Courthouse Steps Decision Webinar: Transunion LLC v. Ramirez

Litigation Practice Group Teleforum

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On June 25, 2021, the Supreme Court issued its decision in Transunion LLC v. Ramirez.  In this case, a class of plaintiffs sued the credit reporting company TransUnion under the Fair Credit Reporting Act.  The plaintiffs alleged that the process Transunion used to flag consumer credit worthiness accounts—running consumers names against the U.S. Treasury Departments’ Office of Foreign Assets Control database of terrorists, traffickers, and other criminals and flagging those names that matched database listed names—resulted in harm to the plaintiffs where the match was only a coincidence.

Although the initial class contained 8,185 members, only 1,853 class members incurred harm since Transunion only conveyed credit reports flags for that subset to third parties during the relevant period.

The District Court ruled the whole 8,185 member class had standing to sue.  The Supreme Court reversed on the standing issue, ruling that the 6,332 class members whose information had not been conveyed to third parties during the relevant period had no Article III standing since they had suffered no cognizable injury.  


  • Theodore "Ted" Frank, Director of Litigation and Senior Attorney, Hamilton Lincoln Law Institute 

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As always, the Federalist Society takes no position on particular legal or public policy issues; all expressions of opinion are those of the speaker.

Event Transcript



Dean Reuter:  Welcome to Teleforum, a podcast of The Federalist Society's practice groups. I’m Dean Reuter, Vice President, General Counsel, and Director of Practice Groups at The Federalist Society. For exclusive access to live recordings of practice group Teleforum calls, become a Federalist Society member today at



Evelyn Hildebrand:  Welcome to The Federalist Society's virtual events. This afternoon, July 7, we discuss the Supreme Court's decision in TransUnion LLC v. Ramirez. My name is Evelyn Hildebrand, and I'm an Associate Director of Practice Groups at The Federalist Society. As always, please note that all expressions of opinion are those of the expert on today's call.


      Today, we are fortunate to have with us Mr. Ted Frank, the Director of Litigation and Senior Attorney at Hamilton Lincoln Law Institute and a member of The Federalist Society's Litigation Practice Group Executive Committee. After our speaker gives his opening remarks, we will turn to you, the audience, for questions. You can enter those questions at any time in the Chat or the Q and A feature at the bottom of your screen. If you have a question at any time, again, please enter those questions at the bottom of your screen in the Chat or the Q and A function. With that, thank you for being with us today. Ted, the floor is yours.


Theodore "Ted" Frank:  Thanks. And thanks to The Federalist Society for putting this together. I'm here to discuss the June 25 Supreme Court decision in TransUnion v. Ramirez, perhaps one of the two or three biggest decisions of the term. The press has largely been covering it as a class action decision, but it's really a decision about the balance of power between the legislative and judicial branches.


      Let's talk about the lawsuit that led to this case. The Fair Credit Reporting Act is a federal statute that provides actual or statutory damages for violations. Credit reporting agencies like the petitioner here, TransUnion, are required to follow reasonable procedures to assure "maximum possible accuracy when preparing a consumer report." They're also required to clearly and accurately disclose to consumers all information in the consumer's file along with a summary of rights.


      But as we know from Spokeo v. Robins, the Supreme Court doesn't think that the creation of statutory damages by Congress is by itself enough to create Article III jurisdiction. A plaintiff must have standing. Standing requires an injury-in-fact, one that is concrete and particularized, and under Clapper v. Amnesty International, an injury that is either all ready materialized or is "certainly impending." Article III standing requires a concrete injury even in the context of the statutory violation.


      So in Spokeo, a "bare procedural violation" without real-world injury is insufficient. Now, Spokeo hasn't been the clearest decision. It holds that intangible injuries might satisfy standing if they're concrete. Go look up concrete in the dictionary, and you see that it means tangible. Good luck litigating that oxymoron. But the Spokeo Court indicated that an alleged intangible harm that has a close relationship to a harm that has traditionally been regarded as providing a basis for a lawsuit in the English or American courts would count as concrete.


