Access to Justice

Unlikely bedfellows in TransUnion SCOTUS case: Justice Thomas and class action fans

(Reuters) – As the U.S. Supreme Court gets ready in TransUnion v. Ramirez to revisit the vexing question of constitutional standing for class action plaintiffs alleging procedural violations of federal laws, Justice Clarence Thomas has become a guiding light for plaintiffs.

That’s right: Thomas as a beacon for class action proponents. Last week, the class action lead plaintiff, Sergio Ramirez, who won a $40 million judgment against the credit reporting agency Transunion for falsely flagging him and more than 8,100 other people as terrorists, argued in his merits brief that Thomas’s theory of Article III standing and concrete injury offers an overarching framework for what has become an overly complicated inquiry. And it just so happens that the Thomas theory would benefit plaintiffs like Ramirez.

The key, explained Ramirez counsel Samuel Issacharoff of New York University School of Law, is Thomas’s emphasis on the distinction between generalized “public rights,” like, say, the right to clean air and water, and personal rights that Congress has conferred on individual plaintiffs, such as the right to be notified of mistakes in your credit report. In concurrences in 2016’s in Spokeo v. Robins and 2020’s Thole v. U.S. Bank, Thomas has written that common law history justified that dividing line: Private rights belong to individuals, who can sue to vindicate them; public rights belong the community.

Ramirez counsel Issacharoff argued in last week’s merits brief that there’s currently “confusion” in the lower courts about Article III standing for statutory violations because the Supreme Court’s recent rulings have addressed matters of both private and public rights yet haven’t emphasized the distinction.

But according to the Ramirez brief when you view precedent through the prism of Thomas’s theory, standing doctrine is easier to discern. “All cases denying standing based on insufficient injury have done so in the public rights context, not where suit is brought by a private individual against a private defendant to enforce a private right granted by Congress,” Ramirez’s brief said.

Under the Thomas theory of standing, it’s easy for Ramirez and fellow class members whose accounts were erroneously flagged to establish their Article III right to sue. Even though TransUnion insists most of the people in the class were not actually harmed because their errant credit reports were not sent to prospective creditors, class members clearly alleged statutory violations of the private rights Congress gave them in the Fair Credit Reporting Act.

On Wednesday, some of Ramirez’s amici – most notably, the Constitutional Accountability Center and law professors including Thomas Bennett of the University of Missouri, Stephen Vladeck of the University of Texas and Erwin Chemerinsky of the University of California, Berkeley – highlighted that point. CAC’s brief dived into U.S. history to argue that Article III of the Constitution was not intended to limit Congress’s power to create private rights to sue.

“When a private legal right conferred by statute was the basis of a suit, courts did not impose any requirement of additional harm,” wrote CAC counsel of record Brianne Gorod.

The law professors specifically cited Thomas’s concurrence in Spokeo, as well as his brand-new opinion for the 8-1 majority in Uzuegbunam v. Preczewski, in which the justice wrote that “the common law inferred damages whenever a legal right was violated.”

Thomas, wrote the professors’ counsel of record Travis Lenkner of Keller Lenkner, had the “insight” to clarify that “the violation of private rights created by Congress suffices to create Article III standing, without imposing uncodified elements beyond what Congress required.”

It would be quite something if the TransUnion case – which the credit reporting agency positioned as a vehicle for assuring that “uninjured” plaintiffs are not part of a class action and TransUnion amici saw as an opportunity to use Article III to restrict class certification – instead led to the adoption of Thomas’s more expansive view of plaintiffs’ standing to sue over statutory violations.

Other Ramirez amici, including the American Association for Justice and Public Citizen, confronted the business lobby’s attempt to persuade the Supreme Court that class actions cannot be certified unless plaintiffs can prove the class does not include uninjured plaintiffs.

For one thing, the Ramirez amici argued, that question isn’t even properly before the court, not the least because every class member in the Ramirez case was injured by TransUnion’s statutory violations: They were all falsely flagged in credit reports because they shared names with people on a government terror watch list; and they were all insufficiently informed of the error by TransUnion. (TransUnion’s counsel of record, Paul Clement of Kirkland & Ellis, told the court that Ramirez was the only class member who was turned down for credit because of the false report and that no prospective creditors even saw the errant reports of more than 6,000 class members.)

Putting the specific facts of the Ramirez case aside, AAJ and Public Citizen argued, there is nothing in the constitution or the federal rules for class actions that requires class representatives to prove every class member’s injury in order to win class certification. Uninjured class members, the briefs said, are not entitled to damages. But Public Citizen said judges can sort out damages after class certification.

Different Ramirez amici addressed whether the case should not have been certified as a class action because Ramirez was not a typical class member. TransUnion argued that the jury who heard the case was inflamed by Ramirez’s humiliating story of being turned down for a car loan in front of his wife and father-in-law because of the false terror flag on his credit report.

TransUnion argued in its Supreme Court brief that no other class member had a similar experience. Even the U.S. Justice Department, which sided with Ramirez on the Article III standing issue, said in its brief that Ramirez may not have been sufficiently typical to warrant class certification.

But Ramirez amici, including the Impact Fund, the NAACP Legal Defense Fund and other civil rights groups, cautioned the Supreme Court not to allow class litigation to devolve into a “standardless quagmire” in which trial judges have to assess whether class representatives’ stories are too compelling. “The drafters intended Rule 23 to enhance civil rights enforcement,” the groups said. “TransUnion’s approach further threatens to undermine Rule 23 itself.”

TransUnion counsel Clement did not respond to an email request for comment. The case is scheduled to be argued on March 30.

Opinions expressed here are those of the author. Reuters News, under the Trust Principles, is committed to integrity, independence and freedom from bias.

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