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Ninth Circuit Rejects “Novel” FCRA Standalone Theory


Seyfarth Synopsis: In recent years, federal courts have weighed in on the Fair Credit Reporting Act’s (FCRA) requirement that consumer report disclosures be in a standalone document consisting solely of the disclosure. Recently, the Ninth Circuit rejected a former employee’s argument that his employer violated the FCRA when it provided the consumer report disclosure with other application materials, concluding that this “novel” interpretation of the FCRA “stretches the statute’s requirements beyond the limits of law and common sense” and “is thwarted by the statute itself.”Luna v. Hansen & Adkins Auto Transport, Inc.

The Facts

The FCRA requires employers who obtain a background check report on a job applicant to first provide the applicant with a “clear and conspicuous disclosure” in a document that consists solely of the disclosure that the employer may obtain such a report. In recent years, the Ninth Circuit has considered the extent to which certain text in the disclosure is considered extraneous and, thus, violates the standalone requirement.

In Luna, the plaintiff did not take issue with the language in the consumer report disclosure. Instead, he brought a class action lawsuit claiming that his former employer violated the FCRA by (1) providing the disclosure simultaneously with other application materials and (2) failing to place the FCRA authorization on a standalone document. While the consumer report disclosure was on a standalone document, the authorization appeared at the end of the employment application, which included other notices, waivers, and agreements unrelated to acquiring the consumer report. The district court granted the employer’s motion for summary judgment.

The Ninth Circuit’s Decision

On April 24, 2020, the Ninth Circuit held that the FCRA’s standalone requirement does not prohibit the presentation of the disclosure together with other application materials. The Court noted that while the FCRA FULL ARTICLE

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