Facts

Securitas Security Services USA provides security solutions in several areas: mobile and remote guarding; on-site; electronic security; fire and safety; and corporate risk management. Sometime in September 2017, Mark Demery applied to work at Securitas. The job application included consumer-reporting notices for several states that was included in a lengthy application, appearing in a page of dense text with other information not involving the Fair Credit Reporting Act (FCRA). Securitas obtained a background report on Demery and did not hire him. On March 27, 2018, Demery, on behalf of himself and others, sent a letter to Securitas asserting claims for violations of the FCRA and the California Investigative Consumer Reporting Agencies Act (ICRAA).

PLAINTIFFS' CONTENTIONS: Plaintiff Demery and others alleged that in obtaining and using consumer and/or investigative consumer reports to conduct background checks on Demery and other proposed class of job applicants without providing the requisite disclosures, defendant Securitas was in violation of both federal and California consumer laws. Under the FCRA, potential employers must notify the applicant or employee that a report may be obtained for employment purposes. This notification must be in a separate, standalone document that consists only of that notification. Securitas failed to follow this procedure as it included copious, extraneous information in the notification. Not only was the information presented in a manner intended to prevent applicants from seriously reviewing the information presented, Securitas also attempted to obtain the applicants' waiver by including a forced acknowledgment of receiving the disclosure and FCRA Summary of Rights and certification. Securitas also refrained from following the specific steps required if any adverse actions based on that report are taken. For example, before taking any adverse action based on the report, employers must provide a "pre-adverse action" notice that includes a copy of the report and a current version of the FCRA Summary of Rights. A similar procedure, but with more handouts, is also required for the "post-adverse action" notice. As Securitas omitted these requisite requirements, it was in violation of state and federal laws.

DEFENDANT'S CONTENTIONS: Defendant Securitas denied all contention and alleged that it complied with statutory state and federal requirements and further implemented adequate policies and practices in its hiring process.

Settlement Discussions

On May 30, 2019, the parties participated in a mediation session with Gig Kyriacou and negotiated for several months but were unable to reach a settlement. Then, on January 16, 2020, Demery filed his complaint. On October 27, 2020, the parties participated in a second mediation with Hunter Hughes III, Esq., which resulted in a settlement term sheet on November 10, 2020.

Result

The parties agreed to settle for $2.175 million.