Witt et al v. CoreLogic SafeRent, LLC

Filing 56

MEMORANDUM OPINION. Signed by District Judge Robert E. Payne on 4/8/2016. (jsmi, )

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 1 of 21 PageID# 540

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
Richmond Division

CAROLYN WITT, et al.,
Plaintiffs,

v.

Civil Case No. 3:15-cv-386

CORELOGIC SAFERENT, LLC, et al.,
Defendants.

MEMORANDUM OPINION
This matter
DISMISS

is

PLAINTIFFS'

ALTERNATIVE,

before

the

SECOND

Court

AMENDED

TO TRANSFER VENUE

set forth herein,

on

DEFENDANTS'

COMPLAINT

(ECF No.

MOTION TO
IN

OR,

THE

For the reasons

51) .

the motion will be granted in part and denied

in part.

BACKGROUND
On

February

Alphonso
Eric

Robertson

Gonzalez

Hackett

2,

II

Complaint

("Gonzalez"),

Willie

Stanley,

(collectively,
("SAC,"

ECF No.

White
Jr.

Edwards

("Stanley"),

Allen

filed

("Witt"),
("Allen''),

("Edwards"),
Shondel
and
a

LLC

Lewis

Roberts

David Holmes

Second Amended

on behalf of themselves

In the SAC,

CoreLogic SafeRent,

Witt

("White"),

"Plaintiffs")
50)

Carolyn

Christopher

Jourdin

Tony

others similarly situated.
defendants,

Plaintiffs

("Robertson") ,

("Hackett"),

("Roberts"),
("Holmes")

2016,

and all

Plaintiffs allege that

("SafeRent")

and its sister

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 2 of 21 PageID# 541

company

CoreLogic

National

Background

Data,

("NBD")

LLC

(collectively, "Defendants"), violated the Fair Credit Reporting
Act
Count

( "FCRA") .
I,

The

SAC

brought
class,

nationwide

against
alleges

alleges

four

SafeRent
that

Counts

on

SafeRent

behalf

under
of

violated

the
a

15

1681k(a), which requires that:
A consumer reporting agency which furnishes
a consumer report for employment purposes
and which for that purpose compiles and
reports items of information on consumers
which are matters of public record and are
likely to have an adverse effect upon a
consumer's
ability
to
obtain
employment
shall(1)
at
the
time
such
public
record
information is reported to the user of such
consumer report, notify the consumer of the
fact that public record information is being
reported by the consumer reporting agency,
together with the name and address of the
person to whom such information is being
reported; or
(2) maintain strict procedures designed to
insure
that
whenever
public
record
information which is likely to have an
adverse effect on a consumer's ability to
obtain employment is reported it is complete
and up to date.
For purposes of this
paragraph, items of public record relating
to arrests, indictments, convictions, suits,
tax liens, and outstanding judgments shall
be considered up to date if the current
public record status of the item at the time
of the report is reported.

15 U.S.C.

§

1681k(a).

The class alleged in Count I is:

FCRA.

putative
U.S.C.

§

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 3 of 21 PageID# 542

All natural persons residing in the United
States (a) who were the subject of a report
sold
by
Defendant
SafeRent;
(b)
where
Defendant SafeRent's database indicates that
the report was furnished for an employment
purpose; (c) Defendant SafeRent's database
showed that the report contained at least
one adverse
criminal
record "hit;"
(d)
within the five period preceding the filing
of this action and during pendency.
Excluded from the class definition are any
employees, off ice rs, directors of Defendant
SafeRent, any attorney appearing in this
case, and any judge assigned to hear this
action.
SAC

~

58.
There is also an alternate sub-class:
All natural persons residing in the United
States (a) who were the subject of a report
sold
by
Defendant
SafeRent;
(b)
where
Defendant SafeRent's database indicates that
it was furnished for an employment purpose;
(c)
where
Defendant
SafeRent' s
database
showed that the report contained at least
one
adverse
criminal
"hit"
from
a
jurisdiction form which Defendant SafeRent
does not obtain at least four digits of an
associated
social
security
number;
(d)
within the five year period preceding the
filing date of this Complaint and during its
pendency.
Excluded from the class definition are any
employees, officers, directors of Defendant
SafeRent, any attorney appearing in this
case, and any judge assigned to hear this
Action.

