Williams v. First Advantage LNS Screening Solutions Inc., No. 17-11447

Citation947 F.3d 735
Decision Date09 January 2020
Docket NumberNo. 17-11447
Parties Richard Alexander WILLIAMS, Plaintiff-Appellee, v. FIRST ADVANTAGE LNS SCREENING SOLUTIONS INC, f.k.a. LexisNexis Screening Solutions Inc., et al. Defendants, First Advantage Background Services Corporation, a Florida Corporation, Defendant-Appellant.
CourtU.S. Court of Appeals — Eleventh Circuit

Barry Seth Balmuth, Law Office of Barry Seth Balmuth, Palm Beach Gardens, FL, Michael Massey, Massey & Duffy, LLC, Gainesville, FL, for Plaintiff-Appellee.

Frederick T. Smith, Megan Hall Poonolly, Seyfarth Shaw, LLP, Atlanta, GA, Jules A. Levenson, Thomas J. Piskorski, Jason Matthew Torres, Joseph S. Turner, Seyfarth Shaw, LLP, Chicago, IL, for Defendant-Appellant.

Before MARTIN, JULIE CARNES, and O’SCANNLAIN,* Circuit Judges.

JULIE CARNES, Circuit Judge:

In this Fair Credit Reporting Act ("FCRA") case, First Advantage Background Services Corporation ("Defendant") appeals the denial of its motion for judgment as a matter of law, or, in the alternative, motion for a new trial or remittitur. On appeal, Defendant asserts that the jury’s $250,000 compensatory damages award should be vacated because Richard Alexander Williams ("Plaintiff") failed to show evidence of reputational harm. Defendant also contends that it was entitled to judgment as a matter of law on Plaintiff’s claim that it willfully violated the FCRA. Finally, Defendant argues that the excessiveness of the jury’s $3.3 million punitive damages award rendered it unconstitutional under the Due Process Clause. After careful review, and with the benefit of oral argument, we affirm the district court’s denial of Defendant’s motion for judgment as a matter of law to the extent it challenged the reputational harm claim and the willfulness claim. We, however, vacate the jury’s punitive damages award and remand the case to the district court to enter a judgment awarding Plaintiff $1 million in punitive damages.

I. Defendant’s Procedures

Defendant is a consumer reporting agency that prepares criminal background reports on individuals. In 2012 Defendant prepared around 9 to 10 million background reports nationally, and in 2013 it prepared 10 to 12 million background reports nationally.1 Defendant charged $11 to $12 for each report. As to how Defendant prepares these reports, Defendant maintains a national criminal file database that contains criminal records from around the country. When a customer orders a criminal background check, the consumer’s information is passed through an automated search of this database.

Defendant’s standard operating procedures for people with non-common names require a match of at least two identifiers—such as name, date of birth, social security number, or driver’s license number—before attributing to the subject of a background investigation the criminal record of a person with the same, or similar, name. Attribution requires only a "reasonable match," rather than an exact match. Defendant looks for middle names or initials, but a match can be made without one. For example, consider the following two individuals, both of whom are Florida residents born on the same day with an uncommon name: Daniel Atreus Kowalski and Dan Kowalski. Daniel and Dan have a match of two identifiers—identical dates of birth and "reasonably matching" names. If Dan had a grand theft auto conviction, while Daniel had no criminal record, a background report compiled by Defendant on Daniel could nonetheless indicate that he had a grand theft auto conviction. The fact that Daniel has a reported middle name would not prevent Dan’s criminal record from being included in a background report on Daniel. On the other hand, if Dan had a conflicting middle name or middle initial (e.g. , "C." or "Christopher"), Dan’s conviction would not be included in Defendant’s background report on Daniel.

Defendant purports to follow a different procedure when a customer requests a background report on an individual with a common name, such as Joe Smith. In such a case, Defendant’s policy provides that a member of the records adjudication team must attempt to locate a third identifier to ensure a reasonably accurate match. An adjudicator could potentially use Experian to obtain an address history that might provide more information except for the fact that Defendant’s agreement with Experian limits the number of employees who can conduct an Experian search; so Experian is not always utilized. If the adjudicator cannot locate a third identifier, he or she must so note this fact and obtain a supervisor’s permission before releasing the criminal background report. Thus, notwithstanding Defendant’s awareness that a third identifier should be obtained, its actual practice permits matching a subject who has a common name with a criminal record based on only two identifier matches.

