January 28, 2020

Class plaintiffs take refuge In Illinois’ looser standing requirements

Two recent decisions by courts in Illinois—one by a state appellate court and the other by a federal district court—provided refuge to putative class plaintiffs who fall short of establishing Article III standing in federal court.
In Soto v. Great America LLC, et al., the Appellate Court of Illinois’ Second District held that a class of plaintiffs has standing to pursue claims for FACTA violations in Illinois state court without having to prove actual harm.  2020 IL App (2d) 180911, slip op. ¶ 21 (Ill. App. Ct. Jan. 22, 2020).  Plaintiffs are Six Flags customers who allege that the amusement park violated the federal Fair and Accurate Credit Transactions Act of 2003 (FACTA) when they printed more than the last five digits of their debit card numbers on sales receipts at an amusement park.  FACTA prohibits any merchant who accepts credit and debit cards from providing more than the last 5 digits of a card or expiration date on any sales receipt provided to a card holder.  In addition, FACTA states that any merchant who willfully fails to comply with these requirements is liable to consumers for either “actual damages sustained by the customer as a result of the failure” or “damages of not less than $100 and not more than $1000.” 15 U.S.C. § 1681n(a)(1)(A) (2012).  
The Six Flags defendants successfully moved to dismiss the state court complaint on the basis that plaintiffs failed to plead an injury in fact to establish Article III standing.  The Appellate Court reversed and remanded, holding that “plaintiffs had standing to pursue their statutory claims without pleading an actual injury beyond the violation of their statutory rights.”  (Id. ¶ 21.)  While the Court acknowledged that federal courts have reached “inconsistent positions” concerning Article III standing in FACTA cases, it also observed that Illinois state courts are “not required to follow federal law on issues of standing” and in any event “may interpret the federal standing criteria less restrictively than federal courts do[.]”  (Id. ¶¶ 22.)
In Bryant v. Compass Grp. USA, Inc., the U.S. District Court for the Northern District of Illinois remanded a putative class action under the Illinois Biometric Information Privacy Act (BIPA) on similar grounds, finding that plaintiffs lacked Article III standing but may nevertheless litigate their claims in state court.  No. 1:19-cv-6622, slip op. at 7-8 (N.D. Ill. Jan. 28, 2020).  Plaintiff alleges that the defendant vending machine company violated BIPA by requiring that plaintiff provide a fingerprint scan to purchase items from a vending machine without first obtaining written permission to collect the fingerprint scan.  (Id. at 1-2.)  In a motion to remand, Plaintiff argued that the BIPA claims—which had been filed in Illinois state court but removed to federal court—should be litigated in state court because defendant’s statutory violations were insufficient to establish Article III standing.  (Id.)  The federal court agreed, finding that claimed statutory violations of BIPA may be insufficient in federal court, but that “it is the policy of the Illinois courts to allow parties to sue under BIPA even if they cannot demonstrate that ‘they have sustained some compensable injury beyond violation of their statutory rights[.]’”  (Id. at 7-8)

Opinion (Soto v. Six Flags) | Opinion (Bryant v. Compass Group)