Id.

~

59.
Count

II,

pled

against

both

Defendants,

alleges

that,

should the Court find that the background reports provided by

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 4 of 21 PageID# 543

Defendants were not
furnished

consumer

for "employment purposes," then Defendants
reports

violation of 15 U.S.C.

§

without

1681b.

a

permissible

purpose

in

The asserted class consists of:

All natural persons residing in the United
States who were the subject of a report sold
by SafeRent to NBD and/ or NBD to any third
party within the five year period preceding
the filing of this action and during its
pendency.
Excluded from the class definition are any
employees,
officers,
directors
of
Defendants, any attorney appearing in this
case, and any judge assigned to hear this
action.
SAC

<JI

73.
Count

nationwide

III,

brought

class,

against

alleges

that

NBD
NBD

on

behalf
violated

of

a

15

1681e (e) (2), which requires that:
A person who procures a consumer report for
purposes of reselling the report (or any
information in the report) shall(A) Establish and comply with reasonable
procedures designed to ensure that the
report (or information) is resold by
the person only for a purpose for which
the
report may be
furnished
under
section 1681b of this title, including
by requiring that each person to which
the report (or information) is resold
and that resells or provides the report
(or information) to any other person(i)
(ii)

identifies each end user of the
resold report (or information);
certifies each purpose for which
the report (or information) will
be used; and

putative
U.S.C.

§

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 5 of 21 PageID# 544

certifies that the report (or
information) will be used for no
other purpose; and

(iii)

(B)

before
reselling
the
report,
make
reasonable
efforts
to
verify
the
identifications and certifications made
under subparagraph (A) .

Specifically,
1681e(e) (2) (A) (i)
users

of its

Plaintiffs
by

reports.

allege

improperly

that

failing

to

NBD

violated

identify

the

Plaintiffs have defined the Count

§

endIII

class to include:
All natural persons residing in the United
States (a) who were the subject of a report
sold by Defendant National Background Data
to any third party; (b) for which Defendant
National Background Data did not obtain the
name of the end user from its reseller
customer at the time that it furnished the
report;
(d) during the five year period
preceding the filing date of the Complaint
and during its pendency.
Excluded from the class definition are any
employees, officers, directors of Defendant
National
Background
Data,
any
attorney
appearing
in this
case,
and any judge
assigned to hear this action.
Id.

<JI

87.

Count
SafeRent

IV is
pursuant

an individual claim,
to

15

U.S.C.

§

brought by Witt against
1681e(b).

That

requires that:
Whenever
a
consumer
reporting
agency
prepares a consumer report it shall follow
reasonable
procedures
to
assure
maximum
possible
accuracy
of
the
information
concerning the individual about whom the

section

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 6 of 21 PageID# 545

report relates.
15

U.S.C.

1681e(b).

§

Witt

alleges

that

SafeRent

"failed to

establish or to follow reasonable procedures to assure maximum
possible accuracy in the preparation of the consumer report it
furnished regarding Plaintiff Witt."

SAC

<JI

102.

The SAC alleges that both Defendants committed all of the
above

violations

willfully,

and

therefore

statutory and punitive damages on all counts.

the

SAC

seeks

Witt also seeks

actual damages on Count IV.
FACTUAL BACKGROUND

NBD is a

reseller consumer reporting agency that provides

its customers access to a database
"the
NBD' s

Database")
customers,

agencies

of

criminal

("The Multistate Database" or

record

which in this

SAC

information.

32.

<JI

instance are consumer reporting

( "CRAs"), pay to search the Multi state Database by way

of the Internet.

The Multistate Database then returns results

(such as arrest records) that match the search criteria that are
entered by NBD's customer.

