For purposes of federal jurisdiction, no harm means no foul. As early as Marbury v. Madison (1803), the Supreme Court recognized that the function of the courts, and not Congress or the Executive, is to redress the grievances of individuals, but that the jurisdiction of the Court is not unlimited. Courts decide only “cases and controversies.” On the other hand, “[i]t is settled that Congress cannot erase Article III’s standing requirements by statutorily granting the right to sue to a plaintiff who would not otherwise have standing.” Raines v. Byrd, 521 U. S. 811, 820 (1997). When a federal statute, such as the Fair Credit Reporting Act (“FCRA”), or the Fair Debt Collection Practices Act (“FDCPA”), provides an individual with a right of action not historically recognized by the courts, Congress has overstepped its bounds, and such an individual will not have standing to invoke the federal court’s jurisdiction without demonstrating concrete injury.
No matter the statutory grant, an individual must articulate an injury in fact. An injury in fact must be “concrete.” Spokeo, Inc. v. Robins, 578 U.S. 330 (2016). “Concrete” means “real,” and not “abstract.” A plaintiff cannot satisfy the demands of standing by alleging a bare procedural violation. The Court has rejected the proposition that “a plaintiff automatically satisfies the injury-in-fact requirement whenever a statute grants a person a statutory right and purports to authorize that person to sue to vindicate that right.” Spokeo, 578 U.S. at 341. An injury in law is not an injury in fact.
Moreover, “the mere risk of future harm, standing alone, cannot qualify as a concrete harm.” Thus, where class plaintiffs’ credit files contained inaccurate information that caused a decrease in their credit scores, but those wrongfully-lowered credit scores were not provided to any third-party businesses, the plaintiffs could not demonstrate concrete injury sufficient to conjure standing to sue, even though the credit reporting agencies had violated the FCRA. TransUnion LLC v. Ramirez, 594 U.S. ___ (June 25, 2021). The mere presence of an inaccuracy in an internal credit file, if it is not disclosed to a third party, causes no concrete harm. No harm, no foul.
In another recent case, a debt collector violated the FDCPA by failing to send the required debt validation notice within five days of mailing a collection letter to the plaintiff and calling the plaintiff to collect a debt, and further failed during the collection calls to identify itself as a debt collector or state that it was attempting to collect a debt. The plaintiff alleged that she suffered personal humiliation, embarrassment, mental anguish, and emotion distress. The Seventh Circuit concluded that anxiety and embarrassment are not injuries in fact for the purposes of FDCPA standing and dismissed the case for lack of jurisdiction. Wadsworth v. Kross, Lieberman & Stone (August 31, 2021). Again: no harm, no foul.
My practice includes the defense of mortgage loan servicers in consumer finance litigation in Ohio and Kentucky. If you need assistance with a similar matter, please contact me as soon as possible.