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KELCHNER v. SYCAMORE MANOR HEALTH CTR.

February 27, 2004.

LISA R. KELCHNER, Plaintiff
v.
SYCAMORE MANOR HEALTH CENTER; PRESBYTERIAN HOMES, INC., Defendants



The opinion of the court was delivered by: JOHN E. JONES, District Judge

MEMORANDUM AND ORDER

Currently pending before this Court are the parties' cross Motions for Partial Summary Judgment. We have jurisdiction pursuant to 28 U.S.C. § 1331 and 29 U.S.C. § 1132(e) and have reviewed the submissions of the parties. For the reasons discussed below, we will grant Defendants' Motion as to Plaintiff's claim under the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq. ("FCRA" or "the Act").

PROCEDURAL HISTORY

  Lisa Kelchner ("Plaintiff Kelchner") filed her Complaint on February 27, 2002, and her Amended Complaint on May 29, 2002. Plaintiff Kelchner brings this action pursuant to FCRA and the Employment Retirement Income Security Act, 29 U.S.C. § 1001-1461 ("ERISA") amended by the Consolidated Omnibus Reconciliation Act Page 2 of 1985, 29 U.S.C. § 1161 et seq. ("COBRA"), against her employer, Presbyterian Homes, Inc. ("PHI") and their subsidiary, Sycamore Manor Health Center (hereinafter collectively "Defendants").

  By Order of December 3, 2002, we denied Defendants' Motion to Dismiss because Plaintiff's Amended Complaint raised an issue of first impression. By Order of March 3, 2003, we conditionally certified this matter as a class action pursuant to Fed.R.Civ.P. 23(B)(2), delineating a plaintiffs' class ("Class" or "Plaintiffs") of all persons who were employed by PHI and of whom PHI requested authorization to obtain consumer reports, as required by the FCRA.*fn1

  On June 25, 2003, Plaintiffs filed a Motion for Partial Summary Judgment and on July 14, 2003, Defendants filed a cross Motion for Summary Judgment. The subject of these Motions is Plaintiff Kelchner's claim that she was wrongfully terminated for refusing to sign a written authorization to allow her employer to obtain consumer reports on her, and that members of the Class signed the authorization under duress due to the threat of termination. Plaintiff now seeks a declaratory judgment that the Defendants acted in violation of the FCRA. Defendants move for summary judgment because they claim their actions did not violate the act, and additionally, that any violation as may be determined by the Court was not "willful" Page 3 within the meaning of the Act. The Motions have been briefed by both parties and are now ripe for disposition.

 FACTUAL BACKGROUND

  The facts relevant to disposition of Plaintiffs' claim under the FCRA are well known to the parties and are not in dispute. Briefly, Plaintiff Kelchner was employed by PHI at Sycamore Manor Health Center for approximately nineteen (19) years. In February of 2001, she and other PHI employees were asked to sign an "Annual Statement of Personnel Policy Understanding" ("Annual Statement"). The purpose of this Annual Statement was to provide PHI with the necessary written authorization for obtaining "investigative consumer reports" in connection with the employees' continued employment by PHI. The Annual Statement informed employees that these reports "may involve personal interviews with sources such as neighbors, friends, or associates" and that they were for "employment related purposes only." (Am. Compl. at Ex. 1.)

  When Plaintiff Kelchner refused to sign the Annual Statement, she was informed that receipt of an executed authorization from her by PHI was a condition of continued employment. In addition, PHI notified her that she must sign the Annual Statement by March 21, 2000 or be taken off the active schedule. (Def. Stmt. Undisp. Mat. Facts at Ex. A.) Plaintiff Kelchner continued to refuse to sign the Annual Statement, and her work hours were reduced to zero on March 21, 2001. Page 4 However, she remained on the payroll and was given an additional period of time to provide her authorization.

  On June 12, 2001, Plaintiff Kelchner was sent a second, revised Annual Statement to be signed by June 19, 2001 and warned that should she fail to sign it, PHI would deem her employment "abandoned." (Def. Stmt. Undisp. Mat. Facts at Ex., D.) The revised Annual Statement, unlike the first, sought authorization for obtaining "consumer reports" containing information relating to employees' "credit standing, character, general reputation, personal characteristics, or mode of living" for the purposes of investigating "theft from residents, coworkers, or PHI property; potential fraud in insurance claims; or other forms of dishonesty."*fn2 (Compl. at Ex. 2.) Page 5

  Plaintiff Kelchner refused to sign the second Annual Statement as well, and as a result, all aspects of her employment relationship with PHI ended as of June 30, 2001.*fn3

 DISCUSSION

  Standard of Review

  Summary judgment is appropriate if "there is no genuine issue as to any material fact and . . . the moving party is entitled to judgment as a matter of law." F.R.C.P. 56(c); see also Turner v. Schering-Plough Corp., 901 F.2d 335, 340 (3d Cir. 1990). The party moving for summary judgment bears the burden of showing "there is no genuine issue for trial." Young v. Quinlan, 960 F.2d 351, 357 (3d Cir. 1992). Summary judgment should not be granted when there is a disagreement about the facts or the proper ...


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