Auer v. Trans Union, LLC

• Citation: 902 F.3d 873
• Decision Date: 06 September 2018
• Docket Number: No. 17-2413,17-2413
• Parties: Colleen M. AUER, Plaintiff - Appellant, v. TRANS UNION, LLC, a Delaware Limited Liability Company, Defendant, CBCInnovis, Inc., a Pennsylvania Corporation; City of Minot, a North Dakota Municipal Corporation; Smith, Bakke, Porsborg, Schweigert & Armstrong, a North Dakota General Partnership; John Does 1-100, inclusive, Defendants - Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (8th Circuit)

902 F.3d 873

Colleen M. AUER, Plaintiff - Appellant,

v. TRANS UNION, LLC, a Delaware Limited Liability Company, Defendant,CBCInnovis, Inc., a Pennsylvania Corporation; City of Minot, a North Dakota Municipal Corporation; Smith, Bakke, Porsborg, Schweigert & Armstrong, a North Dakota General Partnership; John Does 1-100, inclusive, Defendants - Appellees.

No. 17-2413

United States Court of Appeals, Eighth Circuit.

Submitted: April 9, 2018

Filed: September 6, 2018

Counsel who represented the appellant was Colleen M. Auer of Minot, ND.

Counsel who represented the appellees City of Minot and Smith, Bakke, Porsborg, Schweigert & Armstrong were Randall J. Bakke, of Bismarck, ND and Shawn A. Grinolds, of Bismarck, ND.

Counsel who represented appellee CABInnovis, Inc., were John W. Drury and Pamela Q. Devata of Chicago, IL.

Before COLLOTON, SHEPHERD, and STRAS, Circuit Judges.

COLLOTON, Circuit Judge.

This appeal concerns claims brought by Colleen Auer against several defendants: the City of Minot (her former employer); the law firm of Smith, Bakke, Porsborg, Schweigert & Armstrong; and the consumer reporting agency CBCInnovis, Inc. (CBC). Auer alleged that these parties violated their obligations under the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq ., in handling a consumer report that she agreed to provide as part of her application for employment with the City.

The district court dismissed Auer’s claims against the City and the law firm for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6), and granted judgment on the pleadings for CBC under Rule 12(c). Auer appeals these orders, and a separate order directing the City and the Smith law firm to dispose of copies of her consumer report that remained in their possession. Because Auer lacked Article III standing to bring her claims in federal court, we vacate the district court’s orders and remand with instructions that Auer’s complaint be dismissed for lack of jurisdiction.

I.

On February 26, 2014, Auer accepted appointment as the city attorney for the City of Minot. Several days later, the City’s human resources director requested that Auer authorize a background check. Auer completed and signed an authorization form. The single-page form was entitled "Authorization to Release Information and Waiver," and contained the following three paragraphs of text:

I hereby authorize representatives of the City of Minot to obtain any information in my files pertaining to my driver’s license records, criminal history records, education records; credit records; and personal history records.

I hereby direct you and release you, as the custodian of such records, and any school, college, university or other education institution, credit bureau or related personnel, both individually or collectively, from any and all liability for damages of whatever kind, which may be at any time result to me, my heirs, family or associates because of compliance with this authorization and request to release information, or any attempt to comply with it.

Should there be any questions as to the validity of this release, you may contact me as indicated below.

The form then included a space for Auer’s signature, and several spaces for Auer to input her identifying information, including her social security number and driver’s license number.

After Auer signed the authorization form, the City’s police department completed a background check. As part of the investigation, the police department obtained Auer’s credit report from the consumer reporting agency CBC. CBC had obtained Auer’s credit information from another consumer reporting agency, Trans Union, LLC.

On May 2, 2014, the City terminated Auer’s employment as city attorney. Auer filed claims against the City for wrongful termination, and requested that the City provide her with records related to her employment and termination, including her complete personnel file. The City retained the Smith law firm for representation in that action and for assistance in responding to Auer’s records request. The City, in an attempt to comply with the records request, provided the law firm with Auer’s authorization form and associated credit check. The law firm then contacted Auer, stating that it had received Auer’s consumer information pursuant to her records request, and offering to furnish that information to Auer.

After Auer received the Smith law firm’s letter and subsequent correspondence, she brought this action. She alleged that the City, the Smith law firm, and CBC had violated a number of obligations under the FCRA in procuring, using, and furnishing her consumer report. The City and the Smith law firm moved to dismiss Auer’s claims against them for failure to state a claim. In the same motion, they requested the court’s permission to destroy any of Auer’s consumer information that remained in their possession.

