Marquez v. Bank of America, National Association, No. 4:2017cv00555 - Document 108 (N.D. Cal. 2018)
Court Description: ORDER GRANTING DEFENDANT BANK OF AMERICAS MOTION FOR PARTIAL SUMMARY JUDGMENT by Judge Claudia Wilken.(dtmS, COURT STAFF) (Filed on 4/25/2018)
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Marquez v. Bank of America, National Association Doc. 108 1 2 3 IN THE UNITED STATES DISTRICT COURT 4 FOR THE NORTHERN DISTRICT OF CALIFORNIA 5 6 7 SERGIO MARQUEZ, individually and on behalf of others similarly situated, 8 United States District Court Northern District of California 11 ORDER GRANTING DEFENDANT BANK OF AMERICA’S MOTION FOR PARTIAL SUMMARY JUDGMENT Plaintiff, 9 10 Case No. 17-cv-00555-CW v. (Dkt. No. 78) BANK OF AMERICA, NATIONAL ASSOCIATION, et al., Defendants. 12 13 Plaintiff Sergio Marquez brings this putative class action 14 lawsuit against Defendants Bank of America, N.A. (BOA), Business 15 Information Group, Inc. (BIG), and TALX Corporation, d/b/a 16 Equifax Workforces Solutions (TALX). On January 9, 2018, BOA 17 brought a motion for partial summary judgment on Plaintiff’s 18 First, Third, and Fifth Causes of Action.1 Plaintiff filed an 19 opposition and BOA filed a reply. On March 20, 2018, the parties 20 appeared for a hearing. Having considered the papers and the 21 arguments of counsel, the Court GRANTS BOA’s motion for partial 22 summary judgment. 23 24 25 26 27 28 1 TALX simultaneously filed a motion to dismiss Plaintiff’s Eleventh Cause of Action for lack of subject matter jurisdiction. TALX’s motion was heard on the same day as BOA’s motion. On March 28, 2018, however, Plaintiff and TALX informed the Court that they had reached a settlement in principle and requested that the Court defer ruling on TALX’s motion to dismiss, which the Court will do. Docket Nos. 102, 104. Dockets.Justia.com BACKGROUND 1 In October 2016, Plaintiff applied for employment with BOA 2 as a Mortgage Loan Officer. During the application process, 3 Plaintiff reviewed and electronically signed forms as part of an 4 online background check. Declaration of Cindy Prebil (Prebil 5 Decl.) ¶ 14. Plaintiff signed an “FCRA Disclosure and 6 Authorization” form (Disclosure Form), a one-page document which 7 states: 8 United States District Court Northern District of California 9 10 11 12 13 14 15 In connection with your employment or application for employment or contract assignment with Bank of America (the “Bank”), the Bank may obtain, where permitted, one or more consumer reports as defined in the Fair Credit Reporting Act (15 U.S.C. 1681) (“FCRA”). Consumer reports may contain information concerning your criminal history, fingerprint records, character, general reputation, employment history, civil history, credit history, education, academic and professional credentials, qualifications, motor vehicle record, and other background checks, based on the background check requirements for the subject position at the Bank. In some states, such as California, these reports are referred to as “Investigative Consumer Reports.” 16 Prebil Decl., Ex. 2 at 1; see also id. ¶ 5. 17 goes on to provide that the “Bank may obtain consumer reports 18 from various entities, including, but not limited to:” “Equifax 19 Workforce Solutions, a/k/a TALX Corporation,” and “Business 20 Information Group, Inc. (BIG).” 21 form provides the entities’ addresses, telephone numbers, and 22 webpages where additional information and the entities’ privacy 23 policies can be found. 24 Authorization: Id. The Disclosure Form Prebil Decl., Ex. 2 at 1. The The form then provides an 25 By signing below, you: 26 27 1. Authorize the Bank to obtain consumer reports about you at any time after receipt of this authorization and throughout your employment, if applicable; and 28 2. Agree, as permitted by law, that notices, documents 2 and communications may be provided electronically and will meet the requirements set forth under Federal and/or State law, and agree that a fax or photocopy of this authorization with your signature should be accepted with the same authority as the original. 1 2 3 By checking the box below you authorize Bank of America to obtain, where permitted, one or more consumer reports as described above for employment purposes. 4 5 Id. Beneath the authorization is a checkbox next to the 6 statement “Yes, I authorize Bank of America to obtain, where 7 permitted, one or more consumer reports for employment 8 purposes.”; (2) the applicant’s name and date; and (3) a space United States District Court Northern District of California 9 where the applicant can use a mouse to electronically draw his 10 signature. Id. 11 Plaintiff executed the Disclosure Form and Authorization on 12 October 29, 2016. Prebil Decl. ¶ 7, Ex. 2 at 2. After signing 13 the Authorization, Plaintiff clicked “Continue,” which brought up 14 another page entitled “Other Background Check Information,” which 15 contained information about: (1) state and local laws and 16 ordinances governing background checks; (2) the Bank’s 17 fingerprinting and criminal background check process; and 18 (3) additional checks for certain positions subject to Financial 19 Industry Regulatory Authority (FINRA). Prebil Decl., Ex. 2 at 2. 