Source: https://www.fenwick.com/publications/pages/ninth-circuit-in-spokeo-inaccurate-consumer-reports-support-standing-in-fcra-cases.aspx
Timestamp: 2019-04-23 02:00:42+00:00

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The U.S. Court of Appeals for the Ninth Circuit held that allegations that Spokeo Inc. published an inaccurate consumer report in violation of the Fair Credit Reporting Act established a concrete injury sufficient to confer Article III standing. This new Robins v. Spokeo decision, which came down on Aug. 15, is significant not only because it makes it easier for plaintiffs to bring statutory violation cases but also because it places the Ninth Circuit firmly on the side of those circuits which have found that violations of federal statutory rights are generally sufficient to create Article III standing.
The FCRA provides a private right of action for willful or negligent failures to comply with its requirements. For willful violations, plaintiffs may recover statutory damages, punitive damages, and attorney’s fees and costs.
Spokeo operates a website that compiles consumer data and builds individual consumer information profiles. Parties can visit the website to view a report containing information about a person’s life, such as age, contact information, marital status, occupation, hobbies and economic health.
Thomas Robins discovered that Spokeo had published a profile of him which inaccurately stated that he was in his 50’s, married with children, employed in a professional or technical field, possessed a graduate degree and that his wealth level was higher than it actually was. Robins sued Spokeo for willfully violating the various procedural requirements under FCRA, including failing to “follow reasonable procedures to assure maximum possible accuracy” of the information in his consumer report.
The district court dismissed Robin’s complaint for lack of standing, concluding that he had only alleged a bare violation of the statute which was not an actual injury-in-fact. The Ninth Circuit reversed the dismissal in Robins v. Spokeo (9th Cir. 2014) (Spokeo I), holding that Robins had suffered a concrete and particularized injury because he had alleged that Spokeo had violated his specific statutory rights. After the Supreme Court granted certiorari in Spokeo v. Robins (2016) (Spokeo II), it vacated the Ninth Circuit’s decision, holding that, although the Ninth Circuit had properly addressed whether the alleged injuries were particularized as to Robins, the Ninth Circuit did not conduct a proper analysis concerning whether the alleged injuries were sufficiently concrete as well. Therefore, the Supreme Court remanded the case to the Ninth Circuit with instructions to consider specifically whether the injuries alleged by Robins met the “concreteness requirement” imposed by Article III.
Taking up Robin’s FCRA allegations once again, the Ninth Circuit again reversed the district court’s dismissal, concluding that Robin’s alleged injuries were sufficiently concrete for purposes of Article III standing.
With the Supreme Court’s guidance in mind, the Ninth Circuit looked to whether the FCRA was established to protect consumers’ concrete interests (as opposed to their purely procedural rights). The Ninth Circuit observed that “the Supreme Court seems to have assumed that, at least in general, the dissemination of false information in consumer reports can itself constitute a concrete harm.” The court also observed that the interests that the FCRA protects are similar to other “reputational and privacy interests that have long been protected in the law[,]” and although “there are differences between FCRA’s cause of action and those recognized at common law, the relevant point is that Congress has chosen to protect against a harm that is at least closely similar in kind to others that have traditionally served as the basis for lawsuit.” Thus, informed by both Congress and historical practice, the Ninth Circuit held that Congress enacted the FCRA to protect consumers’ concrete interest in accurate credit reporting.
Finally, the Ninth Circuit rejected Spokeo’s argument that the injuries alleged by Robins were too speculative to establish a concrete injury. The Ninth Circuit held that both the challenged conduct and the attendant injury had already occurred as Spokeo had already published a “materially inaccurate consumer report” about Robins resulting in the alleged intangible injury caused by the report.
The new Spokeo decision exacerbates a growing division among the circuits concerning how Spokeo II is applied in federal statutory injury cases. It is consistent with prior Ninth Circuit precedent in Syed v. M-I (9th Cir. 2017) and Van Patten v. Vertical Fitness Group (2017) and the Third Circuit’s decision in In re Horizon Healthcare Services Data Breach Litig. (3d Cir. 2017) in adopting an expansive interpretation of Spokeo II and recognizing Article III standing based on violations of the statutory protections created by federal privacy statutes, such as the FCRA. However, other circuits have applied Spokeo II much more narrowly in federal statutory injury cases and found that procedural or technical violations of statutory rights created by Congress without any allegations of actual harm do not establish a concrete injury and Article III standing. For instance, the Fourth Circuit in Dreher v. Experian Info. Solutions (4th Cir. 2017) and Seventh Circuit in Groshek v. Time Warner Cable (7th Cir. 2017) both denied Article III standing in cases alleging procedural FCRA violations on this basis. This circuit split will likely not be resolved until and if the Supreme Court decides to take up the issue again.

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