ACA Files Amicus Brief on Merits in U.S. Supreme Court Case that Could Substantially Reduce Frivolous Litigation Against Members

ACA urges the Supreme Court to clarify that actual harm is needed when a plaintiff sues for violation of federal statute.

In July 2013, the ACA International Board of Directors approved initiatives to protect the long term viability of the credit and collection industry. These efforts are funded by a three-year Industry Advancement Fund assessment.

On July 9, 2015, ACA International filed a “friend of the court” brief with the U.S. Supreme Court addressing the merits of the case Spokeo, Inc. v. Robins, No. 13-1334 (U.S., Filed May 2, 2014). At issue in Spokeo is whether a plaintiff has the right (standing) to sue for violations of federal statute when the plaintiff does not suffer any economic loss or other tangible harm. 

The important issue in Spokeo arises under a wide array of far-reaching federal laws. Some of these federal laws, like the Fair Debt Collection Practices Act (FDCPA) and the Telephone Consumer Protection Act (TCPA), greatly impact ACA members.  Without the requirement that plaintiffs must suffer actual damages, companies will continue to be exposed to statutory damage awards any time a plaintiff (and more particularly a class-action plaintiff) can establish any technical violation of law even if no one has been harmed. 

As previously reported by ACA, the plaintiff in Spokeo filed a class-action Fair Credit Reporting Act (FCRA) suit against an operator of a “people search engine” because he believed that erroneous information listed about him harmed his employment opportunities.  The district court dismissed the case because the plaintiff did not allege any actual or imminent harm, but the Ninth Circuit Court of Appeals reversed. The Ninth Circuit determined that the plaintiff didn’t need to allege actual damages in order to sue for statutory penalties. In doing so, the Ninth Circuit joined the Fifth, Sixth, Tenth and D.C. Circuits as opposed to the Second, Third and Fourth Circuits, which have found directly to the contrary. 

If the Supreme Court rules in favor of Spokeo and ultimately decides that actual damages are required for a plaintiff to bring suit against a company for federal law violations, it would dramatically affect the credit and collection industry. As such, ACA submitted its amicus brief supporting the Petitioner (Spokeo, Inc.) in order to help the Court understand that the inconsistent and unpredictable application of federal laws by the lower courts impose “constitutionally unwarranted liability” on the credit and collections industry.      

“The filing of this brief reflects ACA’s continuing commitment to being the credit and collection industry’s strongest advocate,” added Robert L. Föehl, Vice President and General Counsel for ACA International.  “ACA is uniquely qualified to assist the Court in addressing this important issue.” 

The case will be heard and decided by the Court in its upcoming term which commences in early October.