Id.

<JI

31.

The Multistate Database is owned and managed by SafeRent, a
sister company to NBD.

Id.

<JI

criminal

in

the

Id.

<JI<JI

record

governmental
records

in

data

sources.
bulk,

formats

32.

Saf eRent obtains most of the
Database

42-44.

those

records

electronically

SafeRent
so

buys

that

properly incorporated into the Multistate Database,

they

from

criminal
can

be

and updates

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 7 of 21 PageID# 546

the

records

at

varying

Because

Id.

intervals.

purchases criminal record data in bulk,

SafeRent

the public records

in

the Multistate Database often contain only limited identifying
For

information.
rarely,

if ever,

example,

public

records

purchased

contain Social Security Numbers

in

bulk

( "SSNs"),

and

sometimes do not contain other identifying data such as middle
names or addresses.

Id.

The Class Plaintiffs present factually similar cases.
Plaintiffs

reside

in Virginia

and have applied for

opportunities within the last five years.
also

allege

years,

that,

at

some

point

SAC

within

employment

15.

Plaintiffs

last

twenty-two

<J[

the

All

each was the subject of a background report provided by

SafeRent

and

NBD.

Id.

<J[<J[

20-31.

Each

of

these

background

reports was purchased by one of NBD's CRA customers, which then
resold an edited version of the report.
Plaintiffs
Stanley,
background

and

Allen,
Witt

checks

Edwards,

further
in

that occurred within the last

<J[<J[

that

with

five

16-18.
Roberts,

White,

Hackett,

specify

conjunction

Id.

NBD

provided

employment

years.

SAC

their

applications

<J[<J[

21,

23-27.

Each of those background checks contained criminal record "hits"
to

attributed

the

enumerated

Plaintiffs.

Id.

38.

Furthermore, each of those Plaintiffs alleges that he or she was
denied employment based on the information supplied by SafeRent
and NBD.

Id.

<J[<J[

21, 23-27.

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 8 of 21 PageID# 547

PROCEDURAL HISTORY

The original Complaint in this action was filed on June 26,
2015.

{ECF No. 1).

{ECF No.

9)

SafeRent filed its first motion to dismiss

on August 31,

2015,

on the grounds that:

were

{2)

time-barred;

SafeRent

was

not

subject

the

Hines,

claims of Plaintiffs Tyrone Henderson and James O.

{1)

Jr.

to

personal

jurisdiction in Virginia with respect to the claims of Plaintiff
John

Moore;

and

Plaintiff Witt's
venue.

those

{ 3)

claims

(ECF No. 10).

claims

having

been

dismissed,

should also be dismissed for

improper

Less than 24 hours later, in an apparent

attempt to circumvent the issues raised in SafeRent's motion to
dismiss,
largely

Plaintiffs
identical

to

filed
the

an

Amended

original

Complaint,

Complaint

which

except

for

was
the

addition of brief and vague allegations pertaining to fourteen
newly proposed Named Plaintiffs.

{EC F No . 12 ) .

Both SafeRent and NBD again moved to dismiss pursuant to
Fed.
2016,

R.

Civ.
the

P.

12 (b) (6).

Court

granted

(ECF Nos.

26,

Defendants'

motions

dismissed the claims of Plaintiffs Henderson,
with prejudice.

(ECF No.

49).

On January 12,

37).

in

Hines,

part

and

and Moore

The Court also found that the

claims of the fourteen so-called "Newly Named Plaintiffs" lacked
any factual

support,

any FCRA violations.
Named

Plaintiffs'

and therefore

failed to plausibly allege

Accordingly, the Court dismissed the Newly

claims

without

prejudice

and with

leave

to

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 9 of 21 PageID# 548

amend.

Id.

Defendants' motion to dismiss the Amended Complaint

was therefore denied as moot as to Witt.
The

SAC

attempts

to

cure

Complaint by adding additional
fourteen

Newly

Named

Plaintiffs do not

the

defects

details

Plaintiffs

appear

Id.

