In recent years, corporations have been vexed with class actions filed under statutes that allow consumers and others to sue for civil penalties where it is alleged that the defendant committed a technical violation of a statutory requirement, even where the plaintiff suffered no actual injury. Such statutes include the Fair Credit Reporting Act ("FCRA"), the Telephone Consumer Protection Act, the Fair and Accurate Credit Card Transaction Act, and the Truth-in-Consumer Contract, Warranty and Notice Act. But where the plaintiff has suffered no actual injury, does the plaintiff have standing under Article III of the Constitution? In other words, what is the "case or controversy" in these situations?
Yesterday, the United States Supreme Court issued its long-awaited opinion in an appeal that sought to answer that question. Spokeo, Inc. v. Robins involved a claim brought under the FCRA against a "people search engine," wherein the plaintiff alleged a claim for civil penalties under the statute because the defendant allegedly reported incorrect information about him. Reflecting what it is likely to have been a compromise opinion among competing views demonstrated by the justices at oral argument, the Court did not answer the question of whether the Spokeo plaintiff himself had Article III standing. Instead, the Court's majority opinion took the opportunity to clarify that a standing inquiry requires the injury to be both "particularized" (meaning that it affects the plaintiff in a personal and individual way) and "concrete" (meaning that it is actual, real and not abstract). Because the Court felt that the Ninth Circuit had failed to give proper consideration to the "concrete" requirement, it remanded the case for further consideration in light of its opinion.
Of course, "concreteness" goes to the heart of the question – i.e., whether and when an injury asserted by a plaintiff suing for a technical violation of a statute creates Article III standing. In its opinion, the Court made clear that "Article III standing requires a concrete injury even in the context of a statutory violation." Accordingly, an allegation of a "bare procedural violation" of a statute (e.g., failure to provide notice that causes no injury), the provision of accurate information, or the provision of harmlessly inaccurate information would not create a "concrete" injury entitling a plaintiff to standing. On the other hand, the Court also made clear that laws passed by Congress can recognize as "concrete" some injuries that were not so recognized under common law. Presumably, therefore, a FCRA plaintiff could satisfy the "concrete" requirement by alleging facts to show that the defendant circulated false information that could possibly do him harm in the future.
Thus, the Spokeo opinion makes clear that defendants in claims based on violations of statutory rights have a potential defense if the plaintiff has not alleged that the violation of that right rises to the level of being "concrete." As an example, the Court noted that a claim under the FCRA would not be cognizable if the only false information promulgated about a plaintiff was an incorrect zip code. But the Court did not identify a clear threshold for what gives rise to an "injury," leaving that critical question for another day. Significantly, because this case involves only the inquiry for entry into federal court under Article III, it does not necessarily affect the threshold for standing of similar claims brought in state courts.