U.S. District Court Dismisses FCRA Lawsuit Against Home Depot

By Michael Klazema on 11/16/2017
California’s Central District U.S. District Court made headlines last month by dismissing an FCRA lawsuit against Home Depot. Per a report from The National Law Review, the court ruled that the plaintiff in the case lacked the proper standing to pursue the lawsuit.

The plaintiff’s case against Home Depot accused the home improvement supplies retailer of violating the Fair Credit Reporting Act in its handling of prospective employee background checks. As coverage explains, the lawsuit alleged that Home Depot did not properly comply with the FCRA when notifying the plaintiff that she would be the subject of a background check. The plaintiff also claimed that Home Depot did not go through the correct process of obtaining her authorization to run the background check.

The FCRA requires employers to follow a rigid set of guidelines when conducting pre-employment background screenings, reports note. For instance, the FCRA says that employers must present candidates with background check disclosure forms that are separate from all other paperwork, not bundled with the job application or any other materials. The exception to this rule is the authorization form a candidate signs, which can legally be included alongside the disclosure.

As reports explain, the plaintiff argued that Home Depot violated the FCRA by including a liability waiver with the background check disclosure and authorization. She claimed these violations rendered her employment background check invalid. What the plaintiff did not do was claim any injury suffered due to the alleged FCRA violations.

This point proved crucial in the U.S. District Court ruling, coverage notes. The court ruled that the client lacked injury-in-fact standing in accordance with Article III of the FCRA. Article III standing requires a plaintiff to present a “concrete injury” to sue for FCRA violations. If a plaintiff cannot prove that he or she was harmed by a violation of FCRA guidelines, he or she does not have grounds to sue over that violation. The court cited the U.S. Supreme Court’s decision in last year’s Spokeo, Inc. v. Robins case to justify the decision.

The plaintiff did not connect the noncompliant background check disclosure to a loss of employment opportunity or any similar consequences. Reports indicate the plaintiff was seeking to register a nationwide class of Home Depot candidates affected by the FCRA compliance violation, coverage notes.

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