(the

in the

of

the

Amended

concerning nine of the
other

five

Newly

Named

Defendants have again

SAC) .

moved to dismiss on the ground that the SAC fails to satisfy the
requirements

of

Fed.

R.

Civ.

P.

8 (a)

and

12 (b) (6).

For

the

reasons set forth herein, the motion will be granted in part and
denied in part.
DISCUSSION
A. Legal Standard

Fed.

R.

Civ.

P.

12(b) (6)

permits

a

party

to

move

for

dismissal of a claim if the complaint fails "to state a claim
upon which

relief

can be

granted."

Fed.

R.

Civ.

P.

8 (a) (2)

requires "a short and plain statement of the claimn showing that
the

pleader

dismiss,

a

is

entitled to

complaint

must

relief.
contain

"To survive
sufficient

a

motion

factual

to

matter,

accepted as true, to 'state a claim to relief that is plausible
on

its

(quoting

face.'"
Bell

Ashcroft
Atlantic

v.

Iqbal,

Corp.

v.

556

U. s.

Twombly,

662,

550

678

U.S.

(2009)

544,

570

{2007)).
Courts
allegations

should
in

the

assume

the

Complaint,

veracity
and

of

should

all
deny

well-pleaded
a

motion

to

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 10 of 21 PageID# 549

dismiss where those well-pleaded allegations
claim for relief.
the

pleader's

Id.

at

That is,

679.

description

of

what

state a

plausible

a court "will accept

happened ... along

with

any

conclusions that can be reasonably drawn therefrom," but "need
not accept conclusory allegations encompassing the legal effects
Charles A.

of the pleaded facts."

Wright

Federal Practice and Procedure§ 1357
Old Dominion Sec. Co., L.L.C.,

&

Arthur R.

Miller,

(3d ed. 1998); Chamblee v.

2014 WL 1415095, at *4

(E.D. Va.

A claim is "plausible" when the plaintiff pleads facts

2014).

sufficient to allow the court to draw the reasonable inference
that

the

defendant

Twombly,

550

U.S.

dismiss,

however,

at

is

liable

the

A court

556.

where

for

the

alleged

should grant

allegations

are

misconduct.
a

motion

nothing more

to

than

legal conclusions, or where they permit a court to infer no more
than a possibility of misconduct.

Iqbal, 556 U.S. at 678-79.

The Supreme Court made clear in Iqbal that,
claims

that

are plausible

from those

that

must distinguish between "on the one hand,
in

a

conclusory

manner

a

defendant's

to distinguish

are

not,

other,

statements

containing

court

statements alleging

conformity

proscribed activity with accompanying threadbare
the

the

factual

to

legally

facts,

allegations

and on
that,

separated from mere restatements of legal elements of a claim,
assert

plausible

2012 WL 272807,

grounds
at *5

for

(D.N.J.

relief."
Jan.

27,

Gutierrez
2012).

v.

TD

Bank,

In other words,

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 11 of 21 PageID# 550

allegations

of

wrongful

conduct

that

are

framed

"exclusively

within the terms of the relevant statutes or case law authority"
fail to meet this standard.
Although

courts

Id.

generally

do

not

consider

evidence in deciding motions under Rule 12 (b) ( 6),
consider ... documents
documents

sufficiently

converting the
as

the

(E.D. Va. 2009)
396

v.

a

plaintiff's
in

and

into one for summary judgment,

so long

documents

Dornoch

the

claim,

without

the

to

"a court may

complaint

authenticity of
LLC

to

referred

[motion]

Nutritionals,

396,

central

extrinsic

is

Ltd.,

667

(citing Witthohn v.

Fed.

(4th Cir. 2006)).

not
F.

disputed."

Supp.

2d

621,

PBM
626

Ins. Co., 164 F. App'x

Finally, in considering a motion to

dismiss, the court may "properly take judicial notice of matters
of public record."

Philips v.

