Obabueki v. International Business Machines Corp., 99 CIV. 11262(AGS).
| Decision Date | 14 June 2001 |
| Docket Number | No. 99 CIV. 12486(AGS).,No. 99 CIV. 11262(AGS).,99 CIV. 11262(AGS).,99 CIV. 12486(AGS). |
| Citation | 145 F.Supp.2d 371 |
| Parties | Abel OBABUEKI, Plaintiff, v. INTERNATIONAL BUSINESS MACHINES CORP. and Choicepoint, Inc., Defendants. |
| Court | U.S. District Court — Southern District of New York |
Gregory Antollino, New York, NY, for Plaintiff.
Kevin G. Lauri, Jackson Lewis Schnitzler & Krupman, International Business Machines Corp., New York, NY, for Defendant.
James H. Cox, Paul, Hastings, Janofsky & Walker LLP, Atlanta, GA, for Defendant Choicepoint, Inc.
This diversity action arises out of the withdrawal of an employment offer to plaintiff Abel Obabueki ("plaintiff") by defendant International Business Machines Corp. ("IBM"). Plaintiff alleges that IBM improperly considered his dismissed misdemeanor conviction in making its decision to withdraw the offer, and failed to properly inform plaintiff of its intent to withdraw the offer, in violation of the New York State Human Rights Law ("NYSHRL"), N.Y. Exec. Law §§ 296(15), 296(16) ("Sections 296(15) and 296(16)"), and the Fair Credit Reporting Act ("FCRA" or "the Act"), 15 U.S.C. §§ 1681 et seq. Plaintiff asserts claims against defendant Choicepoint, Inc. ("Choicepoint") under the FCRA and Section 349 of the New York General Business Law as a result of Choicepoint's allegedly improper provision of information related to the conviction to IBM. Currently before the Court are cross-motions for summary judgment on plaintiff's claims against each defendant, and plaintiff's motions to strike certain of each defendant's affirmative defenses. For the reasons set forth below, the motions are granted in part and denied in part.
Plaintiff, a citizen of Connecticut, has a Ph. D. in Materials Science and Engineering and a Master of Business Administration ("MBA") from Stanford University. (") IBM is a corporation organized and existing under the laws of Delaware with its principal place of business in Armonk, New York. (Amended Complaint ("Compl.") ¶ 3.) Choicepoint2, a corporation organized and existing under the laws of Georgia with its principal place of business in Atlanta, is a consumer reporting agency. Choicepoint regularly engages in whole or in part in the practice of assembling or evaluating information on consumers for the purpose of furnishing consumer reports to employers for employment purposes. The information on consumers which Choicepoint compiles and reports to employers is drawn from matters of public record. (Pl. 56.1 Choicepoint ¶¶ 26, 28, 29; Choicepoint 56.1 Resp. ¶¶ 26, 28, 29.)
In 1995, plaintiff was arrested and charged with fraud in obtaining welfare aid.3 He entered a plea of nolo contendere, was ordered to pay restitution for the amount he illegally obtained, was fined $100, served 13 days in jail, and was placed on two years' probation. On January 27, 1997, plaintiff's conviction was "vacated" and "dismissed" pursuant to California Penal Code § 1203.4 ("Section 1203.4").4 The Order disposing of his case (the "California Order") stated that plaintiff was convicted of a misdemeanor offense, and was discharged from probation prior to the termination of the designated period. .) The California Order further directed that "the plea, verdict, or finding of guilt ... be set aside and vacated and a plea of not guilty be entered; and that the complaint be, and hereby is, dismissed." (Id.) Finally, the California Order stated, in parallel language to Section 1203.4, that:
"[Plaintiff] is advised that this Order does not relieve him/her of the obligation to disclose the above referenced conviction in response to any direct question contained in any questionnaire or application for public office or for licensure by any State or local agency, or for contracting with the California State Lottery."
(Id.; IBM 56.1 ¶ 5; Pl. 56.1 Resp. IBM ¶ 5; see also Section 1203.4.) The record of the conviction was not sealed.5 (IBM 56.1 ¶ 7; Pl. 56.1 Resp. IBM ¶ 7.)
