Since the Spokeo, Inc. v. Robins decision in 2016, many defendants have worried that a valid standing argument could have the actual impact of leading to more cases being litigated in state court rather than outright dismissals on the merits.
This month’s ruling in Ratliff v. LTI Trucking Services, Inc. proved to be exactly the kind of holding defendants worried about after Spokeo. Plaintiff Jerome Ratliff, Jr. brought a Fair Credit Reporting Act (15 U.S.C. § 1681) suit in an Illinois federal court. The suit involved a putative class action alleging that LTI Trucking Services violated procedural requirements of the FCRA by failing to provide notices required under § 1681(b)(3)(B) considering negative information disclosed on Ratliff’s background check. That court cited Spokeo’s concrete injury requirements for standing and dismissed the matter outright for lack of subject matter jurisdiction.
Ratliff refiled in state court, and LTI removed the case to federal court. Upon removal, LTI moved to dismiss the case for lack of subject matter jurisdiction, and Ratliff argued for the federal court to dismiss the case and remand to state court.
The federal court agreed with Ratliff and elected to remand the matter for state court. The net result was a defendant facing a class claim in state court rather than federal court, and likely a situation where the defendant is no better off, and perhaps in a worse position, than if Spokeo did not exist.