LaFollette v. RoBal, Inc.

Filing 22

OPINION AND ORDER adopting Magistrate Judge Walter E. Johnsons Final Report and Recommendation 12 , overruling Plaintiff Stephanie LaFollettes Objections to the R&R 15 and granting Defendant RoBal, Inc.s Motion to Dismiss 4 . Signed by Judge William S. Duffey, Jr on 3/30/17. (ddm)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
STEPHANIE LAFOLLETTE,
Plaintiff,
v.

1:16-cv-2592-WSD

ROBAL, INC.,
Defendant.

OPINION AND ORDER
This matter is before the Court on Magistrate Judge Walter E. Johnson’s
Final Report and Recommendation [12] (“R&R”). The R&R recommends the
Court grant Defendant RoBal, Inc.’s Motion to Dismiss [4]. Also before the Court
are Plaintiff Stephanie LaFollette’s (“Plaintiff”) Objections to the R&R [15].
I.

BACKGROUND
A.

Facts1

On or about November 2015, Plaintiff applied for employment with
Defendant. (Compl. ¶ 14). As part of that application, Plaintiff completed

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The facts are taken from the R&R and the record. The parties have not
objected to any specific facts in the R&R, and the Court finds no plain error in
them. The Court thus adopts the facts set out in the R&R. See Garvey v. Vaughn,
993 F.2d 776, 779 n.9 (11th Cir. 1993).

Defendant’s “Employee Applicant Background Check Authorization/Order Form”
(the “Form”). (Compl. ¶ 15; see also Compl. Ex. D [1.4] (copy of Form)). The
Form states that “[t]he undersigned (i) confirms that it [sic] has authorized the
above named Client to obtain a background check for employment purposes
including, without limitation, a consumer report and criminal background check on
the undersigned.” (Compl. ¶ 16). The Form also states in a separate paragraph the
following:
THE UNDERSIGNED RELEASES AND HOLDS HARMLESS
INFORMATION ON DEMAND, INC. AND ITS AGENTS AND
REPRESENTATIVES, AND ALL ENTITITES AND
INDIVIDUALS INVOLVED IN REPORTING INFORMATION
ABOUT THE UNDERSIGNED, FROM ANY AND ALL
CLAIMS BY, OR LIABILITY TO, THE UNDERSIGNED THAT
MAY RESULT FROM, ARISE OUT OF, OR IN CONNECTION
WITH THE CHECK AND CONSENTS TO THE ABOVE
NAMED EMPLOYER TO [SIC] PERFORM PERIODIC
BACKGROUND CHECKS FOR THE DURATION OF MY
EMPLOYMENT WITH THIS COMPANY.
(Compl. ¶ 17 (capital letters and bold in original)).
The Form states that defendant certifies that it “has provided to the subject
of the Background Report a clear and conspicuous written disclosure, in a
document that consists solely of the disclosure, that a consumer report may be
obtained for employment purposes.” (Compl. ¶ 18). Plaintiff alleges that
Defendant never provided her with a document that consists solely of the

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disclosure that it may obtain a consumer report for employment purposes. (Compl.
¶ 19). On November 25, 2015, Defendant obtained Plaintiff’s consumer report
from a consumer reporting agency called Information on Demand. (Compl. ¶ 20).
B.

Procedural History

On July 18, 2016, Plaintiff filed her Complaint on behalf of herself and a
putative class, asserting that Defendant violated the Fair Credit Reporting Act’s
(“FCRA”) “stand-alone disclosure requirement,” 15 U.S.C. § 1681b(b)(2)(A).
Plaintiff does not claim that she or the putative class suffered any actual damages,
but seeks instead statutory damages, costs, and attorneys’ fees. (Compl. ¶¶ 37-38).
On September 28, 2016, Defendant filed its Motion to Dismiss, arguing that
Plaintiff lacks standing to sue under the Supreme Court’s decision in Spokeo, Inc.
v. Robins, 136 S. Ct. 1540 (2016).
On November 21, 2016, the Magistrate Judge issued his R&R. The
Magistrate Judge found that the weight of authority holds that a plaintiff who
receives the disclosure required under the FCRA, but not in the format required by
the FCRA, has not suffered a sufficiently concrete injury to have Article III
standing.
On December 9, 2016, Plaintiff filed her Objections to the R&R. Plaintiff
argues that Spokeo did not alter standing jurisprudence, and that the Magistrate

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Judge erred in finding that a plaintiff who receives the disclosure required under
the FCRA, but not in the format required by the FCRA, has not suffered a
sufficiently concrete injury to have Article III standing.
II.

