Martin v. Fair Collections and Outsourcing, Inc.
MEMORANDUM OPINION. Signed by Judge George Jarrod Hazel on 6/29/2015. (aos, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
KEVIN D. MARTIN
JON ~ ~ ~~~
FAIR COLLECTIONS &
Case No.: G,JII-I-t-3191
Plaintiff Kevin Martin brings this two-count
that FCO willfully or negligently
See ECF NO.1 at
i 1. FCO
has moved to dismiss count one.
that Martin has failcd to state a claim. See ECF No. 11. In count one. Martin allegcs
(""FCO") as a class action under thc Fair Credit Reporting
~ 1681 el seq. (the "FCRA").
report lor cmploymcnt
15 U.S.C. ~ 1681 b(b)(2) by procuring
in writing to the consumer
without first providing
in a document
See id at ~ 53. A hearing is unnecessary.
or causing to be
a clcar and
solely of thc
See Loc. R. 105.6 (Md.). For the rcasons
below. FCO's motion to dismiss is DENIED.
In August 2014. Plaintiff Kevin D. Martin intcrviewed
No. I at'i
fiJr a position with Defendant
18. FCO offercd Martin the position. See hI. As part ofthc
process. Martin signed a form entitled "Consent
to Request Consumcr
Rcport and Investigativc
chccks on applicants
obtain a consumer
fi.mn requires the potential
See ECF No. 1-3. The disclosure
and uses the screening
to perfi.mn the background
report and/or consumer
form"). See id at ~ 19. FCO uses this form to
check. See id at
various other methods
are marked on Martin's
that Sterling will
lorm also rcquircs the potential
that Sterling may obtain additional
about the applicant
tools that could be uscd.
check. a searcb of a number of othcr databases.
report and scnd it to FCO fi.,r
from a number of sources. See id The 10rIn goes on to list investigative
which includes a criminal
See id A total of eight of the investigativc
See id The form then provides the following:
I acknowledge receipt of the attached summary of my rights undcr
the Fair Credit Reporting Act and. as rcquircd by law. any related
state summary 0 frights (collecti vel y "S ummarics 0 I' Rights").
This consent will not affect my ability to qucstion or disputc
of any infi.mnation
in a Report. I
makcs a conditional
disqualify mc based all or in part on my Rcport. I will bc provided
with a copy of the Report and anothcr copy of the Summarics of
Rights. and if I disagrce with the accuracy
of thc purported
days of my receipt of the
Report that I am challenging the accuracy of such infi.mnation
I hereby conscnt to this investigation
procure a Report on my background.
In order to verify my identity for the purposes
I am voluntarily releasing my date of birth. social
1 The selected investigative
tools are: criminal background check. SSN trace/address locator.
employment credit report. education veri fication. employment veri flcation. personal relerenee
veritlcation. professional license/certification.
and sex offender search.
security number and the other
that all employment
and fully understand
The name. address and telephone number of the nearest unit of the
Infosystems. Inc. I State Street. 24th Floor. J ew York. NY 10004
877-424-2457 or 5750 West Oaks Boulevard. Ste. 100
Rocklin. CA 95765 800-943-2589
or 6111 Oak Tree Boulc\'ard.
Independence. Oil 44131 1800-853-3228
See id The remainder of the form contains additional
See id It also requires the applicant to provide certain identifying
date the form. See id Finally. a summary
for residents of certain states.
and to sign and
of rights is [(lUnd on the last two pages. See id The
form is a total of five pages.
Afier Martin signed the disclosure
I(mn. Sterling completed
See id at ~ 32. The resulting report inaccurately
I()r a felony offense on August 18.2007
stated that Martin had been
South Carolina. See id at
Martin received a letter from FCO rescinding
the offer of employment
along with a copy of the background
to dispute the background
report. See id at'i 36.- Martin called both FCO and Sterling
Sterling stated that they ,,"ould respond to
Martin did not reeeive a reply and lost the job opportunity
at FCO. See id at 40-43.
