Fired Driver Stung by Drive-A-Check Report Loses Appeal in Defamation Case

A three-judge panel of the 6th U.S. Circuit Court of Appeals, in a unanimous decision, said Dillon Transportation acted properly when it submitted information on driver Frank McKenna to HireRight, an action that McKenna said in his initial lawsuit defamed him.

In ruling for Dillon last week, the judges upheld a decision by the U.S. District Court for the Middle District of Tennessee that also rejected McKenna's defamation claims. Dillon is based in Tennessee.

The federal case grew out of a state action initially filed by McKenna that was dismissed as "non suited without prejudice" by a state court in March 2021. That status allows the case to be refiled in a different court.

The on-the-road facts of the case were not in dispute. McKenna was a driver for Dillon who overturned his tractor trailer in California in January 2017. He had been working for Dillon since early 2014, and the initial lawsuit said he had been driving for more than 20 years.

McKenna was fired the following month. In the original lawsuit filed with the federal court, McKenna said the cargo had been improperly loaded, contributing to the crash.

Dillon then submitted a "Drive-A-Check" report on McKenna to HireRight, a document referred to in the court documents as a DAC report.

"Employers like Dillon subscribe to HireRight's services so they can use DAC reports to perform background checks on driver applicants" the appellate court said in recapping the history of the case.

Not able to find a job

McKenna sued, saying the report was "defamatory and resulted in his inability to secure later employment." In the initial lawsuit, McKenna's inability to find new employment is detailed, noting that "the plaintiff had never experienced any problem in the past in being hired." It also said he had "a reputation that warranted the unqualified confidence of prospective employers in hiring him as a CDL driver."

Dillon's primary defense was that the federal Fair Credit Reporting Act (FCRA) preempted McKenna's defamation claims, which were a state-level action.

The FCRA, according to a precedent cited by the appeals court, regulates the submission of information to a consumer reporting agency like HireRight.

And because it's federal law, it would preempt a state action. The FCRA, "on its face, preempts state causes of action based on providing information to HireRight."

Federal law trumps state action

In the lower court ruling, Judge Waverly Crenshaw, in issuing his summary judgment, reviewed the roles of McKenna, HireRight and Dillon under the FCRA. And given the protections under FCRA to the "furnisher" of information — Dillon — and the provider of the consumer reporting — HireRight — "McKenna's state law libel and tortious interference with business claims against Dillon are preempted as a matter of law."

A second key argument from McKenna's legal team was that a Department of Transportation mandate regulating carriers to gather data on prospective employee drivers — referred to in the court document as section 508 — opened the door to a lawsuit against Dillon despite the apparent FCRA preemption. The section 508 rule blocks liability findings against companies that supply information on a driver's safety records but leaves open legal actions to companies that supply "false" information.

In the transcript of the lower court hearing, the attorney for McKenna said his client believes the DAC report "contains false information about him that interfered with his prospective business relationships and damaged his reputation." The loss of liability protection for the filing of "false" information under the DOT rule could open the door to a defamation lawsuit like McKenna's. 

The appellate court did not rule on the accuracy of McKenna's claim about the report being false. But the McKenna legal argument would be that the law mandating carrier requirements to fully vet prospective drivers and its lack of protection for those who file "false" information is adequate for McKenna to proceed with a defamation claim despite FCRA preemption.

But a crucial part of the lower court decision and the later appeals court ruling is that nobody requested the McKenna DAC. The court said the DOT regulations are aimed at protecting the submitters of information on individuals who are "under consideration for employment." But given that nobody ever requested McKenna's DAC after he was dismissed by Dillon, "for purposes of the statue he may never have been under consideration."

The court then writes that even if section 508 applies to McKenna, the fact that nobody asked for the DAC means the law is effectively moot in McKenna's case.

"But even if § 508 covers McKenna, that still leaves the FCRA preemption provision" the court wrote. "McKenna responds that we should harmonize the two preemption statutes by giving priority to the more specific statute," which would be the law on vetting prospective drivers. 

McKenna's argument is that the section in FCRA that relates to state laws — 15 U.S. Code Section 1681t — might preempt the McKenna defamation action on its own, but the section 508 law allows it, so it should be able to proceed.

The court rejected that argument. "One regulates the consumer reporting industry" it wrote. "Another regulates the hiring of commercial drivers. The statues have different textual purposes, and neither swallows the other."

An analysis at the Justia law site said of that decision, "the court found the two preemption statutes, the FCRA, and the Department of Transportation regulation, complemented each other and could coexist."

The third argument made by McKenna on appeal was a lengthy dispute over filing deadlines. It was a battle that the former driver ultimately lost.

In a transcript of the hearing in May 2023 before the lower federal court, Jeffrey Cox, attorney for Dillon, said the defamation suit was not the only way for McKenna to protest what was in his DAC.

"The plaintiff was not left without remedy" Cox said. "Pursuant to the Federal Motor Carrier Safety Administration Regulations, he could have filed a dispute with Dillon as to Dillon's characterization of safety records being unsatisfactory. He could have filed a dispute with Dillon, and Dillon would have to include it with the report and/or investigate it, maybe withdraw it. We can't know exactly what would happen, but there's a remedy."

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