Opinion ID: 4518275
Heading Depth: 4
Heading Rank: 2

Heading: the consumer has authorized in writing

Text: (which authorization may be made on the document referred to in clause (i)) the procurement of the report by that person. 15 U.S.C. § 1681b(b)(2)(A). Walker argues that, contrary to this provision, the Disclosure document did not consist “solely of the disclosure” because it contained extraneous information, particularly about investigative consumer WALKER V. FRED MEYER, INC. 11 reports, and that such extraneous information also violated the “clear and conspicuous” requirement because it rendered the Disclosure “muddled” and “confusing to consumers.”3 Thus, both the “clear and conspicuous” requirement and the “solely” requirement, also known as the “standalone requirement,” are at issue. We must decide whether those requirements disallow the inclusion of any of the information included in the Disclosure.
First, as to the standalone disclosure requirement, we noted in Syed that “[t]he ordinary meaning of ‘solely’ is ‘[a]lone; singly’ or ‘[e]ntirely; exclusively,’” and we held that the standalone requirement was unambiguous and meant what it said. Syed, 853 F.3d at 500–01 (quoting American Heritage Dictionary of the English Language 1666 (5th ed. 2011)); see Gilberg, 913 F.3d at 1175 (explaining the basis for Syed’s conclusion that “the statute meant what it said”). Thus, Ninth Circuit precedent reads the FCRA as mandating that a 3 Because Walker signed a separate authorization form, Walker does not claim that Fred Meyer failed to properly secure his authorization to obtain a consumer report as required by 15 U.S.C. § 1681b(b)(2)(A)(ii). However, Walker does argue that the language of Fred Meyer’s authorization form “underscores the confusing and distracting nature of Fred Meyer’s disclosure form, thereby reinforcing Walker’s claim for violation of § 1681b(b)(2)(A)(i),” i.e., his claim that the Disclosure violated the FCRA. While it may be true that the authorization form amplifies any confusion allegedly created by the Disclosure, the authorization form is not relevant to the disclosure form standard set forth in the statute where, as here, the authorization is not included in the Disclosure. Either the Disclosure meets the “clear and conspicuous” and “standalone” requirements, or it does not; that determination does not depend on what is in a separate authorization form. See 15 U.S.C. § 1681b(b)(2)(A). 12 WALKER V. FRED MEYER, INC. disclosure form contain nothing more than the disclosure itself.4 Simply put, “the [disclosure] form should not contain any extraneous information.” See U.S. Fed. Trade Comm’n, Advisory Opinion to Hauxwell, 1998 WL 34323756, at  (June 12, 1998).5 4 The statute provides an express exception permitting the required authorization to be included in the disclosure form as well. That exception is not at issue here because Fred Meyer provided its authorization in a separate form. See 15 U.S.C. § 1681b(b)(2)(A)(ii); Syed, 853 F.3d at 497, 500–01. 5 The FTC’s advisory opinions are not binding or precedential, but can provide helpful insight. For example, the FTC has noted that “[t]he reason for requiring that the disclosure be in a standalone document is to prevent consumers from being distracted by other information side-by-side with the disclosure.” U.S. Fed. Trade Comm’n, Advisory Opinion to Leathers, 1998 WL 34323725, at  (Sept. 9, 1998). As the FTC explained: [W]e believe that it was the intent of the drafters to assure that the required disclosure appear conspicuously in a document unencumbered by any other information. The reason for specifying a standalone disclosure was so that consumers will not be distracted by additional information at the time the disclosure is given. We believe that including an authorization in the same document with the disclosure . . . will not distract from the disclosure itself; to the contrary, a consumer who is required to authorize procurement of the report on the same document will be more likely to focus on the disclosure. However, such a document should include nothing more than the disclosure and the authorization for obtaining a consumer report. U.S. Fed. Trade Comm’n, Advisory Opinion to Steer, 1997 WL 33791227, at  (Oct. 21, 1997). WALKER V. FRED MEYER, INC. 13 Here, the district court held, based on several district court opinions and FTC advisory opinions, that Fred Meyer’s disclosure complied with the FCRA’s standalone requirement because “some additional information” may be included in an FCRA disclosure, as long as the information is “closely