John E. Jones III, United States District Judge
Plaintiff Carrie E. Wirt brings this consumer class action under the Fair Credit Reporting Act, 15 U.S.C. Section 1681 et seq. ("FCRA") on behalf of herself and others similarly situated, and against Defendant Bon-Ton Stores, Inc. Presently pending before this Court is Defendant's Motion to Dismiss or in the Alternative to Strike, pertaining to Count I of Plaintiffs Amended Complaint. (Doc. 33). For the reasons that follow, the Motion shall be denied.
On or around the end of August 2012, Carrie E. Wirt ("Wirt") applied for the position of sales associate at Bon-Ton Stores, Inc. ("Bon-Ton"). (Doc. 26, ¶ 23). Pursuant to Bon-Ton's standard hiring practices, Wirt signed a document entitled "Application for Employment." (Id. ¶ 24, see Doc. 37, Exhibit A). Wirt alleges that this standardized form document was not a "clear and conspicuous disclosure in a document that consists solely of the disclosure" as required by Section 1681b(b)(2)(A)(i) of the FCRA. (Doc. 26, ¶ 24). The first page of the document contained blanks for Wirt's personal information. (Doc. 37, Exhibit A, pg. 1). At the bottom of the second page and the top of the third, several paragraphs outlined Bon-Ton's background check procedure. (Id. pgs.2-3). Also on the third page, a space was available for Wirt to affirm the statement, "I have read and agree with this policy." (Id. pg.3). Further down on the third page, an "Acknowledgments and Agreement" section authorized Bon-Ton to verify all of the information provided in the application, including Wirt's criminal background information. (Id.). The section also indemnified Bon-Ton and any company providing such verification information from suit by Wirt. (Id.).
Wirt was hired and began working at a Bon-Ton retail store on September 2, 2012. (Doc. 26, ¶ 34). On October 1, 2012, Bon-Ton requested a background report on Wirt from HireRight, one of the largest employment background screening companies in America. (Id. ¶¶ 12, 37, 39). On October 15, 2012, Bon-Ton informed Liberty House, a vocational services program that assists Wirt, that the background report it received indicated that Wirt had stolen money from her previous employer, Kmart. (Id. ¶ 35). An employee from Liberty House, Wirt, Bon-Ton's Human Resources Manager and Bon-Ton's Store Manager later met to discuss the situation. (Id. ¶ 36). Wirt explained that she had been wrongfully accused of stealing money from Kmart in December of 2010. (Id. ¶¶ 19, 36). She further explained that,
At the same meeting, Bon-Ton provided Wirt with a "Notification of Adverse Employment Action" and a copy of the Hire-Right background report, dated October 15, 2012. (Id. ¶ 37). The Bon-Ton managers informed Wirt that she was being placed on suspension. (Id. ¶ 41). Allegedly, at no point was Wirt provided with preadverse action notice as required by the FCRA. (Id.). Two days later Bon-Ton reinstated Wirt, and she remained in Bon-Ton's employ until January 12, 2013. (Id., ¶¶ 43, 44).
Wirt commenced this action with the filing of a complaint on September 9, 2014. (Doc. 1). The complaint asserted a single Count under § 1681b(b)(3) of the FCRA on behalf of a class of similarly situated persons. The Count alleged that Bon-Ton failed to give Wirt and others "pre-adverse action notice," as § 1681b(b)(3) requires, before making adverse employment decisions (referred to below as the "Adverse Action Claim"). (Doc. 1, ¶¶ 43-50). In her original complaint, Wirt defined the class as:
(Doc. 1, ¶ 37). Bon-Ton filed an answer to the complaint on October 14, 2014 (Doc. 11), and soon thereafter, deadlines for class certification and discovery were set. (Doc. 15). A March 31, 2015 deadline was also set for amendments to the pleadings. (Doc. 15, ¶ 6).