DISCUSSION
A.

Legal Standards
1.

Review of a Magistrate Judge’s Report and Recommendation

After conducting a careful and complete review of the findings and
recommendations, a district judge may accept, reject, or modify a magistrate
judge’s report and recommendation. 28 U.S.C. § 636(b)(1); Williams
v. Wainwright, 681 F.2d 732, 732 (11th Cir. 1982) (per curiam). A district judge
“shall make a de novo determination of those portions of the report or specified
proposed findings or recommendations to which objection is made.” 28 U.S.C.
§ 636(b)(1). Where no party has objected to the report and recommendation, the
Court conducts only a plain error review of the record. United States v. Slay,
714 F.2d 1093, 1095 (11th Cir. 1983) (per curiam). Plaintiff filed detailed
objections, and the Court conducts its de novo review.
2.

Motion to Dismiss Standard

On a motion to dismiss, the Court must “assume that the factual allegations
in the complaint are true and give the plaintiff[] the benefit of reasonable factual

4

inferences.” Wooten v. Quicken Loans, Inc., 626 F.3d 1187, 1196 (11th Cir.
2010). Although reasonable inferences are made in the plaintiff’s favor,
“‘unwarranted deductions of fact’ are not admitted as true.” Aldana v. Del Monte
Fresh Produce, N.A., 416 F.3d 1242, 1248 (11th Cir. 2005) (quoting S. Fla. Water
Mgmt. Dist. v. Montalvo, 84 F.3d 402, 408 n.10 (11th Cir. 1996)). Similarly, the
Court is not required to accept conclusory allegations and legal conclusions as true.
See Am. Dental Ass’n v. Cigna Corp., 605 F.3d 1283, 1290 (11th Cir. 2010)
(construing Ashcroft v. Iqbal, 556 U.S. 662 (2009); Bell Atl. Corp. v. Twombly,
550 U.S. 544 (2007)).
“To survive a motion to dismiss, a complaint must contain sufficient factual
matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’”
Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570). Mere “labels and
conclusions” are insufficient. Twombly, 550 U.S. at 555. “A claim has facial
plausibility when the plaintiff pleads factual content that allows the court to draw
the reasonable inference that the defendant is liable for the misconduct alleged.”
Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556). This requires more than
the “mere possibility of misconduct.” Am. Dental, 605 F.3d at 1290 (quoting
Iqbal, 556 U.S. at 679). The well-pled allegations must “nudge[] their claims

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across the line from conceivable to plausible.” Id. at 1289 (quoting Twombly, 550
U.S. at 570).
B.

Analysis

The FCRA provides that a person may not procure a consumer report, or
cause a consumer report to be procured, for employment purposes with respect to
any consumer, unless—
(i) a clear and conspicuous disclosure has been made in writing to the
consumer at any time before the report is procured or caused to be
procured, in a document that consists solely of the disclosure, that a
consumer report may be obtained for employment purposes; and
(ii) the consumer has authorized in writing (which authorization may
be made on the document referred to in clause (i)) the procurement of
the report by that person.
15 U.S.C. § 1681b(b)(2)(A)(i)-(ii) (emphasis added).
The allegations of the Complaint and the Form itself show that:
(1) Defendant provided a disclosure to Plaintiff that a consumer report may be
obtained for employment purposes before Defendant procured a report; and
(2) Plaintiff authorized in writing the procurement of that report. Plaintiff does not
allege that the disclosure was misleading or confusing, that she was unaware that a
consumer report was being requested, or that Defendant used the consumer report
inappropriately.

