141 S. Ct. 2190 (2021)
In 2002 TransUnion began selling an add-on product called OFAC Name Screen Alert.1 It compared consumers' first and last names against the U.S. Treasury Department's Office of Foreign Assets Control list of specially designated nationals.2 Therefore it generated many false positives.3
In February 2011 Sergio Ramirez sought to buy a car from a Nissan dealership.4 The dealership ran a credit check revealing an OFAC alert in his TransUnion credit report indicating a potential match.5 The dealership refused to sell the car to Ramirez, and his wife purchased it in her name instead.6 Ramirez requested a copy of his credit file.7 TransUnion sent a first mailing that included his credit file and the required summary of rights but did not mention the OFAC alert.8 The next day TransUnion sent a second mailing notifying him of the OFAC alert but omitting another copy of the summary of rights.9 Ramirez consulted a lawyer, canceled a planned trip to Mexico, and TransUnion eventually removed the alert.10
In February 2012 Ramirez sued TransUnion alleging three violations of the Fair Credit Reporting Act.11 He sought statutory and punitive damages along with class certification.12 The parties stipulated that the class included 8,185 members and that only 1,853 of them had their credit reports disseminated by TransUnion to potential creditors during the class period running from January 1, 2011 to July 26, 2011.13
The District Court ruled that all 8,185 class members had Article III standing.14 A jury awarded statutory and punitive damages to every class member.15 The Ninth Circuit affirmed in relevant part over Judge McKeown's dissent and reduced the punitive damages.16
Whether the 1,853 class members whose credit reports were disseminated to third parties have Article III standing on the reasonable-procedures claim?17
Article III limits federal judicial power to Cases and Controversies in which a plaintiff has a personal stake.18 To have Article III standing a plaintiff must show an injury in fact that is concrete particularized and actual or imminent along with causation and redressability.19 Central to assessing concreteness is whether the asserted harm has a close relationship to harms traditionally recognized at common law such as reputational harm associated with defamation.20
Yes. The parties stipulated that the class included 8,185 members and that only 1,853 of them had their credit reports disseminated by TransUnion to potential creditors during the class period running from January 1, 2011 to July 26, 2011. Publication to a third party of a credit report bearing a misleading OFAC alert injures the subject of the report.21 That harm bears a close relationship to the reputational harm associated with the tort of defamation.22
Under longstanding law a person is injured when a defamatory statement that would subject him to hatred contempt or ridicule is published to a third party.23 The 1,853 class members thus suffered a concrete harm and have Article III standing for the reasonable-procedures claim.24
The 1,853 class members have Article III standing on the reasonable-procedures claim.25
Related opinions on this issue
Joined by Justices Breyer, Sotomayor, And Kagan
Justice Thomas dissented, joined by Justices Breyer, Sotomayor, and Kagan.26 He contended that the FCRA provisions create individual rights owed to consumers, including the duty to follow reasonable procedures for accuracy under section 1681e(b).27 Under historical practice at the founding, the violation of a personal statutory right gives rise to an actionable harm without need for additional proof of concrete injury beyond the statutory violation itself.28
He maintained that the majority's approach departs from founding-era practice where courts often allowed suit upon allegation of the statutory violation alone for private rights.29 This case exemplifies congressional judgment warranting enforcement, as the harm of being labeled a potential terrorist is serious and closely analogous to defamation.30
Joined by Justices Breyer And Sotomayor
Justice Kagan joined Justice Thomas's dissent in full but noted her continued acceptance of Spokeo's concrete injury requirement.31 She highlighted that TransUnion made money selling OFAC reports and nearly 25 percent of the class had false flags sent to creditors in a seven-month period.32 She argued that common sense indicates receiving a letter identifying one as a potential terrorist or drug trafficker is harmful.33
This supports standing under Congress's judgment that such violations merit redress, diverging from the majority's speculative view of risk and harm for the disseminated class members.34
Whether the 6,332 class members whose credit reports were not disseminated to third parties have Article III standing on the reasonable-procedures claim?35
The mere existence of inaccurate information in an internal file absent dissemination has not traditionally provided the basis for a lawsuit.36 Publication is essential to liability in defamation and historical analogues do not recognize injury merely from retention of inaccurate information.37 The mere presence of an inaccuracy in an internal database not disclosed to third parties does not inflict a concrete harm under Article III.38 In a suit for damages the mere risk of future harm standing alone cannot qualify as a concrete injury unless the exposure to risk itself causes a separate concrete harm.39
No. The parties stipulated that the remaining 6,332 class members had misleading OFAC alerts in their internal TransUnion files but TransUnion did not provide those plaintiffs credit information to any potential creditors during the class period.40 The mere existence of inaccurate information in an internal file absent dissemination has not traditionally provided the basis for a lawsuit. The 6,332 class members did not show that the risk materialized nor did they present evidence of independent harms caused by the risk itself such as emotional distress.41 Therefore the risk of future harm does not supply standing for their damages claims and they lack Article III standing.42
The 6,332 class members do not have Article III standing on the reasonable-procedures claim.43
Related opinions on this issue
Joined by Justices Breyer, Sotomayor, And Kagan
Justice Thomas dissented that the majority's cramped view of standing relegates many statutory private rights to state court or nonenforcement.44 He noted that the harm of being labeled a potential terrorist is intrinsically serious and closely analogous to defamation.45 Congress's judgment that such misdeeds deserve redress should be respected rather than overridden by judicial policy judgments.46
The 6,332 class members suffered from the statutory violations even without dissemination, as the FCRA creates enforceable individual rights that courts must respect rather than second-guess through modern standing doctrine.47
Whether class members other than Ramirez have Article III standing on the disclosure and summary-of-rights claims arising from the formatting of TransUnion's mailings?48
The plaintiffs have not demonstrated that the formatting of the mailings caused them any concrete harm with a close relationship to historical legal harms.49 The plaintiffs presented no evidence that aside from Ramirez any other class member opened the dual mailings was confused or distressed relied on the information or attempted but failed to correct their files because of the format.50 Absent such proof the formatting violations are bare procedural violations divorced from any concrete harm and do not suffice for Article III standing for damages.51 An informational injury that causes no adverse effects does not satisfy Article III.52
No. In February 2011 Sergio Ramirez sought to buy a car from a Nissan dealership that ran a credit check revealing an OFAC alert in his TransUnion credit report indicating a potential match.53 Ramirez requested a copy of his credit file. TransUnion sent a first mailing that included his credit file and the required summary of rights but did not mention the OFAC alert. The next day TransUnion sent a second mailing notifying him of the OFAC alert but omitting another copy of the summary of rights.
The plaintiffs presented no evidence that aside from Ramirez any other class member opened the dual mailings was confused or distressed relied on the information or attempted but failed to correct their files because of the format. Therefore except for Ramirez the class members do not have standing as to those two claims.54
Class members other than Ramirez do not have Article III standing on the disclosure and summary-of-rights claims.55
Related opinions on this issue
Joined by Justices Breyer And Sotomayor
Justice Kagan dissented that the majority's assumptions about how recipients handle mailings are implausible.56 She argued that TransUnion made money selling OFAC-branded credit reports to third parties.57 Common sense suggests persons who request their credit reports would open them and be affected by information labeling them as potential drug traffickers supporting standing for the class.58
The risk and actual effects from the formatting defects warrant standing for all class members under the congressional scheme rather than denying redress based on speculative assumptions about consumer behavior.59