On April 27, 2015, the United States Supreme Court granted certiorari in Spokeo Inc. v. Robins to address the issue of whether Congress may confer Article III standing on a plaintiff who suffers no concrete harm by simply authorizing a private right of action based on the violation of a federal statute alone. Although the substantive decision in Spokeo could have wide-ranging implications for lawsuits brought for technical, no-harm violations of consumer protection statutes, the Supreme Court’s grant of certiorari alone has had an impact throughout federal district courts. In light of the Supreme Court’s grant, numerous courts have stayed litigation pending the outcome of Spokeo.
In Salvatore v. Microbilt Corp., for example, the District Court for the Middle District of Pennsylvania recently stayed a case under the Fair Credit Reporting Act, finding the circumstances surrounding Spokeo “weigh[ed] heavily in favor of granting a stay.” According to the court, given the significant impact Spokeo could have on consumer litigation where no actual harm has occurred, “the parties face potential hardship if the stay were denied and the parties were required to expend time and resources engaging in fact and expert discovery over the course of the next year while Spokeo remains pending.” In addition, the court noted the plaintiff would not “suffer any real harm” if a stay is granted and “any harm that the plaintiff may arguably face is substantially outweighed by the importance that a decision in Spokeo likely will have on this litigation.”
The Salvatore decision is not an isolated holding. Momentum for Spokeo-based stays has been growing throughout the federal court system in cases under several different consumer protection statutes. In fact, as of the date of this blog entry, more courts have granted Spokeo-based stays than denied them. For example, a Spokeo-based stay was granted by the District Court for the Southern District of California in Provo v. Rady Children’s Hospital San Diego, a case under the Fair Debt Collection Practices Act. A few weeks earlier, the District Court for the Southern District of Florida granted a Spokeo-based stay in Boise v. ACE USA, Inc., a case brought under the Telephone Consumer Protection Act (“TCPA”). Similarly, in late May of 2015, a District Judge in the Eastern District of Virginia granted a stay based on Spokeo in Williams v. Elephant Insurance Co., a case also under the TCPA.
The examples above serve as only a representative list of the numerous cases where courts have granted stays based on the pending Spokeo decision. Although other courts have certainly denied Spokeo-based stays, seeking a stay of a consumer case, even a class action, pending the outcome of Spokeo has gained traction in recent months as a potentially successful litigation strategy for defendants.