Background Check Lawsuit Claims Hotels Violated FCRA

By Thomas Ahearn and WAKEUP CALL

A class action lawsuit filed against ESA Management LLC, which operates more than 680 Extended Stay America hotels in the United States, alleges the company obtained background check reports on job applicants without their authorization in violation of the Fair Credit Reporting Act (FCRA). 

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 When plaintiff, Yahaira Camacho, applied for a job at a California Extended Stay America hotel in July 2013 ESA Management failed to provide her with a written disclosure stating that a background check report may be obtained for employment purposes and did not ask for her authorization to obtain the report. According to the background check class action lawsuit: “At each of its hotels, ESA Management obtains consumer reports for employment purposes without a valid disclosure and a valid, signed authorization as part of the application process.”

TopClassActions.com reports the job application allegedly included a disclosure stating: “I authorize the investigation of all statements contained in this application and release from all liability any persons or employers supplying such information, and I also release Extended Stay Hotels from any liability that might result from making this investigation.” The background check class action lawsuit argues that the statement failed to comply with the FCRA for the following reasons:

  • The statement did not inform job applicants that a background check would be be obtained.
  • The statement did not seek written authorization from the job applicant to obtain the background check report.
  • The statement was included on the same page as numerous other statements and not on a separate page that consisted only of the disclosure and authorization as required under the FCRA.
  • The statement included language that released the defendant from liability.

TopClassActions.com reports the plaintiff seeks to represent all individuals who applied for work at Extended Stay America hotels in the United States where a background check report was obtained in the past five years. Pursuant to the terms of the FCRA, Class Members are entitled to recover statutory damages of “not less than $100 and not more than $1,000”  The case information is Yahaira Camacho, et al. v. ESA Management LLC, et al., Case No. 3:14-cv-01089, in the U.S. District Court for the Southern District of California.

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