20 This page also allowed Plaintiff to select an option “to indicate 21 if [he] would like a copy of [his] consumer report free of 22 charge.” Id. at 2. Plaintiff selected this option. Id. 23 After submitting his application, on October 31, 2016, 24 Plaintiff was offered a position with BOA, which was contingent 25 upon a satisfactory background check. Declaration of James 26 Treglio (Treglio Decl.), Ex. 1. Ultimately, after conducting a 27 background check and interviewing Plaintiff about his employment 28 3 1 history, BOA decided not to hire Plaintiff. 2 Prebil Decl. ¶ 18. On February 2, 2017, Plaintiff filed this suit. Docket No. 1. 4 complaint (FAC) against Defendants, asserting claims under the 5 Federal Credit Reporting Act (FCRA), 15 U.S.C. § 1681; the 6 Investigative Consumer Reporting Agencies Act (ICRA), California 7 Civil Code section 1786, et seq.; and the California Consumer 8 Credit Reporting Agencies Act (CCRA), California Civil Code 9 United States District Court Northern District of California 3 section 1785.1 et seq. On September 22, 2017, Plaintiff filed a first amended 10 LEGAL STANDARD 11 Summary judgment is properly granted when no genuine and 12 disputed issues of material fact remain, and when, viewing the 13 evidence most favorably to the non-moving party, the movant is 14 clearly entitled to prevail as a matter of law. 15 56; Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); 16 Eisenberg v. Ins. Co. of N. Am., 815 F.2d 1285, 1288-89 (9th Cir. 17 1987). 18 Fed. R. Civ. P. The moving party bears the burden of showing that there is 19 no material factual dispute. 20 true the opposing party’s evidence, if supported by affidavits or 21 other evidentiary material. 22 815 F.2d at 1289. 23 in favor of the party against whom summary judgment is sought. 24 Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 25 587 (1986); Intel Corp. v. Hartford Accident & Indem. Co., 952 26 F.2d 1551, 1558 (9th Cir. 1991). Therefore, the court must regard as Celotex, 477 U.S. at 324; Eisenberg, The court must draw all reasonable inferences 27 Material facts which would preclude entry of summary 28 judgment are those which, under applicable substantive law, may 4 1 affect the outcome of the case. 2 identify which facts are material. 3 Inc., 477 U.S. 242, 248 (1986). 4 The substantive law will Anderson v. Liberty Lobby, Where the moving party does not bear the burden of proof on 5 an issue at trial, the moving party may discharge its burden of 6 production by either of two methods: 7 8 United States District Court Northern District of California 9 10 The moving party may produce evidence negating an essential element of the nonmoving party’s case, or, after suitable discovery, the moving party may show that the nonmoving party does not have enough evidence of an essential element of its claim or defense to carry its ultimate burden of persuasion at trial. Nissan Fire & Marine Ins. Co., Ltd., v. Fritz Cos., Inc., 210 11 F.3d 1099, 1106 (9th Cir. 2000). 12 If the moving party discharges its burden by showing an 13 absence of evidence to support an essential element of a claim or 14 defense, it is not required to produce evidence showing the 15 absence of a material fact on such issues, or to support its 16 motion with evidence negating the non-moving party’s claim. Id.; 17 see also Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871, 885 (1990); 18 Bhan v. NME Hosps., Inc., 929 F.2d 1404, 1409 (9th Cir. 1991). 19 If the moving party shows an absence of evidence to support the 20 non-moving party’s case, the burden then shifts to the non-moving 21 party to produce “specific evidence, through affidavits or 22 admissible discovery material, to show that the dispute exists.” 23 Bhan, 929 F.2d at 1409. 24 If the moving party discharges its burden by negating an 25 essential element of the non-moving party’s claim or defense, it 26 must produce affirmative evidence of such negation. Nissan, 210 27 F.3d at 1105. If the moving party produces such evidence, the 28 5 1 burden then shifts to the non-moving party to produce specific 2 evidence to show that a dispute of material fact exists. 3 Id. If the moving party does not meet its initial burden of 4 production by either method, the non-moving party is under no 5 obligation to offer any evidence in support of its opposition. 