Gray v. Hireright, LLC, Case No. 5:18-cv-06177-NKL

MICHAEL GRAY, Plaintiff, v. HIRERIGHT, LLC, Defendant.

Case No. 5:18-cv-06177-NKL

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF MISSOURI ST. JOSEPH DIVISION

April 5, 2019

ORDER

Defendant HireRight, LLC moves pursuant to 28 U.S.C. § 1404(a) to transfer this proceeding brought by plaintiff Michael Gray for alleged violations of the Fair Credit Reporting Act ("FCRA") to the United States District Court for the Middle District of Tennessee. For the reasons discussed below, the motion to transfer is denied.

I. ALLEGED FACTS

Mr. Gray applied in or around August 2018 for employment with Communications Solutions, LLC ("CS"), and after interviewing him, CS hired him. Response to Defendant's Motion to Transfer Venue, Doc. 26, p. 1. He worked at CS for approximately two weeks, at which time CS told him that his employment was being terminated because his consumer report, which had been generated by HireRight, indicated that he had lied during the hiring process concerning the absence of a criminal record in the last seven years. Id. Specifically, the report indicated that Mr. Gray had been charged with or convicted of felony charges within the seven years preceding his employment application. Petition, Doc. 1-1, ¶¶ 11-17. Mr. Gray advised CS that he had not been charged or convicted of any crime in the last seven years. Doc. 26, p. 1. CST nonetheless terminated Mr. Gray on the basis of HireRight's purportedly inaccurate, misleading, and incomplete consumer report. Id.; see also Petition, Doc. 1-1, ¶ 14.

HireRight is a background screening company. Defendant's Suggestions in Support of Its Motion to Transfer to the Middle District of Tennessee Pursuant to 28 U.S.C. § 1404(a), Doc. 12, p. 6. "[I]ts U.S. hub of operations for North American public criminal record processing" and its "operations department for the United States" are in Nashville, Tennessee. Id. "The operations department is responsible for creating, maintaining, and implementing policies and procedures regarding the preparation and delivery of background reports, including compliance with the FCRA." Id. HireRight states that "[t]he individuals with knowledge of the implementation of those procedures, including as specifically applied to this case, are located in Tennessee." Id., pp. 6-7. The team of "Investigative Specialists" that perform the research and analysis that may be included in the background reports "are primarily located in Tennessee." Id., p. 7.

Of HireRight's 1,900 employees, 260 are in Tennessee. Id., p. 6. In contrast, HireRight has just one employee based in Missouri, a person who works from home in a "technical support capacity" and does not process background reports. Id.

Mr. Gray initiated a putative class action against HireRight on November 6, 2018, alleging violations of the FCRA. Doc. 1-1, Petition. He alleges that HireRight produced a consumer report concerning Plaintiff that was "inaccurate, misleading, and incomplete," and that HireRight's "failure to utilize procedures designed to comply with the unambiguous mandates of the FCRA when producing consumer reports is negligent, reckless and willful." Doc. 1-1, Petition, ¶¶ 10, 23. He seeks to represent three nationwide classes defined as follows: (1) "[a]ll individuals who were the subject of one or more consumer reports in which the Defendant identified an individual as having a [f]elony or [m]isdemeanor record in the last seven years when they did not, fromNovember 6, 2013, through the conclusion of this matter"; (2) "[a]ll individuals who were the subject of one or more consumer reports in which the Defendant identified the [c]ourt [r]ecords as being within the last seven years but included records beyond seven years, from November 6, 2013, through the conclusion of this matter"; and (3) "[a]ll individuals who were the subject of one or more consumer reports in which Defendant failed to include information specifying that the consumer had no criminal records in the last seven years from November 6, 2013, through the conclusion of this matter." Id., ¶ 29. He seeks statutory and punitive damages as well as costs and attorneys' fees, but not actual damages. Id., ¶¶ 50-52, p. 9, ¶¶ c and d.

After removing Mr. Gray's proceeding from state court to federal court, HireRight moved for transfer of this case to the Middle District of Tennessee.

II. Standard

The Court may "transfer any civil action to any other district or division where it might have been brought," so long as it is "[f]or the convenience of parties and witnesses, in the interest of justice . . . ." 28 U.S.C. § 1404(a). Thus, after the appropriateness of venue in the proposed forum is established, the Court must undertake "'individualized, case-by-case consideration of convenience and fairness.'" Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29, 108 S. Ct. 2239, 2244 (1988) (citation omitted).