      So, in this case, Sergio Ramirez, the respondent, is the lead plaintiff in a class action under the FCRA against TransUnion. A different Sergio Ramirez was listed on a watch list database maintained by the Office of Foreign Assets Control — that's called an OFAC watch list — of terrorists and drug dealers that U.S. businesses are not allowed to do business with. TransUnion's credit reports flagged Ramirez as a "potential match" when people asked for credit reports on people named Sergio Ramirez.


      Ramirez, as a result, suffered difficulty obtaining credit, was embarrassed in front of family members, and even canceled a vacation after a car dealer received the report from a third party that relied on the TransUnion credit report noting that someone named Sergio Ramirez was on the OFAC watch list. Ramirez asked TransUnion for his credit report after this. He got two envelopes, one with a standard credit report and required disclosures and a second envelope that did not contain the disclosures but listed the fact that he was listed as a potential match with the OFAC watch list. He sued.


      He brought a class action, but it was not on behalf of people who had been denied credit or even on behalf of people who had arguably inaccurate reports disseminated. Instead, the class consisted of about 8,100 people who had received information from TransUnion about the OFAC database in these two separate envelopes. Over 6,000 of whom, the parties stipulated, never had a credit report disseminated to a third party. The class was under a cause of action that Ramirez had received his credit report in a non-compliant format in two envelopes instead of one. So he didn't get the summary of rights with the OFAC information, but separately.


      The district court certified the class, and it went to trial, which focused on this sad story of Ramirez's embarrassment. The jury awarded just under the $1,000.00 maximum, $984.22 in statutory damages. We would love to see if the briefs explained where that other $15.78 went from, but I don't have an answer to that. But the jury awarded that $984.00 to every class member and then another $6,353.00 in punitive damages for a total verdict of more than $60 million.


      TransUnion protested on appeal the class certification arguing that the majority of the class didn't have an Article III injury. Maybe they said you could tie an FCRA claim to defamation, but there's no publication to a third party here. The district court held that only the class representative needed Article III standing. The Ninth Circuit disagreed but held in a 2-1 decision that the technical violation of two envelopes was sufficient injury to satisfy Article III because of the loss of informational content.


      TransUnion also argued against class certification under Rule 23(a) because Ramirez's injuries weren't typical of the class. The Ninth Circuit held, again 2-1 over Judge McCann's dissent, that typicality is satisfied as long as there's some common denominator tying the representative in class together. TransUnion, I think, reasonably argued that this is essentially the same thing as the commonality standard and writes the typicality standards out as a separate inquiry. So the Ninth Circuit affirms, though it did reduce the punitive damages by $20 million.


      TransUnion seeks cert. They get it granted on the two questions of one, the Article III standing question, and two, on the issue of class certification because of typicality. Typicality is important because a plaintiff who's atypical could prejudice the class, whereas if a plaintiff has atypical facts that are adverse to them. But on the other hand, if a class is represented by an atypically sympathetic plaintiff, defendants are deprived of the rights that due process guarantees, giving plaintiffs the practical advantage of being able to litigate, not on behalf of themselves but on behalf of a perfect plaintiff that would expose the jury to inflammatory evidence and arguments that could not be presented in the suits of absent class members if they sued individually.


      This is especially problematic in statutory damages cases where there is no individualized inquiry into actual damages. Here, nearly everything Ramirez testified about had nothing to do with the two separate envelopes that was binding him to the other 8,000 class members. Thus, TransUnion argued the class should be decertified. They also argued, of course, that there was no concrete injury because of the procedural violation of the way the information was disseminated, that it was a bare statutory damages case.


      Ramirez, at the Supreme Court, argued that the Court should adopt as a rule Justice Thomas's concurrence in Spokeo, distinguishing between public rights and private rights. We saw that discussed in length in an excellent Judge Newsom concurrence in Sierra v. Hallandale Beach earlier this year in the Eleventh Circuit, asking for a more coherent jurisprudence for Spokeo. The Court doesn't create that coherent Spokeo jurisprudence. They create a different jurisprudence.


