On Remand From Supreme Court in Spokeo, Ninth Circuit Holds FCRA Violation Satisfies Article III Standing

The Ninth Circuit finally weighed in again on Article III standing issues after the remand of the Spokeo case from the United States Supreme Court. The Supreme Court in Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016), addressed whether a willful violation of the Fair Credit Reporting Act (“FCRA”), absent proof of actual damages, constituted sufficient harm to confer Article III standing to a FCRA plaintiff. The Court ultimately declined to resolve the question, instead remanding the case back to the Ninth Circuit to consider whether the Spokeo plaintiff’s injuries were sufficiently “concrete” to confer Article III standing. In so doing, the Court advised that a statutory cause of action does not automatically empower courts to resolve alleged violations of the statute; rather, Article III requires that the statutory violation must cause the plaintiff to suffer harm that “actually exist[s]” and is not merely “abstract” or “procedural.” 136 S. Ct. at 1548-49.

On Tuesday, August 15, 2017, the Ninth Circuit issued its decision on remand, holding that FCRA plaintiff Robins satisfied Article III’s concrete harm requirement. See Robins v. Spokeo, Inc., No. 11-58643 (“Spokeo II”). Writing for a unanimous panel, Judge O’Scannlain distilled the Court’s discussion of Article III’s concrete harm requirement in Spokeo as requiring a two-step inquiry:

(1) Were the statutory provisions at issue established to protect the plaintiff’s concrete (as opposed to procedural) rights?; and
(2) Did the specific procedural violations alleged in the case actually harm, or present a material risk of harm, to those interests?

The Ninth Circuit answered positively to both questions. First, surveying the FCRA’s legislative history, the court concluded that the interests the FCRA were intended to protect—namely, to protect consumers from the dissemination of false information regarding their credit ratings—were concrete in nature. Op. at 10-15. Second, the Ninth Circuit held that the Spokeo II plaintiff Robins alleged FCRA violations that presented a legitimate and material risk of actual harm to him. The court reasoned that the nature of the information that was allegedly reported falsely—essentially, misstating Robins’ marital status, educational background, and employment history—is the type that could be important to employers or others making use of a consumer report, even when it portrayed these characteristic more favorable than the reality. The court specifically referenced the amicus brief filed in support of Robins by the Consumer Financial Protection Bureau, which argued that making Robins appear wealthier and more educated than he was could have dissuaded potential employers from hiring Robins because he appeared—incorrectly—overqualified. Op. at 18.

Whether or when this case or issue is likely to head back to the Supreme Court is unclear. In the meantime, while Spokeo II provides some guidance within the Ninth Circuit on Article III standing of FCRA litigants, its factual emphasis on the allegations and injuries claimed by Robins makes it difficult to discern how other statutory violation claims, and even according to the Ninth Circuit, certain FCRA claims will be treated from a standing perspective. Indeed another key unresolved question is whether courts must conduct an Article III standing analysis for all class members litigating in the class action context, as the Eighth Circuit, for example, has held. See, e.g., Avritt v. Reliastar Life Ins. Co., 615 F.3d 1023 (8th Cir. 2010). While such a rule makes sense in the context of a predominance analysis, especially when it is apparent that not all class members will have been hurt by a challenged practice, this principle is far from universal acceptance.

A collection of our writings on Spokeo can be found below.

Disclaimer

This blog is made available by Foley & Lardner LLP (“Foley” or “the Firm”) for informational purposes only. It is not meant to convey the Firm’s legal position on behalf of any client, nor is it intended to convey specific legal advice. Any opinions expressed in this article do not necessarily reflect the views of Foley & Lardner LLP, its partners, or its clients. Accordingly, do not act upon this information without seeking counsel from a licensed attorney. This blog is not intended to create, and receipt of it does not constitute, an attorney-client relationship. Communicating with Foley through this website by email, blog post, or otherwise, does not create an attorney-client relationship for any legal matter. Therefore, any communication or material you transmit to Foley through this blog, whether by email, blog post or any other manner, will not be treated as confidential or proprietary. The information on this blog is published “AS IS” and is not guaranteed to be complete, accurate, and or up-to-date. Foley makes no representations or warranties of any kind, express or implied, as to the operation or content of the site. Foley expressly disclaims all other guarantees, warranties, conditions and representations of any kind, either express or implied, whether arising under any statute, law, commercial use or otherwise, including implied warranties of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Foley or any of its partners, officers, employees, agents or affiliates be liable, directly or indirectly, under any theory of law (contract, tort, negligence or otherwise), to you or anyone else, for any claims, losses or damages, direct, indirect special, incidental, punitive or consequential, resulting from or occasioned by the creation, use of or reliance on this site (including information and other content) or any third party websites or the information, resources or material accessed through any such websites. In some jurisdictions, the contents of this blog may be considered Attorney Advertising. If applicable, please note that prior results do not guarantee a similar outcome. Photographs are for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.