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Whole Foods Settles Background Check Lawsuit for $803,000

Had the chain not settled, they could have had to pay upwards of $20 million.

Spencer Platt/Getty Images

Another day, another legal battle for Whole Foods: According to Top Class Actions, the spendy grocery store chain has settled one of the many lawsuits on its docket and must hand over $803,000 to do so. The company was sued last December for allegedly violating the Fair Credit Reporting Act (FCRA) between 2009 and 2012. The class action lawsuit says that Whole Foods did not properly disclose that employees were consenting to background checks in the job application form.

ESR notes the lead plaintiff Colin Speer filed the lawsuit after he applied for a job at Whole Foods. Speer says he was "given a contact and release of information form and a disclosure statement form that were not clear and conspicuous about undergoing background checks." Whole Foods for its part "denies that it engaged in any wrong doing" but has agreed to settle. This is because if a jury found the company guilty it may have had to pay each of the 20,000 lawsuit members $1,000 — or $20 million in total. Now, plaintiffs will receive around $40 each. When asked for a comment a spokesperson for Whole Foods told Eater, "All parties have been ordered by the court not to make any comment on the settlement agreement.

Whole Foods isn't the first major chain to be accused of of violating the FCRA. Last month, Chipotle was slapped with a similar lawsuit in California. According to the class action case, the burrito chain shadily asked job applicants to consent to background checks but hid it within a general consent agreement.