Harris v. Mexican Specialty Foods, Inc.

• Decision Date: 09 April 2009
• Docket Number: No. 08-13510.,No. 08-13616.,08-13510.,08-13616.
• Citation: 564 F.3d 1301
• Parties: Bobbie HARRIS, individually, and on behalf of all others similarly situated, Plaintiff-Appellant, United States of America, Intervenor-Plaintiff-Appellant, v. MEXICAN SPECIALTY FOODS, INC., d.b.a. La Paz Restaurante & Cantina, Defendant-Appellee. Julie Best Grimes, individually and as representative of all other persons similarly situated, Plaintiff-Appellant, Nimrod W.E. Long, III, et al., Plaintiffs, United States of America, Intervenor-Plaintiff-Appellant, v. Rave Motion Pictures Birmingham, LLC, Rave Motion Pictures Birmingham, II, LLC, Rave Motion Pictures Birmingham, III, LLC, Delaware limited liability companies, d.b.a. Rave Motion Pictures, Rave Reviews Cinemas, LLC, a Delaware limited liability company, Boston Ventures LP, a Delaware limited partnership, Defendants-Appellees.
• Court: U.S. Court of Appeals — Eleventh Circuit

564 F.3d 1301

Bobbie HARRIS, individually, and on behalf of all others similarly situated, Plaintiff-Appellant, United States of America, Intervenor-Plaintiff-Appellant, v. MEXICAN SPECIALTY FOODS, INC., d.b.a. La Paz Restaurante & Cantina, Defendant-Appellee.

Julie Best Grimes, individually and as representative of all other persons similarly situated, Plaintiff-Appellant, Nimrod W.E. Long, III, et al., Plaintiffs, United States of America, Intervenor-Plaintiff-Appellant, v. Rave Motion Pictures Birmingham, LLC, Rave Motion Pictures Birmingham, II, LLC, Rave Motion Pictures Birmingham, III, LLC, Delaware limited liability companies, d.b.a. Rave Motion Pictures, Rave Reviews Cinemas, LLC, a Delaware limited liability company, Boston Ventures LP, a Delaware limited partnership, Defendants-Appellees.

No. 08-13510.

No. 08-13616.

United States Court of Appeals, Eleventh Circuit.

April 9, 2009.

Deepak Gupta, Public Citizen Litigation Group, Washington, DC, Joseph H. Aughtman, Wilson Daniel Miles, III, Scarlette M. Tuley, Beasley, Allen Crow, Methvin, Portis & Miles, Montgomery, AL, Jonathan H. Waller, Waller Law Office, P.C., Birmingham, AL, Alexander W. Jones, Jr., William S. Pritchard, III, Pritchard, McCall & Jones, LLC, Birmingham, AL, for Plaintiffs-Appellants Harris and Grimes.

Joshua D. Jones, Maynard, Cooper & Gale, P.C., Birmingham, AL, for Defendants-Appellees Mexican Specialty Foods, Inc., et al.

William Perry Brandt, Heather S. Esau Zerger, Bryan Cave, LLP, Kansas City, MO, Dylan Cook Black, James William Gewin, Bradley, Arant, Boult, Cummings, LLP, Birmingham, AL, for Defendants-Appellees Rave Motion Pictures, et al.

Scott R. McIntosh, Douglas N. Letter, U.S. Dept. of Justice, Washington, DC, for the United States.

Richard J. Rubin, Santa Fe, NM, for Amici Curiae National Consumer Law Center, National Association of Consumer

Advocates, and U.S. Public Interest Research Group.

Timothy Sandefur, Sacramento, CA, for Amicus Curiae Pacific Legal Foundation.

Appeals from the United States District Court for the Northern District of Alabama.

Before EDMONDSON, Chief Judge, and DUBINA and KRAVITCH, Circuit Judges.

KRAVITCH, Circuit Judge:

In this case we consider the constitutionality of the statutory-damages provision found in § 616(a)(1)(A) of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681, et seq. The district court, finding that the statutory-damages provision is unconstitutionally vague and excessive, dismissed the complaints with prejudice. For the reasons stated below, we vacate the rulings of the district court and remand for further proceedings.

I. BACKGROUND

A. The FCRA

The FCRA endeavors to "ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy," Safeco Ins. Co. of America v. Burr, 551 U.S. 47, 127 S.Ct. 2201, 2205, 167 L.Ed.2d 1045 (2007), by, among other things, compelling merchants to adopt procedures to safeguard consumers' credit information. See 15 U.S.C. § 1681(b). In 2003, Congress passed the Fair and Accurate Credit Transactions Act ("FACTA"), Pub.L. No. 108-159, 117 Stat. 1952 (2003) (codified at 15 U.S.C. § 1681c(g)), amending the FCRA. FACTA, which is aimed at protecting consumers from identity theft, provides that "no person that accepts credit cards or debit cards for the transaction of business shall print more than the last 5 digits of the card number or the expiration date upon any receipt provided to the cardholder at the point of the sale or transaction." 15 U.S.C. § 1681c(g)(1).¹

As part of its framework, the FCRA authorizes consumers to bring private suits for willful violations of its terms.² Originally, the FCRA provided actual and punitive damages for willful violations. 15 U.S.C. § 1681n(1)-(2) (1970). In 1996, Congress amended this section, adding that victims of willful violations could receive "any actual damages sustained by the consumer as a result of the failure or [statutory] damages of not less than $100 and not more than $1,000." Pub L. No. 104-208, Div. A, Title II, Subtitle D, 2412(b), 110 Stat. 3009-446 (1996) (codified at 15 U.S.C. § 1681n(a)(1)(A)) (emphasis added). In addition, the FCRA still allows victims of willful violations to receive punitive damages. See 15 U.S.C. § 1681n(a)(2).

