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Food Lion Parent Company Settles FCRA Lawsuit for $3 Million

The parent company of Food Lion has recently joined the ranks of companies paying large dollar amounts to settle a Fair Credit Reporting Act (FCRA) class action lawsuit. On March 2, 2015, a preliminary motion was filed by the plaintiffs in Brown v. Delhaize America, LLC, (the parent company of Food Lion) in which the plaintiff’s attorneys are seeking the court’s approval of a $3 million FCRA class action settlement.

At the root of the lawsuit were the company’s disclosure forms and its adverse action procedures. As we have seen in many of these cases, the plaintiff claimed the defendants’ disclosure form violated the FCRA because it was not a stand-alone document. The plaintiff also claimed that the defendants “frequently took adverse employment action against their employees based on their background checks without providing those employees with a pre-adverse action notice required by the FCRA.”

This is another reminder to employers to review their disclosure forms and their adverse action procedures to make sure everything complies with the FCRA, as well as another state and local laws. Corporate Screening offers compliance services and products that can assist, including our Screening Assessment Program (SPA) and our Adverse Action Workflow Tool. For more information visit Compliance Services on our website,

2015 ERC Hiring Trends & Practices Survey Now Open

Corporate Screening, in partnership with ERC, would like to invite you to participate in the 2015 Hiring Trends & Practices Survey. From the logistics of recruitment and the selection process to hiring related policies and metrics like time-to-fill and cost-per-hire, the final survey report will provide valuable benchmarking data and insights about the hiring trends and practices of organizations just like yours here in Northeast Ohio.

It doesn’t take a lot of time – about 15 minutes, and your input will help ERC gather the most up-to-date hiring metrics. Additionally, survey participants will receive a free electronic copy of the full report when it is published later this spring.

The deadline to participate in this survey is Friday, April 17, 2015. Click here to participate today.

If you have any questions, please contact ERC at 440-684-9700 or by email at

Background Checks Are a Growing Trend in Youth Sports


We’ve blogged a number of times on our VerifyStudents blog about the growing number of colleges and universities that have implemented background check policies designed to protect minors on their campuses. Organizations involved with student sports also appear to be joining in on this trend.

A recent article reported that the Massachusetts Interscholastic Athletic Association (MIAA) will require referees and umpires working with students to undergo background checks beginning this summer. The move comes after two incidents: the first, when a Boston Globe investigation indicated some of the referees had serious criminal records; and the second (which happened shortly after the Globe investigation), when a high school basketball referee was charged with murdering his wife.

Criminal offenses that could prevent employment include those “ involving violence, threats of violence, drugs, sexual assault, and crimes against minors, among other things. Suspension would be immediate and would last until the legal case is resolved.  Disqualified referees can appeal twice to review panels.” 

The MIAA is not the only ones requiring background checks. A USA Today article reports that USA Basketball is beginning a program that not only certifies basketball coaches, but also improves the safety for participating students by requiring its coaches to undergo background checks. A spokesman for the organization said it wants to implement standards for coaching that make the game both enjoyable and safe.

Update: EEOC vs. Freeman Decision


On Friday, the U.S. Court of Appeals for the Fourth Circuit affirmed a summary judgment ruling from August 2013 (read our blog for more detail) that dismissed the EEOC’s lawsuit against Freeman, Inc., a service provider for corporate events (EEOC vs Freeman). The lawsuit alleged that Freeman’s background and credit checks created a disparate impact against African American, Hispanic and male candidates. A recent Seyfarth Shaw blog states,”the Fourth Circuit unanimously affirmed Judge Titus’ rejection of the “utterly unreliable analysis” of the EEOC’s expert, while a concurring judge went out of his way to chide the EEOC at length for its litigation tactics across this line of systemic background check cases.”