      They reaffirm Spokeo in the sense that a plaintiff must have concrete injury to sue -- that can be a physical or monetary harm. It can be a reputational harm. And thus, since it can be a reputational harm, the Court says okay, TransUnion provided third parties with credit reports containing OFAC alerts for 1,853 class members, including the names, plaintiff Ramirez, to the extent the jury adopted that. Those 1,853 class members, therefore, suffered harm with a close relationship to the harm associated with the tort of defamation.


      Where it goes beyond Spokeo is with respect to the other 6,332 class members where the Court holds that the mere existence of inaccurate information, as in dissemination, traditionally is not provided the basis for a lawsuit in American courts. Therefore, the plaintiffs cannot demonstrate that the misleading information in the internal credit files itself constitutes a concrete harm. Ramirez says, well, what about the exposure to risks that the misleading information will be disseminated? The Court says, well, material risk of future harm can satisfy the concrete harm requirement in the context of a claim for injunctive relief to prevent the harm from occurring, at least so long as the harm -- the risk of harm is sufficiently imminent and substantial.


      But for the first time, it holds that the mere risk of future harm without more cannot qualify as a concrete harm in a suit for damages. They analogize it to a drunk driver who's weaving across the highway but doesn't actually hit anyone. No individual driver who was also on the highway has a suit against that drunk driver. Nor did those plaintiffs present evidence that the class members were independently harmed by their exposure to the risk itself. The risk of future harm cannot supply the basis for their standing. So in the absence of adverse effects, the formatting requirement in the statute does not count as an informational injury creating standing.


      The Court concludes in a Justice Kavanaugh 5-4 opinion, no concrete harm, no standing, the 6,332 class members without dissemination have no standing at all, and only Ramirez has standing on the formatting requirement claim. The Court reverses and remands and concludes, "In light of our conclusion of that Article III standing, we need not decide whether Ramirez's claims were typical of the claims of the class under Rule 23. On remand, the Ninth Circuit may consider in the first instance whether class certification is appropriate in light of our conclusion about standing."


      Importantly, the decision is phrased as a constitutional separation of powers limit on Congress. The argument being if the law of Article III did not require plaintiffs to demonstrate concrete harm, Congress could authorize virtually any citizen to bring a statutory damages suit against virtually any defendant who violated virtually any federal law. The public interest that private entities comply with the law cannot "be converted into an individual right by statute that denominates it as such, and that permits all citizens, or for that matter a subclass of citizens, who suffer no distinctive concrete harm to sue."


      A regime where Congress could freely authorize unharmed plaintiffs to sue defendants who violate federal law not only would violate Article III but also infringe on the executive branch's Article II authority according to a majority and its choice of how to prioritize and how aggressively to pursue legal actions against defendants who violate the law. Private plaintiffs are not accountable to the people and then are not charged with pursuing the public interests in enforcing the defendant's general compliance of regulatory law. So that's the majority opinion.


      And Justice Thomas has a [inaudible 13:29] dissent that seems to have a lot of input from the three liberals on the Court who joined him. Thomas argues at the founding, where an individual sought to sue someone for a violation of his private rights, such as a trespass on his land, the plaintiff needed only to allege the violation. Courts typically do not require any showing of actual damages. Nominal damages were available for technical injuries of private rights.


      The very first Congress passed a copyright statute that did not require a showing of monetary loss. Later on, Justice Story permitted a suit over patent infringements, a cause of action absent from common law, because "where the law gives an action for a particular act, the doing of that act imports of itself a damage to a party because every violation of a right imports some damage." This understanding, Thomas argues, accords proper respect for the power of Congress and other legislatures to define legal and property rights.