6 Id. 7 ultimate burden of persuasion at trial. This is true even though the non-moving party bears the Id. at 1107. Federal Rule of Civil Procedure 56(d) provides that a court 9 United States District Court Northern District of California 8 may defer considering a motion for summary judgment, deny it, or 10 issue any other appropriate order if “a nonmovant shows by 11 affidavit or declaration that, for specified reasons, it cannot 12 present facts essential to justify its opposition.” 13 DISCUSSION 14 BOA brings a motion for summary judgment with respect to 15 Plaintiff’s First, Third, and Fifth Causes of Action. 16 I. 17 18 19 20 21 22 23 24 25 First Cause of Action: Violation of the FCRA Section 1681b(b)(2)A requires that a person may not procure a consumer report for employment purposes 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. In his First Cause of Action, Plaintiff alleges that BOA 26 violated 15 U.S.C. § 1681b(b)(2)(A) because the Disclosure Form 27 was not a stand-alone document in that it contained: 28 (1) extraneous information such as state law disclosures and 6 1 (2) a liability waiver. Both arguments lack merit. Plaintiff alleges that the Disclosure Form was not a stand- 3 alone document and instead appeared alongside other documents as 4 part of BOA’s job application process, including other 5 information related to his background check, such as California 6 state law disclosures. 7 disclosure be “clear and conspicuous” and “in a document that 8 consists solely of the disclosure.” 9 United States District Court Northern District of California 2 Commission has noted, the “the reason for specifying a stand- Section 1681b(b)(2)(A) requires that the As the Federal Trade 10 alone disclosure was so that consumers will not be distracted by 11 additional information at the time the disclosure is given.” 12 Letter from Cynthia Lamb, Investigator, Div. of Credit Practices, 13 Fed. Trade Comm’n, to Richard Steer, Division of Credit 14 Practices, 1997 WL 33791227, at *1 (Oct. 21, 1997). 15 disclosure may be accompanied by the authorization for 16 procurement of a report required by § 1681b(b)(2)(B). 17 has provided a screenshot showing that the Disclosure Form and 18 Authorization appeared as a stand-alone electronic page. 19 Decl. ¶¶ 4-5, Ex. 1. 20 The Id. BOA Prebil This complies with § 1681b(b)(2)(A). Plaintiff alleges that the Disclosure Form and Authorization 21 was not a stand-alone document because it was displayed as part 22 of BOA’s online application process, which included other 23 information such as various state law disclosures and 24 requirements for Plaintiff’s signature. 25 Authorization appeared as a separate and distinct web page 26 separated from the rest of the documents. 27 information was displayed on the screen alongside the Disclosure 28 and Authorization. But the Disclosure and Id., Ex. 1. No other Plaintiff was required to click “Continue” to 7 view the rest of the online application. 2 qualifies as a stand-alone document for purposes of 3 § 1681b(b)(2)(A). 4 No. 16-CV-02843-YGR, 2016 WL 6892721, at *6 (N.D. Cal. Nov. 23, 5 2016) (noting that the FCRA requires a separate and distinct 6 writing and, “[b]y analogy, the web page would also need to be 7 separate and distinct.”). 8 California court considering an almost identical BOA disclosure 9 United States District Court Northern District of California 1 form provided as part of an online application, the “FCRA does 10 not prohibit an employer from providing an FCRA disclosure as 11 part of the employer’s job application process. 12 FCRA prohibit an employer from providing an FCRA disclosure at 13 the same time the employer provides other employment documents.” 14 Newton v. Bank of Am., 2015 WL 10435907, at *8 (C.D. Cal. May 12, 15 2015). 16 Id. ¶ 8. This See Burnthorne-Martinez v. Sephora USA, Inc., As stated by a Central District of Nor does the Plaintiff also alleges that the Disclosure Form improperly 17 includes a liability waiver. 18 “the FCRA unambiguously bars a prospective employer from 19 including a liability waiver on a disclosure document provided a 20 job applicant pursuant to Section 1681b(b)(2)(A).” 21 LLC, 853 F.3d 492, 503 (9th Cir.), cert. denied, 138 S. Ct. 447, 22 (2017). As the Ninth Circuit has found, Syed v. M-I, 23 In Syed, the liability waiver read: 24 I understand the information obtained will be used as one basis for employment or denial of employment. I hereby discharge, release and indemnify prospective employer, PreCheck, Inc., their agents, servants and employees, and all parties that rely on this release and/or the information obtained with this release from any and all liability and claims arising by reason of the use of this release and dissemination of information that is false and untrue if obtained by a 25 26 27 28 8 third party without verification. 1 2 Id. at 497–98 (emphasis added). 