Spokeo, Inc. v. Robins (13-1339)

Issues 

Can a plaintiff who has suffered no concrete harm sue in federal court for a violation of the Fair Credit Reporting Act without violating Article III of the US Constitution?

Oral argument: 
November 2, 2015

This case presents the Supreme Court with an opportunity to decide whether plaintiffs may file lawsuits in federal court simply by showing that a defendant violated a federal statute. On the one hand, Spokeo, Inc. argues that Article III of the United States Constitution requires the plaintiff to show that he was sufficiently harmed by the violation of the statute. See Brief for Petitioner, Spokeo, Inc. at 11–13. On the other hand, Robins contends that although he might not meet the injury-in-fact requirement, he was in fact harmed by the incorrect information that was listed on Spokeo, Inc.’s website. See Brief for Respondent, Thomas Robins at 34. According to Robins, the fact that Congress created a private right of action in the Fair Credit Reporting Act combined with the fact that Spokeo, Inc. violated the statute is enough to file a lawsuit. See Brief for Respondent at 15. The Supreme Court’s decision in this case will implicate class action lawsuits involving large corporations, as well as potentially alter the likelihood that corporations will settle claims to prevent significant financial consequences. See Brief for Amici Curiae Ebay Inc. et al., in Support of Petitioner at 13–14; see Brief for Time Inc. and Seven Media Organizations, in Support of Petitioner at 20.

Questions as Framed for the Court by the Parties 

May Congress confer Article III standing upon a plaintiff who suffers no concrete harm, and who therefore could not otherwise invoke the jurisdiction of a federal court, by authorizing a private right of action based on a bare violation of a federal statute?

Facts 

The issues in this case arise from the information that Petitioner Spokeo, Inc. provides to its users about other individuals through its online services. See Robins v. Spokeo, Inc., 742 F.3d 409, 410 (9th Cir. 2014), cert. granted, 135 S. Ct. 1892, 191 L. Ed. 2d 762 (2015). Spokeo, Inc. operates a website that provides users with information about other individuals, including contact information, marital status, age, occupation, economic health, and wealth level. See Robins v. Spokeo, Inc., 742 F.3d at 410. The case began in 2011 in the United States District Court, Central District of California, when Respondent Thomas Robins alleged that Spokeo, Inc. was in violation of the Fair Credit Reporting Act (“FCRA”) for reporting false information about him. See Robins v. Spokeo, Inc., 742 F.3d at 410. Robins claimed that the website described him as having a graduate degree, being wealthy, being married and in his 50s, and having children, all of which was untrue. See Brief for Respondent, Thomas Robins at 8–9; see id. at 411. In Robins’ view, this inaccurate information jeopardized his employment prospects and caused stress and anxiety about his continued unemployment. See id.

Spokeo, Inc. moved to dismiss the case, alleging that Robins did not show injury-in-fact, and therefore lacked the standing required under Article III of the United States Constitution to bring a claim in federal court. See Robins v. Spokeo, Inc., 742 F.3d at 410. The district court ruled that Robins failed to allege “any actual or imminent harm,” and that the injury claimed could not be traced to Spokeo’s alleged violations. See id. at 411.

In 2014, Robins filed an appeal in the United States Court of Appeals for the Ninth Circuit, claiming that he had standing to bring his claim because the FCRA statute authorizes a private cause of action arising from a violation of any of its provisions. See Robins v. Spokeo, Inc., 742 F.3d at 411–12. The Ninth Circuit agreed with Robins that when Congress has created a private cause of action through a statute, such as in the FCRA, the violation of the statute implies that there is sufficient injury-in-fact to confer standing. See Robins v. Spokeo, Inc., 742 F.3d at 412. The Ninth Circuit further concluded that there is sufficient standing as long as the plaintiff alleges that he was injured, rather than merely alleging harm to others. See id. at 413.

Subsequent to the Ninth Circuit’s ruling, Robins filed a petition for a writ of certiorari. See Brief for Petitioner, Spokeo, Inc. at 1. The Supreme Court of the United States granted certiorari on April 27, 2015. See Brief for Petitioner, Spokeo, Inc. at 1.

Analysis 

In this case, the Supreme Court will decide whether Congress may confer Article III standing on a plaintiff who has suffered no concrete harm by permitting a private lawsuit based on the violation of a federal statute. See Brief for Petitioner, Spokeo, Inc. at 12. Spokeo, Inc. contends that before a court may grant Article III standing, there must be a showing of imminent and concrete harm. See id. at 11–12. On the other hand, Robins argues that the Court only requires that a violation of a statutory right be concrete and particularized in order to grant standing. See Brief for Respondent, Thomas Robins at 15–16.

DOES GRANTING STANDING RAISE SEPARATION OF POWERS CONCERNS?