Defendant has a dispute system that allows consumers to contest items listed in their background reports. Between 2010 and 2013, Defendant prepared 3,554,163 reports containing public record information. During that time, Defendant made 13,392 corrections as a result of customers successfully disputing Defendant’s inclusion of public records belonging to another individual in their background reports, yielding a "not-me" or "not mine" error rate of 0.38 percent nationally.2 During the relevant time period, Defendant’s "not-me" or "not mine" error rate for Florida reports ranged from 0.28 percent (2013) to 0.64 percent (2012).

Pertinent here is the fact that Defendant’s system offers no means to ensure that an investigative subject who has been mispaired with a particular criminal conviction or arrest of a person with a similar name will not be mismatched in future background checks with other convictions/arrests of this same person. To return to our Dan/Daniel example above, assume that Dan was convicted in 2006 of grand theft auto, but a 2008 background report on Daniel erroneously attributed Dan’s grand theft auto conviction to Daniel. Seeing the error, Daniel immediately disputed the inclusion of the conviction in his background report, resulting in a revised report. After being released from prison, Dan returns to his life of crime and is convicted of carjacking in 2013. Although Defendant’s system can prevent a future misattribution of the disputed 2006 conviction, it provides no means to prevent other convictions or arrests of Dan, such as the 2013 carjacking conviction, from being attributed to Daniel in a subsequent background report.

II. Events Leading to the Present Suit

Plaintiff Richard Williams has lived with his mother in Chiefland, Florida, for his entire life. In February 2012, Plaintiff applied for a customer accounts representative position at Rent-A-Center East, Inc.’s ("Rent-A-Center") Chiefland store. As part of the hiring process, Rent-A-Center asked Defendant to prepare a criminal background report on Plaintiff.

In preparing the Rent-A-Center background report, Defendant’s employees examined public records from the Palm Beach County and Levy County courts. According to the Rent-A-Center report, Defendant used Plaintiff’s first, middle, and last name, social security number, date of birth, and address to prepare the report. The report also indicated that Defendant had obtained driver record information from Florida’s motor vehicle records, and it listed Plaintiff’s driver’s license number and information.

On February 28, 2012, Defendant sent an electronic copy of the report to Rent-A-Center and mailed a copy to Plaintiff. The report stated that the Palm Beach Circuit and County courts had two case numbers associated with a "Ricky Williams." Both cases involved 2009 charges for sale of cocaine. The listed disposition of the cases was "bench warrant." Both cases stated that the "SSN on File" was the same as the first five digits of Plaintiff’s social security number, though the report indicated that the match between Plaintiff and Ricky Williams was based on their names and dates of birth. Given the criteria provided by Rent-A-Center, Plaintiff’s "overall case score" was "ineligible." Although Richard Williams is a common name, Defendant did not follow its common-name procedure, which called for the use of three, not just two, identifiers.

On March 1, 2012, Plaintiff filed a dispute with Defendant and provided a copy of his driver’s license, which listed his height as five feet, ten inches. After Plaintiff initiated the dispute, Defendant’s employees ordered copies of the physical records relating to Ricky Williams’ charges and saw that Ricky Williams’ bench warrant listed his height as six feet, two inches. Upon seeing the discrepancy in height, Defendant removed the sale-of-cocaine charges from Plaintiff’s report. On March 12, 2012, Defendant sent Rent-A-Center a revised background report clearing Plaintiff, but Rent-A-Center did not re-extend its job offer to Plaintiff.

Plaintiff subsequently applied for a variety of other jobs. In November 2012, he was hired by the Levy County Sheriff’s Office to be a 911 dispatcher. Rather than hiring an outside company, the Sheriff’s Office conducted its own background check on Plaintiff and apparently found no disqualifying information. Unfortunately, though, Plaintiff could not meet performance expectations while in training, and he quit after about a month in lieu of being terminated.

In March 2013, Plaintiff was hired by Kangaroo, a gas station. Like the Sheriff’s Office, Kangaroo ran its own background check. Plaintiff ultimately left the Kangaroo job because he was not working enough hours, and all of the money he made was used to pay for his own gas. A few days after quitting his job at Kangaroo, Plaintiff received a call from Winn-Dixie Stores, Inc. ("Winn-Dixie"), offering him an interview. Plaintiff subsequently received a job offer for a position at Winn-Dixie’s Gainesville store, but the offer was contingent on Plaintiff passing a background check. On April 23, 2013, Winn-Dixie asked Defendant to...

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