Eighth Circuit Finds that Class-Action FCRA Plaintiff Lacks Article III Standing Under Spokeo

The Eighth Circuit reiterated in a decision last month that trial courts must distinguish between FCRA plaintiffs who have suffered concrete harm and plaintiffs who merely seek to collect statutorily allowed damages as a way to ensure compliance with the law.  Under the Supreme Court’s decision in Spokeo, the former have Article III standing to assert FCRA claims but the latter do not.

In Schumacher v. SC Data Center, Inc., plaintiff Ria Schumacher sought a job with defendant SC Data.  During the application process, Schumacher responded “no” to a question asking whether she had ever been convicted of a felony.  SC Data offered a position to Schumacher and then obtained her authorization to allow a third party to independently investigate her criminal records.  SC Data later rescinded its offer to Schumacher when the report that it obtained revealed Schumacher’s 1996 felony conviction.

Schumacher alleged three FCRA violations on behalf of herself and a class: (1) taking an adverse employment action based on a consumer report without first providing the report to the applicant; (2) obtaining a consumer report without providing an FCRA-compliant disclosure form; and (3) obtaining more information about an applicant than allowed by the authorization.  Four days after the Supreme Court’s decision in Spokeo, SC Data moved to dismiss Schumacher’s claims for lack of standing.  The trial court found that Schumacher had standing to pursue all three claims, but the Eighth Circuit reversed.

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