related to the FCRA disclosure,” and focuses the applicant’s attention on the FCRA disclosure rather than detracting from it. After this case was appealed, however, the Ninth Circuit decided Gilberg, which forecloses the district court’s interpretation that the FCRA contains an implied exception allowing the inclusion of information that is “closely related” to the disclosure. See Gilberg, 913 F.3d at 1176 (explaining that Syed “forecloses” such an approach and suggesting that, in any case, such a standard would be difficult to implement, and would be inappropriate because “even ‘related’ information may distract or confuse the reader”).6 In light of Gilberg, a disclosure form violates the FCRA’s standalone requirement if it contains any extraneous information beyond the disclosure required by the FCRA. 6 Specifically, the Gilberg court read Syed as signaling that the FCRA “should not be read to have implied exceptions,” especially when an exception would be contrary to the FCRA’s purpose. Id. at 1175 (citing Syed, 853 F.3d at 501–03); see also Syed, 853 F.3d at 501 (explaining that, “in light of Congress’s express grant of permission for the inclusion of an authorization, the familiar judicial maxim expressio unius est exclusio alterius counsels against finding additional, implied, exceptions,” and noting that “[a]n implied exception to an express statute is justifiable only when it comports with the basic purpose of the statute”). Gilberg then went on to hold that, even where a defendant argues that any additional information in its disclosure form is consistent with the congressional purpose of the FCRA, “purpose does not override plain meaning,” and the meaning of “solely” is plain. 913 F.3d at 1175. As a result, the Gilberg court concluded that “Syed holds that the standalone requirement forecloses implicit exceptions.” Id. at 1176. 14 WALKER V. FRED MEYER, INC. See Gilberg, 913 F.3d at 1176 (holding that the defendant violated the standalone requirement where its disclosure “contain[ed] extraneous and irrelevant information beyond what [the] FCRA itself requires”). As Fred Meyer points out, if an FCRA disclosure may only contain the disclosure that is required by the statute, the question then becomes what language counts as part of the “disclosure” itself. The statute requires a standalone “disclosure . . . that a consumer report may be obtained for employment purposes,” but does not further define the term “disclosure” or explain what information can be considered part of that “disclosure” for purposes of the standalone requirement. See 15 U.S.C. §§ 1681a, 1681b(b)(2)(A)(i). We now hold that beyond a plain statement disclosing “that a consumer report may be obtained for employment purposes,” some concise explanation of what that phrase means may be included as part of the “disclosure” required by § 1681b(b)(2)(A)(i). For example, a company could briefly describe what a “consumer report” entails,7 how it will be “obtained,” and for which type of “employment purposes” it 7 Such an allowance for a brief description of consumer reports would align with prior FTC guidance. In its advisory opinion to Coffey, the FTC explained: It is our view that Congress intended that the disclosure not be encumbered with extraneous information. However, some additional information, such as a brief description of the nature of the consumer reports covered by the disclosure, may be included if the information does not confuse the consumer or detract from the mandated disclosure. Fed. Trade Comm’n, Advisory Opinion to Coffey, 1998 WL 34323748, at  (Feb. 11, 1998). WALKER V. FRED MEYER, INC. 15 may be used.8 See 15 U.S.C. § 1681b(b)(2)(A)(i). Such information would further the purpose of the disclosure by helping the consumer understand the disclosure. See Syed, 853 F.3d at 501 (noting that Congress’ purpose to protect consumers from improper invasions of privacy would be frustrated in the absence of a clear disclosure because job applicants would not understand what they were authorizing). With this standard in mind, we turn to the text of the Disclosure to determine whether it impermissibly contained extraneous information beyond the § 1681b(b)(2)(A)(i) disclosure itself. The first paragraph provides: We ([t]he Kroger family of companies) will obtain one or more consumer reports or investigative consumer reports (or both) about you for employment purposes. These purposes may include hiring, contract, assignment, promotion, reassignment, and termination. The reports will include information about your character, general reputation, personal characteristics, and mode of living. This language provides the required disclosure that consumer reports may be obtained for employment purposes, see id., and then, in accordance with the standard we set forth above, helpfully explains what those “employment purposes” may 8 Of course, any such explanation should not be confusing or so extensive as to detract from the disclosure. In other words, it must still meet the separate “clear and conspicuous” requirement, discussed further below. See 15 U.S.C. § 1681b(b)(2)(A)(i). 