The Ninth Circuit recently issued its latest opinion in Spokeo, Inc. v. Robins, the closely-watched putative class action dating back to 2010. The plaintiff initiated the lawsuit against Spokeo, which aggregates publicly available data about individuals on its website, alleging the company published inaccurate information about him, including his age, wealth, marital status, educational history, and profession. He claimed that this conduct violated the Fair Credit Reporting Act (FCRA), which imposes various requirements on consumer reporting agencies with regard to the creation and use of consumer reports and enables an injured consumer to recover actual or statutory damages. Although the district court dismissed the lawsuit, finding the plaintiff had not suffered any actual damages and thus lacked standing to bring his claim, the Ninth Circuit reversed, holding that the violation of the statutory right itself constituted the injury-in-fact necessary to give rise to Article III standing.
The case continued to the Supreme Court, which issued its long-awaited decision in May 2016.By a vote of 6-2, the Court vacated the Ninth Circuit’s opinion, holding it had focused only on whether the plaintiff’s injury was particularized (i.e. affected the plaintiff in a personal way) while failing to address whether it was concrete (i.e. actually in existence) — both of which are necessary for a finding of injury-in-fact. However, rather than answering the question of whether Congress can confer Article III standing on a plaintiff by authorizing a private right of action based on the mere violation of a statute, the Court remanded for the Ninth Circuit to consider whether the plaintiff’s injury here was sufficiently concrete for purposes of standing.
In the wake of that decision, circuit courts took conflicting views of whether alleged violations of various federal statutes alone gave rise to standing.Then, earlier this month, the Ninth Circuit got a chance to weigh in again, finding for a second time that the plaintiff had standing to sue Spokeo for alleged violations of the FCRA. In its decision, the Ninth Circuit reiterated the Supreme Court’s warning that a plaintiff cannot automatically establish standing merely because Congress provided him with a statutory right to sue. Instead, the plaintiff must show a concrete injury that causes real rather than simply legal harm, though an intangible injury may suffice. The court relied on a Second Circuit case interpreting the Supreme Court’s earlier Spokeo decision to explain that a procedural violation of a statute may suffice to show standing when (1) the statute was meant to protect concrete interests, and (2) the alleged procedural violations harmed or materially risked harm to those interests.
Thus, the court was required to analyze both the specific statute and the nature of the alleged violations in order to determine whether the claimed injury was sufficiently concrete; in this case, it was. First, the court explained that Congress had enacted the relevant FCRA provisions to prevent the transmission of inaccurate consumer reports, the widespread use of which meant that material inaccuracies could have very real implications and threaten a consumer’s livelihood. The court compared this to individuals’ interests in privacy and reputation, long-protected by common law. Ultimately, then, it found that the statute was meant to protect a plaintiff’s concrete interest in accurate credit reporting.
With regard to the second prong, the court clarified that allegations of “a bare procedural violation of the statute” alone do not suffice to show the necessary harm. Indeed, even in the context of the FCRA, “in many instances, a plaintiff will not be able to show a concrete injury simply by alleging that a consumer-reporting agency failed to comply with one of the FCRA’s procedures,” as “that violation alone would not materially affect the consumer’s protected interests in accurate credit reporting.” However, in this case, the misrepresentations involved “a broad range of material facts” about the plaintiff’s life, which not only caused him to suffer stress, but harmed his search for employment — and this was true even though Spokeo allegedly reported that plaintiff had higher levels of wealth and education than he actually did. As such, plaintiff’s alleged violations created a material risk of harm to his interest in accurate credit reporting, rendering the alleged injury sufficiently concrete to establish standing in this instance.
At present, it is unclear whether the ruling will have implications beyond FCRA cases that allege a material misstatement of personal facts concerning the named plaintiff(s). Although the plaintiffs’ bar will undoubtedly argue for a broad reading of the decision, we believe that the Ninth Circuit’s focus on the FCRA and its legislative history, as well as the common law of libel and defamation, favors a narrow reading of the case. Stay tuned to the Classified blog to find out what —if any — impact the Ninth Circuit’s ruling will have on broader Article III standing jurisprudence.
Robins v. Spokeo, Inc., No. 11-56843 (9th Cir. Aug. 15, 2017).