The U.S. Supreme Court's opinion in TransUnion LLC v. Ramirez, No. 20-297, 594 U.S. __, 2021 WL 2599472 (June 25, 2021), includes powerful language for defendants to use in seeking an early dismissal of consumer class actions in federal court under Federal Rule of Civil Procedure 12(b)(1). Less clear is the extent to which the opinion changes the way federal courts will decide whether plaintiffs have standing under Article III to bring individual and class action claims based on alleged statutory violations.


In TransUnion, the named plaintiff, Sergio Ramirez, filed a class action after a Nissan dealer declined to sell him a car because TransUnion's consumer report indicated "his name was on a 'terrorist list.'" The list in question was the U.S. Treasury Department's Office of Foreign Assets Control's list of 'specially designated nationals' who threaten America's national security. Individuals on the OFAC list are terrorists, drug traffickers, or other serious criminals, and it is generally unlawful to transact business with any person on the list. TransUnion created the OFAC Name Screen Alert to help businesses avoid transacting with individuals on OFAC's list.

TransUnion's OFAC Name Screen Alert did nothing more than compare a consumer's name against the OFAC list, and then place an alert on any person's credit report whose name appeared as a "potential match." TransUnion's simple name match protocol resulted in "many false positives" because "[t]housands of law-abiding Americans happen to share" a name with persons on OFAC's list.

Ramirez sued TransUnion, alleging violations of the Fair Credit Reporting Act. The District Court certified a class of 8,185 members who had been misidentified in TransUnion's OFAC Name Screen Alert, but only 1,853 members "had their credit reports disseminated by TransUnion to potential creditors." Nevertheless, "[t]he District Court ruled that all 8,185 class members had Article III standing," and a jury awarded the class more than $60 million at trial. The Ninth Circuit affirmed.

The Court's Opinion

The Supreme Court reversed the judgment and remanded. The Court held that the 1,853 class members whose credit reports had been disseminated to creditors "suffered a harm with a 'close relationship' to the harm associated with the tort of defamation" and therefore "suffered a concrete harm that qualifies as an injury in fact."

The remaining class members did not have standing to pursue their claims because "[t]he mere presence of an inaccuracy in an internal credit file, if it is not disclosed to a third party, causes no concrete harm." The harm suffered by these persons "is roughly the same, legally speaking, as if someone wrote a defamatory letter and then stored it in her desk drawer."

In and of itself, this holding was not surprising given the course of argument and the outcome of Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1549 (2016). In Spokeo, the Court already found that a plaintiff does not "automatically satisf[y] 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." But whereas Spokeo was remanded to the Ninth Circuit to determine whether the named plaintiff had suffered a concrete harm, the Court's opinion in TransUnion itself provides exemplars of what does and what does not constitute concrete harm under the FCRA.

Ramirez's factual allegations were sufficient to confer standing for him and those whose inaccurate reports had been disseminated to third parties; absent class members who were wrongly identified but whose information had not been shared do not have standing. "An 'asserted informational injury that causes no adverse effects cannot satisfy Article III.'"

Implications for Article III Standing

Although Spokeo stands for the proposition that "risk of harm" may be sufficiently concrete for purposes of Article III, where the "risk of future harm" does not materialize, harm is not concrete. In TransUnion, more than 6,000 of the 8,185 class members' consumer reports were not disseminated, and there was no evidence that those class members "even knew that there were OFAC alerts" in their credit files. "It is difficult to see how a risk of future harm could supply the basis for a plaintiff's standing when the plaintiff did not even know that there was a risk of future harm."

TransUnion provides further support and color to Spokeo's Article III analysis in the same way that Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009), provided further support and color to Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007), for motions to dismiss under Rule 12(b)(6). Putting the analogy into context, Twombly told us that to survive a motion to dismiss under Rule 12(b)(6), a plaintiff must plead facts showing that his "right to relief [rises] above the speculative level." Iqbal elaborated and provided the language that is now ubiquitous in motions to dismiss for failure to state a claim: "Threadbare recitals of the elements of a cause of action, supported by mere conclusory allegations, do not suffice" and pleadings that are "no more than conclusions, are not entitled to the assumption of truth."1

TransUnion provides similarly helpful language for defendants seeking to challenge Article III standing based on the plaintiffs' failure to allege a cognizable injury. "No concrete harm, no standing." "To demonstrate their personal stake, plaintiffs must be able to sufficiently answer the question: 'What's it to you?'"

While "Congress may 'elevate to the status of legally cognizable injuries concrete, de facto injuries that were previously inadequate in law,' … 'it may not simply enact an injury into existence, using its lawmaking power to transform something that is not remotely harmful into something that is.'" And while Congress may determine which injuries are worthy of redress, and perhaps even identify intangible harms that are sufficient for Article III standing (as Justice Thomas argued in dissent), such an approach "would largely outsource Article III to Congress." Article III does not give Congress or federal courts "a freewheeling power to hold defendants accountable for legal infractions."

All of this language will be effective when deployed in some cases alleging damage claims based on statutory violations. But TransUnion probably will not be interpreted to universally require dismissal of all complaints alleging statutory violations and seeking statutory damages, even where a readily identifiable loss is not alleged. Justice Kavanaugh, who authored the opinion, was clear that the "asserted harm" must simply have a "'close relationship' to a harm traditionally recognized as providing a basis for a lawsuit in American courts – such as physical harm, monetary harm, or various intangible harms including (as relevant here) reputational harms." Intangible harms identified "include, for example, reputational harms, disclosure of private information, and intrusion upon seclusion."

To be sure, because there is no substantive right to accuracy in a credit report that no one ever views, plaintiffs asserting FCRA claims will now need to allege that erroneous credit information in their file was published to third parties to establish at least a sufficient risk of future harm to support Article III standing. Similarly, persons bringing claims under the Video Privacy Protection Act must allege that their viewing history was published by a video service provider without consent and actually seen by third parties because, again, no right to privacy exists in a video rental or selection list that is not viewed by a third party. And persons alleging a technical violation of the Fair and Accurate Credit Transactions Act will need to show that their credit card receipts included enough additional information to result in identity theft or fraudulent charges.

But TransUnion may preserve standing in cases where a statute defines a substantive right to privacy, but the attendant harm is harder to define. For example, the Illinois Biometric Information Privacy Act allows "aggrieved" persons to seek statutory damages where a defendant collected or used biometric information without consent. The Illinois Supreme Court and the Ninth Circuit both decided that the invasive act of obtaining biometric information without consent is an injury, and a plaintiff need not articulate some other harm (the U.S. Supreme Court denied certiorari in the Ninth Circuit matter, and the case was ultimately settled).

Similarly, circuit and district courts have generally found that California's Invasion of Privacy Act provides a substantive right requiring consent before recording conversations, and the Telephone Consumer Protection Act provides a substantive right to be free from telemarketing calls that consumers have not consented to receive.

Moving Forward

The defense bar hoped that TransUnion would put an end to technical statutory violation claims where plaintiffs could not show a tangible and concrete harm, usually defined as some loss of money or property, but the opinion does not go that far. It appears to preserve federal court standing in cases where Congress or state legislatures codify privacy protections that are closely tied to common law protections such as invasion of privacy or intrusion upon seclusion, but where the harm is intangible.

The Ninth Circuit on remand can revisit standing or send it back to the district court. The U.S. Supreme Court also left open the possibility that TransUnion could oppose certification based on the absence of harm and perhaps as it relates to typicality (the federal government in its brief argued that Ramirez's "particularly severe injuries defeat typicality").

The Court noted at the end of the opinion that "[i]n light of our conclusion about 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."


1  Id. at 678-679.