The U.S. Court of Appeals for the Third Circuit affirmed the dismissal of employment discrimination claims filed by Cheryl Peebles against her former employer Chain IQ Americas Inc., ruling that her factual allegations were insufficient to support her wrongful termination lawsuit.
In a nonprecedential opinion issued Feb. 3, 2026, Circuit Judge Julio M. Bove wrote for a three-judge panel that included Circuit Judges Stephanos Bibas and L. Felipe Restrepo. The court accepted all of Peebles' allegations as true for purposes of the appeal but concluded they failed to state viable claims under federal civil rights laws.
Peebles, an African-American woman, worked at Chain IQ Americas between July 2022 and January 2023. According to the court filing, she was initially cleared to begin work after Chain IQ's human resources department conducted a pre-employment background check. The company assigned Peebles to work on matters involving UBS, a major financial services client.
The employment relationship deteriorated in November 2022 when a different human resources employee informed Peebles that she was being removed from the UBS account. The HR representative cited alleged "flags" on her pre-employment background check as the reason for the reassignment, according to court documents.
Despite the background check concerns, Chain IQ's CEO praised Peebles' performance quality in December 2022, telling her that her work was "excellent." However, the CEO simultaneously informed Peebles that she could not continue working for Chain IQ due to the alleged failure to pass the pre-employment background check.
Peebles filed suit in the U.S. District Court for the Eastern District of Pennsylvania, bringing claims under multiple legal theories. She alleged racial discrimination in violation of Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination based on race, color, religion, sex, or national origin. She also brought claims under 42 U.S.C. § 1981, a Reconstruction-era civil rights statute that provides remedies for racial discrimination in contractual relationships, including employment.
Additionally, Peebles asserted a cause of action under Pennsylvania's Criminal History Record Information Act, which regulates how employers may use criminal background information in employment decisions. The state law includes provisions designed to prevent discriminatory use of criminal history records.
District Judge Cynthia M. Rufe dismissed Peebles' complaint, concluding that the factual allegations were insufficient to support any of the claimed causes of action. The dismissal meant that Peebles had failed to plead enough facts to make her claims plausible under federal pleading standards established in cases like *Bell Atlantic Corp. v. Twombly* and *Ashcroft v. Iqbal*.
On appeal to the Third Circuit, Peebles challenged the district court's dismissal, arguing that her factual allegations were sufficient to state viable discrimination claims. The case was submitted to the appeals court on Jan. 30, 2026, and decided just four days later.
The Third Circuit's decision was designated as a nonprecedential opinion, meaning it cannot be cited as binding precedent in future cases within the circuit. Under the court's Internal Operating Procedures, such dispositions are not considered opinions of the full court and have limited precedential value.
Circuit Judge Bove noted in the opinion that the panel "assume[d] the parties' familiarity with the underlying facts, procedural history, and issues on appeal." This suggests the court viewed the legal issues as straightforward enough not to require extensive factual recitation or legal analysis in the published opinion.
The affirmance represents a complete victory for Chain IQ Americas, which successfully defended against all of Peebles' discrimination claims at both the district court and appellate levels. The company avoided potential liability for monetary damages and other remedies that could have resulted from a successful discrimination lawsuit.
For Peebles, the adverse ruling closes off federal court remedies for her employment termination. The Third Circuit's affirmance means she cannot pursue her Title VII and Section 1981 claims further unless she seeks review from the U.S. Supreme Court, though such petitions for certiorari are rarely granted in employment discrimination cases.
The case highlights the challenges employees face in pleading sufficient facts to survive motions to dismiss in discrimination cases. Federal courts require plaintiffs to provide more than conclusory allegations of discriminatory treatment, demanding specific factual allegations that make discrimination claims plausible.
The decision also illustrates how background check issues can complicate employment relationships and potentially give rise to discrimination claims when combined with other factors like timing, inconsistent explanations, or disparate treatment of employees from different protected classes.
Employment attorneys note that the Criminal History Record Information Act claim's dismissal suggests that Pennsylvania's protections for employees facing adverse actions based on background checks may require more specific factual allegations to survive initial court review.