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Tyus v. United States Postal Service

United States District Court, E.D. Wisconsin

June 20, 2017

RONDO TYUS, Individually and as a representative of the Class Plaintiff,


          WILLIAM E. DUFFIN U.S. Magistrate Judge

         On December 9, 2015, defendant United States Postal Service (USPS) removed this case to federal court. (ECF No. 1.) All parties consented to the full jurisdiction of a magistrate judge. (ECF Nos. 13, 16.) After USPS moved to dismiss the complaint, the plaintiffs amended the complaint. (ECF No. 12.) The parties subsequently jointly moved to stay the action pending the outcome of Spokeo v. Robins, 742 F.3d 409 (9th Cir. 2014), cert. granted, 135 S.Ct. 1892 (2015). The court granted the motion to stay and found USPS's motion to dismiss moot in light of the amended complaint. (ECF No. 20.)

         After the Supreme Court issued its decision in Spokeo v. Robins, 136 S.Ct. 1540 (2016), on May 16, 2016, USPS moved to dismiss the amended complaint. (ECF No. 21.) The court granted the motion to dismiss (ECF No. 33), which order was reconsidered (ECF No. 56) and granted plaintiff Rondo Tyus leave to again amend his complaint under Federal Rule of Civil Procedure 15(a).

         Tyus - the only remaining plaintiff- filed a Second Amended Complaint on January 13, 2017. (ECF No. 57.) USPS now moves to dismiss the Second Amended Complaint under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). (ECF No. 63.) That motion is fully briefed (ECF Nos. 64, 67, 72) and ready for resolution.


         According to the Second Amended Complaint, in September 2014 Tyus applied for security clearance to work at USPS. (ECF No. 57, ¶ 20.) At that time USPS contracted with General Information Services Inc. (“GIS”) to perform criminal background checks on job seekers. (ECF No. 57, ¶ 24.) USPS procured Tyus's criminal background report from GIS in October 2014. (ECF No. 57, ¶ 27.) In a letter dated October 27, 2014, USPS provided Tyus with a copy of his criminal background report, telling him that if “you believe the report to be inaccurate or incomplete, please fax the completed disclosure/ dispute form to GIS within five (5) business days from the date of this letter.” (ECF No. 57, ¶¶ 27, 31.)

         The Second Amended Complaint alleges that Tyus's GIS report contained several inaccuracies. (ECF No. 57, ¶¶ 37-40.) First, the GIS report stated that Tyus had been jailed for a misdemeanor offense in 2011; in fact the jail time was stayed and Tyus received only a probation and a fine. (ECF No. 57 at ¶ 37.) The GIS report also referenced an ordinance violation from more than seven years before that was labeled as criminal in nature; in fact, the violation was non-criminal and should not have been included in the report. (Id. at ¶ 38.) (See 15 U.S.C. § 1681c(a)(5), prohibiting the inclusion of non-criminal adverse information older than seven years.) Lastly, the GIS report claimed that Tyus had not admitted to his prior criminal conviction; in fact, Tyus had admitted to his conviction in his job application. (Id. at ¶ 39.)

         In a letter dated October 30, 2014, USPS informed Tyus that, based on the GIS report, it had denied Tyus's request for a security clearance, resulting in Tyus not being eligible for the job as a security guard with USPS. (Id. at ¶ 32.) The Second Amended Complaint does not say when Tyus received either letter. Rather, relying on the dates of both letters, it alleges that USPS did not provide Tyus with the five days that the October 27, 2014 letter said he would have to address inaccuracies in his GIS report. The Second Amended Complaint alleges that, “by failing to provide Plaintiff Tyus with those five days, USPS failed to give Plaintiff Tyus a reasonable and real opportunity to dispute the results of the report, and therefore violated the FCRA's pre-adverse action notice requirements.” (Id. at ¶ 36.) And “[a]s a result of Defendant's FCRA violations, Plaintiff Tyus has suffered emotional distress and financial loss.” (Id. at ¶ 41.)

         USPS moves to dismiss the Second Amended Complaint under both Federal Rule of Civil Procedure 12(b)(1) (for lack of subject matter jurisdiction) and 12(b)(6) (for failure to state a claim upon which relief can be granted). Its arguments under both rules are overlapping, as discussed below, focusing on the alleged deficiency of the allegations in the Second Amended Complaint.


         “Article III of the Constitution limits federal judicial power to certain ‘cases' and ‘controversies[.]'” Silha v. ACT, Inc. 807 F.3d 169, 172-73 (7th Cir. 2015) (quoting Lujan v. Def. of Wildlife, 504 U.S. 555, 559-60 (1992)). “Standing is an essential component of Article III's case-or-controversy requirement. ‘In essence the question of standing is whether the litigant is entitled to have the court decide the merits of the dispute or particular issues.'” Apex Dig., Inc. v. Sears, Roebuck & Co., 572 F.3d 440, 443 (7th Cir. 2009) (internal citation omitted) (quoting Perry v. Vill. of Arlington Heights, 186 F.3d 826, 829 (7th Cir. 1999)).

         “The ‘irreducible constitutional minimum' of standing consists of three elements. The plaintiff must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.” Spokeo, Inc. v. Robins, 136 S.Ct. at 1547 (quoting Lujan, 504 U.S. at 560) (internal citation omitted). “To establish injury in fact, a plaintiff must show that he or she suffered ‘an invasion of a legally protected interest' that is ‘concrete and particularized[.] '” Id. (quoting Lujan, 504 U.S. at 560). As detailed more fully in previous Orders in this case, a bare procedural violation is not sufficient to give a plaintiff standing to sue; “Article III standing requires a concrete injury even in the context of a statutory violation.” Spokeo, 136 S.Ct. at 1549.

         As for the requirement that the injury be “fairly traceable” to the challenged conduct, proximate cause is not necessary. See Lexmark Intern., Inc. v. Static Control Components, Inc., 134 S.Ct. 1377, 1391, n.6 (“Proximate causation is not a requirement of Article III standing, which requires only that the plaintiff's injury be fairly traceable to the defendant's conduct.”) However, Tyus still must “show that the defendant's actual action has caused the substantial risk of harm.” Remijas v. Neiman Marcus Grp., LLC., 794 F.3d 688, 696 (7th Cir. 2015) (quoting Clapper v. Amnesty Intern. USA, 133 S.Ct. 1138, 1150, n.5 (2013)).

         USPS argues that the Second Amended Complaint fails to allege a concrete harm because it “does not allege that if the decision letter was dated five days, rather than three days, after the pre-adverse action letter, it would have resulted in a different conclusion regarding his security clearance denial.” (ECF No. 64 at 6.) USPS argues that Tyus “only disputes the date on the face of the adverse decision letter.” (ECF No. 72 at 11.) Because all it alleges is a bare procedural ...

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