Swift Transportation Co. Accused of Large-Scale Violation of Fair Credit Reporting Act, Agrees to Settle for $4.4 Million

On April 21, 2014, the parties in James Ellis III, et al. v. Swift Transportation Co. of Arizona, LLC filed a joint motion for a class action settlement. In the complaint, filed in the Eastern District of Virginia on July 23, 2013, the Plaintiff had claimed that the Defendant had collected consumer information, including criminal background reports, about job applicants who submitted non-in-person applications-via facsimile, telephone, mail, electronic mail, or through an internet website. Plaintiff alleged that Swift routinely obtained such consumer data (i) without obtaining proper authorization from applicants, (ii) without providing notice that applicants were entitled to free copies of their consumer reports within 60 days, (iii) without providing notice that they were entitled to dispute the information in these reports, and (iv) without providing notice of adverse actions that were taken by Swift on the bass of these reports, all violations of the FCRA.

Each of the 10,000+ members of the class-each person who applied for a Department of Transportation regulated position at Swift during the five years before the filing of the Complaint that started this lawsuit-will be eligible to receive between $100.00 and $1000.00. In addition to attorneys’ fees and costs, $5,000.00 service awards to named plaintiffs, and administrative costs, the company will pay out approximately $4,400,000.00. In the Settlement Agreement, the company denies the charges in the Complaint and explicitly states that their willingness to settle is based on its calculation that the company will benefit more from paying the agreed amount than incurring the cost and risk of further litigation.

This settlement and several others like it happen against the backdrop of a larger political discussion of whether companies should be permitted to gather and use applicant’s credit information in the first place. In December 2013, Senator Elizabeth Warren introduced the “Equal Employment for All Act,” which would amend the FCRA to say that “a person, including a prospective employer or current employer, may not use a consumer report or investigative consumer report, or cause a consumer report to be procured, with respect to any consumer where any information contained in the report bears on the consumer’s creditworthiness, credit standing, or credit capacity–“(A) for employment purposes; or (B) for making an adverse action…” Senator Warren and the Bill’s co-sponsors have argued that there is rarely any correlation between a candidate’s creditworthiness and her fitness for a job, and that individuals’ credit problems are almost always caused by a combination of economic downturn and personal misfortune. “Families have not fully recovered from the 2008 financial crisis,” Warren said, “too many Americans are still searching for jobs. This is about basic fairness-let people compete on the merits, not on whether they already have enough money to pay all their bills.”

If you believe your credit information has been used by a prospective employer in violation of the FCRA, please contact The Harman Firm, LLP.