STEVEN J. McAULIFFE, District Judge.
Plaintiff, Rex Landry, filed this putative class action against his former employer, Time Warner Cable, as well as Thompson Reuters Corporation. In addition to various state law claims, Landry alleges that Time Warner and Reuters violated various provisions of the federal Fair Credit Reporting Act ("FCRA"). Pending before the court is Reuters' motion to dismiss, in its entirety, one of the claims advanced against it, and to dismiss a portion of the second. Landry objects. For the reasons stated, Reuters' motion is denied.
Standard of Review
When ruling on a motion to dismiss under Fed. R. Civ. P. 12(b)(6), the court must "accept as true all well-pleaded facts set out in the complaint and indulge all reasonable inferences in favor of the pleader."
In other words, "a plaintiff's obligation to provide the `grounds' of his `entitlement to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do."
Accepting the allegations set forth in Landry's complaint as true — as the court must at this juncture — the relevant facts are as follows. In 2015, Landry applied for, and was given, a job with Time Warner Cable, Inc. Approximately four months after he started working for Time Warner, Landry was called into a meeting, during which a member of Time Warner's Corporate Security Division accused him of having been convicted of a felony (and serving a prison sentence) in Harris County, Texas — facts not disclosed on Landry's job application. Landry says he never lived in Harris County and, more importantly, he was never convicted of a felony in Texas. He claims Time Warner obtained that erroneous information from the background check it secured through Reuters' CLEAR (Consolidated Lead Evaluation and Reporting) service. And, says Landry, although he authorized Time Warner to perform a background check as part of the hiring process, he claims the report it obtained from Reuters was unauthorized.
Landry says that, as a direct result of the erroneous information contained in Reuters' report, he was suspended without pay. Subsequently, Landry contacted the Harris County prison and learned that an individual who shares his name (but not his date of birth or his social security number) had, indeed, served time at the prison. He shared that information with Time Warner, which acknowledged its mistake and agreed that Landry had not lied on his job application. Nevertheless, Time Warner informed Landry that his employment was being terminated for an entirely unrelated reason: because he had allegedly used profane language in front of a co-worker, which made that coworker feel uncomfortable. Landry asserts that Time Warner's stated reason(s) for terminating his employment are a pretext.
As for Reuters and its CLEAR report, Landry says: (1) Reuters knew or should have known that Time Warner would use the information contained in that report for the purpose of establishing Landry's eligibility for employment; (2) Reuters did not adopt and implement reasonable procedures for ensuring that credit information about Landry was collected, maintained, and dispensed in an appropriate manner; (3) the CLEAR report provided to Time Warner contained several inaccuracies, including that Landry had served prison time in Harris County, Texas; and (4) in providing the CLEAR report to Time Warner, Reuters willfully violated several provisions of the FCRA.
Reuters moves to dismiss count five of Landry's complaint, asserting that, while the FCRA generally prohibits credit reporting agencies from disclosing information that is more than seven years old, the statute contains an exemption for "records of convictions of crimes." Accordingly, says Reuters, "any information in CLEAR about a criminal conviction of `Ryan Landry,' regardless of date of conviction, is not a violation of the FCRA as a matter of law." Defendant's Memorandum (document no. 11-1) at 3-4. Additionally, Reuters moves to dismiss count four (and, if the court is not persuaded by its initial challenge, count five) to the extent those counts allege "willful" violations of the FCRA. At best, says Reuters, Landry's complaint must be read to advance claims of mere negligence.
Count Five — Exemption for Criminal Convictions.
In count five of his complaint, Landry asserts that Reuters violated the FCRA by providing outdated information — that is "one or more adverse items of information which antedates the report by more than seven years and is something other than a record of a conviction for a crime." Complaint at para. 85.
In support of its motion to dismiss that count, Reuters asserts that "the
As Reuters points out, Landry alleges that the CLEAR report included outdated (and false) information about a criminal conviction in Texas — information that may not be actionable under the exemption set forth in 15 U.S.C. § 1681c(a)(5). But, Landry's complaint also alleges that the CLEAR report contained
Liberally construing the allegations of the complaint, the court is constrained to conclude that Landry has alleged minimally sufficient facts to state a viable claim in count five of his complaint. That count adequately alleges that Reuters' CLEAR report contained adverse information "which antedates the report by more than seven years" and which is not covered by the limited exemption for "records of convictions of crimes" set forth in section 1681c(a)(5). In other words, Landry does not rest the claims advanced in count five solely on the fact that the CLEAR report contained a record of a criminal conviction from Texas. Instead, it adequately alleges that the report also contained other adverse and impermissibly outdated information about him — that is, "arrests and/or dismissals of criminal counts from 2000." Complaint at para. 35. Reuters' motion to dismiss count five must, therefore, be denied.
Counts Four and Five — Willful Violations of the FCRA.
Next, Reuters alleges that Landry's complaint does not adequately allege that it acted "willfully" in its failure to comply with the requirements of the FCRA. At best, says Reuters, Landry's complaint might be read to plausibly allege that its failure to comply with FCRA requirements was the product of negligence.
The Supreme Court has held that, under section 1681n of the FCRA, "willful" violations of the statute encompass both knowing violations of the FCRA's requirements and those that are committed with a reckless disregard for those requirements.
The complaint's allegations of "willfulness" are sufficient — if barely — to survive Reuters' motion to dismiss. Once discovery is completed, this issue may be better addressed on summary judgment.
For the foregoing reasons, as well as those set forth in plaintiff's memorandum (document no. 15-1), Reuters' motion to dismiss (document no. 11) is denied, without prejudice to its ability to address those issues on summary judgment, with the benefit of a more fully developed record.