Spokeo, Inc. v. Robins: The Illusory 'No-Injury Class' Reaches the Supreme Court

The Supreme Court’s grant of certiorari in Spokeo, Inc. v. Robins, 135 S. Ct. 1892 (Mem.) (2015) casts a shadow on the long-accepted constitutional principle that Congress has the authority to enact a statute to regulate corporations’ behavior for the public good, and to provide a private right of action to a person as to whom the statute is violated. That right of action often provides for the award of a minimum amount of statutory damages as an alternative or in addition to actual damages. Congress has enacted numerous such statutes, including the one at issue in Spokeo, the Fair Credit Reporting Act (“FCRA”), which was passed forty-five years ago. Suddenly, within the last ten years, corporate litigation activists have invented a new argument to avoid regulatory statutes that provide for statutory damages. They claim that a “mere” statutory violation is an “injury in law” rather than the “injury in fact” required for Article III standing. And they are launching a frontal assault on Congress’s constitutional authority to enact any statute that provides a private right of action for its violation, accusing Congress of thereby violating Article III by “creating standing.” Corporate litigation activists then apply to a class representative the argument that the violation of a person’s statutory rights is not an “injury in fact,” and call the result a “no-injury class.” The appellation “no-injury class” is another misleading verbal weapon of recent vintage.This article hopes to makes three small contributions to the burgeoning literature on Spokeo, which at this writing has not yet been decided. First, the Question Presented to the Supreme Court is misleading and overbroad. It implies that the plaintiff in Spokeo, Thomas Robins, has been found not to have suffered any “concrete harm,” but the case is still at the pleading stage. Thus, the question is simply whether Robins’s complaint contains sufficient allegations of injury, assumed to be true on a motion to dismiss, to establish Article III standing. Further, the Question Presented implies that a ruling involving the FCRA (the statute at issue in Spokeo) will be generalizable to all other statutes that create a private right of action and allow statutory damages, without recognizing the many variations in these statutes’ language and operation.Second, the article sketches the historical legal difference between the words “injury” and “damage.” “Injury” connotes the violation of one’s legal right, even if one has not sustained any actual harm, while “damage” means a loss or harm, even if one has no legal right to sue. The Supreme Court has adhered to these meanings since Marbury v. Madison. Given that historical distinction, the term “injury in fact” is confusing and somewhat self-contradictory: under the definition of “injury” as the violation of a legal right, the term “injury in fact” is akin to “violation of a legal right in fact.” Further, the petitioner Spokeo’s newly-discovered phrase “injury in law” - which has never been used in a single United States Supreme Court opinion - is redundant. Under the definition of “injury” as the violation of a legal right, the phrase “injury in law” is akin to “legal right in law.” But however nonsensical, the epithet “injury in law” serves a useful purpose for corporate activists: it minimizes, even ridicules, so-called “technical,” “trifling” statutes that regulate corporate behavior. Finally, the petitioner Spokeo and its numerous business-oriented amici could have made the very same argument they are making in Spokeo - that the violation of the Fair Credit Reporting Act is not itself an “injury in fact” - only nine years ago in Safeco Insurance Co. v. Burr, 551 U.S. 47 (2007), but did not. In Safeco, the putative class alleged that insurers Safeco and GEICO had not complied with the FCRA’s requirement of sending the class members notice of an “adverse action” when the insurers did not charge them the lowest available insurance rate because of a less-than-perfect credit report. The defendants’ amici repeatedly stated that the plaintiffs in Safeco had not alleged any “actual harm” or “actual damages” even though they sought $1,000 in statutory damages for each member of the class (as the FCRA allows). Thus, Safeco presented exactly the same alleged “no-injury” situation, under exactly the same statute, as Spokeo. Yet the Safeco petitioners and their amici (four of which are also amici in Spokeo) failed to argue that the class representatives lacked Article III standing or that violation of the FCRA was not an “injury in fact.” It seems fair to ask why not, if the Article III argument is so compelling. One might speculate that the reason is that corporate litigation activists have only recently contrived the “statutory-violation-is-not-an-injury-in-fact” argument.