The district court granted the motion to dismiss and denied a later motion for reconsideration under Rule 60(b) as to all claims at issue on appeal. The court also ordered the City and the Smith law firm to surrender all physical copies of the consumer report to the clerk of court, but to destroy all electronic copies. The City and the law firm, in compliance with the order, have since destroyed all electronic copies of Auer’s report and deposited the hard copies with the clerk.

Separately, the district court granted judgment on the pleadings for CBC under Rule 12(c). The court reasoned that the complaint contained "nothing more than formulaic recitations of the elements of a claim and assertions without factual enhancement," and thus failed to state a plausible claim for relief.

Auer appeals the district court’s orders dismissing her claims against the City and the Smith law firm, granting judgment on the pleadings for CBC, and directing the City and the law firm to destroy and surrender the remaining copies of her consumer report.

II.

We begin with the threshold question whether Auer has Article III standing to bring her suit in federal court. "Federal jurisdiction is limited by Article III of the Constitution to cases or controversies; if a plaintiff lacks standing to sue, the district court has no subject-matter jurisdiction." ABF Freight Sys., Inc. v. Int’l Bhd. of Teamsters , 645 F.3d 954, 958 (8th Cir. 2011). "Subject-matter jurisdiction can never be waived or forfeited," Gonzalez v. Thaler , 565 U.S. 134, 141, 132 S.Ct. 641, 181 L.Ed.2d 619 (2012), and we have an obligation to satisfy ourselves of our own jurisdiction and that of the district court. Bender v. Williamsport Area Sch. Dist. , 475 U.S. 534, 541, 106 S.Ct. 1326, 89 L.Ed.2d 501 (1986).

To have standing, Auer "must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision." Spokeo, Inc. v. Robins , ––– U.S. ––––, 136 S.Ct. 1540, 1547, 194 L.Ed.2d 635 (2016). To establish an injury in fact, a plaintiff must show an injury that is " ‘concrete and particularized’ and ‘actual or imminent, not conjectural or hypothetical.’ " Id. at 1548 (quoting Lujan v. Defs. of Wildlife , 504 U.S. 555, 560, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) ). "Article III standing requires a concrete injury even in the context of a statutory violation," and a plaintiff cannot "allege a bare procedural violation, divorced from any concrete harm, and satisfy the injury-in-fact requirement of Article III." Id. at 1549.

In Count 4 of her complaint, Auer pleaded that the City violated several procedural requirements of the FCRA. She asserted that the City procured her consumer report without making "a clear and conspicuous disclosure" that her "consumer report may be obtained for employment purposes." She also complained that the City did not obtain Auer’s written authorization. See 15 U.S.C. § 1681b(b)(2)(A)(i), (ii). Auer further alleged that the City procured and used her report for purposes that were not authorized by the FCRA, see id. § 1681b(f)(1), and furnished her report to the Smith law firm for an unauthorized purpose and without obtaining the required certifications. See id. § 1681b(f)(1), (2). Auer pleaded that these violations caused her to suffer "injury to her privacy, reputation, personal security, the security of her identity information and loss of time spent trying to prevent further violations of her rights under the FCRA."

"To determine whether an intangible harm counts as an injury in fact, we must consider Congress’ judgment and whether the alleged intangible harm has a close relationship to a harm that traditionally provided a basis for suit in the Anglo-American legal system." Heglund v. Aitkin County , 871 F.3d 572, 577 (8th Cir. 2017). Although invasion of privacy did provide a basis for suit at common law, Braitberg v. Charter Commc’ns, Inc. , 836 F.3d 925, 930 (8th Cir. 2016), a plaintiff’s consent to the invasion of a protected interest traditionally served as a bar to recovery in a tort action. Restatement (Second) of Torts § 892A (Am. Law. Inst. 1979) ; see, e.g. , Hill v. Nat’l Collegiate Athletic Ass’n , 7 Cal.4th 1, 26 Cal.Rptr.2d 834, 865 P.2d 633, 648 (1994) ; Gray v. McDonald , 28 Mo. App. 477, 488 (1888), aff’d , 104 Mo. 303, 16 S.W. 398 (1891) ; Sampson v. Burnside , 13 N.H. 264, 265 (1842).

Because Auer consented to the City’s background check, she failed to plead an intangible injury to her privacy that is sufficient to confer Article III standing. Before the City procured Auer’s consumer information, it provided Auer with an authorization form that stated: "I hereby authorize representatives of the City of Minot to obtain any information in my files pertaining to my driver’s license records, criminal history records, education records; credit records; and personal history records." Auer filled out this authorization form because she understood that "a completed Authorization was required to initiate a background check," and...