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General Information Services Announces Settlement of King v. GIS and Dowell v. GIS
Soon, the parties in King v. General Information Services and Dowell v. General Information Services will file settlement documents asking the court to approve a settlement of the claims in the cases. GIS is releasing information about this proposed settlement because GIS's refusal in the past to comment on pending litigation has resulted in misleading public statements about the cases and about GIS.
Apart from reaching a monetary resolution, the parties agreed on important changes to background reporting that they anticipate the rest of the industry will rapidly adopt. Specifically, when GIS reports a criminal case in which conviction occurred and that is more than seven years old, GIS will remove all non-conviction count information. The settlement sets out narrow exceptions where the provision of that information would be allowed. GIS will also remove any indication of count numbers in the case, so that users of the report will not infer the existence of unlisted counts.
For those who have not been following the cases, GIS's pending motion for summary judgment in the King case sets out the facts underlying the case:
• GIS reported a single criminal case that resulted in a conviction that occurred more than seven years ago.
• As a part of reporting the conviction in the case, GIS reported that the plaintiff pled guilty to one count in the charge and that the prosecutor declined to prosecute the other counts in the charge.
• This information was accurate, was complete, and reflected the publicly available information at the time of the report.
• The employer decided not to hire the plaintiff on the basis of the one offense for which she pled guilty and was convicted, not on the other offenses.
The plaintiff’s claim is that reporting the counts that the prosecutor charged but ultimately decided not to prosecute, as part of reporting the conviction in that same criminal case, violates the Fair Credit Reporting Act's prohibition on reporting "any other adverse item of information, other than records of convictions of crimes which antedates the report by more than seven years."
GIS filed a summary judgment motion based on the facts above, and the plaintiff’s lawyers responded thoroughly. The parties disagreed over the following legal issues:
• Whether the records that GIS reported about the criminal case are "records of conviction" that the FCRA allows. • Whether the information about the non-convictions was adverse to the plaintiff.
• Whether GIS acted on a reasonable interpretation of the FCRA, so was not willfully violating it.
• Whether the FCRA violates the First Amendment’s freedom of speech by prohibiting GIS from communicating public records to someone who is not prohibited from using them.
The plaintiffs’ claims in the Dowell case are similar, the main difference being that the users of the reports in the Dowell case certified that the reports were not for employment, but were for access to secure facilities.
Continuing the cases to trial would place financial and management burdens on GIS. The plaintiffs’ lawyers have alleged a class action, in which the plaintiffs would represent everyone about whom GIS issued a report in which GIS reported non-conviction count information as part of a case in which a conviction occurred more than seven years ago. This class has approximately 50,000 reports in it. If the jury found GIS to have willfully violated the FCRA (erroneously, in GIS’s opinion), GIS would be liable for statutory damages of $100 to $1000 per report.
The risk of a runaway verdict, which would absorb resources that could be better used improving GIS's services for its clients, compels GIS to settle the case. GIS does not admit any wrongdoing in the settlement, but is agreeing to pay a total of $3.4m to settle the case.
The settlement sets important standards for the consumer-reporting industry on reporting this kind of non-conviction count information. Under the settlement, when GIS reports a criminal case in which conviction occurred and that is more than seven years old, GIS will remove all non-conviction count information. GIS has already made the operating and system changes that this settlement requires to meet this standard going forward. The settlement acknowledges that not every report of non-conviction count information over seven years old will violate the FCRA. It therefore includes specific permission to communicate non-conviction count information in the following narrow circumstances:
• Disclosure of non-conviction count information to the subject of that information • Disclosure of non-conviction count information as required by court order
• Re-communication of archived reports to the original user where the original user is not making any current decision based on the report • Reports that are not governed by the FCRA (for example, a report for use in a misconduct investigation that the FCRA defines as not being a consumer report)
• Reports where an exception in the FCRA allows reporting of non-conviction count information over seven years old • Reports where other law pre-empts the FCRA
• Provision of copies of government documents including non-conviction count information when needed for audit purposes imposed by law or self-regulatory regime (for example, when an employer hires a person into a regulated position) • Provision of non-conviction count information for use after the subject of the report requests individualized assessment of the criminal history and the dismissed counts could be relevant to the assessment (for example, under the Equal Employment Opportunity Commission’s guidance on criminal history)
• Provision of non-conviction count information to confirm the that the subject of the report fairly reported his or her own criminal history (for example, when the subject mis-identifies the count on which conviction occurred, but does fairly identify the case) • Reports to be used strictly outside the United States
• Reports to other consumer reporting agencies for their use in preparing a report to an end-user
GIS believes that these exceptions in the settlement establish clear guidance for the industry for when reporting non-conviction count information is not adverse. These exceptions allow the industry to continue playing a positive role in helping employers manage risk and promoting employment of genuinely rehabilitated offenders.
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