As Dwight Schrute of hit NBC show “The Office” said, “identity theft is not a joke, Jim! Millions of families suffer every year!” In response, Congress has passed a variety of legislation over the years aimed at curbing identity theft. One such piece of legislation, the Fair Credit Reporting Act (“FCRA”), as amended by corollary acts, prohibits the printing of more than the last 5 digits of the credit card number or the credit card number’s expiration date on any sales receipt. Anyone who “willfully fails to comply with [the requirements] is liable to that consumer” for statutory or actual damages, attorney’s fees and costs, and potential punitive damages. But is a statutory violation of the FCRA alone a sufficient injury to confer Article III standing? No, says the Ninth Circuit.
In Bassett v. ABM Parking Services, Inc. which was filed on February 21, 2018, after paying for parking at the defendant’s parking garage, the plaintiff was issued a receipt bearing his credit card expiration date. The plaintiff did not allege that a second receipt existed, that his receipt was lost or stolen, or that he was the victim of identity theft. Rather, the plaintiff brought suit on the basis that his “exposure . . . to identity theft” created an “imminent risk” that his “property would be stolen and/or misused by identity thieves.” The District Court for the Western District of Washington granted the defendant’s motion to dismiss on grounds the plaintiff lacked Article III standing since he failed to allege a sufficiently concrete injury.
On appeal, the Ninth Circuit affirmed the District Court’s decision after finding the plaintiff’s theory of “exposure to identity theft is . . . ‘too speculative for Article III purposes.’” In doing so, the Ninth Circuit relied on the Supreme Court’s decision in Spokeo, Inc. v. Robins, 136 S.Ct. 1540 (2016), which held that a “bare procedural violation, divorced from any concrete harm” cannot “satisfy the injury-in-fact requirement of Article III.” Equally as important, the Court declared that Congress cannot “eliminate [the] constitutional floor” of the injury-in-fact requirement by statutorily granting plaintiffs the right to sue when they would otherwise lack standing.
Bassett is a not just a victory for merchants; the Ninth Circuit’s reassurance that speculative injuries do not confer standing is music to the ears of defendants of all industries. Defendants, therefore, would be well-advised to challenge standing when a plaintiff’s injury appears theoretical.
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