The United States Supreme Court held earlier this year in Spokeo v. Robins that to maintain Article III standing, a plaintiff must allege an injury-in-fact that was both concrete and particularized. Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1542 (2016). This requirement of requiring an injury to actually exist has the potential to eliminate spurious suits from plaintiffs based on alleged federal statutory violations, including particularly alleged violations of federal statutes related to consumer financial services.

In Spokeo, the question presented was whether the plaintiff, Robins, had standing to maintain an action in federal court against petitioner Spokeo under the Fair Credit Reporting Act of 1970 (FCRA). Spokeo, 136 S. Ct. at 1544. Spokeo operates a “people search engine.” Id. Spokeo performed such a search for information about Robins, and some of the information it gathered and then disseminated was incorrect. Id. When Robins learned of these inaccuracies, he filed a complaint on behalf of himself and a class of similarly situated individuals. Id. The district court dismissed Robins’ complaint, but the Ninth Circuit reversed. The United States Supreme Court vacated and remanded the Ninth Circuit’s decision, holding: “the injury-in-fact requirement requires a plaintiff to allege an injury that is both ‘concrete and particularized.’ The Ninth Circuit’s analysis focused on the second characteristic (particularity), but it overlooked the first (concreteness).” Id. at 1545. For an injury to be “particularized,” it “must affect the plaintiff in a personal and individual way.” Spokeo, 136 S. Ct. at 1548. A “concrete” injury must be “de facto”; that is, it must actually exist. Id. “Concrete” is not, however, necessarily synonymous with “tangible.Id. at 1549. The Court noted, “Robins cannot satisfy the demands of Article III by alleging a bare procedural violation. A violation of one of the FCRA’s procedural requirements may result in no harm.” Spokeo, 136 S. Ct. at 1550.

Since Spokeo, courts in every circuit have required more than a “procedural violation” to find sufficient standing under Article III. See Hochendoner v. Genzyme Corp., 823 F.3d 724, 728 (1st Cir. 2016) (declining to find standing for all but two plaintiffs); Sikhs for Justice Inc. v. Kerry, No. 15-4018-cv, 2016 U.S. App. LEXIS 18167, at *5 (2d Cir. 2016) (no standing where plaintiffs failed to allege a particularized or concrete injury-in-fact caused by the Secretary’s failure to designate RSS as a terrorist organization.); In re Nickelodeon Consumer Privacy Litig., 827 F.3d 262, 274 (3d Cir. 2016) (finding standing where the purported injury is clearly particularized, as each plaintiff complains about the disclosure of information relating to his or her online behavior, and concrete in the sense that it involves a clear de facto injury, i.e., the unlawful disclosure of legally protected information.); Alston v. Experian Info. Solutions, Inc., No. PJM 15-3558, 2016 U.S. Dist. LEXIS 117939, at *17-18 (D. Md. 2016) (“The Court is unconvinced that Alston has pled enough facts to support his claim that the lack of formal notice caused him injury sufficient to meet the standing requirements under FCRA.”); Lee v. Verizon Communs., Inc., No. 14-10553, 2016 U.S. App. LEXIS 16929, at *4-5 (5th Cir. 2016) (Plaintiff’s allegation of an “invasion of a statutory right to proper plan management” under ERISA was not alone sufficient to create standing where there was no allegation of a real risk that plaintiff’s defined-benefit-plan payments would be affected.); Galaria v. Nationwide Mut. Ins. Co., No. 15-3386/3387, 2016 U.S. App. LEXIS 16840, at *9 (6th Cir. 2016) (Plaintiffs’ allegations of a substantial risk of harm, coupled with reasonably incurred mitigation costs, are sufficient to establish a cognizable Article III injury at the pleading stage of the litigation.); Diedrich v. Ocwen Loan Servicing, LLC, No. 15-2573, 2016 U.S. App. LEXIS 18196, at *9 (7th Cir. 2016)(finding no standing when no injury was alleged under RESPA); Braitberg v. Charter Communs., Inc., No. 14-1737, 2016 U.S. App. LEXIS 16477, at *11 (8th Cir. 2016) (Plaintiff has not alleged an injury-in-fact as required by Article III when his complaint asserts “a bare procedural violation, divorced from any concrete harm.”); McQuinn v. Bank of Am., N.A., No. 14-56038, 2016 U.S. App. LEXIS 13434, at *2 (9th Cir. 2016) (finding concrete injury sufficient for standing); Fish v. Kobach, No. 16-3147, 2016 U.S. App. LEXIS 18784, at *5 n.5 (10th Cir. 2016) (finding standing); Nicklaw v. CitiMortgage, Inc., No. 15-14216, 2016 U.S. App. LEXIS 18206, at *8 (11th Cir. 2016)(no actual injury from failure to timely record mortgage); Hancock v. Urban Outfitters, Inc., 830 F.3d 511, 514 (D.C. Cir. 2016)(mere request for a zip code failed to equate actual injury).

The far-reaching implications of Spokeo will directly impact those in the consumer financial services industry, in particular, those that deal consistently with federal consumer protection statutes, for example the Fair Credit Reporting Act (FCRA), Fair Debt Collection Practices Act (FDCPA), Real Estate Settlement Procedures Act (RESPA) and Truth in Lending Act (TILA). Many federal statutes do not require actual injury in order to bring a claim, but the Spokeo decision appears to now require a plaintiff to demonstrate a particularized injury that is concrete. Spokeo may allow more companies to dismiss spurious claims against them based upon nebulous statutory violations where there is no actual harm or injury- even when the statute itself does not require actual harm. It may prove to be another tool that consumer financial services providers can use to defend themselves against meritless litigation.