Lyft Inc. avoided a putative background screening class action over alleged privacy violations on Spokeo grounds last week.
In the putative class action, the plaintiff driver alleged that Lyft failed to comply with the Fair Credit Reporting Act when it included "extraneous information" in its FCRA disclosure. In addition, the plaintiff claimed that Lyft failed to inform him, at the time of the disclosures, that he had a right to request a summary of his rights under the FCRA. Plaintiff claimed that the inaccurate disclosures violated his privacy and statutory rights under the FCRA.
In July, Lyft moved to dismiss the complaint, arguing that the plaintiff lacked standing where he had alleged only bare statutory violations. The District Court for the Northern District of California granted the motion, finding that the plaintiff did not meet the requirement showing his injury was concrete and real under Spokeo, because he did not allege that he suffered any real harm as a result of not receiving the required disclosures or a summary of his rights.
The Court noted that while procedural violations that have resulted in real harm, or even a risk of real harm, "may be sufficient" to meet the concrete injury requirement, the plaintiff in this case alleged "no such injury." Specifically, the Court found that the plaintiff did "not allege that as a result of Lyft's failure to provide the disclosures in a separate document or to notify him of his right to receive a summary of his legal rights he was confused about his rights or that he would not have consented to the background checks had he understood his rights." In addition, the plaintiff failed to "allege that he was harmed by the background check in any way."
In its opinion, the Court also rejected the plaintiff's argument that invasion of privacy is an injury that has traditionally been recognized, finding that the plaintiff was unable to cite to any authority in support of this argument and further indicating that there was no allegation of fraud or deceit that could result in an invasion of privacy.
The Court further rejected the plaintiff's argument that he sufficiently alleged an informational injury. Addressing the recent history of opinions covering such arguments in light of the Spokeo decision, the Court found that a violation of a disclosure requirement under the FCRA, by itself, could not be sufficient to confer Article III standing on a plaintiff.
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