3 found that clear waivers of all liability associated with the 4 background check process violate the FCRA. 5 IntelliCheck, LLC, 254 F. Supp. 3d 1124, 1130 (N.D. Cal. 2017). 6 Here, Plaintiff contends that the following statement 7 appearing in the Authorization constitutes an illegal liability 8 waiver: United States District Court Northern District of California 9 District courts have similarly See, e.g., Cunha v. By signing below, you: [ . . .] 2. Agree, as permitted by law, that notices, documents and communications may be provided electronically and will meet the requirements set forth under Federal and/or State law, and agree that a fax or photocopy of this authorization with your signature should be accepted with the same authority as the original. 10 11 12 13 Prebil Decl., Ex. 2 (emphasis added). Plaintiff contends that 14 this constitutes a waiver of liability under the FCRA, ICRA, and 15 CCRA, which is illegal under Syed. 16 Plaintiff’s reading of the Authorization as a liability 17 waiver is strained. As both parties agree, contracts should be 18 “construed as a whole” and should “be interpreted to give effect 19 to the mutual intention of the parties.” Opp. at 12, Reply at 3; 20 see also Leo F. Piazza Paving Co. v. Found. Constructors, Inc., 21 128 Cal. App. 3d 583, 591 (1981). In Syed, the liability waiver 22 clearly and unambiguously served as a “broad release of 23 liability” for all violations of the FCRA. Syed, 853 F.3d at 24 498. By contrast, the portion of the Authorization pointed out 25 by Plaintiff serves to advise Plaintiff that notices, documents 26 and communications may be provided electronically and that such 27 notices, documents and communications should not violate the law 28 9 1 simply because they are provided electronically. 2 context, this advises that the Disclosure Form’s digital nature 3 does not affect its validity. 4 “clear, unambiguous, and explicit” language necessary to 5 effectuate a waiver of all liability. 6 Sch. Dist., 33 F. Supp. 3d 1138, 1166 (N.D. Cal. 2014). 7 Read in The Authorization lacks the R.H. v. Los Gatos Union Because the Disclosure Form was a stand-alone document that contained no extraneous information or liability waiver, it 9 United States District Court Northern District of California 8 complies with § 1681b(b)(2)(A). 10 11 II. Third Cause of Action: Violation of the ICRA The ICRA, California Civil Code section 1786.16, provides 12 that a person may procure an investigative consumer report only 13 if the person: 14 16 procuring or causing the report to be made provides a clear and conspicuous disclosure in writing to the consumer at any time before the report is procured or caused to be made in a document that consists solely of the disclosure, that: 17 (i) An investigative consumer report may be obtained. 18 (ii) The permissible purpose of the report is identified. 15 19 20 21 22 23 24 25 26 27 28 (iii) The disclosure may include information on the consumer’s character, general reputation, personal characteristics, and mode of living. (iv) Identifies the name, address, and telephone number of the investigative consumer reporting agency conducting the investigation. (v) Notifies the consumer in writing of the nature and scope of the investigation requested, including a summary of the provisions of Section 1786.22. (vi) Notifies the consumer of the Internet Web site address of the investigative consumer reporting agency identified in clause (iv), or, if the agency has no Internet Web site address, the telephone number of the agency, where the consumer may find information about the investigative reporting agency’s privacy practices, 10 2 including whether the consumer’s personal information will be sent outside the United States or its territories and information that complies with subdivision (d) of Section 1786.20. 3 Plaintiff asserts that the Disclosure Form violates the ICRA 1 in two respects: (1) the disclosure was not provided in a 5 document consisting “solely” of the disclosure (repeating many of 6 the same arguments asserted in his FCRA claim) and (2) the 7 disclosure did not identify the “investigative consumer reporting 8 agency conducting the investigation,” as identified in subsection 9 United States District Court Northern District of California 4 (iv). 10 For the reasons stated in the previous section, Plaintiff’s 11 first assertion lacks merit. 12 alone document and did not contain extraneous information. 13 for Plaintiff’s second assertion, BOA points out that it properly 14 disclosed the information for the two parties that would provide 15 investigative consumer reports, namely, TALX and BIG. 16 responds that BOA did not disclose that, while the investigative 17 consumer report on Plaintiff was contracted to BIG, it was 18 actually performed by third parties Fieldprint, Inc. (which in 19 turn requested a report from the FBI) and Transunion, LLC, as 20 stated in a declaration provided by BIG. 21 Timothy Gaudreau (Gaudreau Decl.) ¶¶ 13-14. 