The bottom line was that the courts found the EEOC’s expert and his reports to be unreliable, citing a number of reasons: he used a selective data sample, which skewed the results; and the contained missing data, mathematical errors and coding errors. Seyfarth Shaw’s blog continues:

This ruling is the latest in a string of defeats to the EEOC in its campaign to challenge employer’s use of background checks in hiring decisions.  The Fourth Circuit decision is particularly noteworthy for a blistering concurrence by Judge Steven Agee.  Judge Agee agreed with the decision of the panel, noting that it “was not a close question,” but wrote separately to excoriate the EEOC for its questionable litigation tactics in the Freeman case and across this line of cases generally.  The concurrence details at length the “record of slipshod work” by the EEOC’s expert in other similar cases, including EEOC v. Kaplan Higher Education Corp., a similar ruling by the Sixth Circuit last year.  Judge Agee outlined a scathing critique of the “slapdash nature of Murphy’s work,” concluding that Murphy “undeniably cherry-picked” and perhaps even “fully intended to skew the results.”

As a governmental agency, the EEOC holds a lot of power and has great resources at its disposal. Judge Agee expressed his concerns about this in the decision:

In deciding when to act, the Commission must balance sometimes-competing responsibilities. On the one hand, the agency must serve the employee’s interest by preventing an employer from “engaging in any unlawful employment practice” under Title VII. 42 U.S.C. § 2000e-5(a). On the other hand, “the EEOC owes duties to employers as well: a duty reasonably to investigate charges, a duty to conciliate in good faith, and a duty to cease enforcement attempts after learning that an action lacks merit.” EEOC v. Argo Distrib., LLC, 555 F.3d 462, 473 (5th Cir. 2009). That the EEOC failed in the exercise of this second duty in the case now before us would be restating the obvious. 

While this decision is a blow to the EEOC, it remains to be seen whether this will slow down their aggressive strategy.

Uber Adds “Panic Button” in Chicago

Background Check - Traffic

The Chicago Sun Times reports that Uber will add a “panic button” to its app in Chicago. If users feel threatened, they can press the button and the police will be alerted. Uber’s General Manager, Chris Taylor, said that the feature would likely become used in other areas.


Additionally, riders in Chicago who use Uber should be aware that in January an additional safety program was rolled out. Similar to secret shopping, 10 off-duty police officers were hired to take Uber rider one day a month and report back to the company about the experience.


Uber’s head of safety, Phillip Cardenas, states in the article that the company does background checks that go back seven years, which is two years more than the city requires.


As we have stated before, conducting background checks is important for businesses such as Uber, where customer safety should be of utmost concern.  The additional safety measures being used and piloted in Chicago should only help further to protect users.


FTC Shuts Down Diploma Mill Operators


The Federal Trade Commission (FTC) announced that as part of a settlement, two Florida-based diploma mills will no longer market and sell academic degrees. The FTC’s complaint was that they “deceived consumers into enrolling in their programs by claiming they could obtain “official” and accredited high school diplomas and use them to enroll in college, apply for jobs, and “receive the recognition [they] aspire for in life.” The defendants also fabricated an accrediting organization to give legitimacy to their diploma mill operation.”


Marketing the diplomas under the names “Jefferson High School Online,” and “Enterprise High School Online,” the defendants claimed that for $200-$300 and passing a multiple choice exam, consumers would receive a legitimate high school diploma. In September 2014, a U.S. district court judge signed a temporary restraining order that halted the businesses.


Under the settlement, the defendants are not allowed to make misrepresentations in marketing or selling other products or services, and were fined more than $11.1 million (which will be partially suspended, based on inability to pay). But if it is discovered that the defendants misrepresented their financial positions, they will be responsible for the entire amount immediately.


Consumers looking to complete their degrees should be on the lookout for diploma mills. One thing to check is the school’s accreditation. Diploma mills often claim they are accredited by fake accrediting agencies. The U.S. Department of Education publishes a List of Nationally Recognized Accrediting Agencies. If the school is not accredited by one of these agencies, it could be a diploma mill.


At Corporate Screening, we offer education verification that identifies diploma mills and phony accrediting agencies which are not recognized by the U.S. Department of Education. For more information about diploma mills, we invite you to check out the article, “High School Diploma Mills” featured in a previous edition of our newsletter, Screening Solutions.

Another Lawsuit Reminder: Are Your Company’s Adverse Action Procedures FCRA Compliant?



FCRA compliance continues to be an important theme in 2015. This time, McKnight’ reports that a federal lawsuit claims Genesis Healthcare, which runs more than 500 long-term care facilities and is one of the largest nursing home chains in the U.S., did not follow proper adverse action procedures. In addition, the suit claims that the consumer reporting agency that Genesis used, General Information Services (GIS), did not “take reasonable steps to ensure accuracy” of the information it reported.


