May 16, 2016
The U.S. Supreme Court this morning issued its opinion in the case of Spokeo, Inc. v. Robins, on appeal from the U.S. Court of Appeals for the Ninth Circuit, in which the Court clarified the requirements for standing when a plaintiff alleges a bare violation of a statute. The Supreme Court held that the Ninth Circuit failed to consider in its standing analysis the requirement that a plaintiff plead a "concrete" injury to establish injury-in-fact, and remanded the case back to the Ninth Circuit to consider whether Thomas Robins alleged a "concrete" injury in his Fair Credit Reporting Act ("FCRA") lawsuit against Spokeo, Inc.
Robins alleged that Spokeo, a "people search" provider, was a consumer reporting agency under the FCRA and that it included inaccurate information in its profile of him. The profile said that Robins was married, had children, was employed, was relatively affluent, and held a graduate degree, none of which was correct. Robins filed a class-action lawsuit against Spokeo, alleging that its publication of inaccurate information about him violated the FCRA's requirement that consumer reporting agencies follow reasonable procedures to ensure maximum possible accuracy of information. In his complaint, Robins did not allege any specific harm that he suffered, such as losing a job offer as a result of a potential employer's use of Spokeo's profile of him.
The U.S. District Court for the Central District of California dismissed Robins' complaint for lack of standing on the grounds that Robins did not suffer an injury-in-fact, but the Ninth Circuit reversed. The Ninth Circuit reasoned that a violation of a statutory right is "usually a sufficient injury in fact to confer standing" and found that Robins had established a violation of his statutory right under the FCRA and therefore had standing under Article III. Spokeo appealed.
The U.S. Supreme Court held that the Ninth Circuit's standing analysis was flawed, because the Ninth Circuit only considered the "particularized" requirement (i.e., an individualized, personal harm) for injury-in-fact, and failed to consider the "concreteness" element of injury-in-fact. The Court explained that both elements are necessary to establish injury-in-fact. The Court remanded the case back to the appellate court to consider whether Robins alleged a sufficiently concrete injury.
In so holding, the Court reasoned that in the context of claims under the FCRA, a plaintiff "cannot satisfy the demands of Article III by alleging a bare procedural violation." However, the Court made clear that a concrete injury can include "the risk of real harm," but that such risk cannot be abstract. The Court declined to make a finding on whether Robins actually suffered injury-in-fact, explaining that it is possible that a procedural violation of the FCRA could create a degree of risk sufficient to meet the concreteness requirement, and leaving it to the Ninth Circuit to determine on remand whether Robins had alleged such a risk.
The Court's decision creates a hurdle for plaintiffs who allege bare violations of the FCRA (and statutes like the FCRA, that do not expressly include a "harm" requirement as a prerequisite to a private right of action) and nothing more. While the Court preserved the argument for such plaintiffs that "the risk of real harm" might be sufficient to establish a concrete injury, the Court provided some examples of FCRA violations that may not cause concrete harm or present a material risk of harm - an incorrect zip code, without more, and the failure to provide a user of a consumer report with a required notice when providing otherwise accurate information to the user.
Justice Ginsburg, writing for the dissent, agreed that concrete injury is a necessary element of injury-in-fact and the standing inquiry. However, she argued that Robins did allege a sufficiently concrete harm, because the information in his report affected his "fortune in the job market" by, for instance, making him appear overqualified, or like he might expect too high of a salary than employers would be willing to pay. Accordingly, Justice Ginsburg did not think it was necessary to remand the case back to the Ninth Circuit.
The opinion was 6-2, with Justice Alito writing for the majority. Justice Thomas concurred, and Justice Ginsburg wrote a dissenting opinion, in which Justice Sotomayor joined.
Hudson Cook, LLP, on behalf of Consumer Data Industry Association, filed an amicus brief in support of Spokeo, Inc.