**Originally posted on American Bar Association, Section of Litigation Class Actions & Derivative Suits website.**
Original Post can be found here: https://apps.americanbar.org/litigation/committees/classactions/practice.html#02
Federal lawsuits must allege an injury-in-fact. Together with traceability and redressability, this forms the holy trinity of Article III standing. See U.S. Const. Art. III § 2. But what if a statute provides a right to sue in federal court, is actual harm still required for plaintiffs—for instance, consumers or debtors—to receive their statutory remedies? While Spokeo does not clearly answer this question; it only addresses it. Nonetheless, Spokeo likely frames the outer limits of standing, particularly for statutory private rights of action, and one federal circuit court has already applied Spokeo outside of the statutory context.
According to the Supreme Court, when the Ninth Circuit addressed Article III standing, it failed to appreciate the difference between the two injury-in-fact prongs: concreteness and particularity. Though often bundled together, Spokeo made clear that these separate and distinct requirements. The Ninth Circuit erred by focusing only on particularity and ignoring concreteness—a flaw they may correct on remand.
As to concreteness, the injury in fact:
- must actually exist;
- for statutory actions, must be more than a bare procedural violation;
- may be intangible—but intangible harm alone may not be enough; and
- may consist of the “risk of real harm,” even if difficult to prove or measure
If you are scratching your head trying to apply these concreteness parameters, you are not alone. Spokeo commentators have noted the watered-down, middle-ground, and possibly inconsistent statements in the opinion. But the case does teach class action practitioners that the following types of alleged injuries are not sufficiently “concrete”:
- Bare procedural violations of statutes like the Fair Credit Reporting Act (FCRA)
- By way of example, the failure of a consumer reporting agency to provide the required notice to a user of the agency’s consumer information, which may be entirely accurate
- As another FCRA example, the dissemination of an incorrect zip code, without more. (At least, the Court described as “difficult to imagine” how it “could work any concrete harm.”)
On the other side of the injury-in-fact coin is particularity, which the Spokeo Court found to have been sufficiently analyzed by the Ninth Circuit. To be “particular,” the injury must be “individualized,” must “affect the plaintiff in a personal and individual way,” and must be “distinct” and “not undifferentiated.”
While the Supreme Court may have handed the Spokeo defendant a marginal victory, what may prove more interesting is the fallout among lower courts.
Particularity, in Particular
With Spokeo hot off the presses, a circuit panel applied it, using the “concreteness versus particularity” dichotomy as a springboard. See Hochendoner v. Genzyme Corp., No. 15-1445, Slip Op. (1st Cir. May 23, 2016). Hochendoner did not present a statutory right of action. Hochendoner, along with its companion case Adamo, was brought as a putative class action by patients suffering from a rare genetic disorder who sued the producer of an enzyme that effectively treats but does not cure the condition. Following a series of contaminations and other issues, there was a shortage of the drug for several years.
Noting Spokeo’s emphasis on the distinction between concreteness and particularity, the First Circuit analyzed the latter and concluded the plaintiffs failed to meet the particularity requirement. The plaintiffs offered no specific information as to the harm experienced by each individual plaintiff and offered “only scattered descriptions of generalized harms.” Absent from the complaints were allegations linking the alleged injuries “to any specific plaintiff.” The panel even went so far as to hold that the standing doctrine requires a “plaintiff-by-plaintiff and claim-by-claim analysis” that “demands allegations linking each plaintiff to each of these injuries.” (Slip Op. at 16.)
Plaintiffs—at least those in the First Circuit—must take heed to carefully craft their complaints to narrowly link the alleged misconduct to the alleged injury suffered by a specific plaintiff. Defendants could potentially cite Hochendoner as fodder for either a motion to dismiss for lack of subject matter jurisdiction or to oppose class certification, arguing that each and every putative class member have not suffered a particularized injury—and thus lack standing.
While Spokeo may not represent a sea change in Article III standing jurisprudence, at the very least, it highlights the need for practitioners to carefully examine allegations at the pleadings stage to determine whether a “concrete” and “particular” injury has been alleged. Meanwhile, Hochendoner’s tightening of the “particularity” requirement based on Spokeo arguably allows the defense bar to claim a broader Spokeo victory—at least for now.