Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_16-cv-06583/USCOURTS-cand-3_16-cv-06583-3/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1441 Petition for Removal - Fair Credit Reporting Act

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United States District Court

Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

JOYCE BENTON,

Plaintiff,

v.

CLARITY SERVICES, INC.,

Defendant.

Case No. 16-cv-06583-MMC 

ORDER GRANTING IN PART AND 

DENYING IN PART PLAINTIFF'S 

MOTION TO REMAND

Re: Dkt. No. 22

Before the Court is plaintiff Joyce Benton’s (“Benton”) “Motion to Remand,” filed 

December 13, 2016, by which Benton seeks remand of a complaint brought under the 

Fair Credit Reporting Act (“FCRA”). Defendant Clarity Services, Inc. (“Clarity”) has filed 

opposition, to which Benton has replied. The matter came on regularly for hearing on 

January 20, 2017. Christian Schreiber of Chavez & Gertler LLP and James Pietz of 

Feinstein, Doyle, Payne & Kravec, LLC appeared on behalf of Benton. Hsiao C. Mao of 

Troutman Sanders LLP appeared on behalf of Clarity.

The Court, having considered the parties’ respective written submissions and the 

arguments of counsel at the hearing, rules as follows.

1. In the First Cause of Action, Benton alleges Clarity violated two separate 

subsections of 15 U.S.C. § 1681b, each of which the Court addresses in turn. 

a. To the extent Benton alleges Clarity violated 15 U.S.C. 

§ 1681b(c)(1)(B)(i) by “disclosing consumer reports to persons or entities that do not have 

a permissible purpose for obtaining such consumer reports” (see Compl. ¶ 85), the Court 

finds, for the reasons stated on the record at the hearing, that a sufficient showing as to 

standing has been made. In particular, the Court finds Benton’s allegation that she has 

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United States District Court

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“suffered a violation of [her] right to privacy” as a result of such allegedly wrongful 

disclosure (see id. ¶ 87) is not a “bare procedural violation, divorced from any concrete 

harm,” see Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1549 (2016), but rather one that 

caused sufficiently concrete injury to Benton’s privacy interest. See, e.g., Hawkins v. 

S2Verify, No. C 15-03502 WHA, 2016 WL 3999458, at *5 (N.D. Cal. July 26, 2016) 

(holding, where plaintiff alleged violation of FCRA based on defendant’s disclosure of 

arrests older than seven years, Congress’s decision to “restrict access to” such 

information “bestowed a degree of privacy” thereon; further holding defendant, by 

“sen[ding] restricted information about plaintiff into the world . . . caused injury to plaintiff’s 

privacy interest”). 

b. By contrast, the Court finds, for the reasons stated on the record at the 

hearing, that to the extent Benton alleges Clarity violated 15 U.S.C. § 1681b(e)(5)(A) by 

failing to “administer and maintain a toll-free number that allows consumers to opt out of 

pre-screened offers of credit and insurance” (see Compl. ¶ 84), such allegation pleads a 

“bare procedural violation, divorced from any concrete harm,” see Spokeo, 136 S. Ct. at 

1549, and thus is insufficient to establish standing. In particular, the Court finds Clarity’s

provision of a notification method by mail (see Compl. ¶¶ 45-46), although not in strict 

compliance with § 1681b(e)(5)(A), was a reasonable alternative that did not violate 

Benton’s right to “meaningfully” control the dissemination of her consumer information. 

See, e.g., Syed v. M-I, LLC, -- F.3d --, 2017 WL 242559, at *4 (9th Cir. Jan. 20, 2017) 

(holding defendant’s use of form tying waiver of liability to applicant’s authorization of 

disclosure deprived [applicants] of their ability to meaningfully authorize . . . credit 

check”).

2. As to the Second Cause of Action, in which Benton alleges Clarity violated 15 

U.S.C. § 1681e(a) by failing to “maintain reasonable procedures designed to limit the 

furnishing of consumers reports” (see Compl. ¶ 92), which claim is predicated on

Benton’s allegation that Clarity violated 15 U.S.C. § 1681b(e)(5)(A) by failing to maintain 

a toll-free number (see id. ¶ 94), the Court, for the reasons discussed above as to 

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§ 1681b(e)(5)(A), finds Benton’s allegations are insufficient to establish standing. 

3. Similarly, with respect to Benton’s Third Cause of Action, in which Benton

alleges Clarity violated 15 U.S.C. § 1681g by “fail[ing] to disclose the source of the 

information for each particular type of personal information listed in [p]laintiff’s consumer 

file disclosure” (see Compl. ¶ 65), the Court finds, for the reasons stated on the record at 

the hearing, that such allegations are in the nature of a “bare procedural violation, 

divorced from any concrete harm,” see Spokeo, 136 S. Ct. at 1549, and thus insufficient 

to establish standing. In particular, the Court finds where, as here, the complaint does 

not allege that any of the information for which the source was not provided was in any 

manner inaccurate and, upon the Court’s inquiry at the hearing, no inaccuracy was 

identified, the violation is procedural, rather than concrete. See id. at 1550 (citing, as 

example of “bare procedural violation” consumer reporting agency’s failure to provide 

“required notice to [third-party] user of . . . agency’s consumer information,” where such

information “regardless [is] entirely accurate”). 

4. In light of the above, the Court will sever the claims for which the Court has 

found plaintiff lacks standing and said claims will be remanded to state court. See, e.g., 

Lee v. Am. Nat’l Ins. Co., 260 F.3d 997, 1006 (9th Cir. 2001) (holding, where Article III 

standing existed as to claims against only one of two defendants, proper procedure was 

to sever claims for which plaintiff lacked standing; noting “[a] case that is properly 

removed in its entirety may nonetheless be effectively split up when it is subsequently 

determined that some claims cannot be adjudicated in federal court”). 

CONCLUSION

For the reasons stated, Benton’s motion to remand is hereby GRANTED in part 

and DENIED in part, as follows:

1. To the extent Benton bases the First Cause of Action on the ground that Clarity 

violated 15 U.S.C. § 1681b(c)(1)(B) by disclosing her consumer report to entities lacking

a permissible purpose, the motion is DENIED. 

2. As to all other claims asserted in the complaint, the motion is GRANTED and 

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said claims are SEVERED and REMANDED to the Superior Court of the State of 

California, in and for the County of Alameda. 

IT IS SO ORDERED.

Dated: January 24, 2017

MAXINE M. CHESNEY

United States District Judge

Case 3:16-cv-06583-MMC Document 29 Filed 01/24/17 Page 4 of 4