The plaintiff claims that Genesis Healthcare rescinded the job after hiring her, and she was not provided with a copy of her background check and “a statement of her rights, as called for by the FCRA.” The plaintiff is also seeking class action status against Genesis.


The beginning of the year is a good time to review your adverse action procedures. Check your letters and supporting documents, and review your processes to make sure that they comply with FCRA guidelines.


Corporate Screening would also like to remind you that our Adverse Action Workflow Tool can help. Generate on-demand pre-adverse action and adverse action letters, automated messages that tell you when to proceed with the next step, and with an electronic log that keeps track of your actions, the Adverse Action Workflow was designed to simplify and streamline this process!


For more information about the Adverse Action Workflow Tool, visit our website at You can also sign up for a free webinar to learn more about the tool. Dates, times and registration links are listed below.


Adverse Action Workflow Tool Webinars

Please note that all webinars are on Eastern Standard Time.


Wed, Jan 28, 2015 3:00 PM – 4:00 PM EST


Fri, Jan 30, 2015 11:00 AM – 12:00 PM EST


Tue, Feb 3, 2015 1:00 PM – 2:00 PM EST


Thu, Feb 5, 2015 11:00 AM – 12:00 PM EST

New Year, New FCRA Class Action



Welcome to a new year. It didn’t take long before an FCRA class action lawsuit was filed. reports that Paramount Pictures is the latest to be slapped with a lawsuit that alleges the company violated the Fair Credit Reporting Act (FCRA). The plaintiffs allege that the company’s disclosure document violated the FCRA because it was not a stand-alone document.


According to the article, the estimated class membership is more than 500, and statutory damage requests range from $100 to $1000 for each FCRA violation. Add in the legal fees involved and this could be an expensive case for Paramount.


Employers, please take the time now to review your background screening policies and forms. It’s a new year and a good time to ensure they comply with FCRA guidelines, as well as all state and local regulations. As this case illustrates, it is doubtful these expensive lawsuits will end any time soon. Rather, it is far more likely that there will be an increase in these types of cases this year and in the coming years.

Uber Under Fire on a Number of Fronts

Uber’s been making worldwide news a lot lately for its policies. And not in a good way. Its company standards have been questioned – from its background checks to its insurance policies. This has resulted in lawmakers to express concerns about the company. And the results have included lawsuits, as well as suspension of company operations in certain states and municipalities. And the bad news extends worldwide.

In the US, there appears to be a battle between Uber and some of the states out west. On Monday, December 8, 2014 the city of Portland, Oregon sued the company, claiming it is an “illegal, unregulated transportation service” according to Business Insider. The following day, Uber was sued by District Attorneys in Los Angeles and San Francisco, who claimed that the company “falsely assured customers it used “industry-leading standards” to vet its drivers while failing to use fingerprints to check criminal histories,” according to Businessweek.


Additional municipalities and states are also enacting or considering legislation. reports that on December 5, 2014, the state of Kentucky enacted “emergency rules” for ride share companies that require them to apply to operate in the state, with specific insurance requirements and background checks. And as we shared in an earlier blog, North Carolina’s General Assembly is studying whether to create a state standard for all vehicles for hire.

Worldwide, things aren’t looking much better. Earlier this week, Uber was banned in New Delhi, India, after a female passenger accused an Uber driver of raping her. The company responded by saying it would review its operations in the country and will assess how it screens its employees, according to the New York Times and other sources. And the company has been banned in the Netherlands as well as Thailand.

The Times reports that Uber’s background checks include drug and alcohol testing, but the company does not do fingerprint screening. It also relates that some lawmakers claim their state requirements for background checks are generally “more rigorous” than Uber’s.

Uber has experienced rapid growth, and in doing so, has upset the applecart for traditional transportation services, such as livery vehicles and taxis. These companies are understandably concerned about Uber’s ability to undercut their services, and in some cases have lobbied to keep ride sharing from their locales. But given the rapid expansion, it looks like ride sharing is not going away any time soon.


Concern for passengers and drivers alike needs to be at the forefront for Uber, as well as lawmakers and policymakers. Uber and other ride-sharing operations should ensure that their drivers undergo strict background checks. It’s just good business to protect one’s customers.