Ryals v. Strategic Screening Solutions, Inc.

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For James Ryals, Jr., on behalf of himself and all others similarly situated, Plaintiff: Christopher Colt North, LEAD ATTORNEY, Newport News, VA; Leonard Anthony Bennett, Susan Mary Rotkis, Consumer Litigation Associates, Newport News, VA; William Leonard Downing, The Consumer and Employee Rights Law Firm PC, Newport News, VA.

For Strategic Screening Solutions, Inc., Liberty Screening Services, Ltd., Defendants: Charles Michael Sims, LEAD ATTORNEY, LeClairRyan, A Professional Corporation, Richmond, VA; Ryan Christopher Day, LeClairRyan PC (Alexandria), Alexandria, VA.

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MEMORANDUM OPINION

Robert E. Payne, Senior United States District Judge.

This case is before the Court on the Defendants' MOTION TO DISMISS FIRST AMENDED CLASS ACTION COMPLAINT PURSUANT TO RULE 12(b) (1) (Docket No. 23). For the reasons set forth below, this motion will be denied.

BACKGROUND

Plaintiff, James Ryals, Jr. (" Ryals" ) applied for employment with GCA Services Group, Inc. (" GCA" ) in March of 2014. First Amended Class Action Complaint (" FAC" ) (Docket No. 5, at ¶ 35). As a part of the employment process, GCA obtained a background report that was prepared by the Defendants, which, according to the FAC, are consumer reporting agencies. Id. at ¶ ¶ 37, 19-21. Ryals received several letters during the hiring process that informed him that GCA was reviewing his application for employment based on information collected from the Defendants. Id. at ¶ ¶ 46-51. One of those letters contained a copy of a consumer report that is alleged to reflect dismissed charges that were too old to be lawfully included in a consumer report. Id. at ¶ ¶ 38-43, 49-50. In early April of 2014, Ryals was notified that GCA had decided not to offer him a position based, at least in part, on adverse information provided in the background reports. Id. at 52-54.

Defendants contend, however, that GCA " reconsidered its denial and offered employment to Plaintiff" in May of 2014. Memorandum in Support of Motion to Dismiss First Amended Class Action Complaint Pursuant to Rule 12(b)(1), Docket No. 24, at 3 (hereafter " Defendants' Opening Br." at 3.). They assert that Ryals " never responded to GCA's offer, which was communicated by a GCA employee to Plaintiff in multiple voicemail messages that same month." Id.; see also Declaration of Staci Hoover^[1], Docket No. 24-6 (" I

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personally communicated GCA's offer of employment to Mr. Ryals by telephone at the number he provided in his employment application. I left four or five messages on Mr. Ryals' voicemail, each indicating that he had been selected for employment and requesting that he contact me to schedule orientation." ) Ryals " denies that he ever received any telephone calls or voicemail messages from GCA or anyone on behalf of GCA." Plaintiff's Response in Opposition to Defendants' Motion to Dismiss First Amended Class Complaint Pursuant to Rule 12(b)(1), Docket No. 27, at 5 (hereafter " Plaintiff's Response Br." at 5.).

In the FAC, Ryals alleges that the Defendants violated three provisions of the Fair Credit Reporting Act (" FCRA" ). Docket No. 5. In Count I, Ryals alleges that the Defendants violated 15 U.S.C. § 1681c(a)(5) by including " adverse items of information ... which antedated the report on Plaintiff by more than seven years." Id. at 12. In Count II, Ryals alleges that Defendants violated 15 U.S.C. § 1681g(a) by " systematically failing to provide a complete copy of all information in class member files within its mandated disclosure" , failing " to disclose the actual sources of information within [the] reports" , and failing " to include the explanation of rights disclosures mandated" by the FCRA. Id. at 17. In Count III, Ryals alleges that the Defendants violated 15 U.S.C. § 1681k by " failing to notify consumers at the time ... of the fact that adverse public and criminal record information [was] being provided to employers or prospective employers" and failing to maintain strict procedures. Id. at 19. Ryals has acknowledged that his actual damages stemming from the above facts are " nominal." Id. at ¶ 121.

DISCUSSION

Defendants argue that Ryals lacks Article III standing to pursue his FCRA claims because he has not alleged a legally-cognizable injury-in-fact.^[2] If the plaintiff does not have standing, this Court lacks subject matter jurisdiction and can go no further in evaluating this case, and it must be dismissed. Arbaugh v. Y & H Corp., 546 U.S. 500, 514, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006).

I. Legal Standard

The United States Constitution's " case-or-controversy" requirement limits the jurisdiction of the federal court system. U.S. Const. Art III § 2. In order to fall within the Constitution's limits and thus the federal court system's jurisdiction, a plaintiff suing in federal court must have standing to pursue his or her claim. If a named plaintiff in a putative class action cannot establish that he has standing to pursue a claim or claims, then the entire action must be ...