The FCRA was further amended by the Credit and Debit Card Receipt Clarification Act of 2007 ("Clarification Act"), Pub.L. No. 110-241, 122 Stat. 1565 (2008) (codified at 15 U.S.C. § 1681n(d)), which was signed into law on June 3, 2008—just a few days after the district court's decision in the instant case. The Clarification Act applies to transactions that took place between December 4, 2004, and June 3, 2008, exempting merchants from liability for willful violations of the FCRA in cases where the merchant printed credit card expiration dates on customer receipts, but "otherwise complied" with FACTA. Id. The Clarification Act applies retroactively to all cases pending as of the time of its enactment. Id. This means that to recover for willful FACTA violations that occurred prior to the enactment of the Clarification Act, a customer must prove that the merchant printed more than the last five digits of the customer's card number on an electronically-generated receipt. Simply proving that the expiration date was printed will not suffice.

B. Procedural History

Plaintiff-Appellants Bobbie Harris and Julie Best Grimes (collectively "the plaintiffs") filed separate cases in district court against Defendant-Appellees Mexican Specialty Foods, Inc. ("Mexican Specialty Foods") and Rave Motion Pictures, Birmingham, LLC,³ respectively (collectively "the defendants"), alleging that the defendants willfully violated FACTA, and seeking statutory damages, punitive damages, costs of suit, and attorney's fees, pursuant to 15 U.S.C. § 1681n(a). The plaintiffs' complaints also seek class certification on behalf of themselves and all other persons similarly situated, pursuant to Rule 23 of the Federal Rules of Civil Procedure. The proposed classes include every customer who engaged in a credit or debit card transaction with one of the defendants after the date FACTA became effective and whose electronically-generated receipt included more than the last five digits of the customer's card number and/or its expiration date.⁴

The defendants filed motions for summary judgment, alleging that the FCRA's statutory-damages provision is unconstitutional. The United States ("the government") intervened as a plaintiff pursuant to 28 U.S.C. § 2403(a) to defend the constitutionality of the statute.

The district court issued a single order declaring the FCRA's statutory-damages provision unconstitutionally vague on its face and unconstitutionally excessive on its face and as applied to the defendants, in violation of the Fifth Amendment Due Process Clause.⁵ The claims were dismissed with prejudice. The plaintiffs appealed and we consolidated the cases.⁶ For the reasons stated below, we conclude that: (1) the merits of the as-applied excessiveness challenge are not ripe for adjudication; (2) the statute is not unconstitutionally vague on its face; and (3) the statute is not unconstitutionally excessive on its face. We therefore vacate the district court's order and remand for further proceedings.

II. STANDARD OF REVIEW

We review de novo questions concerning our subject matter jurisdiction, including ripeness. Elend v. Basham, 471 F.3d 1199, 1204 (11th Cir.2006). We review the constitutionality of a challenged statute de novo. Konikov v. Orange County, Fla., 410 F.3d 1317, 1321 (11th Cir.2005).

III. DISCUSSION

A. Ripeness

We first address whether the instant case is ripe for adjudication. Ripeness doctrine "originate[s] from the Constitution's Article III requirement that the jurisdiction of the federal courts be limited to actual cases and controversies." Elend, 471 F.3d at 1204-05. For a court to have jurisdiction, the claim must be "sufficiently mature, and the issues sufficiently defined and concrete, to permit effective decisionmaking by the court." Cheffer v. Reno, 55 F.3d 1517, 1524 (11th Cir.1995). "The ripeness doctrine protects federal courts from engaging in speculation or wasting their resources through the review of potential or abstract disputes." Digital Props., Inc. v. City of Plantation, 121 F.3d 586, 589 (11th Cir.1997). "A claim is not ripe for adjudication if it rests upon contingent future events that may not occur as anticipated, or indeed may not occur at all." Texas v. United States, 523 U.S. 296, 300, 118 S.Ct. 1257, 140 L.Ed.2d 406 (1998) (internal quotation marks omitted).

Because the question of ripeness depends on the timing of the adjudication of a particular issue, see Atlanta Gas Light Co. v. Fed. Energy Regulatory Comm'n, 140 F.3d 1392, 1403-04 (11th Cir. 1998), it applies differently to facial and as-applied challenges. A facial challenge asserts that a law "always operates unconstitutionally," BLACK'S LAW DICTIONARY 223 (7th ed.1999) (emphasis added); therefore, a facial challenge will succeed only if the statute "could never be applied in a constitutional manner." DA Mortgage, Inc. v. City of Miami Beach, 486 F.3d 1254, 1262 (11th Cir.2007). In the context of a facial challenge, a purely legal claim is presumptively ripe for judicial review because it does not require a developed factual record. See Nat'l Treasury Employees Union v. Chertoff, 452 F.3d 839, 854-55 (D.C.Cir.2006); Solantic, LLC v. City of Neptune Beach, 410 F.3d 1250, 1274 (11th Cir.2005); Roe No. 2 v. Ogden, 253 F.3d 1225, 1232 (10th Cir.2001). An as-applied challenge, by contrast, addresses whether "a statute is unconstitutional on the facts of a particular case or to a particular party." BLACK'S LAW DICTIONARY at 223. Because such a challenge asserts that a statute cannot be constitutionally applied in particular circumstances, it necessarily requires the development of a factual record for the court to consider. Se...