Pitt Cnty. Mem'l Hosp.,

572 F.3d

176, 180 (4th Cir. 2009).
B. Analysis

Defendants contend that the SAC fails to satisfy the pleading
standards

set

forth

in

Twombly and

Iqbal.

(Defendants'

Memorandum in Support of Its [sic] Motion to Dismiss Plaintiffs'
Second Amended
Venue

("Def.

Complaint

Mem.,"

ECF

or,

in

the

No.

52) ) .

Alternative,

to

Specifically,

assert that the SAC is inadequate because:
[a]ll that is alleged is that at some point
in the past-including as long as twenty two
years ago-each of the Newly Named Plaintiffs

Transfer

Defendants

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 12 of 21 PageID# 551

underwent background checks and were denied
an employment opportunity.
The nature of
NBD's involvement is not linked to any
application.
There is no mention of the
data returned by SafeRent/NBD, let alone how
it was 'likely adverse' or 'incomplete.'
The employers and job positions sought are
not identified.
The Newly Named Plaintiffs
do not provide the approximate date they
allege that SafeRent/NBD were involved in
any of their alleged efforts to obtain
employment.
Id. at 2.
The

Court

agrees

with

Defendants

Plaintiffs

Robertson,

Gonzalez,

Defendants'

motion

dismiss

Plaintiffs.
Edwards,

However,

Hackett,

sufficient
Therefore,

to

facts

the

White,
to

Defendants'

and
will

Court

be

motion

will

the

be

of

as

to

those

Plaintiffs Allen,

Stanley
claims

claims

Accordingly,

granted
that

and

plausible

to

Holmes.

finds

Roberts,

support

as

have

under

denied

as

alleged

the

FCRA.

to

those

Plaintiffs. 1

1

Defendants also contend that, once the claims of the nine
remaining Newly Named Plaintiffs are dismissed, Plaintiff Witt's
claims must fail for lack of proper venue.
However, Defendants
do
not
challenge
the
plausibility
of
Plaintiff
Witt's
allegations.
Nor do Defendants contend that venue in the
Richmond division is improper as to any of the other nine
Plaintiffs.
Therefore, because the Court finds that the claims
of Plaintiffs Allen, Edwards, Hackett, White, Roberts, and
Stanley, all of whom reside in the Richmond di vision of the
Eastern District of Virginia, satisfy Fed. R. Civ. P. 12(b) (6),
it is not necessary to reach Defendants' arguments concerning
venue, which are premised on the assumption that Witt is the
only remaining Named Plaintiff.

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 13 of 21 PageID# 552

1. Plaintiffs Robertson, Gonzalez, and Holmes

Plaintiffs

Robertson,

Gonzalez,

and

Holmes'

claims

must

fail because they have alleged no facts linking NBD or SafeRent
to the asserted claims.

For example, Robertson alleges that:

Over a course of several years, beginning in
1999, he has been the subject of multiple
background checks, one of which was created
when NBD sold his
report to HR Plus.
Approximately three years ago, he had sought
a position with a government contractor for
which an offer was withdrawn because of a
derogatory dismissed criminal record in his
background check.
SAC

20.

«JI

The

fact

that

Robertson

was

the

subject

of

a

report

provided by NBD at some point within the last seventeen years,
combined

with

the

fact

that

some

unspecified

CRA

included

a

"derogatory dismissed criminal record" in Robertson's background
check at some point within the last three years, does not permit
the Court to infer any conduct violative of the FCRA by SafeRent
or

NBD.

The

paragraph
report

Court

when,

or

was

is
for

furnished

by

unable
what

to

discern

purpose,

SafeRent

and

from

this

Robertson's
NBD;

short

background

when

or

where

Robertson submitted the employment application that led to such
a

report;

whether

the

report

furnished

by

NBD

incomplete or outdated criminal record information;
that

report

affected

Robertson's

application

for

included
or whether

employment.

