Judge rejects broad discovery objections in FCRA case

Overruling general objections and citing a defendant’s ‘strained and untenable’ view of a jurisdiction issue, a federal judge ordered expansive discovery for a pair of would-be class action plaintiffs seeking penalties for alleged background check violations.

The judge’s opinion will provide ammunition for litigants facing resistance to civil discovery requests. The ruling sets explicit ground rules for discovery responses – rejecting nonspecific “form” objections, prohibiting self-defined relevance limitations, and requiring privilege logs and details of any claims of excessive burden.

U.S. District Judge Robert E. Payne denied sanctions, but he ordered production of nearly all the information sought by the plaintiffs. His opinion came in the case of Spendlove v. RapidCourt LLC (VLW 019-3-609).

Access to court records

Represented by consumer law attorneys, the plaintiffs are suing RapidCourt LLC of Huntersville, North Carolina. The company reportedly taps courthouse records to provide information about job seekers to Checkr Inc. which in turn provides background checks to potential employers.

Laws governing background checks are technical and complex. Lawyers have reported multimillion dollar settlements against employers for failing to comply with the rules, many of which are found in the federal Fair Credit Reporting Act.

In Spendlove, the job-applicant plaintiffs contend RapidCourt willfully violated the FCRA by reporting stale court information, failing to timely notify consumers of the lapse and failing to provide full copies of consumers’ files on request.

Citing its North Carolina home base, RapidCourt asked the Richmond judge to either dismiss the lawsuit or transfer venue. The plaintiffs sought jurisdictional discovery, including expert examination of RapidCourt’s online interface used to access court records.

The plaintiffs objected to RapidCourt’s responses to those discovery requests and asked for an order compelling discovery Judge rejects broad discovery objections in FCRA case and sanctions. They got a strongly worded order to compel.

General objections

Payne overruled and struck general objections that came in various forms.

General objections reach so broadly they obscure what is being foreclosed from discovery, he said. “Thus, use of the general objection precludes meaningful negotiation in the meet and confer process (which appears to have happened here), and it allows the producing party a degree of control over the discovery process not intended by the federal discovery rules,” Payne said.

Rapid Court’s general objections to relevance were framed in such general terms as to not comply with requirements of Rules 26 and 33, the judge continued.

“For a relevance objection to be adequate, it must be ‘plain enough and specific enough so that the court can understand in what way the interrogatories [or document requests] are alleged to be objectionable,’” Payne wrote, citing an 11th Circuit opinion.

Similarly, “a party objecting to a discovery request as overly burdensome must submit affidavits or other evidence demonstrating the nature and extent of the asserted burden,” Payne said.

Assertions of privilege must describe the nature of the documents withheld, he said.

“Here, RapidCourt has not provided any sort of privilege log pertaining to the documents referred to in its ‘common specific objections’ nor has RapidCourt explained with specificity why the attorney-client or work-product privileges apply,” Payne wrote.

Relevance

Payne rejected a familiar practice in civil discovery – the response that “all relevant, non-privileged” information will be produced. Such a response implicitly challenges the relevancy of the request and is procedurally improper, the judge ruled.

“By asserting an improper objection, RapidCourt has spent its ammunition on the relevance ground wastefully. It must now pay the price and provide the requested discovery,” Payne wrote.

Jurisdiction issue

To address the jurisdictional question, RapidCourt was asked about its contacts in Virginia. RapidCourt took the position it need provide information on only those Virginia contacts that formed the basis of the plaintiffs’ claims. Payne said the company’s objections were based on a “strained and untenable view” of the jurisdictional test.

That position “is both unreasonable and is at odds with applicable decisions,” Payne said. He ordered disclosure of information on whether RapidCourt solicited Virginia customers, held contracts with Virginia businesses to obtain records or provide them to customers or accessed or transmitted Virginia records to third parties.

Testing the search tool

The plaintiffs sought to have their expert access RapidCourt’s user interface that accesses court records for Virginia consumers, view a full set of screenshots, examine the software source code and get login credentials to do a test run.

The company’s interface allows subscribers “to gain access to courthouse website portals and to access information on their websites in real time,” Payne said.

RapidCourt agreed to allow a sample search for Virginia court records, but the plaintiffs claimed a sample search would provide only minimal insight into the kinds of records that users see.

Payne ordered RapidCourt to permit a thorough examination. He ordered production of the source code and credentials to allow searches for “an extended period of time.”

Based on the company’s own information, the precise mechanics of searches, record storage and presentation of the records to clients “all are directly relevant to ascertaining the nature and extent of RapidCourt’s contacts with the state of Virginia as they pertain to personal jurisdiction,” Payne said. “It is therefore necessary for Plaintiffs to determine precisely how the RCX Technology at issue works and fits into the underlying claims,” the judge continued.

Payne ordered RapidCourt to allow expert access to a separate non-live database of public records and a deposition to determine how that database is used by clients.

Payne directed the company to provide a list of potential class members and documents applicable to whether the company is subject to the FCRA.

Payne denied sanctions under Rule 37(c)(1) because the plaintiffs complained about discovery responses, not disclosures pursuant to Rule 26(a) or Rule 26(e).

The plaintiffs are represented by Leonard A. Bennett of Newport News and eight other consumer law attorneys, according to online court records. RapidCourt is represented by Steven D. Brown of Richmond and seven other attorneys.