Stacy v. Dollar Tree Stores, Inc.

• Decision Date: 11 August 2017
• Docket Number: CASE NO. 16–61032–CIV–ZLOCH
• Citation: 274 F.Supp.3d 1355
• Parties: Sherika STACY, on behalf of herself and all similarly-situated individuals, Plaintiff, v. DOLLAR TREE STORES, INC., Defendant.
• Court: U.S. District Court — Southern District of Florida

274 F.Supp.3d 1355

Sherika STACY, on behalf of herself and all similarly-situated individuals, Plaintiff,

v.DOLLAR TREE STORES, INC., Defendant.

CASE NO. 16–61032–CIV–ZLOCH

United States District Court, S.D. Florida.

Entered August 14, 2017

Signed August 11, 2017

Brandon J. Hill, Luis A. Cabassa, Wenzel Fenton Cabassa, P.A., Marc Reed Edelman, Morgan & Morgan, P.A., Tampa, FL, Craig Carley Marchiando, Pro Hac Vice, Leonard A. Bennett, Pro Hac Vice, Consumer Litigation Associates, P.C., Newport News, VA, for Plaintiff.

Barry Rodney Davidson, Douglas C Dreier, Hunton & Williams LLP, Miami, FL, Lewis F. Powell, III, Pro Hac Vice, Hunton & Williams, LLP, Richmond, VA, Robert T. Quackenboss, Pro Hac Vice, Hunton & Williams, Atlanta, GA, Cullan Edmiston Dertie Jones, Hunton and Williams LLP, Washington, DC, for Defendant.

ORDER

WILLIAM J. ZLOCH, Sr. United States District Judge

THIS MATTER is before the Court upon Defendant Dollar Tree Stores, Inc.'s Motion To Sever And Remand Counts II And III Of The First Amended Complaint Pursuant To 28 U.S.C. § 1441 (DE 50). The Court has carefully reviewed said Motion, the entire court file and is otherwise fully advised in the premises.

When Plaintiff Sherika Stacy ("Stacy") applied for a promotion with Defendant Dollar Tree Stores, Inc. ("Dollar Tree"), she completed a form authorizing a background check. That form contained the disclosure mandated by the Fair Credit Reporting Act ("FCRA"). Despite the FCRA's requirement that this disclosure be in a stand-alone document, 15 U.S.C. § 1681b(b)(2)(A)(I), the form also contained information to assist Stacy in understanding her rights and the scope of the background check. Stacy understood she was authorizing a background check when she completed the form, but has nevertheless sued Dollar Tree for providing more information than the FCRA requires. The Court must now decide whether she suffered a concrete injury or instead whether she merely trifles with a "bare procedural violation" of the statute. Spokeo, Inc. v. Robins, ––– U.S. ––––, 136 S.Ct. 1540, 1549, 194 L.Ed.2d 635 (2016).

I. Background

A. The Statutory Backdrop

The FCRA regulates the creation and use of "consumer reports"—reports containing information "bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics or mode of living," that are used for, among other things, "employment purposes." 15 U.S.C. § 1681a(d)(1) (hereinafter, "consumer report" or "background check"). A "consumer" is simply an individual. 15 U.S.C. § 1681a(c). "Employment purposes" include "evaluating a consumer for employment, promotion, reassignment or retention as an employee." 15 U.S.C. § 1681a(d)(1).

As pertinent here, the FCRA prohibits the procurement of a consumer report for employment purposes, unless: (1) "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 ... that a consumer report may be obtained for employment purposes" and (2) "the consumer has authorized in writing ... the procurement of the report. ..." 15 U.S.C. § 1681b(b)(2)(A). The FCRA mandates that this disclosure be "in a document that consists solely of the disclosure." Id. (hereinafter, the "stand-alone document requirement").

B. Stacy's Employment at Dollar Tree

Dollar Tree owns and operates a chain of discount variety stores across the country. From 2013 to 2015, Stacy worked as a sales associate at a Dollar Tree store in Tallahassee, Florida. Because Dollar Tree does not conduct background checks on applicants for sales associate positions, Dollar Tree did not conduct a background check on Stacy before she was hired. Dollar Tree does, however, conduct background checks on applicants for assistant store manager. So, when Stacy applied for a promotion to that position, Dollar Tree sent her an email notifying her of its intent to conduct a background check.

