IRBsearch Sold Inaccurate Consumer Reports Used in Background Checks, Class Action Alleges

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A proposed class action alleges IRBsearch, LLC has unlawfully sold employment-related consumer reports without satisfying the strict federal requirements for consumer reporting agencies.

The 27-page lawsuit alleges the reports sold by the defendant, which consist of consumer information scraped from publicly available sources such as court websites and sex offender registries, are essentially consumer reports as defined by the federal Fair Credit Reporting Act (FCRA).

Although IRBsearch claims to not be a consumer reporting agency, the company, the case says, specifically markets itself as a provider of information and services that are governed by the FCRA. Thus, IRBSearch is obligated to comply with the federal statute, including by having reasonable procedures in place to ensure the maximum possible accuracy of the information it reports, the suit contends.

The plaintiff, who says she lost her job as a result of false information included in a consumer report prepared by IRBsearch, claims the company has violated the FCRA by:

• Failing to provide her, upon request, with her full file, including the sources of the information and the entities to whom it was provided;
• Reporting information likely to have an adverse effect on a person’s ability to obtain employment without first providing notice to the person that such information was being reported and to whom it was being reported;
• Publishing obsolete information about consumers; and
• Failing to follow reasonable procedures to ensure the maximum possible accuracy of the reported information.

According to the case, the plaintiff “was a victim of an inaccurate consumer report” sold by the defendant that was eventually provided to her former employer, Stellar Partners, as part of the airport retail operator’s background check process for new employees.

The suit says Stellar Partners hired non-party Osa Consulting Group to perform a pre-employment background check on the plaintiff after she applied for a position with the company in August 2019. Per the case, IRBsearch provided inaccurate information about the plaintiff to Osa, who then repackaged the information and shared it with Stellar. According to the lawsuit, Stellar fired the plaintiff based on the inaccurate information in the report, which included various entries related to theft allegations and felony charges that “simply do not belong to Plaintiff.”

The suit claims the defendant knew or should have known that the information it was supplying would be used for an employment purpose, which is governed by the FCRA, and that it was obligated to comply with the FCRA’s reporting requirements.

The plaintiff claims to have been unaware that it was the defendant who originally provided the consumer report used to fire her until after she sued Osa and Stellar in another lawsuit.

“Defendant’s deceit therefore worked, as it was able to keep itself secret until Plaintiff sued Osa and Stellar and then, through discovery in litigation, learned Defendant’s identity,” the complaint states.

The lawsuit looks to cover certain U.S. residents who, within the past two years, requested their full file disclosure from IRBSearch; were the subject of a criminal record report sold by the defendant for an employment purpose and who did not receive proper notice of the report from the company; or were the subject of a report that contained outdated adverse information.

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