Desiree Gilberg, on behalf of herself, all others similarly situated, Plaintiff-Appellant,
v.
California Check Cashing Stores, LLC, a California corporation; CheckSmart Financial, LLC, a Delaware limited liability company, Defendants-Appellees.
Argued
and Submitted November 15, 2018 San Francisco, California
Appeal
from the United States District Court D.C. No.
2:15-cv-02309-JAM-AC for the Eastern District of California
John A. Mendez, District Judge, Presiding
H.
Scott W. Leviant (argued), Thomas Segal, and Shaun Setareh,
Setareh Law Group, Beverly Hills, California, for
Plaintiff-Appellant.
Timothy W. Snider (argued) and Chrystal S. Chase, Stoel Rives
LLP, Portland, Oregon; Bryan L. Hawkins, Stoel Rives LLP,
Sacramento, California; for Defendants-Appellees.
Before: Raymond C. Fisher and Milan D. Smith, Jr., Circuit
Judges, and Lawrence L. Piersol, District Judge.
[*]
SUMMARY[**]
Fair
Credit Reporting Act
The
panel affirmed in part and vacated in part the district
court's summary judgment in favor of defendants in an
action under the Fair Credit Reporting Act, and remanded for
further proceedings.
FCRA
requires employers who obtain a consumer report on a job
applicant to provide the applicant with a "clear and
conspicuous disclosure" that they may obtain such a
report (the "clear and conspicuous" requirement)
"in a document that consists solely of the
disclosure" (the "standalone document"
requirement) before procuring the report.
The
panel held that a prospective employer violates FCRA's
"standalone document" requirement by including
extraneous information relating to various state disclosure
requirements in that disclosure. The panel concluded that
defendant's form violated this requirement, as well as
the "standalone document" requirement of
California's Investigative Consumer Reporting Agencies
Act. The panel further held that defendant's disclosure
did not satisfy FCRA's and ICRAA's "clear and
conspicuous" requirements because, although the
disclosure was conspicuous, it was not clear.
The
panel addressed additional issues in a concurrently-filed
memorandum disposition.
OPINION
FISHER, CIRCUIT JUDGE.
The
widespread use of credit reports and background checks led
Congress to pass the Fair Credit Reporting Act (FCRA) to
protect consumers' privacy rights. FCRA requires
employers who obtain a consumer report on a job applicant to
provide the applicant with a "clear and conspicuous
disclosure" that they may obtain such a report (the
"clear and conspicuous requirement") "in a
document that consists solely of the disclosure" (the
"standalone document requirement") before procuring
the report. 15 U.S.C. § 1681b(b)(2)(A)(i). This appeal
requires us to decide two questions: (1) whether a
prospective employer may satisfy FCRA's standalone
document requirement by providing job applicants with a
disclosure containing extraneous information in the form of
various state disclosure requirements, and (2) whether the
specific disclosure provided by the employer in this case
satisfied the clear and conspicuous requirement.
We held
in Syed v. M-I, LLC, 853 F.3d 492 (9th Cir. 2017),
that FCRA contains "clear statutory language that the
disclosure document must consist 'solely' of the
disclosure." Id. at 496. Consistent with
Syed, we now hold that a prospective employer
violates FCRA's standalone document requirement by
including extraneous information relating to various state
disclosure requirements in that disclosure. We also hold that
the disclosure at issue here is conspicuous but not clear.
Accordingly, we affirm in part, vacate in part and
remand.[1]
I.
Background
In the
process of applying for employment with CheckSmart Financial,
LLC, Desiree Gilberg completed a three-page form containing
an employment application, a math screening and an employment
history verification. Two weeks later, Gilberg signed a
separate form, entitled "Disclosure Regarding Background
Investigation," that is the subject of this litigation.
A copy of the disclosure is appended to this opinion. The
form appears to have been printed in Arial Narrow, size 8
font.
Because
the legal sufficiency of the FCRA disclosure provided to
Gilberg is in question, we include the full text of the
disclosure:
DISCLOSURE REGARDING BACKGROUND
INVESTIGATION
DISCLOSURE AND ACKNOWLEDGMENT
[IMPORTANT - PLEASE READ CAREFULLY BEFORE SIGNING
ACKNOWLEDGMENT]
CheckSmart Financial, LLC may obtain information
about you from a consumer reporting agency for employment
purposes. Thus, you may be the subject of a 'consumer
report' and/or an 'investigative consumer report'
which may include information about your character, general
reputation, personal characteristics, and/or mode of living,
and which can involve personal interviews with sources such
as your neighbors, friends, or associates. These reports may
include employment history and reference checks, criminal and
civil litigation history information, motor vehicle records
('driving records'), sex offender status, credit
reports, education verification, professional licensure, drug
testing, Social Security Verification, and information
concerning workers' compensation claims (only once a
conditional offer of employment has been made). Credit
history will only be requested where such information is
substantially related to the duties and responsibilities of
the position for which you are applying. You have the right,
upon written request made within a reasonable time after
receipt of this notice, to request whether a consumer report
has been run about you, and the nature and scope of any
investigative consumer report, and request a copy of your
report. Please be advised that the nature and scope of the
most common form of investigative consumer report obtained
with regard to applicants for employment is an investigation
into your education and/or employment history conducted by
Employment Screening Services, 2500 Southlake Park,
Birmingham, AL 35244, toll-free 866.859.0143,
www.es2.com or another outside organization. The
scope of this notice and authorization is all-encompassing;
however, allowing CheckSmart Financial, LLC to obtain from
any outside organization all manner of consumer reports and
investigative consumer reports now and, if you are hired,
throughout the course of your employment to the extent
permitted by law. As a result, you should carefully consider
whether to exercise your right to request disclosure of the
nature and scope of any investigative consumer report.
New York and Maine applicants or employees only: You
have the right to inspect and receive a copy of any
investigative consumer report requested by CheckSmart
Financial, LLC by contacting the consumer reporting
agency identified above directly. You may also contact the
Company to request the name, address and telephone number of
the nearest unit of the consumer reporting agency designated
to handle inquiries, which the Company shall provide within 5
days.
New York applicants or employees only: Upon request,
you will be informed whether or not a consumer report was
requested by CheckSmart Financial, LLC, and if such
report was requested, informed of the name and address of the
consumer reporting agency that furnished the report.
Oregon applicants or employees only: Information
describing your rights under federal and Oregon law regarding
consumer identity theft protection, the storage and disposal
of your credit information, and remedies available should you
suspect or find that the Company has not maintained secured
records is available to you upon request.
Washington State applicants or employees only: You
also have the right to request from the consumer reporting
agency a written summary of your rights and remedies under
the ...