Current Class Action Issues Before the Supreme Court Part I
June 2, 2015
The United States Supreme Court has recently granted certiorari in (fancy lawyer speak for “has agreed to review”) two cases that have significant implications for both class action practitioners as well as litigants. In this post we’ll examine the first case, Robins v. Spokeo.
Robins v. Spokeo addresses whether Spokeo, an online data aggregator, can be held liable under the Fair Credit Reporting Act (“FCRA”) for failing to maintain reasonable procedures designed to ensure accuracy in the reports it produces and sells about people. In a nutshell, the plaintiff alleged that Spokeo violated the FCRA by publishing inaccurate information about his financial condition online. Spokeo has argued that the case presents the following question:
"Whether Congress may confer Article III standing upon a plaintiff who suffers no concrete harm, and who therefore could not otherwise invoke the jurisdiction of a federal court, by authorizing a private right of action based on a bare violation of a federal statute."
According to Spokeo, Robins suffered no “concrete harm” apart from the fact that Spokeo allegedly committed a “bare violation” of the FCRA with respect to the information it published about him.
The problem for Spokeo is that the question it presents begs its own answer and assumes that Robins suffered no harm—but Robins does allege that he suffered “concrete harm.” Even if Robins can’t show economic harm as a result of Spokeo’s false information, he can still show that Spokeo violated his privacy rights, as enshrined in the FCRA, not to have false information about him published online. Indeed, the concrete harm at the heart of Spokeo’s violation of the FCRA is the same as any privacy tort like false light, publication of private information, and defamation. This fact was not lost on the Ninth Circuit when it ruled in Robins’s favor:
[Spokeo’s Attorney]: "But what happened, what is here is, he is as much a bystander – yes his information is involved – but he is as much a bystander as someone who watches someone cut them off and make an illegal left turn. I mean yeah there’s witness some harm but unless some, something has happened, something tangible distinct and palpable you don’t have the type of injury-in-fact that would allow you to bring a lawsuit in federal court. You have the FTC to take care of these broad and differentiated harms."
Judge Graber: "So if your client lied about somebody to a third party there’s no standing on the part of the person who’s lied about? I mean isn’t that a traditional defamation-type claim? I mean it, it seems very similar to – its not identical obviously – but it seems very similar to very traditional torts and tort standing."
(Oral Arg. 10:55 - 11:41)
It will be interesting to see how the Supreme Court handles Spokeo’s framing of the issue and its attempt to gloss over these privacy injuries. If the Ninth Circuit’s decision is overturned, the case could have far reaching implications for consumers whose codified privacy rights are violated but are unable to demonstrate “concrete harm” in the form of economic damages.
 In the interests of full disclosure, the author of this post was the attorney who argued the appeal before the Ninth Circuit on behalf of Robins but is no longer an attorney on the case.
Denied a Job Because of the Background Check? Using Background Checks When Deciding Who to Hire? Consumer Rights and Employer Duties Under the FCRA.