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 14 of 21 PageID# 553

Thus, Robertson has alleged no connection between Defendants and
the allegedly defective background report.
For

the

same

the

reasons,

allegations

pertaining

to

Plaintiffs Holmes and Gonzalez also lack this necessary nexus,
notwithstanding the Court's previous Memorandum Order explicitly
(ECF No.

alerting Plaintiffs to this deficiency.
claims

are

exactly

generalizations
Twombly,

and

that

are

under the FCRA.

the
the

of
Court

Supreme

condemned

insufficient

conclusory

threadbare,

sort

to

support

any

These

4 9) .

in

Iqbal and

plausible

claim

See ECF No. 49; see also Hinton v. Trans Union,

LLC, 654 F. Supp. 2d, 440, 449 (E.D. Va. 2009).
Accordingly,

all claims of Plaintiffs Robertson,

Gonzalez,

and Holmes will be dismissed with prejudice.
2. Plaintiffs A1len,
Stanley
a. Count I:

Edwards,

Hackett,

allege

facts

showing

that:

§

( 1)

adverse public record information;

defendant

the

requisite

furnished

notice
reports

outdated

public

records;

maintain

strict

procedures

that

and
to

(5)

(2)

( 3)

under

1681k(a),

the

employment-purposed consumer reports;

provide

Roberts,

and

15 U.S.C. § 1681k(a)

To state a claim under 15 U.S.C.
must

White,

a plaintiff

defendant

furnished

the reports contained

the defendant failed to
§

1681k(a) (1);

contained
the

ensure

incomplete

defendant
that

(4)

the

the
or

failed

to

records

it

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 15 of 21 PageID# 554

Henderson v. CoreLogic

furnished were complete and up to date.
National
685127,

Background
at

Employ.com,
2014);
{N.D.

*10

Ga.

Roberts,

{E.D.

Inc.,

Farmer

v.

WL

Agency,

Plaintiffs
have

Supp.

18,

Feb.

2611259,

Phillips

Stanley

F.

LLC,

Va.

2014

2012).
and

Data,

2016

Speers

v.

2016);

at
Inc.,

Allen,

3d

*5-7

{D.

285

May

13,
700

Hackett,

alleged

Pre-

688,

F.R.D.

Edwards,

adequately

Or.

WL

all

White,

of

these

elements.
First,

those

Plaintiffs

have

all

set

forth

allegations

specifically connecting Saf eRent and NBD to employment-purposed
background reports obtained within the past five years.
21,

23-27.

For

Plaintiff

example,

"[a] pproximately three years ago,
staffing

agency.

contract position,

The

staffing

Allen

alleges

<]I<j{

that,

he sought a position with a
agency

helped

him

procure

a

the offer of which was withdrawn because of

criminal record information that NBD supplied about him."
21.

SAC

SAC !

Similarly, Plaintiff Roberts alleges that, "[a]pproximately

five years ago, he had sought a position with a security company
for which he was disqualified because of the information that
NBD supplied about him."
that

these

reports

Id.

!

contained

26.

Second,

criminal

Plaintiffs allege

record

adversely affected their employment applications.

"hits"

that

See SAC ! 21,

23-27, 38.
Third,

Plaintiffs

allege

that

they

did

not

receive

the

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 16 of 21 PageID# 555

notices

required

by

1681k(a) (1)

§

"at

furnished their consumer reports--indeed,

the

time"

Plaintiffs allege that

they never received any such notices from SafeRent.
Fourth,

61.

Plaintiffs

allege

SafeRent

that

"the

Id.

public

~~

41,

records

[SafeRent] furnishes to third parties are summaries, indexes, or
partial

records

SafeRent

never

record."

Id.

that

that

~

43.
data

criminal

Finally,

4 4.

procedure"

of

the

from

is

its

complete

Specifically,

courthouse

and

sources.

up-to-date

public

the Named Plaintiffs allege

incomplete

because

it

"purchased

and

thus

without

the

such as social security numbers."

