1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

NICHOLS KASTER, LLP 

Matthew C. Helland, CA Bar No. 250451 

helland@nka.com 

One Embarcadero Center, Suite 720 

San Francisco, CA 94111 

Phone: (415) 277-7235 

Fax: (415) 277-7238 

NICHOLS KASTER, PLLP 

Daniel C. Bryden, MN Bar No. 0302284* 

dbryden@nka.com 

4600 IDS Center 

80 South 8th Street 

Minneapolis, MN 55402 

Phone: (612) 256-3200 

Fax: (612) 338-4878 

*admitted pro hac vice 

Attorneys for Individual and Representative Plaintiffs

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

LASANDRA HILLSON, STEVEN 

BOHLER, and ASHLEY SCHMIDT, 

individually and as representatives of the 

class, 

 Plaintiffs, 

v. 

KELLY SERVICES, INC., 

Defendant. 

 Case No.: 4:14-cv-03256-JCS 

FIRST AMENDED CLASS 

ACTION COMPLAINT 

FOR DAMAGES 

(1) Violations of the Fair Credit 

Reporting Act, 15 U.S.C. § 

1681, et seq.

 

 DEMAND FOR JURY TRIAL

 

LaSandra Hillson, Steven Bohler, and Ashley Schmidt (“Plaintiffs”), by and 

through their attorneys, on behalf of themselves and the class set forth below, bring the 

following Class Action Complaint against Kelly Services, Inc. (“Defendant”). 

INTRODUCTION 

1. This consumer class action is brought under the Fair Credit Reporting Act 

(“FCRA”) against an employer who routinely violates the FCRA’s basic protections by 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 1 of 11 Pg ID 20
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-2-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

failing to obtain the proper authorization to conduct background checks, and by failing to 

provide the “stand alone” disclosure required by the FCRA. As Defendant’s practices 

were routine and systematic, Plaintiffs assert claims for statutory damages on behalf of a 

class of similarly situated job applicants and employees.

THE PARTIES 

2. Plaintiff LaSandra Hillson is an individual person and a resident of 

Hayward, California. 

3. Plaintiff Steven Bohler is an individual person and a resident of Mound, 

Minnesota. 

4. Plaintiff Ashley Schmidt is an individual person and a resident of 

Davenport, Iowa. 

5. Defendant Kelly Services, Inc. is an employment agency and recruitment

company incorporated in Delaware and headquartered in Troy, Michigan. 

JURISDICTION AND VENUE 

6. This Court has federal question jurisdiction over this action pursuant to 28 

U.S.C. § 1331. Venue is proper is proper in this District pursuant to 28 U.S.C. § 1391 

because Plaintiff Hillson resides in this district and a substantial part of the events or 

omissions giving rise to this claim occurred in this district. 

INTRADISTRICT STATEMENT 

7. Pursuant to L.R. 3-2(c) and (d), this action is properly assigned to the 

Oakland Division of the Northern District of California because a substantial portion of 

the events giving rise to the dispute occurred in Alameda County, California. 

STATUTORY BACKGROUND 

8. Enacted in 1970, the FCRA’s passage was driven in part by two related 

concerns: first, that consumer reports were playing a central role in people’s lives at 

crucial moments, such as when they applied for a job or credit, and when they applied for 

housing. Second, despite their importance, consumer reports were unregulated and had 

widespread errors and inaccuracies. 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 2 of 11 Pg ID 21
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-3-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

9. While recognizing that consumer reports play an important role in the 

economy, Congress wanted consumer reports to be “fair and equitable to the consumer” 

and to ensure “the confidentiality, accuracy, relevancy, and proper utilization” of 

consumer reports. 15 U.S.C. § 1681. 

10. Congress was particularly concerned about the use of consumer reports by 

employers to deny otherwise qualified job applicants or to take other adverse actions 

against employees. Accordingly, Congress required employers to make a clear and 

conspicuous written disclosure to employees and job applicants, in a document that 

consists solely of the disclosure, that a consumer report may be obtained for employment 

purposes. 15 U.S.C. § 1681b(b)(2). This is commonly referred to as the “stand-alone 

disclosure” requirement. 

11. The FCRA stand-alone disclosure requirement ensures that employees and 

job applicants know when reports about them are being generated. This notice is one of 

many elements of the FCRA that combine to ensure that consumers are aware that 

consumer reports are generated about them, that they know their rights, and that they have 

the opportunity to dispute errors in their reports. See 15 U.S.C. § 1681b(b)(3)(A) (preadverse employment action notice requirement); 15 U.S.C. § 1681b(4)(B) (notification of 

national security investigation); 15 U.S.C. § 1681c(h) (notification of address 

discrepancy); 1681d(a) (disclosure of investigative report); 15 U.S.C. § 1681g (full file 

disclosure to consumers); 15 U.S.C. § 1681k(a)(1) (disclosure regarding the use of public 

record information); 15 U.S.C. § 1681h (form and conditions of disclosure); 15 U.S.C. § 

1681m(a) (notice of adverse action). 