STANDARD OF REVIEW
Federal Rule of Civil Procedure
12(b)(6) permits a defendant
for failure to state a claim upon whieh relief can be granted.
survive a motion to dismiss invoking
12(b)(6). "a complaint
to present a motion to
Fed. R. Civ. 1'. 12(b)(6). To
must contain sufficient
I()r Colleetions at FCO. and signatory on the letter. is also
named Kevin Martin but is not related to the I'laintifI see ECF No. I at 36. or. the Court
assumes. to the Kevin Martin who was actually arrested on August 18. 2007.
matter. accepted as true .. to state a claim to relief that is plausible on its face .... Asherl!!; \'. l!fhal.
556 U.S, 662. 678 (2009) (ciling Bell Allalllic COlli. ". 1'll'OlIIhI)'. 50 U.S. 544. 570 (2007)). "/\
claim has facial plausibility when the plaintiff pleads filctual content that allows the court to
draw the reasonable infcrcnce that the defendant is liable for thc misconduct allcgcd:' Id at 663.
"Thrcadbarc rccitals of thc clcmcnts of a causc of action. supportcd by mcrc conclusory
statcmcnts. do not sufficc:' /d. at 678-79; 7"l'omh~\'.550 U.S. at 545 ("a plaintitrs obligation to
provide thc 'grounds' of his 'cntitlelmcntj
to relicI' rcquircs morc than labels and conclusions.
and a formulaic rccitation ofa causc ofaction's
c1cmcnts will not do.").
Fed. R. Civ. P, 12(b)(6)'s purposc "is to test thc sufticicncy ofa complaint and not to
rcsolvc contcsts surrounding thc facts. thc mcrits of a claim. or thc applicability of dcf'cnscs:'
Presley \'. Cilyo(Charlolle.\Tille.
464 F.3d 480. 483 (4th Cir. 20(6) (citation and intcrnal
quotation marks omittcd). Whcn deciding a motion to dismiss undcr Rule 12(b)(6). a court "must
acccpt as truc all of the factual allegations eontaincd inthc complaint:' anclmust "draw all
rcasonablc inferences Ifrolll those facts I in favor of the plaintifr." 1:".1. d//
de Nemo//rs & Co
\'. Kolonlndlls .. Inc.. 637 F.3c1435. 440 (4th Cir. 201 J) (citations and internal quotation marks
omitted), The Court nccclnot. howcvcr. acccpt unsupported legal allegations. see Re\'elle \'.
Charles CO//III)'COIl//n'1'.1'.882 F.2d 870. 873 (4th Cir. J 989). legal conclusions couchcd as
factual allcgations. "apasall \'. Allaill. 478 U.S. 265.286 (1986). or conclusory filctuai
allcgations dcvoid of any rcfercnce to actual cvcnts. Uniled mack Fire!ighlers 4Nor!iJlk \'.
/Iirsl, 604 F.2d 844. 847 (4th Cir. 1979).
FCO movcs to dismiss count onc of Martin's Complain!. See ECF No. II. Count onc
allcgcs that FCO violated J 5 U.S,c. ~ J 681 b(b)(2) by "procuring or causing to bc procured a
consumer report for employmcnt purposes without tirst providing a c1car and conspicuous
disclosurc in writing to the consumer in a document that consists solcly of the disclosure that thc
consumer report may be obtaincd for employment purposcs:' ECF No. I at
'1 53. FCO argues
that this count should be dismisscd for two main reasons. First. FCO contcnds. Martin cannot
allege a violation of the FCRA because the disclosure form provided to Martin clearly mects thc
requiremcnts of the FCRA as a matter of law . .'1"" ECF No. 11-1 at I. Sccond. evcn if the
disclosure fonll docs violate the FCRA, FCO argucs that Martin cannot recover bccause he has
neither alleged that FCO's negligencc in violating the statute caused him actual damagcs nor that
FCO acted willfully in violating thc statute . .'1"" itl. at 2.
A. The Disclosure Form
The Court will lirst address whcther Martin's Complaint statcs a claim that thc I'CO form
violates 15 U.S.c. ~ 168 Ib(b )(2). The FCRA was cnacted ..[t 10 saleguard the consumcr in
connection with the utilization of credit:' Pub. L. No. 90-321. 82 Stat. 146 (2003). Scction
. . . a pcrson may not procurc a consumcr rcport. or causc a
consumcr report to be procured. ric)remployment purposes with
rcspect to any consumer. unless-(i) a clear and conspicuous disclosure has bcen madc in writing to
thc consumcr at any timc before the report is procured or caused to
be procured, in a document that consists so!,,!y of thc disclosure.
that a consumcr report may be obtaincd Ii))" employment purposes:
(ii) the consumer has authorized in writing (which authorization
may be made on the document relerred to in clause (i)) the
procurement of the report by that person.