Id.

records

identifying information,
<JI

obtains

furnishes

SafeRent's

obtained

it

in

Plaintiffs
obtaining

bulk

allege

that

"summaries,

SafeRent's

indexes,

or

"standard

and

partial

records" fails to satisfy the "strict procedures" requirement of
§

1681k(a) (2).

Therefore, say Plaintiffs,

§

1681k(a) (2) is "not

available to SafeRent."
These allegations are sufficient to state a claim under
1681k (a) .

Plaintiffs have plausibly alleged that:

consequently,

SafeRent)

furnished

Plaintiffs

in

connection

employment;

(2)

those

record

"hits"

that

of the

reports

background

had

employment applications;

with

an
( 3)

background
recent
checks

adverse

{1) NBD {and,
checks

applications
contained

effect

on

§

on
for

criminal

Plaintiffs'

Plaintiffs did not receive notice

as provided by

§

1681k {a) ( 1);

( 4)

the

reports

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 17 of 21 PageID# 556

furnished by NBD and Saf eRent contained public records that were
incomplete

or

outdated;

and

(5)

SafeRent

failed

to

maintain

strict procedures to ensure that the public records it reported
were

complete

and

up-to-date.

Thus,

facts to support each element of
Therefore,

Defendants'

Plaintiffs

have

alleged

1681k(a).

§

motion to dismiss Count

I

will be

denied as to Plaintiffs Allen, Edwards, Hackett, White, Roberts,
and Stanley.
b. Count II:

To state a
must

allege

report;

claim under 15 U.S. C.

facts

(ii)

the

15 U.S.C. § 1681(b)

showing

that:

defendants

" ( i)

used

or

1681 (b),

§

there

a plaintiff

was

obtained

a

it;

consumer
(iii)

the

defendants did so without a permissible statutory purpose;
(iv)

the

state."

defendants
King v.

acted

with

the

specified

Equable Ascent Fin.,

LLC,

and

culpable mental

2013 WL 24 7 4377,

at

*2 (M.D.N.C. June 10, 2013).
In

addition

to

the

factual

allegations

set

forth

in

paragraphs 21 through 44 of the SAC, detailed in part B.2 above,
Plaintiffs allege that NBD has argued in other litigation that
its

obtained

from

SafeRent's database, are not sold for employment purposes.

SAC

c:!I

4,

reports,

47

comprised

entirely

(citing Henderson v.

LLC, Case No. 3:12-cv-97).
Defendants

could

not

have

of

information

CoreLogic Nat'l Background Data,

If this is so, say Plaintiffs, then
had

a

permissible

purpose

for

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 18 of 21 PageID# 557

furnishing the reports.

'lI 75.

Id.

Id. 'lI 83.

that this conduct was willful.
the

alternative

to

Count

I,

Plaintiffs further allege

as

This claim is pled in

permitted by

Fed.

R.

Civ.

P.

Id. 'lI 46.

8 (d).

These

allegations,

taken

in

conjunction with

the

factual

allegations set forth in paragraphs 21 through 44 of the SAC,
support
under

each
§

Roberts,

of

the

1681b.

required

Plaintiffs

elements
Allen,

for

a

Edwards,

plausible
Hackett,

claim
White,

and Stanley have alleged a connection between SafeRent

and NBD and specific consumer reports that,

if not provided for

"employment purposes," had no permissible purpose and thus were
furnished in violation of
Therefore,
Hackett,

White,

§

1681b.

the Court finds that Plaintiffs Allen,
Roberts,

claim under 15 U.S.C.

and Stanley have
168lb.