Subsequently, plaintiff engaged the services of a private detective to determine what a prospective employer could learn about his conviction by performing a background check. (IBM 56.1 ¶ 8; Pl. 56.1 Resp. IBM ¶ 8; Pl. Dep., Ex. B to Lauri Aff., at 176-82, 461-67.) The detective advised plaintiff that his record was clear and contained no convictions. (IBM 56.1 ¶ 9; Pl. 56.1 Resp. IBM ¶ 9.) Plaintiff claims that he conducted a similar investigation on his own, and was unable to locate information containing his conviction. (Pl. Dep. at 176-82, 461-67.)
At IBM, once a decision is made to make a conditional offer of employment to a candidate, the individual is asked to complete an application form. (IBM 56.1 ¶ 18; Pl. 56.1 Resp. IBM ¶ 18.) An applicant must also complete a Security Data Sheet ("SDS"), which requests, inter alia, that he identify whether he has pleaded guilty or "no contest" to a crime or other offense within the last seven years.6 However, the applicant is expressly requested not to include "arrests without convictions" or "convictions or incarcerations for which a record has been sealed or expunged." Both the application form and SDS provide that "any misrepresentation or deliberate omission of a fact ... will justify terminating consideration" of the application for employment. (IBM 56.1 ¶ 20; Pl. 56.1 Resp. IBM ¶ 20.) Further, IBM policy states that the mere identification of a conviction on the SDS will not subject an applicant to disqualification. (IBM 56.1 ¶ 21; Pl. 56.1 Resp. IBM ¶ 21.) Rather, the policy requires that the company perform an analysis of whether the crime is related to the position for which the applicant has applied. (IBM 56.1 ¶ 22; Pl. 56.1 Resp. IBM ¶ 22.) Specifically, the policy provides that "when reviewing information listed on the SDS (i.e. criminal record history) of a potential employee," the Human Resources unit responsible for hiring must perform an analysis of the crime in relation to the job being offered to determine whether placing the applicant in the position would create a risk to the safety or property of others. (IBM 56.1 ¶ 23; Pl. 56.1 Resp. IBM ¶ 23.)
In April 1999, Olwyn Spencer ("Spencer"), IBM's Program Director for Market Management, identified the need for a marketing manager position for the company's JAVA Company Software group. Spencer, who is also the Hiring Manager for that group, initially posted the position notice on the IBM website for IBM employees. (IBM 56.1 ¶ 24; Pl. 56.1 Resp. IBM ¶ 24.) By August 1999, no internal candidates had emerged. James Bailey ("Bailey"), an IBM recruiter, then sought outside candidates for the position.7 At a certain point, Bailey received plaintiffs resume from another IBM recruiter, and sent it to Kathy Brown ("Brown"), the IBM Account Manager for the JAVA position, who in turn forwarded it to Spencer for consideration. (IBM 56.1 ¶¶ 25-26; Pl. 56.1 Resp. IBM ¶¶ 25-26.)
In September 1999, plaintiff interviewed with Spencer for the marketing manager position. Spencer rated plaintiff an outstanding candidate for the job, and he was given a conditional offer of employment subject to a background check.8 Plaintiff then completed the IBM application form and SDS. In response to the question regarding prior convictions that were neither "expunged" nor "sealed," plaintiff checked "no." (IBM 56.1 ¶ 30; Pl. 56.1 Resp. IBM ¶ 30.)
IBM retained Choicepoint to perform the background check on plaintiff, pursuant to a longstanding agreement (the "IBM-Choicepoint Agreement") whereby Choicepoint renders "background Verification Services" to IBM.9 10 On September 28, 1999, an individual working for Inquest, one of Choicepoint's contractors, was sent to the state courthouse in Santa Clara County, California to check for criminal convictions of plaintiff. The contractor identified plaintiff's former conviction for welfare fraud and reported it to Choicepoint. .)
On or about October 5, 1999, IBM received a report from Choicepoint, apparently based on the information Choicepoint had obtained from Inquest, which reflected plaintiff's welfare fraud conviction (the "First Report").11 However, the report failed to mention the dismissal of the conviction pursuant to Section 1203.4. Upon receiving the First Report, Brown contacted plaintiff and advised him of its contents.12 Plaintiff responded that the conviction had been vacated and the case dismissed, and provided Brown with a copy of the California Order. (IBM 56.1 ¶¶ 33-34; Pl. 56.1 Resp. IBM ¶¶ 33-34; Pl. Dep. at...
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