests she has met her burden by alleging that Winco provided her with an FCRA disclosure and authorization at approximately the same time, and that the disclosure contains extraneous information in violation the Act’s requirement that the disclosure be essentially a stand-alone disclosure pursuant to 15 U.S.C. § 1681b. Mitchell suggests that failing to provide her with the stand-alone disclosure was a concrete harm because it caused her “informational harm” and “invaded her privacy.”

[3] As a Ninth Circuit decision, Gilberg covers Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Washington, as well as the territories of Guam and the Northern Mariana Islands. No other federal court of appeals has considered the question presented in Gilberg, let alone taken a contrary position. [4] See 15 U.S.C. § 1681b(b)(2). [5] See id.; see also 15 U.S.C. § 1681a(h) (defining “employment purposes”).

Prior to settlement, the court denied Defendant's motion to dismiss, finding that the allegations outlined above stated a claim for relief. Adding to the deluge, Big Lots was hit with a class action in Illinois less than two weeks ago, with the Plaintiff claiming that the retailer's FCRA form contained "extraneous information" and alleging that the form did not consist "solely" of a disclosure.FCRA: Requirements for Compliance To comply with the FCRA notice and disclosure provisions contained in 15 U.S.C. § 1681b(b)(2)(A)(i)-(ii), the employer must provide "a clear and conspicuous disclosure," in writing, in a document that consists solely of the disclosure. This requires the disclosure to be contained in a singular, standalone document, with no extraneous information.

See Rod Fliegel and Jennifer Mora, The FTC Staff Report on "40 Years of Experience with the Fair Credit Reporting Act" Illuminates Areas of Potential Class Action Exposure for Employers, Littler Report (Dec. 12, 2011), www.littler.com/publication-press/publication/ftc-staff-report-40-years-experience-fair-credit-reporting-act-illumin.2 12 C.F.R. part 1022.3 15 U.S.C. § 1681b(b).4 15 U.S.C. § 1681b(a)(3)(B), (b).5See Rod Fliegel, The FACT and How It Affects FCRA and Employment Investigations (the Vail Letter), Littler ASAP (Jan. 15, 2004), www.littler.com/publication-press/publication/fact-and-how-it-affects-fcra-and-employment-investigations-vail-letter.6 15 U.S.C. § 1681d.7 15 U.S.C. § 1681b(f).8 15 U.S.C. § 1681b(b).9 15 U.S.C. § 1681b(b).10 15 U.S.C. § 1681m(a).11See Philip Gordon and Cathy Beyda, New FTC Regulations On Proper Destruction of "Consumer Information": Steps Employers Need to Take to Comply, Littler ASAP (May 1, 2005), www.littler.com/publication-press/publication/new-ftc-regulations-proper-destruction-consumer-information-steps-empl.12 15 U.S.C. § 1681p.13 15 U.S.C. § 1681o.14 15 U.S.C. § 1681n.15See Rod Fliegel, Barry Hartstein, and Jennifer Mora, EEOC Issues Updated Criminal Record Guidance that Highlights Important Strategic and Practical Considerations for Employers, Littler ASAP (Apr. 30, 2012), www.littler.com/publication-press/publica

Addressing two issues of first impression in the U.S. Court of Appeals, Ninth Circuit, a panel ruled that a consumer suffers a concrete, Article III injury-in-fact when a third party obtains her credit report for a purpose not authorized by the Fair Credit Reporting Act (FCRA).The court also held that plaintiffs are not required to plead the defendant’s actual unauthorized purpose in obtaining the report in order to survive a motion to dismiss; they need allege only facts giving rise to a reasonable inference that the defendant obtained the credit report in violation of the FCRA.What happenedFreshta Nayab sued a national bank, alleging that it obtained her credit report for a purpose not authorized by the FCRA, in violation of 15 U.S.C. § 1681b(f).The bank moved to dismiss the suit, arguing that Nayab lacked standing because she merely alleged a statutory violation and not an actual injury. The district court granted the motion and Nayab appealed.Reversing, the federal appellate panel determined first that Nayab had standing because she had alleged a concrete injury that satisfied the requirements set forth in the Supreme Court’s decision in Spokeo v. Robins by alleging that the third party had obtained her credit report for a purpose not authorized by the FCRA.The bank was correct that a bare procedural violation may not establish a concrete harm sufficient for Article III standing, the panel said, but Nayab’s claim based on Section 1681b(f) alleged the violation of a substantive right.“When a third party obtains the consumer’s credit report in violation of § 1681b(f)—that is, for a purpose not authorized by the statute—the consumer is harmed because he or she is deprived of the right to keep private the sensitive information

Robertson v. Allied Solutions began with a familiar fact pattern: Robertson applied for a job with Allied, and Allied decided not to hire her based on a negative, but accurate, background check. Robertson then sued on behalf of a putative class, claiming that Allied had made its decision without first providing her with a copy of the background check and an opportunity to address its contents, as required by the FCRA. 15 U.S.C. § 1681b(b)(3). (Allied allegedly also failed to provide properly formatted pre-background check disclosures, but Robertson did not press that claim on appeal.)

LexisNexis then generates a “report” detailing the match and the adjudication and sends the report to the inquiring employer.The FCRA requires that before taking any “adverse action” against an employee, the person taking such action must send the employee a copy of the report and a notice of the consumer’s rights in accordance with 15 U.S.C. § 1681b(b)(3). As an additional service, LexisNexis sends these “pre-adverse action letters” on employers’ letterhead to employees or potential employees whose information results in a match.

Lawsuits against employers under the FCRA show no signs of abating in 2023, including nationwide class actions.Employers can fortify efforts to comply with the FCRA by, among other things, reviewing their policies and procedures and providing FCRA compliance training.The continued filing of lawsuits against employers under the FCRA underscores the need for in-house counsel, Human Resources, and Talent Acquisition to comply with the statute, especially the “pre-adverse action” notice requirement in 15 U.S.C. § 1681b(b)(3)(A).1Employers have had some recent success knocking FCRA claims for “informational injuries” out of federal court by contesting the plaintiff’s “standing” under Article III of the U.S. Constitution.2 These victories hinge on the federal constitutional requirements for a plaintiff to pursue any claims in federal court (e.g., injury-in-fact), not on the merits.3 Courts remain split on the rules for standing to bring pre-adverse action notice claims, however, and it is a mistake to assume the standing cases allow employers to let their guard down.4 They do not.Even apart from the circuit court split on standing rules, the FCRA allows claims in federal or state court (i.e., there is concurrent jurisdiction), and state courts may not be bound by Article III even when adjudicating claims under a federal statute.5Pre-Adverse Action NoticeAs a reminder, if an employer intends to take any “adverse action” against a candidate based on information in a background report (e.g., criminal convictions)