Rashid Kambarov filed a lawsuit in the District of Oregon alleging violations of the Fair Credit Reporting Act against Quality Counts, Inc. and First Advantage Background Services Corp. Kambarov claimed that Quality Counts completed an employment report about him, sold it to Elwood Staffing, and published inaccurate information regarding his criminal history. The district court dismissed the case for lack of personal jurisdiction, concluding that the defendant lacked sufficient contacts with Oregon. Kambarov appealed, arguing that the defendant's actions were expressly aimed at Oregon and caused foreseeable harm there.
The Ninth Circuit reviewed the dismissal de novo, applying Oregon's long-arm statute and the Due Process Clause. The court explained that to establish specific personal jurisdiction, a plaintiff must show: (1) the defendant purposefully directed activities at the forum; (2) the claim arises from those activities; and (3) exercising jurisdiction is reasonable. To determine purposeful direction, the court applied the 'effects' test from Calder v. Jones. The court found the first element satisfied because Quality Counts committed intentional acts by completing and selling the report. For the second element, the court held that the report was expressly aimed at Oregon because it concerned an Oregon resident's criminal record, was drawn from Oregon court records, and was accessed by an Oregon office of Elwood Staffing. The court noted that the brunt of the harm, including employment termination and reputational injury, was suffered in Oregon. The third element was satisfied because Quality Counts knew Kambarov lived in Oregon and that the report would cause him harm there. The court emphasized that the district court failed to resolve factual disputes in the plaintiff's favor and did not address the second and third factors of the Briskin test, necessitating a remand.
The case returns to the District Court for further proceedings. The district court must now conduct a full jurisdictional analysis, resolving any genuine factual disputes in Kambarov's favor and addressing the second and third factors of the specific personal jurisdiction test. The decision clarifies that background check companies may be subject to jurisdiction in a state where the subject of the report resides and where the report is accessed by a local employer, provided the plaintiff makes a prima facie showing of intentional aiming of conduct.
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