22 language of section 178616(a)(2)(iv) only requires that BOA 23 identify “the investigative consumer reporting agency conducting 24 the investigation.” 25 reporting agency conducting the investigation.” 26 obtained information from several different repositories, such as 27 Fieldprint, Transunion, and the FBI, does not take away from this 28 fact. The Disclosure Form was a standAs Plaintiff See also Declaration of But the plain Here, BIG is the “investigative consumer That BIG BOA was only obliged to disclose BIG, the agency it 11 1 engaged to provide a report, and not the various sources that BIG 2 used in conducting its investigation. 3 III. Fifth Cause of Action: Violation of the CCRA 4 The CCRA, California Civil Code section 1785.20.5 states: 5 Prior to requesting a consumer credit report for employment purposes, the user of the report shall provide written notice to the person involved. The notice shall inform the person that a report will be used, and shall identify the specific basis under subdivision (a) of Section 1024.5 of the Labor Code for use of the report. The notice shall also inform the person of the source of the report, and shall contain a box that the person may check off to receive a copy of the credit report. If the consumer indicates that he or she wishes to receive a copy of the report, the user shall request that a copy be provided to the person when the user requests its copy from the credit reporting agency. The report to the user and to the subject person shall be provided contemporaneously and at no charge to the subject person. 6 7 8 United States District Court Northern District of California 9 10 11 12 13 In his Fifth Cause of Action, Plaintiff asserts that BOA 14 violated this section because it did not disclose that a consumer 15 credit report would be used, why it would be used, and who would 16 issue the report. 17 As a preliminary matter, BOA asserts that it was excused 18 from compliance with section 1785.20 because of an exemption in 19 California Civil Code section 1024.5. Section 1024.5 provides 20 that an employer or prospective employer shall not use a consumer 21 credit report for employment purposes unless the position is one 22 that is listed in subsection (a). Section 1024.5(b) states: 23 24 25 26 27 (b) This section does not apply to a person or business subject to Sections 6801 to 6809, inclusive, of Title 15 of the United States Code and state and federal statutes or regulations implementing those sections if the person or business is subject to compliance oversight by a state or federal regulatory agency with respect to those laws. BOA asserts that it is subject to the Title 15 code sections 28 12 1 referenced here and is thus exempt under section 1024.5(b). 2 exemption of section 1024.5(b), however, appears to apply only to 3 the restrictions of “this section,” i.e., section 1024.5, and not 4 section 1785.20. 5 In any event, Plaintiff’s arguments that the Disclosure Form 6 does not comply with the CCRA lack merit. 7 disclosed that a consumer credit report would be used. 8 Prebil Decl., Ex. 2 at 1 (“Consumer reports may contain 9 United States District Court Northern District of California The information concerning your . . . credit history . . . ”). The Disclosure Form See It 10 also disclosed the source of the consumer credit report requested 11 by BOA. 12 entities, including, but not limited to” TALX and BIG). 13 Plaintiff’s argument that BIG pulled information from other 14 sources in compiling its consumer credit report goes too far. 15 The statute requires BOA to disclose the source of the report it 16 requested, not all of the various repositories of information 17 that the source used in compiling its report. 18 required to disclose why it requested the report. 19 required to disclose which basis provided in section 1024.5(a) 20 applied, because BOA is exempt under section 1024.5(b), which 21 Plaintiff does not contest. 22 IV. 23 Id. (“Bank may obtain consumer reports from various Again, BOA was not Nor was BOA Plaintiff’s Rule 56(d) Request Plaintiff requests that the Court defer ruling on BOA’s 24 summary judgment motion, arguing that additional discovery is 25 needed. 26 is essential to his defense. Plaintiff has not explained why the requested discovery Accordingly, his request is denied. 27 28 13 CONCLUSION 1 BOA’s motion for summary judgment on Plaintiff’s First, 2 Third, and Fifth Causes of Action is GRANTED. Plaintiff’s Second 3 and Fourth Causes of Action against BOA remain in the case. 4 IT IS SO ORDERED. 5 6 Dated: April 25, 2018 7 CLAUDIA WILKEN United States District Judge 8 United States District Court Northern District of California 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 14
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