12. As discussed below, Defendant routinely violates the FCRA by failing to 

provide the required stand-alone disclosure to employees and job applicants. 

ALLEGATIONS RELATING TO PLAINTIFF HILLSON

13. On October 18, 2012, Ms. Hillson applied for an administrative assistant 

position with Kelly Services in San Mateo, California. 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 3 of 11 Pg ID 22
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-4-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

14. Ms. Hillson received an application packet from Kelly Services. Included 

in the application packet was a document entitled “Background Screening Notice, 

Disclosure, and Authorization.” (“Disclosure Form,” attached as Exhibit A.) 

15. In addition to providing information about Kelly Services’ background 

checks, the Disclosure Form contains a liability waiver that purports to release Kelly 

Services from liability. Specifically, the Disclosure Form states: 

To the fullest extent permitted by law, I release Kelly, its employees, 

agents, successor and assigns, from any and all claims, actions or liability 

whatsoever that are in any way related to the procurement of a consumer 

report about me, or any subsequent investigation(s) of my background or 

personal history. 

16. The Disclosure Form also contains a statement disclaiming that the form 

creates an employment contract: “I understand that this Authorization is not a contract for 

continued employment and does not alter the at-will nature of my employment or offered 

employment.” 

17. After Hillson applied for the position, Kelly Services procured a consumer 

report on her from consumer reporting agency Verifications, Inc. (“Verifications”). 

18. Because the Disclosure Form contains a liability waiver and an extraneous 

disclaimer regarding its status as a contract, the Disclosure Form does not constitute a 

stand-alone disclosure as required by 15 U.S.C. § 1681b(b)(2).

ALLEGATIONS RELATING TO PLAINTIFF BOHLER

19. On January 15, 2013, Mr. Bohler applied for a position offered by Kelly 

Services in Mound, Minnesota.

20. Mr. Bohler received an application packet from Kelly Services. Included 

in the application packet was a document entitled “Background Screening Notice, 

Disclosure, and Authorization.” (“Disclosure Form,” attached as Exhibit B.) 

21. The Disclosure Form received by Mr. Bohler was identical in all material 

respects to the Disclosure Form received by Ms. Hillson. In other words, the Disclosure 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 4 of 11 Pg ID 23
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-5-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

Form received by Mr. Bohler also contained the purported liability waiver and statement 

regarding at-will employment as described in paragraphs 15-16 above. 

22. After Mr. Bohler applied for the position, Kelly Services procured a 

consumer report on him from Verifications. 

23. Because the Disclosure Form contains a liability waiver and an extraneous 

disclaimer regarding its status as a contract, the Disclosure Form does not constitute a 

stand-alone disclosure as required by 15 U.S.C. § 1681b(b)(2).

ALLEGATIONS RELATING TO PLAINTIFF SCHMIDT

24. In December 2013, Plaintiff Ashley Schmidt applied for a job offered by 

Kelly Services in Davenport, Iowa. 

25. Included within the application packet was a form entitled “Background 

Screening Notice, Disclosure, and Authorization.” (“Disclosure Form,” attached as 

Exhibit C.) 

26. The Disclosure Form received by Ms. Schmidt was identical in all material 

respects to the Disclosure Form received by Ms. Hillson. In other words, the Disclosure 

Form received by Ms. Schmidt also contained the purported liability waiver and statement 

regarding at-will employment as described in paragraphs 15-16 above. 

27. After Schmidt applied for the position, Kelly Services procured a consumer 

report on her from Verifications. 

28. Because the Disclosure Form contains a liability waiver and an extraneous 

disclaimer regarding its status as a contract, the Disclosure Form does not constitute a 

stand-alone disclosure as required by 15 U.S.C. § 1681b(b)(2).

ALLEGATIONS RELATING TO DEFENDANT’S PRACTICES 

29. More than fifteen years ago, the Federal Trade Commission emphasized 

that including a liability waiver in the disclosure form, as Defendant did here, is a 

violation of the FCRA. Letter from William Haynes, Fed. Trade Comm’n, to Richard W. 

Hauxwell, CEO Accufax Div. (June 12, 1998), available at 1998 WL 34323756 

(explaining that “inclusion of a . . . waiver in a disclosure form will violate Section 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 5 of 11 Pg ID 24
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-6-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

[1681b(b)(2)(A)] of the FRCA, which requires that a disclosure consist ‘solely of the 

disclosure that a consumer report may be obtained for employment purposes’”).

