Alaska Employment Law

Caltech may be liable for unnecessary enforcement of federally-mandated background checks 

NASA required “low risk” employees at Caltech’s Jet Propulsion Laboratory to submit to the same in-depth background investigation required of federal civil service employees.   That process requires completion of Standard Form 85 and authorization for the government to send a Form 42 (”Investigative Request for Personal Information”) to the employees’ references, landlords, etc.  The employees argued that NASA lacked statutory authority for the directive, and that the investigation invaded the employees’ constitutional right to privacy and their 4th Amendment rights.

On appeal from the District Court’s denial of the employees’ request for a preliminary injunction, the Court of Appeals (Wardlaw, Thompson, and a District Court judge) has now reversed.

Federal authority: The panel first held that no statute or presidential directive grants NASA the power to do background checks of “low risk” employees.

Employee privacy: On the privacy claims, the court held that the broad inquiries - about illegal drug use, drug counseling, financial integrity, mental or emotional stability - implicate “the right to informational privacy.”  That intrusion is not “narrowly tailored to any legitimate government interest” and is accompanied by a “lack of standards governing the inquiry.”  The panel, thus, concluded that the employees were likely to succeed on their constitutional privacy claims.

4th Amendment “search”:  On the 4th Amendment claims, the panel concluded that background checks are not likely to be deemed “searches” within the meaning of the 4th Amendment.

Private employer as governmental actor: Finally, on Caltech’s claim that it was NASA’s blameless servant, the panel noted:  

Caltech notes that it initially opposed the new background investigations, which are conducted entirely by NASA and other government agencies; therefore, it claims that the investigations are not “joint activities” and Caltech is not a “willful participant.” We have some sympathy for this argument, and if Caltech had done nothing more than abide by the contract terms unilaterally imposed by NASA, we might agree with its position. Here, however, the record is clear that Caltech did do more—it established, on its own initiative, a policy that JPL employees who failed to obtain federal identification badges would not simply be denied access to JPL, they would be terminated entirely from Caltech’s 24 employment. This decision does not necessarily render altech liable as a governmental actor, but it raises serious questions as to whether the university has in fact now become a willful and joint participant in NASA’s investigation program, even though it was not so initially. Caltech’s threat to terminate noncompliant employees is central to the harm Appellants face and creates the coercive environment in which they must choose between their jobs or their constitutional rights. Moreover, with the government enjoined, Caltech faces no independent harm to itself, so the balance of hardships tips overwhelmingly in Appellants’ favor. Therefore, we hold that preliminary injunctive relief should apply both to Caltech and to Federal Appellees.

Nelson v. NASA, 2008 WL 110465 (9th Cir. Jan. 11, 2008).

Eugene Volokh criticizes.