Provider hit with class action lawsuit over inaccurate background check report

The background report for the applicant – who has never been convicted of a felony — returned felonies for drug paraphernalia and theft.
The background report for the applicant – who has never been convicted of a felony — returned felonies for drug paraphernalia and theft.

An Indiana-based healthcare management group is facing a class action lawsuit after one applicant claims she was denied a job at the company due to an allegedly false background check report.

The suit was filed last Tuesday by Michele Petry, who applied for a nursing job with Ide Management Group last month. IMG, doing business as Cathedral Health Care Centers, operates 24 skilled nursing and assisted living facilities in Indiana, Illinois and Iowa.

Petry claims she completed an interview with the company and was told she would receive a job offer if she successfully passed a background check. IMG declined to hire Petry after the background report came back from an unnamed consumer reporting agency showing multiple felonies, including charges for drug paraphernalia and theft. Despite the report's findings, Petry has never been convicted of a felony, according to court documents.

Petry requested a copy of the background report, which IMG refused to provide. Petry's suit claims IMG violated the Fair Credit Reporting Act by not providing her with a copy of the report, or a written description of her rights under the Act.

The lawsuit was brought on behalf of IMG job applicants over the past five years who the company received a consumer report for and “took adverse action against” without providing a copy of the report or consumers' rights. The class is believed to include many of the “hundreds, possibly thousands” of potential workers IMG used a consumer report to screen for employment, the suit reads.

McKnight's request for comment from IMG's in-house counsel was not returned by production deadline on Monday. Petry's lawsuit seeks punitive damages for violating the FCRA, as well as actual damages for financial harm and injury of her reputation.

Past cases involving faulty consumer reports have resulted in hefty penalties for background check companies, The Indianapolis Star reported. Starbucks is currently facing a similar class action lawsuit brought by a Colorado job applicant who claims he was denied a position because of an inaccurate report.