      The concreteness injury and fact inquiry was invented in 1970 and then was applied to a statute enforcing a public right rather than a private right. It was something that broadened the right of access to the courts. Thomas would hold that a statute that creates a public right plus a citizen suit cause of action is insufficient by itself to establish standing, but a statute that creates a private right and a cause of action does give plaintiffs an adequate interest in vindicating their private rights in federal court. He argues, "Never before has this Court declared that legislatures are constitutionally precluded from creating legal rights enforceable in federal court if those rights deviate too far from their common law roots."


      Even under the Court's tests, Thomas continues, he disagrees with the results here. He notes that Spokeo remanded for a determination whether an imminent risk of harm could be concrete injury for damages, whereas here, the Court rules out that possibility entirely. Thomas critiques how the concrete new standard's going to play out, "I see no way to engage in this inescapably value-laden inquiry without it evolving into pure policy judgment. Weighing the harms caused by specific facts and choosing remedies seems to me like a much better fit for legislatures and juries than for this Court."


      Kagan, Breyer, and Sotomayor mildly dissent from the dissent that -- arguing that Article III requires a concrete injury, even in the context of a statutory violation but noting that this should lead to the same result as Justice Thomas's approach in all, but highly unusual, cases. The Kagan argument is Congress is better suited than courts to determine when something causes a harm or risk of harm in the real world. For that reason, courts should give deference to those congressional judgments. Overriding an authorization to sue is appropriate when, but only when, Congress could not reasonably have thought that a suit will contribute to compensating or preventing the harm at issue. So this was a bit of a sleeper decision.


      When I discussed this case in March, I expected the Roberts Court to decide this on narrow grounds. The Solicitor General submitted a brief that had given the Court that halt, hold that the lower courts got the Rule 23 analysis wrong on typicality, reverse on those grounds. And we normally see the Chief try to hold the Court together and avoid 5-4 decisions, sweeping constitutional decisions, and he was in the majority here. He was one of the five decisive votes.


      But perhaps, Ramirez argued too successfully to confuse the Rule 23 analysis, and there weren't enough votes for a narrower decision, so Roberts went along with the Kavanaugh opinion. Neither dissent mentions Rule 23 at all. And I have to wonder whether this means that the Court post-Scalia, post-Ginsburg, who wrote many of the Court's Rule 23 decisions, that this iteration of the Court just isn't interested in Rule 23 questions if it doesn't flag Justice Kagan's attention. And Justice Kagan might not want to see cert on a lot of Rule 23 questions given the current makeup of the Court. We'll see how cert grants shake out in the next few terms.


      Justice Thomas suggests in footnote nine of his dissent that this will be a Pyrrhic victory for the business community. Defendants can't remove these cases to federal court anymore because there's no Article III jurisdiction. They'll get sued in state courts. And recall, in 2005, the business community fought long and hard to pass the Class Action Fairness Act to move national class actions to federal court out of magnet jurisdictions in state court. In theory, because TransUnion places Article -- phrases Article III standing, the Spokeo - TransUnion inquiry on concreteness is a limit on Article I congressional authority. It suggests that private plaintiffs without injury-in-fact can go to state courts to enforce these federal statutes.


      How will that work in practice? Well, it'll be interesting to see what corporate defendant is willing to litigate to judgment these questions in a Madison County or Texarkana State Court, and then take it up two or three levels of appeal to the U.S. Supreme Court, which may not have the same 5-4 majority on this issue 10 years down the line. What happens to state causes of action that don't have injury-in-fact? Can you bring those in -- can you remove those to federal court under diversity jurisdiction? That remains to be decided, though certainly, the Court will have Article III jurisdiction over a State Supreme Court decision enforcing a federal law, even if it doesn't have Article III jurisdiction over the underlying lawsuit. Let me pull up your questions on the Chat now. And there are none, but I do welcome your questions.


Evelyn Hildebrand:  There are actually a couple of questions in the Q and A if you are --


Theodore "Ted" Frank:  Oh, they're in the Q and A and not in the Chat. And --


Evelyn Hildebrand:  Right. Perfect.