16 WALKER V. FRED MEYER, INC. include and what type of information may be included in the “consumer report.”9 Walker argues that the first paragraph of Fred Meyer’s Disclosure nonetheless violates the FCRA’s standalone disclosure requirement because it mentions investigative consumer reports in addition to consumer reports; he contends that information about investigative consumer reports qualifies as impermissible extraneous information. We disagree. The FCRA defines an investigative consumer report as “a consumer report or portion thereof in which information on a consumer’s character, general reputation, personal characteristics, or mode of living is obtained through personal interviews with neighbors, friends, or associates of the consumer . . . .” 15 U.S.C. § 1681a(e) (emphasis added). Because investigative reports are a subcategory or specific type of consumer report, disclosing that an investigative consumer report may be obtained for employment purposes does not violate the FCRA’s mandate that nothing be included in the disclosure document other than a “disclosure . . . that a consumer report will be obtained for employment 9 The Disclosure’s language explaining that reports will include information about the consumer’s “character, general reputation, personal characteristics, and mode of living” tracks the language of the FCRA. The FCRA defines “consumer report” as concerning “communication of any information by a consumer reporting agency bearing on a consumer’s credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living.” 15 U.S.C. § 1681a(d)(1) (emphasis added); see also id. § 1681a(e) (stating that investigative consumer reports also concern information about a consumer’s “character, general reputation, personal characteristics, or mode of living”). WALKER V. FRED MEYER, INC. 17 purposes.”10 See 15 U.S.C. § 1681b(b)(2)(A)(i). As long as the information about investigative reports is limited to disclosing that such reports may be obtained for employment purposes, and providing a very brief description of what that means, the inclusion of such information in a § 1681b(b)(2)(A)(i) disclosure does not run afoul of the standalone requirement. Accord Fed. Trade Comm’n, Advisory Opinion to Willner, 1999 WL 33932153, at ,  (Mar. 25, 1999) (noting that the § 1681b(b)(2)(A) disclosure “includes all types of consumer reports (including, but not limited to, investigative reports)” and suggesting that it could therefore include a “very limited” and “brief” disclosure regarding investigative consumer reports specifically). For the foregoing reasons, the first paragraph of Fred Meyer’s disclosure form can be considered part of the “disclosure” itself for purposes of the FCRA’s standalone requirement. See 15 U.S.C. § 1681b(b)(2)(A)(i). The second and third paragraphs of Fred Meyers’ Disclosure explain: We will obtain these reports through a consumer reporting agency. The consumer reporting agency is General Information Services, Inc. GIS’s address is P.O. Box 353, Chapin, SC 29036. GIS’s telephone number is 10 Of course, any discussion of investigative consumer reports must not be confusing—it is still subject to the clear and conspicuous requirement. Thus, Walker’s arguments that the disclosure statement’s language confusingly “blurs the line between consumer reports and investigative reports” such that the reader cannot understand what information will be obtained about him, including by omitting any mention of credit worthiness or credit capacity in the first and third paragraphs, are better directed to the clear and conspicuous requirement. 