Informational Injury Not Enough to Create Article III Standing

A district court in California has dismissed a complaint alleging violations of the FCRA’s informational provisions because the plaintiff did not have Article III standing.  Nokchan v. Lyft, Inc., Case No. 15-cv-03008-JCS. 2016 U.S. Dist. LEXIS  (N.D. Cal. Oct. 5, 2016).  In Nokchan, an employee of Lyft alleged Lyft failed to provide certain disclosures regarding credit and background checks during the application process.  In response, Lyft filed a motion to dismiss asserting that the plaintiff lacked standing under Article III and citing the Supreme Court’s recent decision in Spokeo v. Robins, 136 S. Ct 1540 (2016).

Since the Spokeo decision, there has been much debate as to which, if any, bare statutory violations provide a sufficient injury in fact to support Article III standing.  In Spokeo, the court held that a plaintiff invoking federal jurisdiction must have an injury in fact – one that is both concrete and particularized, as well as actual.  The Court noted, however, that certain intangible harms may be elevated by Congress to meet the Article III requirements. 

Since Spokeo, plaintiffs and certain courts have relied upon the examples of intangible harms elevated to injury in fact cited by the Supreme Court in Spokeo to distinguish informational injuries from other bare statutory injuries. Those courts have read Spokeo broadly to mean that bare violations of informational statutory provisions are sufficient to assert an injury in fact.   A recent Eleventh Circuit panel, for example, held that bare violations of the FDCPA’s informational provisions found in 15 U.S.C. §1692g were sufficient to grant Article III standing even absent allegations of economic or physical harm.  See, e.g., Church v. Accretive Health, Inc., 2016 U.S. App. LEXIS 12414 (11th Cir. July 6, 2016).  In doing so, the court in Church relied upon the statutory examples cited by the Court in Spokeo.

In Nokchan, the plaintiff asserted bare violations of the FCRA’s informational provisions requiring certain disclosures be made to prospective employees prior to conducting a background check.  The plaintiff did not allege that he was confused by the documents Lyft provided or that if Lyft had complied with the FCRA that he would not have consented to the background and credit checks.  Additionally, he did not allege any actual harm that he suffered as a result of Lyft’s alleged statutory violations.  In contrast, he was actually hired by Lyft and continued to work for them. 

Once the Court found there was no actual or concrete harm suffered by the Plaintiff, it looked to see whether the statutory violations alone were sufficient to provide Article III standing under Spokeo.  In rejecting the rationale used by the Eleventh Circuit in Church, the court in Nokchan noted that the examples provided by the Court in Spokeo of intangible injuries created by statute “involved interests of much greater and broader significance to the public than those at issue in Church… In short, the Court rejects the view that the proposition that every statutory violation of an “informational” right “automatically” gives rise to standing.  Nokchan, 2016 U.S. Dist. LEXIS at 24.  Moreover, “[w]hile procedural violations that have resulted in real harm- or even a risk of real harm – may be sufficient to meet this requirement, Plaintiff in this case has alleged no such injury.” Nokchan at *10.   Because the plaintiff failed to assert any tangible or intangible injury in fact, the court dismissed the action.