Theodore "Ted" Frank:  -- Phillip Goldstein (sp) says, "It seems like Thomas's dissent was based more on his view that there was a concrete harm, not that a concrete harm is not required for standing." Do I agree? It was based on both. He argued that Congress has the authority to decide what a concrete harm is and create those rights on a statutory matter to sue in a private interest. And then — I'm not sure what section of this opinion it was, but it was the last section of his opinion — in the alternative, he argued that even under the Court's new jurisprudence narrowing Spokeo — or expanding Spokeo depending on which way you look at it — he would find that there's a concrete harm here.


      Robert Fitzpatrick asks, "Affirmative action case and class members have not denied entry sued because of risk that affirmative action will deny them acceptance into university." I guess that's a question of whether there's Article III standing on that. Certainly, there's some sort of an injury-in-fact. Somebody's going to claim monetary damages or reputational damages, or future income damages from, say, not being admitted into law school or not being admitted into Harvard, or not getting a job because of affirmative action. Now, can Congress create that? Is that sufficiently similar to a common law cause of action? That's an interesting question that I haven't seen anybody raise.


      And maybe the answer is just very, very obvious, and I'm too oblivious to know what it is. It strikes me that things like Title IX sexual harassment cases are very divorced from the common law and that these are things that Congress invented in the -- and to a certain extent courts invented in the 20th Century on the basis of law review articles. I certainly think that Congress has the authority to create a cause of action for that sort of thing.


      Whether there's going to be a defendant willing to risk the public relations nightmare by arguing that a congressionally created law on sexual harassment is unconstitutional under TransUnion, that's going to be a very brave set of attorneys and a brave defendant doing that, but maybe we'll see that argument sometime going forward. Or maybe somebody will send me an email saying no -- no, here's why it very obviously satisfies TransUnion, and no one will make that argument. Are there any other questions? I'm hearing none. I kick it back to The Federalist Society.


Evelyn Hildebrand:  Great, thank you. If you have any closing comments that you would like to make, I'll hand the floor back over to you, and then we will close out after that.


Theodore "Ted" Frank:  Well, we have a very new set of limits on Congress's powers. And I think the business community was hoping for a federal statute on data breach laws, for example, that would supplant what was happening in various state courts where there's a whole patchwork of causes of action across 50 states, many with statutory damages as high as $2,000.00, some with no individual cause of action beyond actual damages. So whether Congress now has the authority to do that and say that a data breach is by itself some sort of actionable thing is a very curious question that we'll see as it goes forward.


      Under Spokeo, we saw courts of appeals split on this question, saying that data breaches that disclose social security numbers create the sort of imminent risk of harm that creates standing, whereas other kinds of data breaches don't. But now, imminent risk of harm is by itself considered not enough for Article III standing for at least a congressionally created statute. Whether that's enough for a state statute removed to federal court under diversity jurisdiction where the courts are adjudicating the potentially prejudice rights of an out-of-state defendant is a different question. I'll be curious to see how that plays out.


Evelyn Hildebrand:  Great, thank you. And on behalf of The Federalist Society, I just add the thanks of The Society to you -- to Ted Frank, our expert, for the benefit of his valuable time and expertise today. And I want to thank our audience for participating and sending --


Theodore "Ted" Frank:  We have one more question here. Oh, okay. It was just a thank you. Never mind.


Evelyn Hildebrand:  Good eyes, however. If any of our listeners have feedback to send in, please send it at [email protected]. As always, keep an eye on our website and your emails for announcements about upcoming Teleforum calls and virtual events. And we do have another virtual event coming up this afternoon. I believe it's at 2:00, and it's a briefing on the PennEast decision from the Supreme Court, so please tune into that if you are interested. And keep an eye on your emails for more information about that. Thank you all for joining us today. We are adjourned.




Dean Reuter:  Thank you for listening to this episode of Teleforum, a podcast of The Federalist Society’s practice groups. For more information about The Federalist Society, the practice groups, and to become a Federalist Society member, please visit our website at