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In addition to the required disclosure, the Form also includes “extraneous
information,” such as the release and hold harmless paragraph. Plaintiff contends
Defendant violated the FCRA’s “stand-alone disclosure requirement,” that is,
Defendant failed to place the disclosure in a “document that consists solely of the
disclosure” as required under 15 U.S.C. § 1681b(b)(2)(A)(i). The question here is
whether Plaintiff has Article III standing to pursue her claim that Defendant
violated the FCRA’s stand-alone disclosure requirement.
In Spokeo, the Supreme Court reiterated that a plaintiff invoking federal
jurisdiction must establish: (1) an injury in fact; (2) fairly traceable to the
challenged conduct of the defendant; and (3) likely to be redressed by a favorable
judicial decision. 136 S. Ct. at 1547. Defendant argues Plaintiff has not
established that she suffered an injury in fact. The injury in fact element requires a
plaintiff to show that she suffered “an invasion of a legally protected interest” that
is “concrete and particularized” and “actual or imminent, not conjectural or
hypothetical.” Id. at 1548. For an injury to be particularized, it “must affect the
plaintiff in a personal and individual way.” Id. To be concrete, an injury must be
“de facto”—that is, it must be real; it must actually exist. Id. Intangible injuries
can be concrete. Id. at 1549. A bare procedural violation of a statute like the
FCRA, however, does not satisfy the “concrete” element for Article III standing,

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because a violation of the FCRA’s procedural requirements may result in no harm.
Id. at 1550.
Plaintiff asserts that, because she was not provided with the statutorily
mandated information in the format required, she sustained particularized and
concrete harm in the form of an informational injury and an invasion of her
privacy, both of which are sufficient for Article III standing. As an initial matter,
the Court agrees with the Magistrate Judge that the weight of authority holds that a
bare violation of the stand-alone disclosure requirement does not, in itself,
constitute an injury in fact.2 The Court acknowledges, however, that there is
authority to the contrary, and the matter is not settled in federal courts, including in
our Circuit.3
2

See, e.g., In re Michaels Stores, Inc., No. 2615, 2017 WL 354023 (D.N.J.
Jan. 24, 2017); Tyus v. U.S. Postal Serv., No. 15-cv-1467, 2017 WL 52609, at *6
(E.D. Wis. Jan. 4, 2017); Lee v. Hertz Corp., No. 15-cv-04562-BLF, 2016 WL
7034060, at *5 (N.D. Cal. Dec. 2, 2016); Kirchner v. First Advantage Background
Servs. Corp., No. CV 2:14-1437 WBS EFB, 2016 WL 6766944, at *3 (E.D. Cal.
Nov. 14, 2016); Shoots v. iQor Holdings US Inc., No. 15-cv-563 (SRN/SER), 2016
WL 6090723, at *5-8 (D. Minn. Oct. 18, 2016); Nokchan v. Lyft, Inc., No. 15-CV03008 JCS, 2016 WL 5815287, at *6 (N.D. Cal. Oct. 5, 2016); Landrum
v. Blackbird Enters., LLC, No. CV H-16-0374, 2016 WL 6075446, at *4 (S.D.
Tex. Oct. 3, 2016); Fisher v. Enter. Holdings, Inc., No. 4:15-cv-00372 AGF, 2016
WL 4665899, at *4 (E.D. Mo. Sept. 7, 2016); Smith v. Ohio State Univ., No. 2:15cv-3030, 2016 WL 3182675, at *1, 4 (S.D. Ohio June 8, 2016).
3
See, e.g., Hargrett v. Amazon.com DEDC LLC, No. 8:15-cv-2456-T-26EAJ,
2017 WL 416427, at *4 (M.D. Fla. Jan. 30, 2017); Moody v. Ascenda USA Inc.,

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1.

Informational Injury

The Supreme Court has held that “a plaintiff suffers an ‘injury in fact’ when
the plaintiff fails to obtain information which must be publicly disclosed pursuant
to a statute.” Fed. Election Comm’n v. Akins, 524 U.S. 11, 21 (1998). Spokeo
reaffirmed this principle. See Spokeo, 136 S. Ct. at 1549-50.
In support of her argument that Plaintiff suffered an informational injury,
Plaintiff relies on the Eleventh Circuit’s decision in Church v. Accretive Health,
Inc., 654 F. App’x 990 (11th Cir. 2016). In Church, the Eleventh Circuit applied
Spokeo in an FDCPA case. The plaintiff alleged that a collection agency mailed a
collection letter to the plaintiff which failed to include the disclosures required by
Section 1692e(11). Id. at 994. The Eleventh Circuit found that such a violation
was sufficient for standing, because “the invasion of [the plaintiff’s] right to
receive the disclosures is not hypothetical or uncertain; [the plaintiff] did not
receive information to which she alleges she was entitled.” Id. The court advised
that although such an informational injury may not have resulted in tangible

No. 16-CV-60364-WPD, 2016 WL 5900216 (S.D. Fla. Oct. 5, 2016);
Meza v. Verizon Commc’ns, Inc., No. 1:16-cv-0739 AWI MJS, 2016 WL
4721475, at *3 (E.D. Cal. Sept. 9, 2016).