15 U.S.c. ~ 1681b(b )(2)(A) (emphasis added)
FCO contends its disclosurc form complies with this statute . .'1"" ECF No. I I-I at 5-7.
Martin alleges that the form does not "solely" contain thc disclosure as required by law.
No. I at
To resolve this dispute. the Court must consider what is meant by the word
"solely"' in the statute.
In interpreting a statute. the court tirst looks at whethcr the language has a plain and
unambiguous meaning. Robinson\". Shell Oil Co.. 519 U.S. 337. 340 (1997). "The plainness or
ambiguity of statutory languagc is determined by referencc to the language itsell: the spcci lic
contcxt in which that language is used. and the broader context of the statute as a whole:' Id at
341. "Solely" is defined by Merriam- Webster' s online dictionary as "without anything or anyone
else involved" and as ..to the exclusion of all else:' See ECF NO.1 at 6 n.l: .Iee also
Further. this speciJic statute has been
repeatedly addressed and interpreted by the Federal Trade Commission ("'FTC'). In one advisory
opinion. the FTC explained that "[ilt is our view that Congress intended that the disclosure not
be encumbered with extraneous information. However. some additional information. such as a
brief description of the nature of the consumer reports covered by the disclosure. may be
included if the information does not confuse the consumer or detract from the mandated
disclosure:' Advisory Opinion to Coffey. Feb. 11. 1998. amilahie al
icy/a(h'i.ID1)'.opillions/a(h'is(II'.1'-()pi nion-cojf'e.I'-02 -11- 98. In anothcr
advisory opinion on the issue. the FTC stated that the disclosure notice and authorization may be
combined into one document. See Ai/I'i.WJI)' Opinion
Hau.nrell. June 12. 1998. amilahie
In that same
opinion the FTC cautioned that " ... the form should not contain any extraneous information:'
See id. In fact. the FTC explained that the inclusion ofa waiver by the consumer of his or her
rights under the FCRA in a disclosure form "will violate Section 604(b)(2)(A) of the FCRA"
becausc it is extraneous information. See ill. With the inclusion of the waiver. the form no longer
consists '''solely' of the disclosure that a consumer report may be obtained for employment
purposes:' See hi. [n a third opinion on this topic. the FTC further advised that "Itlhe disclosure
may not be part of an employment application" because it would not be "in a document that
consists solely of the disclosure:' See Advisory Opinion to Leathers. Sept. 9. 1998. an/ilahle
h'Ips: /11, '1' '\ ,'..fi c.go, 'ipol i (~I'/(/l'"i,I'IJ1) '-opi n ions/a!'" i,I'IJ1)'-opin i oil-lea' he 1'.1'- 1)-()1)-1)8.
Here. in addition to the disclosure that the consumer report would be obtained for
employment purposes. FCO's form contains an authorizatioll to obtain the report. inf(lI'Ination on
when the applicant must challenge the aceuracy of any report. an acknowledgement that the
employee understands that 'all employment decisions are based on legitimate non-discriminatory
reasons: the name. address and telephone number of the nearest unit of the consumer reporting
agency designated to handle inquiries regarding the investigative consumer report. and several
pieces of state-specific information. See ECF No. 1-3. The form is a total of five pages. See iii.
With all of this information. there is no question that FCO's disclosure j()[In contains more than
a disclosure that the background check would be obtained and an authorization to obtain the
infomlation. Thus. under the plain language of the statute. FCO's disclosure form does not
contain "solely the disclosure:' and the Court cannot say. as a matter of law. that it is acceptable
under the FCRA. Plaintiff: therefore. states a claim that the disclosure f()[In violates the FCRA.
Pizza. LLC. DKC-II-1823.
2012 WL 245965 at *7-8 (D. r-vld.Jan.
25. 2012) (denying motion to dismiss claim that defendant violated FCRA' s disclosure
requirements where defendant's form contained more than the disclosure and authorizationnamely. a liability release-so
the defendant could not show. as a matter of law. that its form
complied with the FCRA): h1l/
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