Spokeo, Inc., argues that federal judicial power is confined to matters that are considered appropriate for resolution in court. See Brief for Petitioner at 20. Spokeo, Inc. contends that the Court’s authority is historically limited to disputes involving concrete injury in order to ensure that the judiciary remains “within its proper constitutional sphere.” Id. at 27–28 (quoting Raines v. Byrd, 521 U.S. 811, 820 (1997)).  Furthermore, Spokeo, Inc. argues that the distinction between the Executive Branch and the Judicial Branch will “be obliterated” if the judiciary is permitted to exceed its historically assigned role. See id. at 28 (quoting Lewis v. Casey, 518 U.S. 343, 349–50 (1996). Spokeo, Inc. maintains that the Constitution confers on the Executive the responsibility to ensure that federal law is obeyed, and that the requirement of imminent and concrete harm exists to prevent Congress from delegating the Executive’s constitutional power to private citizens by granting a private right of action based on statutory violations. See id. at 28–30.

But Robins argues that because this suit is between private parties, separation of powers concerns are not implicated. See Brief for Respondent at 48. Additionally, Robins contends that the Article III rule proposed by Spokeo, Inc. in which the Court, rather than Congress, decides what qualifies as a concrete injury would undermine separation of powers principles because “neither the common law nor the Constitution grants federal courts the exclusive authority” to make such decisions. Id. at 51. Furthermore, Robins contends that separation of powers concerns would also be implicated where the Court rather than Congress is granted power to create relief as a remedy to constitutional and common law harms. Id. at 51–52.

SHOULD THE SUPREME COURT GRANT STANDING WITHOUT A SHOWING OF CONCRETE HARM?

Spokeo, Inc. argues that historically, proof of “imminent concrete harm” is the constitutional minimum required by Article III to establish standing and that this requirement is not satisfied by a mere violation of statutory law. See Brief for Petitioner at 12. According to Spokeo, Inc., for issues concerning the redressability of a claim, Congress is arguably permitted to relax the minimum constitutional requirement by creating a statutory cause of action and providing a statutory relief. Id. at 14–16. However, Spokeo, Inc. argues that Congress may not, on its own accord, statutorily grant standing to a plaintiff. Id. at 16. Spokeo, Inc. contends that this requirement of imminent concrete harm is necessary to prevent the judiciary from exceeding its limited role in America’s system of separation of powers by determining what qualifies as a case or controversy and defining the boundaries of what is appropriate for the courts to resolve. See id. at 28.

In contrast, Robins argues that he qualifies for Article III standing because the requirement for actual or threatened injury is satisfied when legal rights granted by statutes are violated. See Brief for Respondent at 9–11. Robins asserts that Spokeo, Inc. willfully violated his personal rights under the FCRA and that his suit merely redresses that violation under statutes created by Congress. See id. at 31. Additionally, Robins argues that Congress specifically intended the FCRA to prevent customers from being affected by inaccurate information in a credit report thereby creating a cause of action in such customers. Id. at 31–33.

DOES ROBINS SATISFY THE INJURY-IN-FACT REQUIREMENT?

Spokeo, Inc. argues that a legal violation does not satisfy the Article III requirement of concrete harm because it is not a remediable injury-in-fact. See Brief for Petitioner at 36.  Spokeo, Inc. argues that the Ninth Circuit did not require a showing of actual harm when this suit was instituted under FCRA as is required for willful violations. Id. at 37. Furthermore, Spokeo, Inc. argues that the Ninth Circuit did not rest its decision on Robins’ alleged injuries, but rather found that Robins’ claim was sufficient simply because his statutory right was violated. Id. Spokeo, Inc. argues that merely asserting that the “plaintiff’s rights” have been violated does not imply that Robins suffered any of the harms historically recognized by the Court as sufficient to grant standing. Id. at 38. Lastly, Spokeo, Inc. argues that permitting the Court to collapse the recognized three-part test consisting of injury, causation, and redressability into the single question of whether there is an injury-at-law would grant unfettered legal standing to anyone authorized to sue. Id. at 39.

Robins counters that even an application of Spokeo, Inc.’s real-world injury test would grant him standing by the court. See Brief for Respondent at 11.  Robins asserts that Article III only requires that the plaintiff’s injury be “personal, particularized, concrete and otherwise judicially cognizable” in order to provide the basis for standing. Id. (quoting Raines v. Byrd, 521 U.S. 811, 820 (1997)). Therefore, Robins contends that as soon as Spokeo, Inc. willfully violated his legal rights under the FCRA, he was entitled to statutory damages and thus his claim is redressable. Id. at 36. Furthermore, Robins asserts that similarly to the common law defamation standard that allows courts to hear claims for all libel or defamation without proof of consequential harm, his FCRA claim would be actionable under common law. Id. at 41–45.