30. Courts that have addressed liability waivers placed in disclosure forms 

have agreed with the FTC that including such a waiver violates the FCRA’s stand-alone 

disclosure requirement. Dunford v. American Databank, Inc., No. C 13-03829, 2014 WL 

39567744 at *6 (N.D. Cal. Aug. 12, 2014) (finding document that contained a liability 

release to “not consist solely of the disclosure because it added a paragraph exonerating 

[the defendant]”); Avila v. NOW Health Grp., Inc., No. 14 C 1551, 2014 WL 3537825 at 

*2 (N.D. Ill. July 17, 2014) (finding inclusion of liability waivers to be “contrary to the 

express language of the FCRA, which requires a disclosure ‘in a document that consists 

solely of the disclosure’”); Singleton v. Domino’s Pizza, No. 11-1823, 2012 WL 245965 at 

*9 (D. Md. Jan. 25, 2012) (“[B]oth the statutory text and FTC advisory opinions indicate 

that an employer violates the FCRA by including a liability release in a disclosure 

document.”); Reardon v. Closetmaid Corp., No. 2:-8-cv-01730, 2013 WL 6231606 at *10-

11 (W.D. Pa. Dec. 2, 2013) (finding disclosure with liability waiver to be “facially 

contrary to the statute at hand, and all of the administrative guidance”).

31. In accordance with Verifications’ standard procedures, Verifications 

required Defendant to certify that it would comply with the stand-alone disclosure 

provisions of the FCRA. 

32. In a February 2012 publication, Verifications warned its customers that 

“nothing else (including a release of liability) should be a part of the [disclosure and 

authorization] form.” Verifications, Inc., “Court Advises: ‘Solely’ Means Solely 

Regarding Disclosure and Authorization” (Feb. 10, 2012), at 

https://www.verificationsinc.com/eng/whatwevelearned/complianceprofile.cfm?szID=104 

(last visited July 18, 2014), attached as Exhibit D.

33. As part of its service agreement with Verifications, Kelly Services 

acknowledged that the reports it obtains from Verifications are consumer reports. 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 6 of 11 Pg ID 25
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-7-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

34. In its contract with Verifications, Kelly Services agreed that before 

obtaining a consumer report, Kelly Services would provide a disclosure in writing to the 

consumer that a consumer report will be obtained for employment purposes and that such 

disclosure will be made in a document consisting solely of the disclosure. 

35. Kelly Services also agreed to contact Verifications to obtain special 

procedures for preparation and use of a consumer report in the case of suspected 

misconduct or violation of state, federal, or local law. None of the Plaintiffs’ reports were 

procured by Kelly Services using the special procedures referred to in the contract for 

these kinds of reports. 

36. Kelly Services did not procure Plaintiffs’ reports in connection with any 

investigation of suspected misconduct relating to employment, or compliance with 

federal, State, or local laws and regulations, the rules of a self-regulatory organization, or 

any preexisting written policies of the employer. 

37. Upon request from each Plaintiff, Verifications sent each Plaintiff a 

complete copy of his or her consumer report procured by Kelly Services, and not merely a 

summary. 

38. By systematically inserting a liability release and other extraneous 

information into Plaintiffs’ and other class members’ disclosures, Defendant willfully 

violated 15 U.S.C. § 1681b(b)(2)(A)(i).

CLASS ACTION ALLEGATIONS

39. Plaintiffs asserts their claims on behalf of the class defined as follows: 

All individuals on whom Kelly Services obtained a consumer report for 

employment purposes and whose disclosure form contains a liability 

release in the two years predating the filing of this Complaint and 

continuing through the date the class list is prepared. 

40. Numerosity: The Class is so numerous that joinder of all Class members is 

impracticable. Defendant has thousands of employees, many of whom are members of the 

class. 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 7 of 11 Pg ID 26
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-8-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

41. Typicality: Plaintiffs’ claims are typical of the Class members’ claims. 

The FCRA violations committed by Defendant were committed pursuant to uniform 

policies and procedures, and Defendant treated Plaintiffs in the same manner as other 

Class members in accordance with its standard policies and practices. 

42. Adequacy: Plaintiffs will fairly and adequately protect the interests of the 

class, and have retained counsel experienced in complex class action litigation. 

43. Commonality: Common questions of law and fact exist as to all members 

of the class and predominate over any questions solely affecting individual members of 

the Class. 