In that email, Dollar Tree provided a link to a five-page disclosure and authorization form, titled "Consent To Request Consumer Report & Investigative Consumer Report Information" ("the Form"). The Form advised Stacy that Dollar Tree would use a company called Sterling InfoSystems, Inc., to conduct the background check. In substantial part, the Form reads:

I understand that [Dollar Tree Management, Inc. and it's [sic] affiliated companies](‘COMPANY’) will use Sterling InfoSystems Inc., 249 West 17th Street, New York, NY 10011, (877) 424–2457 to obtain a consumer report ("Report") as part of the hiring process. I also understand that if hired, to the extent permitted by law, COMPANY may obtain further Reports from STERLING so as to update, renew or extend my employment.

I understand Sterling InfoSystems Inc.'s ("STERLING") investigation may include obtaining information regarding my credit background, bankruptcies, lawsuits, judgments, paid tax liens, unlawful detainer actions, failure to pay spousal support or child support, accounts place for collection, character, general reputation, personal characteristics and standard of living, driving record and criminal record, subject to any limitations imposed by applicable federal and state law. I understand such information may be obtained through direct or indirect contact with former employers, schools, financial institutions, landlords, and public agencies or other persons who may have such knowledge.

The nature and scope of the investigation sought is indicated by the selected services below: [including criminal background check, Social Security number trace, and motor vehicle report]

I acknowledge receipt of the attached summary of my rights under the Fair Credit Reporting Act and, as required by law, any related state summary of rights (collectively "Summaries of Rights").

This consent will not affect my ability to question or dispute the accuracy of any information contained in a Report. I understand if COMPANY makes a conditional decision to disqualify me based all or in part on my Report, I will be provided with a copy of the Report and another copy of the Summaries of Rights, and if I disagree with the accuracy of the purported disqualifying information in the Report, I must notify COMPANY within five business days of my receipt of the Report that I am challenging the accuracy of such information with STERLING.

I hereby consent to this investigation and authorize COMPANY to procure a report on my background.

In order to verify my identity for purposes of Report preparation, I am voluntarily releasing my date of birth, social security number and the other information and fully understand that all employment decisions are based on legitimate non-discriminatory reasons.

The name, address, and telephone number of the nearest unit of the consumer reporting agency designated to handle inquiries regarding the investigative consumer report is: [Sterling]

DE 50–1. On the first and second pages of the Form, there are also notices about consumers' rights under various state laws. The second and third pages of the Form contain lines for the applicant's signature and space where applicants provide information necessary to conduct the background check. And the fourth and fifth pages of the Form contain information about consumers' rights under the FCRA and contact information for federal agencies tasked with handling consumer protection matters.

Stacy completed, signed, and returned the Form. When a Dollar Tree manager later reviewed Stacy's background check, he erroneously interpreted it as suggesting Stacy had lied about her criminal record on her application. Dollar Tree then terminated Stacy's employment.

Stacy filed suit in state court, asserting three claims under the FCRA. The two germane here—Counts II and III—assert that the Form violated the FCRA's stand-alone document requirement and, as a result, that Dollar Tree never received effective consent to run a background check. Dollar Tree removed the case to this Court, believing the case was within this Court's original jurisdiction.

After Dollar Tree removed the case, two pertinent events occurred. On May 16, 2016, the Supreme Court issued its opinion in Spokeo v. Robins, 136 S.Ct. 1540. And on January 31, 2017, Dollar Tree deposed Stacy. During the deposition, Stacy testified that she received the Form after she applied for a promotion, that she completed it, and that in so doing she understood she was authorizing Dollar Tree to conduct a background check. DE 50–2. The Parties agree on this much.

But they disagree on the legal import of these undisputed facts. Dollar Tree now moves the Court to sever Counts II and III and remand them state court because, in its view, Stacy has conceded that she lacks standing to prosecute those claims in federal court. Stacy maintains that the whole case must remain here because, in her view, violation of the FCRA's stand-alone document requirement is alone sufficient to inflict a concrete injury in fact.

II. Standard of Review

Dollar Tree's Motion (DE 50) asserts that the Court lacks subject matter jurisdiction over Counts II and III of the First Amended Complaint (DE 17) because Stacy lacks Article III standing. Attacks on subject matter jurisdiction, including the plaintiff's standing, come in two forms: "facial attacks" and "factual attacks." Lawrence v. Dunbar, 919 F.2d 1525, 1528–29 (11th Cir. 1990). A facial attack challenges only the pleadings. Id. But a factual attack "challenges the existence of subject matter jurisdiction using materials extrinsic from the pleadings, such as affidavits or testimony." Stalley ex rel. United States v. Orlando Regional Healthcare Sys., Inc., 524 F.3d 1229, 1233 (11th Cir. 2008). Because Dollar Tree relies on materials outside the pleadings—namely, the transcript of Stacy's deposition—it raises a factual attack on the Court's subject matter jurisdiction. But because the facts pertinent to the instant Motion (DE 50) are undisputed, the Court need not hold an...