Judge rules OOIDA suit against DAC may go forward

| Friday, March 18, 2005

The Owner-Operator Independent Drivers Association has obtained a ruling from a U.S. District Court in Denver that will allow its class action complaint against USIS Commercial Services Inc., doing business as DAC Services, to move forward.

In his ruling, U.S. District Judge Robert E. Blackburn upheld the right of drivers to seek damages, costs, attorneys’ fees and, in the case of willful violations, punitive damages from DAC Services for violations of the Fair Credit Reporting Act (FCRA).

The court also ruled, however, that private parties may not seek equitable relief under the FCRA, which the court found was reserved for the Federal Trade Commission. It thus ruled that OOIDA and individual plaintiffs are not entitled to seek an injunction, a declaratory judgment or disgorgement of ill-gotten profits.

OOIDA President Jim Johnston hailed the decision as "an important milestone in the effort to end blackballing of drivers in the trucking industry." Judge Blackburn also ruled that motor carriers who submit termination record forms to DAC are "consumer reporting agencies," potentially subjecting them to accountability under the FCRA.

"This ruling substantially alters the landscape for driver hiring and firing for both owner-operators and company drivers in the trucking industry," said Johnston. "We intend to look carefully at motor carrier use and abuse of the work record descriptors in DAC’s termination record forms, and will seek to hold DAC – and may seek to hold motor carriers – accountable for inaccurate reports regarding driver work histories."

The Denver court’s ruling came in the form of an order granting in part and denying in part DAC’s motion to dismiss the complaint filed by OOIDA and seven drivers.

According to Paul D. Cullen Sr., general counsel for OOIDA, the part of the court order holding that private parties may not seek equitable relief under the FCRA was not expected to have a major impact on the litigation.

"It is hard to believe that an injunction would be necessary to change DAC’s conduct if it is found to owe millions of dollars in damages to drivers for violating the law," said Cullen.

"The core allegations against DAC will go forward under the court’s recent ruling," said Randall Herrick-Stare, lead counsel for OOIDA in the case. "The Denver court held that OOIDA and the individual drivers have alleged valid claims against DAC, including a claim that DAC violated the FCRA by failing to get driver’s permission before receiving a submission about that driver from a previous employer." The court has scheduled a trial for May 2006.

The OOIDA complaint claims that USIS regularly publishes and sells consumer reports that are vague, ambiguous and incomplete, using phrases with uncommon meanings. It alleges that none of the "work record" descriptors in its employment history reports can be relied upon by prospective employers. OOIDA and its member plaintiff’s claim that the use of these certain statements in consumer reports violate the FCRA. The suit seeks statutory, compensatory and punitive damages for violations of the FCRA.

USIS Commercial Services, which is an Oklahoma-based company, claims to store employment histories for more than 2,500 motor carrier clients – including 95 percent of the largest 100 motor carriers – with access to more than 4.7 million driver records. Its predecessor, DAC Services has been a member of the American Trucking Associations (ATA) since about 1989 and USIS’s District of Columbia office was opened in 2002 within the ATA location.

Copies of the court’s March 7 opinion and of OOIDA’s complaint are on OOIDA’s Web site at www.ooida.com.

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