District Court Says Supreme Court Ruling on Standing in Class Actions Does Not Apply to Privacy Claims
July 29, 2021
Authored by: Daniel Rockey
On June 25, 2021, the Supreme Court issued an important decision on Article III standing in class actions that will have a significant impact on the way class actions are certified – and will likely scuttle numerous settlements that have not yet received final approval. In TransUnion LLC v. Ramirez (2021) 141 S.Ct. 2190, the Supreme Court reversed a Ninth Circuit decision certifying a class of 8,185 individuals as to whom TransUnion had erroneously placed an Office of Foreign Assets Control alert into their credit files – in effect, labeling them as a terrorist, narco-trafficker, or serious criminal — in violation of the Fair Credit Reporting Act (“FCRA”). Through FCRA, Congress imposed a requirement on credit reporting agencies to make reasonable efforts to ensure the accuracy of credit reports and created a private right of action which makes “Any person who willfully fails to comply with any [FCRA] requirement … liable to that consumer” for actual damages, statutory damages, punitive damages and attorney’s fees. § 1681n(a). A jury ultimately awarded the class $60 million in statutory and punitive damages.
The Supreme Court reversed. The Court first clarified that all class members, not just representative class members, must demonstrate Article III standing, reversing decisions such as Neale v. Volvo Cars of North America, LLC (3d Cir. 2015) 794 F.3d 353, 362 and Melendres v. Arpaio (9th Cir. 2015) 784 F.3d 1254, 1264, which held that only named class members must have standing. Next, expanding on its decision in Spokeo, Inc. v. Robins, 578 U. S. 330, 340, 136 S.Ct.