44. Class certification is appropriate under Fed. R. Civ. P. 23(b)(3) because 

questions of law and fact common to the Class predominate over any questions affecting 

only individual members of the Class, and because a class action is superior to other 

available methods for the fair and efficient adjudication of this litigation. Defendant’s 

conduct described in this Complaint stems from common and uniform policies and 

practices, resulting in common violations of the FCRA. Members of the Class do not 

have an interest in pursuing separate actions against Defendant, as the amount of each 

Class member’s individual claim is small compared to the expense and burden of 

individual prosecution, and Plaintiffs are unaware of any similar claims brought against 

Defendant by any members of the Class on an individual basis. Class certification also 

will obviate the need for unduly duplicative litigation that might result in inconsistent 

judgments concerning Defendant’s practices. Moreover, management of this action as a 

class action will not present any likely difficulties. In the interests of justice and judicial 

efficiency, it would be desirable to concentrate the litigation of all Class members’ claims 

in a single forum. 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 8 of 11 Pg ID 27
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-9-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

CLAIM FOR RELIEF 

Failure to Provide Stand-Alone Disclosure

45. Defendant violated the FCRA by procuring consumer reports on Plaintiffs 

and Class members without making the stand alone disclosure required by the FCRA. See 

15 U.S.C. §§ 1681b(b)(2). 

46. Defendant acted willfully and in knowing or reckless disregard of its 

obligations and the rights of Plaintiffs and the other Class members. Defendant’s willful 

conduct is reflected by, among other things, the fact that it violated a clear statutory 

mandate set forth in 15 U.S.C. § 1681b(b)(2), and that Defendant certified that it would 

comply with 15 U.S.C. § 1681b(b)(2). Further: 

(a) The FCRA was enacted in 1970; Defendant has had over 40 years 

to become compliant; 

(b) Defendant’s conduct is inconsistent with the FTC’s longstanding 

regulatory guidance, judicial interpretation, and the plain language 

of the statute; 

(c) Defendant knew or had reason to know from its communications 

with Verifications that Defendant’s conduct violated the FCRA; 

(d) Defendant certified to Verifications that it would comply with the 

disclosure requirements of the FCRA; 

(e) Defendant repeatedly and routinely uses the disclosure it used with 

Plaintiffs to procure consumer reports; 

(f) Despite the pellucid statutory text and there being a depth of 

guidance, Defendant systematically procured consumer reports 

without first disclosing in writing to the consumer in a document 

that consists solely of the disclosure, that a consumer report may be 

obtained for employment purposes; and 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 9 of 11 Pg ID 28
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-10-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

(g) By adopting such a policy, Defendant voluntarily ran a risk of 

violating the law substantially greater than the risk associated with 

a reading that was merely careless. 

47. Plaintiffs and the Class are entitled to statutory damages of not less than 

$100 and not more than $1,000 for each and every one of these violations, pursuant to 15 

U.S.C. § 1681n(a)(1)(A). Plaintiffs and the Class members are also entitled to punitive 

damages for these violations, pursuant to 15 U.S.C. § 1681n(a)(2). Plaintiffs and the 

Class members are further entitled to recover their costs and attorneys’ fees, pursuant to 

15 U.S.C. § 1681n(a)(3). 

PRAYER FOR RELIEF

48. WHEREFORE, Plaintiffs, on behalf of themselves and the Class, pray for 

relief as follows: 

a. Determining that this action may proceed as a class action under Rule 

23(b)(3) of the Federal Rules of Civil Procedure; 

b. Designating Plaintiffs as Class Representatives and designating Plaintiffs’ 

counsel as counsel for the Class; 

c. Issuing proper notice to the Class at Defendant’s expense; 

d. Declaring that Defendant violated the FCRA; 

e. Declaring that Defendant acted willfully, in knowing or reckless disregard 

of Plaintiffs’ rights and its obligations under the FCRA; 

f. Awarding statutory damages as provided by the FCRA; 

g. Awarding reasonable attorneys’ fees and costs as provided by the FCRA; 

h. Granting other and further relief, in law or equity, as this Court may deem 

appropriate and just. 

DEMAND FOR JURY TRIAL

49. Pursuant to Rule 38(b) of the Federal Rules of Civil Procedure, Plaintiffs 

and the Class demand a trial by jury. 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 10 of 11 Pg ID 29
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

-11-

FIRST AMENDED CLASS ACTION COMPLAINT, Case No. 4:14-cv-03256-JCS 

Respectfully submitted, 

Dated: August 19, 2014 NICHOLS KASTER, PLLP 

 By: /s/Daniel C. Bryden 

 Daniel C. Bryden (pro hac vice) 

 

ATTORNEY FOR INDIVIDUAL AND 

REPRESENTATIVE PLAINTIFFS 

2:15-cv-10803-LJM-APP Doc # 2 Filed 03/05/15 Pg 11 of 11 Pg ID 30