In the domain of federal jurisdiction, standing is the bedrock concept which serves as the initial gatekeeper. According to Article III of the U.S. Constitution, the judicial Power of the United States is vested exclusively in cases that present an Actual Case and Controversy. In other words, a federal court has no constitutional authority to render advisory opinions or to adjudicate abstract, hypothetical grievances. For years, the federal circuits and the serial plaintiffs under federal consumer protection laws assumed that a technical violation of a federal statute alone was sufficient to permit entry to federal court, until a federal judge on a different side of the country, United States Supreme Court Justice Samuel Alito, in Spokeo, Inc. V. Robins, clarified the boundaries for those kinds of allegations. His opinion did not carry more weight until it was applied to a manufactured TCPA network owned by Melody Stoops.
When Stoops filed her complaint in the U.S. District Court for the Western District of Pennsylvania against Wells Fargo Bank, N.A., she predicated her suit on a twin basis of injury. First, Wells Fargo directly infringed on her own privacy interest by placing unauthorized automated calls to her mobile device. Second, she alleged economic injury, as her interests were allegedly injured as a direct consequence of spending money on airtime for her prepaid phones so that she could record the corporate communication calls to her phone. The simple case of violation of a law for Stoops and her lawyers was that the TCPA bans automated calls; Wells Fargo made automated calls without the plaintiff’s authorization, therefore, a violation occurred for which a statutory award of damages was available.
District Judge Kim R. Gibson in the U.S. District Court for the Western District of Pennsylvania rejected that simple case because it failed to analyze the underlying constitutionality under the framework of Spokeo. In a June 24 judicial order, he relied on the Supreme Court mandate to rigorously attack the plaintiff’s Article III standing claim. Justice Alito stressed that a constitutionally sufficient injury-in-fact must be particularized, which means it must “affect the plaintiff in a personal and individual way.”
A second requirement of an injury, in fact, however, must also exist, which Spokeo clarified, it must be concrete, which means it must be “real, and not abstract.” Though the Court allowed that a concrete injury need not be a tangible harm in physical terms, and financial terms were allowed to be injuries for standing purposes if concrete in fact, the court still has to distinguish real harm from abstract and hypothetically perceived harms.
One portion of Spokeo that Judge Gibson particularly cited is a passage on the issue of a statute creating its own injury-in-fact claim: “The Court emphasize[d] that ‘Congress’ role in identifying and elevating intangible harms does not mean that a plaintiff automatically satisfies the injury-in-fact requirement whenever a statute grants a person a statutory right and purports to authorize that person to sue to vindicate that right.'” This quote goes right to the heart of a professional plaintiff business model; a statute cannot authorize claims outside the confines of the U.S. Constitution. As the Court explicitly states in this part of the opinion, “‘Article III standing requires a concrete injury even in the context of a statutory violation.'”
Applying this to Stoops, Judge Gibson had no difficulty identifying and declaring the inherent contradictions in her claims of injury. His court was able to conclude, within an eloquent and precise judicial opinion, that there was no actual invasion of Stoops’ personal privacy interests: there was no violation because the telephone calls were not “a nuisance and an invasion of privacy,” when her “sole purpose” in using her telephone was to make TCPA claims.
The court’s application of its own logic to Stoops’ alleged claim of economic injury produced similar definitive results, as the expenditure of air time for Stoops’ alleged financial injury was not an external harm, but instead a manufactured cost of business. Her expenditures for air time were not “harm,” but instead an intended cost of business so that the telephone line could record the outgoing calls so that she had the evidence of the calls themselves and the testimony of a purported victim to file an “artificially created harm.” “Plaintiff’s testimony again establishes that she has not suffered an injury in fact,” wrote Judge Gibson. ”
It is well settled that a plaintiff cannot manufacture standing by choosing to make expenditures based on hypothetical future harm that is not certainly impending.'” Judge Gibson entered judgment for the defendant, dismissing the complaint and dismissing the plaintiff’s cross motion for summary judgment, establishing a powerful defense for businesses targeted with this kind of manufacturing of lawsuits.