18 WALKER V. FRED MEYER, INC. (866) 265-4917. GIS’s website is at www.geninfo.com. To prepare the reports, GIS may investigate your education, work history, professional licenses and credentials, references, address history, social security number validity, right to work, criminal record, lawsuits, driving record and any other information with public or private information sources. These paragraphs elucidate what it means to “obtain” a consumer report by providing helpful information about who will provide such a report to Fred Meyer and what private and public information about the applicant will be examined to create a “consumer report.” As a result, this language also does not violate the FCRA’s requirement that the disclosure consist solely of a “disclosure . . . that a consumer report will be obtained for employment purposes.”11 See 15 U.S.C. § 1681b(b)(2)(A)(i). Finally, the fourth and fifth paragraphs of Fred Meyer’s Disclosure inform the consumer that: You may inspect GIS’s files about you (in person, by mail, or by phone) by providing identification to GIS. If you do, GIS will provide you help to understand the files, including communication with trained personnel and an explanation of any codes. Another person may accompany you by providing identification. 11 See footnote 10, supra. WALKER V. FRED MEYER, INC. 19 If GIS obtains any information by interview, you have the right to obtain a complete and accurate disclosure of the scope and nature of the investigation performed. These paragraphs appear to have been included in good faith in order to provide additional useful information about an applicant’s rights to obtain and inspect information about GIS’ investigation of, and file about, the applicant. This language, however, may “pull[] the applicant’s attention away from his privacy rights protected by the FCRA by calling his attention to the rights” that he has to inspect GIS’s files. See Syed, 853 F.3d at 502; see also Gilberg, 913 F.3d at 1175–76 (noting that additional information about rights under state laws, and references to extraneous documents like a summary of rights under the FCRA, was “as likely to confuse as it [wa]s to inform,” and holding that the inclusion of such information violated the standalone disclosure requirement). Thus, while we understand Fred Meyer’s reason for providing this information to job applicants, we hold that it should have been provided in a separate document, because the information cannot reasonably be deemed part of a “disclosure . . . that a consumer report will be obtained for employment purposes.” 15 U.S.C. § 1681b(b)(2)(A)(i). Because this additional information means that the Disclosure does not “consist[] solely of the disclosure,” we hold that the fourth and fifth paragraphs of the Disclosure violate the FCRA’s standalone disclosure requirement. 20 WALKER V. FRED MEYER, INC.
Second, as to the “clear and conspicuous” requirement, we explained in Gilberg that “clear means ‘reasonably understandable’” and “[c]onspicuous means ‘readily noticeable to the consumer’” in this context. Gilberg, 913 F.3d at 1176 (quoting Rubio v. Capital One Bank, 613 F.3d 1195, 1200 (9th Cir. 2010), and adopting its “clear and conspicuous” analysis from the Truth In Lending Act context). The Gilberg court assumed, without deciding, “that clarity and conspicuousness under [the] FCRA present questions of law rather than fact.” Id. at 1177. The Court then held that the defendant’s disclosure form was not clear because it “contain[ed] language that a reasonable person would not understand” and “would confuse a reasonable reader because it combine[d] federal and state disclosures.” Id. Here, despite the fact that Syed made clear that the “standalone” and “clear and conspicuous” requirements are distinct, the district court did not explicitly address whether the Disclosure was “clear and conspicuous,” instead focusing exclusively on the standalone requirement. See Syed, 853 F.3d at 503 (“[T]he question of whether a disclosure is ‘clear and conspicuous’ within the meaning of Section 1681b(b)(2)(A)(i) is separate from the question of whether a document consists ‘solely’ of a disclosure . . . .”). Regardless, because Gilberg was not decided until after the district court issued its order, the district court did not have an opportunity to analyze the Disclosure under the “clear and conspicuous” standard set forth in Gilberg. Nor did the WALKER V. FRED MEYER, INC. 21 parties have the opportunity fully to brief that standard on appeal, due to the timing of Gilberg.12 As a result of these circumstances—and because Walker’s arguments about lack of clarity are not addressed by Gilberg—we decline to reach the issue of whether the first through third paragraphs of the Disclosure satisfy the FCRA’s “clear and conspicuous” requirement.13 See 15 U.S.C. § 1681b(b)(2)(A)(i). We leave it to the district court to determine in the first instance whether the language of those paragraphs is sufficiently clear under the reasonable person standard set forth in Gilberg.14