On or about January 27, 2015, Bon-Ton produced sixty-five pages of discovery, including Wirt's Employment Application. On February 20th, allegedly in response to new information revealed by the discovery, Wirt filed an amended class action complaint. (Doc. 18). Bon-Ton moved to strike the amended complaint on March 10th. (Doc. 20). Subsequently, the parties agreed to a jointly proposed Scheduling Order, and withdrew both the amended complaint and the motion to strike.
Pursuant to the Scheduling Order, Wirt filed the operative Amended Complaint on April 15, 2015. (Doc. 26). The operative Amended Complaint sets forth two Counts. The first Count, also asserted on behalf of a class of similarly situated persons, alleges that Bon-Ton "willfully or negligently violat[ed] Section 1681b(b)(2) of the FCRA by procuring or causing to be procured a consumer report for employment purposes without first providing a clear and conspicuous disclosure in a document that consists solely of the disclosure...." (Id. ¶ 55). The second Count is identical to that in the original complaint. In her Amended Complaint, Wirt includes the same class definition as that which appears in her original complaint. She also out-lines a second category of persons, described as:
(Id. ¶ 46(a)). Wirt seeks an order certifying the two groups of persons as a single class under Rule 23 and appointing Wirt and her counsel to represent the same. (Id. ¶ 63). Wirt also seeks an award of actual, statutory and punitive damages for herself and the class, as well as pre- and post-judgment interest, attorneys fees and costs. (Id.).
On May 1, 2015, Bon-Ton submitted the instant Motion to Dismiss or in the Alternative to Strike, in regards to Count I. (Doc. 33). The Motion has been fully briefed (Docs.34, 37, 38) and is ripe for disposition.
A motion to dismiss pursuant to Rule 12(b)(6) contends that the complaint has failed to assert a claim upon which relief can be granted. See FED. R. CIV. P. 12(b)(6). In considering such motion, courts "accept all factual allegations as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief." Phillips v. Cnty. Of Allegheny, 515 F.3d 224, 231 (3d Cir.2008) (quoting Pinker v. Roche Holdings, Ltd., 292 F.3d 361, 374 n. 7 (3d Cir.2002)). To resolve the motion, a court generally should consider only the allegations in the complaint, as well as "any matters incorporated by reference or integral to the claim, items subject to judicial notice, matters of public record, orders, [and] items appearing in the record of the case." Buck v. Hampton Twp. Sch. Dist., 452 F.3d 256, 260 (3d Cir.2006) (citation and internal quotation marks omitted).
In general, a Rule 12(b)(6) motion tests the sufficiency of the complaint against the pleading requirements of Rule 8(a). Rule 8(a)(2) requires that a complaint contain a short and plain statement of the claim showing that the pleader is entitled to relief, "in order to `give the defendant fair notice of what the claim is and the grounds upon which it rests.'" Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957) (alteration omitted)). While a complaint attacked by a Rule 12(b)(6) motion to dismiss need not contain detailed factual allegations, it must contain "sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955). To survive a motion to dismiss, "a civil plaintiff must allege facts that `raise a right to relief above the speculative level ..." Victaulic Co. v. Tieman, 499 F.3d 227, 234 (3d Cir.2007) (quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955). Accordingly, to satisfy the plausibility standard, the complaint must indicate that the defendant's liability is more than "a sheer possibility." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937. "Where a complaint pleads facts that are `merely consistent with' a defendant's liability, it `stops short of the line between possibility and plausibility of entitlement to relief."` Id. (quoting Twombly, 550 U.S. at 557, 127 S.Ct. 1955).
Under the two-pronged approach articulated in Twombly and later formalized in Iqbal, a district court must first identify all
However, "a complaint may not be dismissed merely because it appears unlikely that the plaintiff can prove those facts or will ultimately prevail on the merits." Phillips, 515 F.3d at 231 (citing Twombly, 550 U.S. at 556-57, 127 S.Ct. 1955). Rule 8 "`does not impose a probability requirement at the pleading stage,' but instead `simply calls for enough facts to raise a reasonable expectation that discovery will reveal evidence of the necessary element." Id. at 234 (quoting Twombly, 550 U.S. at 556, 127 S.Ct. 1955).
