Being sued can be an unsettling and frightening experience. However, it you are not careful, it can be a haunting one, even when you win.
A search of court records, which is an increasingly common part of background checks for jobs or housing, can reveal details of a lawsuit that are embarrassing or unfairly prejudicial. California law provides some protections from being unfairly prejudiced by a civil suit that was dismissed or without merit, but you often need to be proactive in protecting your good name.
There are different rules for different types of cases and different rules for who is providing the information about you. This three part series will examine (1) how to seal information from a typical law suit, (2) the special rules that apply to unlawful detainer actions (evictions), and (3) what can and cannot be reported and by whom.
To understand how the records of a dismissed court case can cause haunt you consider the following scenario:
Jane, a software engineer, quit her job when she became uncomfortable with her employer over-billing clients. After she quit, Jane told the client about the over billing. Her former employer was infuriated and filed a lawsuit against Jane that claimed Jane defamed the company, stole company secrets and violated an agreement not to quit and compete against the employer. The court case was dismissed when the judge found the lawsuit was without merit. Jane, who is now looking for a new job and is one of two finalists for a position with a local high-tech company. The company, which is concerned about protecting its technology secrets, performs a background check that searches surrounding counties for civil and criminal court cases. The company sees that Jane was recently sued by her former employer for stealing trade secrets. The company decides that Jane is not the best fit for the job. While Jane cannot prove it, she suspects that the record of the lawsuit cost her the job.
Jane could have eliminated the risk of being unfairly prejudiced if she was proactive and asked the court to seal the record of the dismissed lawsuit. California Court Rule 2.550 provides the constitutional standard and procedure a court will use when someone requests to seal a court record that would otherwise be public. Because of strong First Amendment support promoting public access to court records, sealing a record is an uphill battle.
California courts will use a balancing test in deciding whether or not to grant a request to seal a record. The court weighs the First Amendment right of public access to court records against any “overriding interests” that support sealing the record to determine if the request should be granted. While the Rules do not define what may qualify as an “overriding interest,” a person’s interest in housing or earning income definitely qualifies.
In the scenario above, Jane could have argued to the court that her “overriding interests” included protecting her ability to obtain a job and earn a living. Her argument would be strengthened because the claims in the dismissed lawsuit are taken very seriously by her prospective employers. The court would seal the record and prevent it from ever being disclosed if it found that the threat of potential harm to Jane’s career prospects outweighed the public’s interest in knowing about the dismissed lawsuit.
If you do not have the time or resources to petition a court to seal the record, you might be able to take advantage of special rules based on the nature of the case, or you may even be able to prevent a credit agency from reporting it. These options are discussed in part 2 and part 3 of this series on Keeping Old Law Suits From Haunting Your Future.
Melanie Bronny holds a juris doctor from the University of Utah's S.J. Quinney College of Law. Mathew Higbee Esq. contributed to this article.