Joseph Ho, MPH

Associate Editor

Loyola University Chicago School of Law, JD 2022

In 1993, and on the heels of the landmark Article III standing case of Lujan v. Defenders of Wildlife, John G. Roberts, Jr. wrote a law review article entitled: “Article III Limits on Statutory Standing.” Twenty-eight years later and now the Chief Justice, Roberts again found himself wrestling over the bounds of the Article III Standing requirement as he presided over this issue in the class action context. Years after the Court decided Spokeo v. Robins in 2016 and Clapper v. Amnesty International in 2013, the Court revisited the matter and listened to oral arguments on March 30, 2021, in TransUnion v. Ramirez. The decision may have enormous consequences. While Acting U.S. Solicitor General Elizabeth Prelogar filed a “friend of the court” brief agreeing that standing exists, other briefs supporting TransUnion suggest that meritless class action lawsuits against corporate defendants from class members that aren’t injured will exponentially increase.

The journey to the U.S. Supreme Court

In 2011, Ramirez sought to finance the purchase of a car. But the credit report from TransUnion listed Ramirez in the database of the U.S. Department of Treasury’s Office of Foreign Asset Control (“OFAC”). Although the dealership ended up selling the car to his wife, it refused to sell the car to Ramirez because the Government prohibited all those listed in OFAC from doing business in the U.S. As a result, Ramirez claimed he was embarrassed.

Ramirez filed a class action against TransUnion one year later, claiming that their OFAC practices violated the Fair Credit Reporting Act. Ramirez sought to certify a class of 8,185 consumers during the six-month period. The class, however, was roughly comprised only 1,800 consumers that had their information sold to creditors. Ramirez argued that in addition to the fact that he suffered harm through misleading letters and the embarrassing occurrence, he said that TransUnion similarly misled the entire class through incomplete information. In opposition, TransUnion argued that the class as a whole could not demonstrate that it suffered harm. TransUnion also argued that because Ramirez’s situation was atypical, it failed to meet the Federal Rules of Civil Procedure requirement that the class representative be typical of class claims.

Upon the California District Court certifying the class on the heels of the U.S. Supreme Court’s decision in Spokeo, the jury awarded a $60 million verdict for the class. A divided panel of the 9th Circuit Court of Appeals upheld the verdict but reduced the award to $40 million.

Contentions of the parties

The issue for the Supreme Court was “[w]hether Article III or Federal Rule of Civil Procedure 23 permits a damages class action when the vast majority of the class suffered no actual injury, let alone any injury anything like what the class representative suffered.” Paul Clement represented TransUnion and argued in his brief that concrete injury for every class member was lacking and that Ramirez was not typical of the class he represented. In opposition, Samuel Issacharoff, on behalf of Ramirez, argued that all class members suffered harm, that damages for personal harms equate to standing, and that neither jurisdiction nor TransUnion’s typicality argument supported overturning the judgment below.

At oral arguments, the justices went back and forth regarding typicality and standing. Questions from the justices on standing concerned the timing, materiality of the risk of harm, the “concrete” level of injury, and the absent class members. On the issue of typicality, the questions rested upon the evidence considered at the trial level and the typicality of claims.

Leading the way

In addition, this case may have broader implications. The issue of standing will be on full display in April as the 11th Circuit Court of Appeals is set to review an objection to a class settlement stemming from a massive data breach at another data reporting agency, Equifax. Other courts are waiting on guidance from the Supreme Court. In another sensitive personal data issue, a Navy member underwent a tenant screening. However, the tenant screening’s algorithm mixed him with an alleged drug trafficker with the same name. The Navy member subsequently brought a class action alleging violations under the Fair Credit Reporting Act. 

The upshot is that while general counsel, corporate officers, and outside counsel await new Supreme Court precedent, the continuous increase of data collection and the difficulty of holding those in control of that data accountable reaffirms the theme of asymmetrical information collecting.