Rule 12(f) allows the court to "order stricken from any pleading any insufficient defense or any redundant, immaterial, impertinent or scandalous matter." FED. R. Civ. P. 12(f). A court may invoke Rule 12(f) to strike material from a pleading either on the timely motion of a party or by its own initiative. Id. "The purpose of a motion to strike is to clean up the pleadings, streamline litigation, and avoid unnecessary forays into immaterial matters." Goode v. LexisNexis Risk & Info. Analytics Grp., 284 F.R.D. 238, 243 (E.D.Pa.2012) (quoting Natale v. Winthrop Res. Corp., No. 07-4686, 2008 WL 2758238, at *14 (E.D.Pa. July 9, 2008)). However, "striking a pleading is a drastic remedy to be used sparingly because of the difficulty of deciding a case without a factual record." Dann v. Lincoln Nat. Corp., 274 F.R.D. 139, 142-43 (E.D.Pa.2011) (internal quotation omitted). "Relief under 12(f) is generally disfavored and will be denied unless the allegations `have no possible relation to the controversy and may cause prejudice to one of the parties, or if the allegations confuse the issues in the case."` Id. (quoting River Rd. Devel. Corp. v. Carlson Corp., No. 89-7037, 1990 WL 69085, at 2* (E.D.Pa. May 23, 1990)). District courts possess great discretion in disposing of a motion to strike. Krisa v. Equitable Life Assurance Soc., 109 F.Supp.2d 316, 319 (M.D.Pa 2000) (quoting River Rd., 1990 WL 69085, at *2).
As discussed above, Wirt's original complaint alleges only a willful violation of 15 U.S.C. § 1681b(b)(3) by Bon-Ton. In her Amended Complaint, Wirt alleges that Bon-Ton willfully or negligently violated 15 U.S.C. § 1681b(b)(2), which provides, in relevant part:
Bon-Ton argues that Wirt's claim regarding the § 1681b(b)(2) violation (also referred to as the "Disclosure Claim") is time-barred because she signed the relevant documentation and felt its effects no later than October 15, 2012, more than two years before her Amended Complaint was filed. In her response, Wirt argues that the Amended Complaint was filed within the FCRA statute of limitations. She also argues that the Disclosure Claim relates back to her original complaint and is therefore admissible under the relation-back doctrine. For the following reasons, the Court concludes that Wirt's claim is not time-barred because it relates back to the timely-filed original complaint, and shall be allowed to proceed.
The FCRA is governed by a two-year statute of limitations, which begins to run "not later than the earlier of-(1) 2 years after the date of discovery by the plaintiff of the violation that is the basis for such liability or (2) 5 years after the date on which the violation that is the basis for such liability occurs." 15 U.S.C. § 1681p. In Merck v. Reynolds, the United States Supreme Court clarified the term "discovery" in the context of a federal statutes of limitations. "Discovery' refers to a plaintiffs actual discovery of certain facts." Merck & Co. v. Reynolds 559 U.S. 633, 644-46, 130 S.Ct. 1784, 176 L.Ed.2d 582 (2010). The Fifth Circuit has further opined that the discovery of the actual facts, and not the knowledge that those facts give rise to a cause of action, is what causes the statute of limitations to run. Mack v. Equable Ascent Financial, LLC, 748 F.3d 663, 665-66 (5th Cir.2014) (holding that the FCRA two-year statute of limitations began to run when plaintiff discovered that his credit report had been obtained without his consent, and not when plaintiff became aware that this constituted a legal violation).
Wirt argues that, although she ostensibly read and signed the documents that constitute Bon-Ton's alleged violation of § 1681b(b)(2), she returned them to Bon-Ton immediately thereafter and "her signature on the documents does not signify receipt." (Doc. 37, pg.11). Rather, Wirt only received the documents when Bon-Ton provided them during discovery. It was at that time that her attorneys were able to ascertain the alleged violation, and only then did the statute of limitations on her claim begin to run.