§

Edwards,

adequately stated a

Defendants'

motion to dismiss

Count II will be denied as to those Plaintiffs.
c. Count III:

15
reports
designed

U.S.C.
to
to

§

15 U.S.C. § 1681e(e)

1681e(e) (2)

"establish
ensure"

and
that

requires

comply
the

with

report

permissible purpose as set forth in

§

resellers

of

reasonable
is

1681b.

resold
Id.

consumer

procedures
only

for

a

The statute

also enumerates three procedures that a reseller is required to
maintain to satisfy this

subsection,

each person to which the report

including "requiring that

(or information)

is resold and

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 19 of 21 PageID# 558

that

resells

other

or

person

provides

{i)

report

identifies

Id.

report [ . J "

the

To

state

each

a

(or
end

claim

reports to other resellers;
for

( 3)

an impermissible purpose;

maintain

reasonable

(2}

user

under

of

this

(1}

plaintiff must plausibly allege that:
reseller of consumer reports;

information}

to

the

any

resold

subsection,

a

the defendant is a

the defendant

resells

those

the defendant furnished reports
and

procedures,

( 4)

the defendant failed to

including,

procedures specifically enumerated by

if

applicable,

1681e {e} {2),

§

the

to ensure

that the end-users of its reports sought those reports only for
permissible purposes.

15 U.S.C.

§

1681e{e}; Washington v.

CSC

Credit Servs., 199 F.3d 263, 266 (5th Cir. 2000).
Plaintiffs
consumer

allege

that

NBD

and,

more

generally,

reports

procured

and

that

resold

NBD

is

23-27'

33-36.

checks

were

Plaintiffs

purchased

from

also
NBD

allege
and

that

resold

their
to

in

SAC

business of procuring consumer reports for resale.

their

<JI<JI

the
21,

background

their

putative

employers by other reseller consumer reporting agencies, such as
HR Plus, ADP, FirstPoint, and Verifications.

Id.

other

background

words,

NBD

did

not

sell

Plaintiffs'

<JI<JI

directly to "end-users," i.e., potential employers.)
allege in Count II that,

if SafeRent' s

and NBD' s

16-18.

(In

checks

Plaintiffs
reports were

not furnished for "employment purposes," then the reports were
furnished

for

an

impermissible

purpose,

in

violation

of

15

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 20 of 21 PageID# 559

u.s.c.

1681b.

§

Plaintiffs

And,

information and belief,

allege

"[u]pon

that,

Defendant National Background Data does

not ever obtain the identity of the end user of the reports that
it

procures

for

resale

regarding

the

putative class members," and therefore,
and

comply

with"

the

U.S.C. § 1681e(e) (2).

"reasonable

Class

Plaintiffs

and

NBD did not "establish

procedures"

required

by

15

Id. c:!I'JI 5, 89.

These allegations, read in conjunction with the allegations
in Count II and the factual allegations set forth in paragraphs
21 through 44 of the SAC,
under

§

alleged

1681e(e) (2).
that

NBD

is

plausibly state an alternative claim

Specifically,
obligated

to

Plaintiffs
require

have

its

plausibly

customers

to

identify end-users of its reports under§ 1681e(e), that it does
not do so, and that, as a result, NBD has furnished reports for
an impermissible purpose.
Plaintiffs

need not

Contrary to

Defendants'

specifically allege the

assertions,

identities of the

end-users in question to plausibly plead this claim.
Therefore,

Defendants' motion to dismiss Count III will be

denied as to Plaintiffs Allen, Edwards, Hackett, White, Roberts,
and Stanley.
CONCLUSION

For
DISMISS

the

reasons

PLAINTIFFS'

ALTERNATIVE,

set

forth

SECOND

TO TRANSFER VENUE

above,

AMENDED
(ECF No.

DEFENDANTS'
COMPLAINT
51)

OR,

MOTION
IN

TO
THE

will be granted in

Case 3:15-cv-00386-REP Document 56 Filed 04/08/16 Page 21 of 21 PageID# 560

part and denied in part.

Defendants' motion will be granted as

to

Holmes,

Plaintiffs

denied as

to

Robertson,

Plaintiffs Witt,

and

Allen,

Gonzalez,
Edwards,

and

Hackett,

will

White,

Roberts, and Stanley.
It is so ORDERED.

Isl
Robert E. Payne
Senior United States District Judge

Richmond, Virg~nia
Date: April
, 2016

be