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economic or physical harm, “the Supreme Court has made clear [that] an injury
need not be tangible to be concrete.” Id. at 995.
As an initial matter, the Court notes that the Church decision is not
published, and it is thus not binding on the Court. See Bravo v. United States,
532 F.3d 1154, 1164 n. 5 (11th Cir.2006) (unpublished opinions are not binding
precedent). The Court also finds that Plaintiff’s reliance on Church is misplaced,
because the facts and the violation at issue are different. In Church, the violation at
issue was a failure to receive a required disclosure. Here, Plaintiff does not argue
that she did not receive the information required by the FCRA; she asserts that she
did not receive the information in the precise form required under the FCRA.
As the Southern District of Texas recently explained, “[a] statutory right to
information is substantive. A statutory right to receive that information in a
particular format is procedural.” Landrum v. Blackbird Enters., LLC, No. cv H16-374, ––– F. Supp. 3d –––, 2016 WL 6075446, at *4 (S.D. Tex. Oct. 3, 2016)
(emphasis in original). Put another way, “[t]he goal of the stand-alone requirement
is a substantive one: to ensure that certain information is in fact conveyed clearly
to job applicants. The means chosen to implement that goal, however, are purely
formal: the portion of the statute at issue prescribes the physical format that the
disclosure must take.” In re Michaels Stores, Inc., Civ. No. 14-7563 (KM) (JCB),

10

2017 WL 354023, at *6 (D. N.J. Jan. 24, 2017); see also Albu, 1:15-cv-412 ([63] at
30-32) (finding that Church did not apply to the stand-alone disclosure requirement
because the plaintiff in Church did not receive the required disclosures and was, in
fact, deprived of information Congress deemed necessary for the protection of
consumers).
Plaintiff here does not allege that she has suffered the harm addressed by
Congress’s promulgation of the stand-alone disclosure rule, namely an applicant’s
failure to understand that he or she was authorizing an employer background
check. Plaintiff does not allege the form of the disclosure caused her confusion or
caused her to fail to understand the disclosure. “Where, as here, plaintiffs do not
allege that they did not see the disclosure, or were distracted from it, the
allegations amount to no more than a bare procedural violation of the stand-alone
requirement[,]” and Plaintiff’s allegations do not confer standing on an
informational injury theory. Id. at *8-9; see also Landrum, 2016 WL 6075446, at
*4 (“[Plaintiff] has pled only a bare procedural violation.”); accord
Mitchell v. WinCo Foods, LLC, No. 1:16-cv-00076-BLW, 2017 WL 901093, at
*2-3 (D. Idaho Mar. 7, 2017); Fields v. Beverly Health & Rehab. Servs., Inc., No.
CV 16-527, 2017 WL 812104, at *6 (D. Minn. Mar. 1, 2017); Albu v. The Home
Depot, Inc., 1:15-cv-412-ELR (N.D. Ga. Nov. 2, 2016) (R&R adopted March 20,

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2017); cf. Nicklaw v. Citimortgage, 839 F.3d 998, 1003 (11th Cir. 2016) (“[T]he
requirement of concreteness under Article III is not satisfied every time a statute
creates a legal obligation and grants a private right of action for its violation . . . .
A plaintiff must suffer some harm or risk of harm from the statutory violation to
invoke the jurisdiction of a federal court.”).4
2.

Invasion of Privacy

Plaintiff next argues that, by violating the stand-alone disclosure
requirement, Defendant invaded her privacy, and that this invasion of her privacy
confers Article III standing. “[A]n invasion of consumers’ privacy was among the
harms that Congress identified and sought to prevent by passing the FCRA.” In re
Michaels Stores, 2017 WL 354023, at *9 & n.17 (citing, among others,
Safeco v. Burr, 551 U.S. 47, 52, 127 S. Ct. 2201, 167 L.Ed. 2d 1045 (2007)
(“Congress enacted FCRA ... to protect consumer privacy.”).