Of the several cases that address situations similar to Wirt's, none are binding on this Court. However, we find the situation in Mack v. Equable Ascent Financial most similar and thus most applicable to the instant analysis. In Mack, the Fifth Circuit held that:
Mack, 748 F.3d at 665-66 (citing Merck, 559 U.S. at 644-48, 130 S.Ct. 1784). In the context of § 1681b(b)(2)(A) background report issues, courts have held that "a plaintiff discovers the facts giving rise to her claim when she learns that the defendant actually procured the background report after she signed the allegedly deficient disclosure form." Moore v. Rite Aid Headquarters Corp., No. 13-1515, 2015 WL
A claim that is otherwise timebarred may survive if it relates back to the original filing. FED. R. Civ. P. 15(c). "[A]mendments that restate the original claim with greater particularity or amplify the factual circumstances surrounding the pertinent conduct, transaction or occurrence in the preceding pleading fall within Rule 15(c)." Bensel v. Allied Pilots Ass'n, 387 F.3d 298, 310 (3d Cir.2004). In applying this rule, courts look for "`a common core of operative facts in the two pleadings.` Glover v. F.D.I.C., 698 F.3d 139, 145-46 (3d Cir.2012) (quoting Bensel, 387 F.3d at 310). However, an amendment "does not relate back ... when it asserts a new ground for relief supported by facts that differ in both time and type from those the original pleading set forth." Mayle v. Felix, 545 U.S. 644, 650, 125 S.Ct. 2562, 162 L.Ed.2d 582 (2005). It is important to note that "the touchstone for relation back is fair notice ... [O]nly where the opposing party is given `fair notice of the general fact situation and the legal theory upon which the amending party proceeds' will relation back be allowed." Glover, 698 F.3d at 146 (quoting Bensel, 387 F.3d at 310).
In her original complaint, filed September 9, 2014, Wirt alleged that before she began work for Bon-Ton, she consented to the background search that ultimately led to the adverse action taken against her. Bon-Ton argues that this information was insufficient to provide fair notice of the Disclosure Claim later asserted in the Amended Complaint. We disagree.
The facts alleged in the first complaint need not be as expansive or explanatory as those in the Amended Complaint. It is sufficient that the facts of both complaints concern the same time period and are of the same type. See Spicer v. Villanova Univ., No. 06-1411, 2006 WL 3486465, at *1-2 (E.D.Pa. Dec. 1, 2006) (holding that, although the original complaint did not mention plaintiffs disability, her claim for disability-based employment discrimination nonetheless related back to her other claims of discrimination on the basis of race and sex because it arose from the same factual core as the original complaint). See also Goode, 284 F.R.D. at 247 (concluding that although the Amended Complaint contained some new allegations, they merely "amplif[ied] the factual circumstances surrounding the pertinent conduct" and thus satisfied the fair notice requirement to defendant (internal quotations omitted)).
Here, the original complaint and the operative Amended Complaint reference the same specific event, the consent to the background check, and thus are of the same time. The additional facts and allegations asserted in the operative Amended Complaint merely amplify what is an admittedly scant description of the consent process in the original complaint. However, because both fact patterns allege deficiencies in Bon-Ton's process of procuring and utilizing background reports for employment purposes, they are of a similar type. Because of this common core of operative fact, the allegations of the original complaint are sufficient to put Bon-Ton on fair notice of the claims that Wirt might allege, and which here fairly arise out of her Amended Complaint.
