CORRECTED ORDER UNITED STATES DISTRICT COURT
DISTRICT OF NEW HAMPSHIRE
Ryan Landry, Plaintiff
v. Case No. 16-cv-507-SM Opinion No. 2017 DNH 151 Time Warner Cable, Inc., and Thomson Reuters Corporation, Defendants
O R D E R
Plaintiff, Ryan Landry, filed this putative class action
against his former employer, Time Warner Cable, as well as
Thomson 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.” SEC v. Tambone, 597 F.3d 436, 441
(1st Cir. 2010). Although the complaint need only contain “a
short and plain statement of the claim showing that the pleader
is entitled to relief,” Fed. R. Civ. P. 8(a)(2), it must allege
each of the essential elements of a viable cause of action and
“contain sufficient factual matter, accepted as true, to state a
claim to relief that is plausible on its face,” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citation and internal
punctuation omitted).
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.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). Instead, the facts alleged
in the complaint must, if credited as true, be sufficient to
“nudge[] [plaintiff’s] claims across the line from conceivable
to plausible.” Id. at 570. If, however, the “factual
allegations in the complaint are too meager, vague, or
conclusory to remove the possibility of relief from the realm of
mere conjecture, the complaint is open to dismissal.” Tambone,
597 F.3d at 442.
2 Background
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
3 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 co-
worker 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.
4 Discussion
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.
I. 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.
See generally 15 U.S.C. § 1681c(a)(5) (prohibiting consumer
5 reporting agencies from creating a consumer report containing
adverse items of information, other than records of convictions
of crimes, which antedate the report by more than seven years).
In support of its motion to dismiss that count, Reuters
asserts that “the only information from CLEAR that Plaintiff
attributes to his suspension” is the (false) report of Landry’s
conviction in Texas. Reuters’ Memorandum (document no. 11-1) at
6. And, says Reuters, because the FCRA specifically allows
credit reporting agencies to include “records of convictions of
crimes which antedate[] the report by more than seven years,” 15
U.S.C. § 1681c(a)(5), count five of Landry’s complaint fails to
state a viable cause of action. The court disagrees.
As Reuters points out, Landry alleges that the CLEAR report
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CORRECTED ORDER UNITED STATES DISTRICT COURT
DISTRICT OF NEW HAMPSHIRE
Ryan Landry, Plaintiff
v. Case No. 16-cv-507-SM Opinion No. 2017 DNH 151 Time Warner Cable, Inc., and Thomson Reuters Corporation, Defendants
O R D E R
Plaintiff, Ryan Landry, filed this putative class action
against his former employer, Time Warner Cable, as well as
Thomson 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.” SEC v. Tambone, 597 F.3d 436, 441
(1st Cir. 2010). Although the complaint need only contain “a
short and plain statement of the claim showing that the pleader
is entitled to relief,” Fed. R. Civ. P. 8(a)(2), it must allege
each of the essential elements of a viable cause of action and
“contain sufficient factual matter, accepted as true, to state a
claim to relief that is plausible on its face,” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citation and internal
punctuation omitted).
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.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). Instead, the facts alleged
in the complaint must, if credited as true, be sufficient to
“nudge[] [plaintiff’s] claims across the line from conceivable
to plausible.” Id. at 570. If, however, the “factual
allegations in the complaint are too meager, vague, or
conclusory to remove the possibility of relief from the realm of
mere conjecture, the complaint is open to dismissal.” Tambone,
597 F.3d at 442.
2 Background
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
3 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 co-
worker 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.
4 Discussion
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.
I. 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.
See generally 15 U.S.C. § 1681c(a)(5) (prohibiting consumer
5 reporting agencies from creating a consumer report containing
adverse items of information, other than records of convictions
of crimes, which antedate the report by more than seven years).
In support of its motion to dismiss that count, Reuters
asserts that “the only information from CLEAR that Plaintiff
attributes to his suspension” is the (false) report of Landry’s
conviction in Texas. Reuters’ Memorandum (document no. 11-1) at
6. And, says Reuters, because the FCRA specifically allows
credit reporting agencies to include “records of convictions of
crimes which antedate[] the report by more than seven years,” 15
U.S.C. § 1681c(a)(5), count five of Landry’s complaint fails to
state a viable cause of action. The court disagrees.
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
other outdated information that is outside the scope of that
exemption. Specifically, Landry alleges that the “Report also
included adverse information that was more than 7 years old,
including, but not limited to, arrests and/or dismissals of
6 criminal counts from 2000.” Complaint at para. 35 (Landry goes
on to claim that, “like most [of] the information in the Report,
this adverse information was inaccurate, in whole or in part.”).
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.
II. 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
7 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. 1 Accordingly, Reuters moves to dismiss
Landry’s claims of willful violations of the FCRA, as set forth
in counts four and five.
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.
Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 57–58 (2007). And,
in support of his claim that Reuters acted with reckless
disregard for its statutory obligations, Landry alleges that:
(1) Reuters is a consumer reporting agency and, therefore, is
well-versed in the requirements imposed upon it by the FCRA; (2)
Reuters provided Landry’s employer with a consumer report in
violation of the FCRA’s requirements; and (3) it has previously
provided other employers with consumer reports related to their
1 The difference is meaningful because if Landry is able to prove that Reuters acted willfully, he could recover statutory damages of up to $1,000 and, potentially, punitive damages. See 15 U.S.C. § 1681n. But, if he is able to demonstrate only that Reuters was negligent, his recovery would be limited to actual damages. See 15 U.S.C. § 1681o.
8 employees in violation of the FCRA’s requirements. From that,
says, Landry, a plausible inference arises that Reuters acted
either knowing that it was violating the FCRA, or with a
reckless disregard for its obligations under that statute. See
generally Bersaw v. Northland Grp. Inc., No. 14-CV-128-JL, 2015
WL 1097402, at *4 (D.N.H. Mar. 11, 2015) (noting that similar
factual allegations would permit a reasonable finder of fact to
conclude that the defendant was “either ignorant of, or simply
ignored, the possibility” that its conduct violated the FCRA -
conduct which, at a minimum, would have been negligent, but
might also support a finding of willfulness or reckless
disregard). See also Phillips v. Grendahl, 312 F.3d 357, 371
(8th Cir. 2002) (noting that evidence that the defendants “had
some experience in dealing with credit reports and either knew
of the Fair Credit Reporting Act or at least knew that such
reports can only be obtained legally under certain
circumstances” could “support an inference that the defendants
knew that their actions were impermissible”) abrogated on other
grounds by Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47 (2007).
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
9 summary judgment. See, e.g., Goodman v. Port Auth. of N.Y &
N.J., 850 F. Supp. 2d 363, 381 (S.D.N.Y. 2012) (“Whether or not
a violation of the FLSA is ‘willful’ is a fact-intensive inquiry
not appropriately resolved on a motion to dismiss.”).
Conclusion
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.
SO ORDERED.
____________________________ Steven J. McAuliffe United States District Judge
August 9, 2017
cc: Benjamin J. Wyatt, Esq. Michael Varraso, Esq. Abigail S. Romero, Esq. Joseph W. Ozmer, II, Esq. Michael D. Kabat, Esq. Michele E. Kenney, Esq. Eric Bosset, Esq. Geoffrey J. Vitt, Esq. Neil K. Roman, Esq.