4

In finding that a bare violation of the stand-alone disclosure requirement is
sufficient for standing, the court in Hargrett v. Amazon.com DEDC LLC, No.
8:15-cv-2456-T-26EAJ, 2017 WL 416427, at *4 (M.D. Fla. Jan. 30, 2017) relied,
in part, on Church for the proposition that not receiving information to which one
is statutorily entitled is a “concrete” injury. For the reasons stated above, the Court
finds Church does not apply here, and respectfully disagrees with the holding in
Hargrett.

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With respect to the question whether a bare violation of the stand-alone
disclosure requirement can result in an invasion of privacy for purposes of
standing, the District of New Jersey cogently explains:
Everyone agrees that an applicant would have standing under the
FCRA if the employer simply obtained a credit report without telling
the applicant, and without the applicant’s consent. On the other hand,
the applicant’s consent, after being informed that the employer would
be seeking such a report, vitiates any claim of a privacy violation.
Either way, the issue hinges on whether the applicant received
disclosure before consenting. The employer’s procurement of a
consumer report would not be unauthorized (and thus an invasion of
privacy) unless the applicant was in fact denied disclosure. That
Michaels did not comply with the stand-alone requirement, unless it
resulted in a deprivation of disclosure, adds nothing. Plaintiffs’
theory collapses on itself; without the addition of nondisclosure in
fact, it is indistinguishable from a bare procedural violation.
Id. at *10. The court continues:
Plaintiffs’ position amounts to a contention that a violation of the
standalone requirement automatically implies that the credit report is
unauthorized. That principle, if accepted, “would raise every
technical violation of [the FCRA] to the realm of a major substantive
harm. This is a leap too far, and is directly contradicted by Spokeo,
which made clear that some subset of violations are too small to
implicate—on a standing level—the interests protected by the larger
statutory framework.” Shoots v. iQor Holdings US Inc., No. 15-CV563 (SRN/SER), 2016 WL 6090723, at *4 (D. Minn. Oct. 18, 2016)
(citing Spokeo, 136 S. Ct. at 1550) (holding that plaintiff alleging
violation of the FCRA’s stand-alone disclosure requirement lacked
standing).
Id.; see also Landrum, 2016 WL 6075446, at *4 (holding that plaintiff did not
allege facts to support standing based on invasion of privacy where plaintiff did not

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allege that he did not know what he was authorizing or that he did not, in fact
authorize the report).
The Court finds the reasoning of the In re Michaels court, and other courts
that have reached a similar conclusion, sound. Plaintiff does not allege that she did
not actually sign the Form authorization, that she did not know what she was
authorizing, or that she did not read the disclosure on the Form. In other words,
she does not allege that she actually suffered an invasion of privacy when
Defendant procured her consumer report after receiving Plaintiff’s authorization.
The violation she alleges is purely procedural. The Court finds that the Plaintiff
fails to allege that she suffered an invasion of privacy.
Because Plaintiff fails to show that she suffered either an informational
injury or an invasion of her privacy, Plaintiff fails to show that she suffered the
particularized and concrete harm necessary to establish standing under Article III.
In Spokeo, the Supreme Court made it clear that “a violation of one of the FCRA’s
procedural requirements may result in no harm,” in which case a plaintiff will lack
Article III standing. 136 S. Ct. at 1549. As the Magistrate Judge concluded, “[i]f
that language is to be given any meaning, it must apply to cases like this one,
where the plaintiff challenges only extraneous information in an otherwise clear
and conspicuous FCRA form and concedes that the language did not confuse her or

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alter her informed consent.” (R&R at 11). Plaintiff here lacks Article III standing,
the Court lacks subject-matter jurisdiction over this action, and Defendant’s
Motion to Dismiss is granted.
III.

CONCLUSION
For the foregoing reasons,
IT IS HEREBY ORDERED that Magistrate Judge Walter E. Johnson’s

Final Report and Recommendation [12] is ADOPTED.
IT IS FURTHER ORDERED that Plaintiff Stephanie LaFollette’s
Objections to the R&R [15] are OVERRULED.
IT IS FURTHER ORDERED that Defendant RoBal, Inc.’s Motion to
Dismiss [4] is GRANTED.
IT IS FURTHER ORDERED that this action is DISMISSED.

SO ORDERED this 30th day of March, 2017.

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