Unlike the Moore defendant, Bon-Ton asserts several additional arguments as grounds for why Wirt's Disclosure Claim should not relate back to the Adverse Action Claim made in the original complaint. Bon-Ton argues that the claims are different because the Disclosure Claim arises from a different statutory obligation and results in a different type of harm than does the Adverse Action Claim. As such, the discovery needed to support those claims may differ. Bon-Ton also notes that Wirt's amendments may more than double the size of the litigation, as the two claims purport to create a new and much larger class. While Bon-Ton's arguments may well be valid, they are presumptive and premature. We have not yet determined the size of the class, nor even whether class certification is appropriate. Though Bon-Ton raises important points, they are more suitably posed at a later time. Here, the question is not whether the two claims are different, or how they may affect the size of the class, but whether the claims arise out of a "common core of operative fact." As we have determined that they do indeed share this necessary characteristic, the relation back doctrine applies and both of Wirt's claims shall be allowed to go forward.
In our Standard of Review, Section III.B above, we noted that "striking a pleading is a drastic remedy to be used sparingly because of the difficulty of deciding a case without a factual record." Dann v. Lincoln Nat. Corp., 274 F.R.D. 139, 142-43 (E.D.Pa.2011). However, "[p]rior to the class certification stage, a defendant may move to strike class allegations prior to discovery in rare cases where the complaint itself demonstrates that the requirements for maintaining a class action cannot be met." Rios v. State Farm Fire and Cas. Co., 469 F.Supp.2d 727, 740 (S.D.Iowa 2007). See Landsman & Funk PC v. Skinder-Strauss Assocs., 640 F.3d 72, 93 n. 30 (3d Cir.2011) (Third Circuit opinion acknowledging that in rare instances, where the complaint shows that the requirements for maintaining a class action cannot be satisfied, a motion to strike will be granted).
Here, Bon-Ton argues that the Disclosure Class definition must be stricken from Wirt's Amended Complaint because the class cannot include the time-barred claims of members on whose behalf no claim was asserted in the original complaint. Phrased differently, Bon-Ton asserts
American Pipe & Construction Co. v. Utah, 414 U.S. 538, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974), holds that "the commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class." American Pipe, 414 U.S. at 554, 94 S.Ct. 756. Bon-Ton argues an inversion of this principle, namely that the statute of limitations is not tolled for the claims of members of a class who were not included at the onset, but were only delineated later in the litigation proceedings. Thus, according to Bon-Ton, American Pipe and its progeny indicate that where an original complaint does not contain any claims on behalf of a class, the claims of those members newly included in a broader class as redefined by a later Amended Complaint must fall within the statute of limitations as delineated by the filing date of that Amended Complaint or struck because they have ran. Their claims cannot relate back to the filing of the original complaint because they were not included in the class as defined by that original complaint. The rationale of American Pipe as applied here suggests that those class members whose claims arose before April 15, 2013 must be excluded from the class because their claims are time-barred, with an exception only for those members who were included in the original class definition proposed by the original complaint, filed September 9, 2014.
However, simply because a portion of a class may have claims that are timebarred does not mean that Wirt's Amended Complaint is deficient in the sweeping way that Rios and Landsman describe.
As previously noted, district courts have great discretion in granting a 12(f) motion to strike. Krisa v. Equitable Life Assurance Soc., 109 F.Supp.2d 316, 319 (M.D.Pa 2000) (quoting River Rd., 1990 WL 69085, at *2). In our discretion, and in an abundance of caution, we conclude that striking the proposed class definition from Wirt's Amended Complaint is not appropriate at this time. However, we will consider the issue of timeliness for these claims and the appropriate scope of the class definition further upon a motion to certify the class, which we presume to be forthcoming at a later date.
For the reasons set forth, we shall deny Bon-Ton's Motion to Dismiss. We also decline to strike Wirt's proposed class definition from the Amended Complaint at this time. While we confess a degree of skepticism regarding Wirt's ability to achieve certification of a class as broadly defined as that which she sets out in her operative Amended Complaint due to the statute of limitations issues and other arguments that Bon-Ton raises in its briefings, those issues are left for another day.
1. Defendant's Motion to Dismiss (Doc. 33) is