The Supreme Court Remands Injury Question In Spokeo Class Action Privacy Claim

On Monday, May 16, the Supreme Court addressed the question of whether an alleged violation of the Fair Credit Reporting Act (FCRA), without allegation of concrete injury, is ever sufficient for Article III standing. The case, Spokeo Inc. v. Robbins, No. 13-1339 (2016), involved a class action against data broker Spokeo Inc.. The plaintiff, Thomas Robins, alleged that Spokeo violated the FCRA by inaccurately reporting online that he was a wealthy, married man with children and a graduate degree when he was actually unmarried and out of work. He argued that those inaccuracies could have hurt his chances with potential employers. The district court dismissed Mr. Robins’s case for failure to show any actual harm from the false information, but in 2014, the U.S. Court of Appeals for the Ninth Circuit allowed the case to move forward based on its analysis that Mr. Robins’s injury allegation was particularized because he alleged that Spokeo violated his individual rights when it handled his information.

The Supreme Court disagreed. The Court held that particularized injury without concrete injury was not sufficient for standing, but it was not entirely clear on when concrete injury exists. The Court’s opinion, authored by Justice Alito, held that “Article III standing requires a concrete injury even in the context of a statutory violation.” At the same time, however, the opinion acknowledged that “[t]he violation of a procedural right granted by statute can be sufficient in some circumstances to constitute injury-in-fact.” The Court ultimately did not decide whether such a concrete injury was present in this case. Instead, it held that the Ninth Circuit did not properly consider the concrete injury requirement question and remanded the case to that court for consideration of the defendant’s injury claim and its bearing on Article III standing.

On its blog, Spokeo celebrated that the Court “squarely rejected the contention that merely alleging a violation of a statute alone gives a plaintiff standing to bring a claim under federal law on behalf of a class of hundreds of thousands or millions of people” and noted that, even if Mr. Robins’ allegations are found to have satisfied the requirement of “real” harm, the Court’s standard as expressed in the opinion will help curb large class actions that include many plaintiffs who have not suffered any real injury.

Spokeo represents another step in the Supreme Court’s attempt to balance the benefits of class actions against potential abuse.  Its significance lies in its clear statement that it is plantiffs’ burden to allege and establish a concrete injury.  Mere reliance on a statutory violation is insufficient.