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Pendergrass v. ChoicePoint

December 9, 2008


The opinion of the court was delivered by: Bruce W. Kauffman, J.


Kauffman, J.

Now before the Court is Defendant Rite Aid Corporation's Motion to Dismiss Count III of the Complaint (the "Motion"). For the reasons discussed below, the Motion will be granted in part and denied in part.


This action arises from Defendant Rite Aid Corporation's termination of Plaintiff Theodore Pendergrass in January 2006 and Defendant ChoicePoint, Inc.'s subsequent listing of him in an employment screening database. As alleged in the Complaint, the relevant facts are as follows: On January 11, 2006, Plaintiff was employed as a shift supervisor at a Rite Aid store in Philadelphia, Pennsylvania when he was approached by a store loss prevention officer and asked to accompany him into the store's "break room." Compl. ¶¶ 16-17. Plaintiff alleges that the loss prevention officer then aggressively questioned him about merchandise losses and coerced him into signing a written statement. Id. ¶¶ 20-23. On January 16, 2006, Plaintiff was terminated for unexplained merchandise losses, fraudulent transactions, and other related infractions. Id. ¶¶ 23-26.

Plaintiff alleges that some time after January 11, 2006, Rite Aid published a report of this incident to ChoicePoint, a "data aggregation company that operates as a private intelligence service to government and industry." Id. ¶¶ 5, 63. One of ChoicePoint's services is Esteem, an employment screening database "that subscribing members use to supplement their background investigations of prospective job applicants." Id. ¶¶ 9-10. Subscribing members, which include many of the largest retail chains in the United States, have 24-hour access to the Esteem database through the internet or other forms of electronic information transfer. Id. ¶¶ 13-14.

After his termination, Plaintiff interviewed with CVS Pharmacy and Walgreens Pharmacy for permanent full-time positions. Id. ¶¶ 28-29. Although he was approved for hiring at both CVS and Walgreens, he was told on or about November 30, 2006 that a "bad report" in his employment history prevented his hiring. Id. According to Plaintiff, the "bad report" was the report Rite Aid submitted to the Esteem database describing the January 11, 2006 incident at Rite Aid as "Cash Register Fraud and Theft of Merchandise," with a total theft amount of $7,313.00. Id. ¶ 31; see also Esteem Report, attached to Compl. at Ex. 2. On July 25, 2007, after unsuccessfully attempting to correct the inaccurate Esteem report with ChoicePoint, Plaintiff received a letter from the retail chain Target that denied his employment application based on a copy of the Esteem report. Compl. ¶ 37.

Plaintiff alleges that Rite Aid made the report "with malice or willful intent to injure [him]" and that Rite Aid "specifically intended to prevent [him] from obtaining future employment." Id. ¶ 64. He further alleges that ChoicePoint "did in fact republish the defamatory report, repeatedly, to its other Esteem subscribers, including but not limited to the said communications to CVS, Walgreens and Target." Id. ¶ 66. As a result, "Plaintiff has been branded a thief in the eyes of almost every potential employer in his field" and has experienced difficulty finding full-time employment. Id. ¶¶ 44, 69.

On January 10, 2008, Plaintiff filed his Complaint, asserting four causes of action: (Count I) violation of the Fair Credit Reporting Act ("FCRA") § 607, 15 U.S.C. § 1681e(b), against ChoicePoint; (Count II) violations of FCRA §§ 611, 623, 15 U.S.C. §§ 1681i, 1681s-2, against Rite Aid and ChoicePoint; (Count III) a defamation claim under Pennsylvania law against Rite Aid and ChoicePoint; and (Count IV) a false imprisonment claim under Pennsylvania law against Rite Aid. In the instant Motion, Rite Aid seeks dismissal of Count III because the applicable statute of limitations bars Plaintiff's defamation claim.


When considering a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), this Court is required "to accept as true all allegations in the complaint and all reasonable inferences that can be drawn therefrom, and view them in the light most favorable to the non-moving party." Rocks v. City of Philadelphia, 868 F.2d 644, 645 (3d Cir. 1989). In deciding a 12(b)(6) motion, "a court looks only to the facts alleged in the complaint and its attachments without reference to other parts of the record." Jordan v. Fox, Rothschild, O'Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir. 1994). "To survive a motion to dismiss, a civil plaintiff must allege facts that 'raise a right to relief above the speculative level on the assumption that the allegations in the complaint are true (even if doubtful in fact).'" Victaulic Co. v. Tieman, 499 F.3d 227, 234 (3d Cir. 2007) (citations omitted in original) (quoting Bell Atl. Corp. v. Twombly, 127 S.Ct. 1955, 1965 (2007)). A statute of limitations defense may be raised in the context of a motion to dismiss where "the complaint facially shows noncompliance with the limitations period and the affirmative defense clearly appears on the face of the pleading." United States ex rel. Malloy v. Telephonics Corp., 68 F. App'x 270, 273 (3d Cir. 2003) (quoting Oshiver v. Levin, Fishbein, Sedran & Berman, 38 F.3d 1380, 1385 n.1 (3d Cir. 1994)).


Rite Aid argues that Plaintiff's defamation claim arises from the publication of the allegedly false theft report to ChoicePoint, which Plaintiff discovered on or about November 30, 2006 when he received the letter from Walgreens. See Compl. ¶ 30. Even assuming that the one-year statute of limitations period did not begin until Plaintiff discovered the existence of the publication on or about November 30, 2006, Rite Aid argues that the Complaint is barred because it was filed in January 2008, well beyond the one-year statute of limitations period.*fn1 See 42 Pa. Cons. Stat. § 5523(1).

Conceding that "many of the events . . . did occur more than one year prior to the January 10, 2008 commencement of this action, including [Rite Aid's] original report to ChoicePoint . . . and the November 2006 republications by ChoicePoint to CVS and Walgreens," Pl.'s Resp. 7, Plaintiff argues that each viewing of the defamatory report in the Esteem database constitutes a separate tort, each with its own statute of limitations. Because the original defamer may be held liable for repetition of the defamatory statement if the repetition was authorized or expected, see Restatement (Second) of Torts ยง 576 (1977), Plaintiff contends that Rite Aid is liable for the foreseeable repetition of the incident report by ChoicePoint. Thus, according to Plaintiff, Rite Aid is liable for each "republication" of the Esteem report, including the July 2007 viewing by Target and any other republications occurring within the statutory ...

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