"In general, federal courts give considerable deference to a plaintiff's choice of forum and thus the party seeking a transfer under section 1404(a) typically bears the burden of proving that a transfer is warranted." Terra Int'l, Inc. v. Mississippi Chem. Corp., 119 F.3d 688, 695 (8th Cir. 1997). However, "where there are hundreds of potential plaintiffs, all equally entitled voluntarily to invest themselves with the corporation's cause of action and all of whom could with equal show of right go into their many home courts, the claim of any one plaintiff that a forum is appropriatemerely because it is his home forum is considerably weakened." Koster v. Lumbermens Mut. Cas. Co., 330 U.S. 518, 524 (1947).

A "'transfer should not be granted when to do so would merely shift, rather than eliminate, the inconvenience of the parties.'" Halton v. Am. Int'l Grp., Inc., No. 06-0443, 2006 U.S. Dist. LEXIS 92598, at *6 (E.D. Wis. Dec. 18, 2006) (quoting Ellis Corp. v. Team Textile Corp., 574 F. Supp. 170, 173 (N.D. Ill. 1983)).

The decision as to whether to transfer a case is discretionary. Stewart Org., 487 U.S. at 29, 108 S. Ct. at 2244.

III. Analysis

There is no dispute that this action could have been filed in the Middle District of Tennessee. See, generally, Doc. 26. The question before the Court is whether convenience and the interests of justice favor transfer.

a. Convenience

Among the factors that courts traditionally consider in evaluating convenience are:

(1) the convenience of the parties, (2) the convenience of the witnesses—including the willingness of witnesses to appear, the ability to subpoena witnesses, and the adequacy of deposition testimony, (3) the accessibility to records and documents, (4) the location where the conduct complained of occurred, and (5) the applicability of each forum state's substantive law.

Terra Int'l, 119 F.3d at 696.

Mr. Gray's home state of Missouri is the more convenient forum for him, while HireRight claims that Tennessee is more convenient. "Typically, 'the party seeking the transfer must clearly specify the essential witnesses to be called and must make a general statement of what their testimony will cover.'" C-Mart, Inc. v. Metro. Life Ins. Co., No. 13-0052 AGF, 2013 U.S. Dist. LEXIS 76587, at *9 (E.D. Mo. May 31, 2013) (citation omitted). HireRight states that its"operations department for the United States is based in Tennessee," and that the "operations department's preparation of background reports can include research and analysis performed by a team of Investigative Specialists that are primarily located in Tennessee." Doc. 12, pp. 6-7. HireRight does not specify how many employees work either as Investigative Specialists or in the operations department generally. HireRight identifies just two employees based in Tennessee who purportedly have relevant information: (1) the Director of Operations, and (2) the individual who completed the public records search for and prepared Plaintiff's final report. The only person whose sworn statements HireRight submitted to support the pending motion resides not in Tennessee, but in California. Doc. 26, p. 5; Doc. 27, p. 6, n.1.

The fact that HireRight has identified just two Tennessee-based employees as witnesses does not tip the scale in HireRight's favor. See James v. Experian Info. Sols., Inc., No. 12-0902, 2014 U.S. Dist. LEXIS 242, at *13 (E.D. Va. Jan. 2, 2014) (finding that defendant had "not met its burden to show that its witnesses would be materially inconvenienced by making an appearance in [the original] forum" where it "mentioned only two witnesses . . . , both of whom [we]re [defendant's] employees whose appearance can be secured regardless of the forum's location through court order or persuasion by an employer who is a party to the action") (quotation marks and citation omitted). The Tennessee residence of two HireRight employee-witnesses is even less compelling a factor because counsel for both parties have offered to conduct depositions of party witnesses in a location that is convenient for each witness. Doc. 12, p. 12, n.1; Doc. 26, p. 5 n.5. and p. 7.

The fact that this is a putative class action does not necessarily change the calculus. Although potential class members could reside throughout the country, in the event that the proposed classes are not certified, the potential class members' convenience of course will be ofno consequence. See Lewis v. Sw. Airlines Co., No. 16-00749, 2016 U.S. Dist. LEXIS 72222, at *13 (N.D. Cal. June 2, 2016) (noting that "the convenience of putative class members other than [the named plaintiff] will become irrelevant if class certification is ultimately denied") (quotation marks and citation omitted).

The factor of the parties' convenience thus does not weigh in favor of either forum. Further, neither Tennessee nor Missouri appears more convenient for members of the putative class. At best, the prospect of a nationwide class is a neutral factor.

As for non-party witnesses, Mr. Gray argues that CS, his former employer, is a Missouri-based third-party witness that warrants denying the ...