Discussion 

The outcome of this case will clarify the requirements needed to have standing to bring lawsuits in federal courts. Robins argues that it is sufficient to show a defendant violated a statute if the statute has allowed individuals to bring forward a private cause of action by a simple violation. See Brief for Respondent, Thomas Robins at 15. Spokeo, Inc. counters that plaintiffs must also show that they were injured by the alleged violation of the statute. See Brief for Petitioner, Spokeo, Inc. at 11–13. This case will implicate corporations’ involvement in class action lawsuits, and corporations’ willingness to pursue settlements. See Brief for Amici Curiae Ebay Inc. et al., in Support of Petitioner at 13–14; see Brief for Amici Curiae Time Inc. and Seven Media Organizations, in Support of Petitioner at 20.

WILL ALLOWING PLAINTIFFS TO SUE WITHOUT ESTABLISHING SUFFICIENT INJURY MAKE CORPORATIONS VULNERABLE TO CLASS ACTION LAWSUITS?

Spokeo, Inc. and supporting amici, including Ebay Inc., Facebook, Inc., and Google Inc., argue that because many companies interact with millions of internet-based users to provide various services to many thousands or millions of users around the world, these companies are particularly vulnerable to getting sued by large classes of individuals for millions or billions of dollars. See Brief for Amici Curiae Ebay Inc. et al., in Support of Petitioner at 13–14.  Furthermore, Time Inc. argues that allowing individuals to bring forward claims without establishing sufficient injury-in-fact could have a chilling effect on the speech of various news media companies because they will be afraid to speak out due to the possibility of being sued. See Brief for Time Inc. and Seven Media Organizations at 25.

Robins and supporting amici, like the Center for Democracy & Technology, counter that regardless of the potential impact on companies, Congress has enacted statutes, like the FCRA, to protect consumers who might be negatively affected by violations of the various statutes. See Brief for Amici Curiae Center for Democracy & Technology et al., in Support of Respondent at 8. Furthermore, the Center for Democracy & Technology alleges that such statutes, like the FCRA, remain important in an era of widespread digitization of information over the Internet, because the statutes ensure that companies are held accountable when providing consumer reports that use personal information. See Brief for Amici Curiae Center for Democracy & Technology et al. at 9–10.

SHOULD COURTS DEFER TO CONGRESS WHEN DECIDING WHETHER A VIOLATION OF A STATUTE IS SUFFICIENT TO FILE A LAWSUIT?

Spokeo, Inc., Ebay Inc., Facebook, Inc., and Google Inc., argue that although Congress can define new legal rights, it cannot eliminate the injury-in-fact requirement. See Brief for Ebay Inc. et al. at 9. The Chamber of Commerce further argues that the requirement of injury-in-fact is a hard floor of the Constitution that cannot be removed through congressional action. See Brief of Amici Curiae Chamber of Commerce of the United States et al., in Support of Petitioner at 10.

Robins and Public Law Professors, on the other hand, contend that Congress is better equipped than the judiciary to evaluate political questions and can do so when enacting a nationwide regulatory policy, such as the FCRA. See Brief for Public Law Professors at 13. The Public Law Professors argue that the Court has long held that Congress can define new legal rights through statutes, which in turn can confer standing for purposes of bringing forward a lawsuit. See id. at 10.

WILL COMPANIES BE COERCED TO SETTLE MERITLESS CLAIMS IF SUFFICIENT INJURY IS NOT REQUIRED FOR CLASS ACTION LAWSUITS?

Time Inc. contends that if the Court holds that there is no requirement to show sufficient injury-in-fact when bringing lawsuits, then defendants would feel pressure to settle when a class action lawsuit is based on a simple violation of a statute. See Brief for Time Inc. and Seven Media Organizations at 20–22.  Time Inc. argues that companies are already routinely subject to lawsuits seeking billions, or even trillions, of dollars in damages, which leads companies to agree to costly settlements to avoid the potentially ruinous financial consequences of litigation. See id.

The Center for Digital Democracy suggests that violations of statutes are not meritless and carry real harm towards individuals, such as in the present case where Robins’ employment options were harmed because of the incorrect information that was displayed about him. See Brief of Amicus Curiae Center for Digital Democracy, in Support of Respondent at 20. They highlight the fact that personal information about individuals, like marriage or divorce records, and employment history, are released online and relatives and employers could potentially use these online databases to gain more information about applicants. See id. at 19–20.

Conclusion 

The Supreme Court’s decision in this case will clarify whether plaintiffs may be granted Article III standing based on the violation of a federal statute. See Brief for Petitioner, Spokeo, Inc. at 12. Spokeo, Inc. contends that historically, the Article III standing rule requires a showing of imminent and concrete harm and that Robins fails to satisfy this requirement. Id. at 11–12. Conversely, Robins argues that the mere violation of a federal statute confers a right of action in a plaintiff without the need to show concrete harm. See Brief for Respondent, Thomas Robins at 15–16. The Supreme Court’s decision in this case will impact large corporations' involvement in class action lawsuits and a corporation's likelihood of settling claims to avoid significant financial consequences. See Brief of Amici Curiae Ebay Inc. et al., in Support of Petitioner at 13–14; see Brief of Amici Curiae Time Inc. and Seven Media Organizations, in Support of Petitioner at 20.

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