Two recent cases serve as reminders that lack of Article III standing remains a viable defense.
6/3/2021 10:30 AM
FDCPANewsArticle III Standing
By Robert M. Horwitz
Lack of subject matter jurisdiction for no standing under Article III of the U.S. Constitution is alive and well in the U.S. Court of Appeals for the 6th Circuit. Although the 7th Circuit received a lot of attention in late 2020 when it dismissed numerous cases filed under the Fair Debt Collection Practices Act for failing to allege an injury in fact sufficient under Article III of the U.S. Constitution to remain in federal court, the 6th Circuit recently used a lack of Article III standing to kick putative class actions claiming violations of the Fair and Accurate Credit Transactions Act of 2003 (FACTA) and the FDCPA from federal court.
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In
O’Toole v. Bob Roache Law, a Seventh Circuit District Court in Indiana granted a defendant’s motion to dismiss a Fair Debt Collection Practices Act (FDCPA) case for lack of standing. In its holding, the court emphasized that allegations of “annoyance or confusion” without allegations of detrimental action taken as a result of the alleged annoyance or confusion, is insufficient to establish an injury in fact necessary to confer standing to an FDCPA plaintiff.
In that case, the plaintiffs incurred a debt with Smokey Ridge Homeowners Association, Inc., and the defendant sent the plaintiffs a collection letter to collect on the debt. The plaintiffs alleged that the defendant’s letter provided “confusing and conflicting information” regarding their rights under the FDCPA and, consequently, that “‘[the] [Plaintiffs’] rights under [the FDCPA] [had] been violated and the Plaintiffs ha[d] been damage[d] thereby.’”
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On Monday and Tuesday of this week, the United States Court of Appeals for the Seventh Circuit issued a series of decisions addressing the Article III standing of consumer plaintiffs alleging violations of the Fair Debt Collection Practices Act (“FDCPA”). The court in five opinions resolving six different appeals arising out of putative class actions revisited the Supreme Court’s decision in
Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016), clarifying how an FDCPA plaintiff must allege and prove an “injury in fact” sufficient to establish subject-matter jurisdiction in a federal court.
Thursday, December 17, 2020
On Monday and Tuesday of this week, the United States Court of Appeals for the Seventh Circuit issued a series of decisions addressing the Article III standing of consumer plaintiffs alleging violations of the Fair Debt Collection Practices Act (“FDCPA”). The court in five opinions resolving six different appeals arising out of putative class actions revisited the Supreme Court’s decision in
Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016), clarifying how an FDCPA plaintiff must allege and prove an “injury in fact” sufficient to establish subject-matter jurisdiction in a federal court.
Two of the five opinions resulted in converting Rule 12(b)(6) dismissals of complaints for failure to state a claim to Rule 12(b)(1) dismissals for lack of subject-matter jurisdiction: