Wed, December 01, 2021

international

High court delivers flurry of rulings as session nears end


WASHINGTON - The Supreme Court on Friday narrowed a lawsuit against a credit reporting company that had flagged thousands of people as potential terrorists or drug dealers, saying only those who can show "concrete harm" can participate in class-action claims.

In a 5-to-4 decision for TransUnion v. Ramirez, Justice Brett Kavanaugh said only a portion of the more than 8,000 people that TransUnion had labeled potential wrongdoers had the information disclosed to another party. That means they did not experience the kind of injury the Constitution requires for bringing suit in federal court, he wrote.

"No concrete harm, no standing," Kavanaugh wrote.

Kavanaugh wrote for himself and four other conservative justices. But the opinion drew a notable dissent from the court's most consistent conservative, Clarence Thomas, joined by the court's three liberals.

"TransUnion generated credit reports that erroneously flagged many law-abiding people as potential terrorists and drug traffickers," wrote Thomas. Yet, "the majority decides that TransUnion's actions are so insignificant that the Constitution prohibits consumers from vindicating their rights in federal court. The Constitution does no such thing."

A jury had ruled against TransUnion and in favor of the class of 8,185 individuals who brought the $40 million lawsuit. But the Supreme Court sent the case back, saying only 1,853 of those had the information distributed to a third-party, and thus could recover damages.

One of them is Sergio Ramirez, who had an embarrassing moment at a California car dealership in 2011 when a salesperson ran a credit check. TransUnion said his name matched a name on the government's list of national security risks. The dealership closed the deal with Ramirez's wife as the buyer.

But Ramirez complained and found he was not the only one. For an extra fee to those making credit checks, TransUnion offered to check whether a name was listed with the Treasury Department's Office of Foreign Assets Control, which maintains the roll of "specially designated nationals."

As Kavanaugh noted, "TransUnion's Name Screen product generated many false positives. Thousands of law-abiding Americans happen to share a first and last name with one of the terrorists, drug traffickers, or serious criminals" on the list.

But Kavanaugh concluded that just being matched to a potential terrorist was not enough.

"The mere presence of an inaccuracy in an internal credit file, if it is not disclosed to a third party, causes no concrete harm," he wrote.

"In cases such as these where allegedly inaccurate or misleading information sits in a company database, the plaintiffs' harm is roughly the same, legally speaking, as if someone wrote a defamatory letter and then stored it in her desk drawer."

He said it was only speculative that there might be future harm to those wrongly labeled. He was joined by Chief Justice John Roberts Jr. and Justices Samuel Alito Jr., Neil Gorsuch and Amy Coney Barrett.

Stephen Newman, who argued the case for TransUnion, said the outcome "will have broad implications for class certification practice nationwide. It also will improve American businesses' ability to serve their customers and workers efficiently, with reduced litigation burden."

Thomas noted that Congress had specifically provided consumers the ability to sue credit reporting companies for harm.

"One need only tap into common sense to know that receiving a letter identifying you as a potential drug trafficker or terrorist is harmful," he wrote. "All the more so when the information comes in the context of a credit report, the entire purpose of which is to demonstrate that a person can be trusted."

He was joined by Justices Stephen Breyer, Sonia Sotomayor and Elena Kagan.

Kagan added in a separate opinion that the majority "holds, for the first time, that a specific class of plaintiffs whom Congress allowed to bring a lawsuit cannot do so under [the Constitution]."

And she disputed the notion that the risk of disseminating the false information about the plaintiffs was too speculative.

"Why is it so speculative that a company in the business of selling credit reports to third parties will in fact sell a credit report to a third party?" she asked.

- - -

The court sided with oil companies and refineries in HollyFrontier Cheyenne Refining v. Renewable Fuels Assn, saying the Environmental Protection Agency has wider latitude in granting exemptions from the existing mandate that they mix ethanol and other renewable fuels into gasoline and diesel.

In a 6 to 3 decision that looked closely at ambiguous wording in the law, the majority said the agency's power to create exemptions is not limited to refineries that have consistently received such a reprieve.

The question was what Congress meant when it vested the EPA to grant "extensions" of the exemption. Gorsuch said that did not mean only those currently with exemptions could apply.

"It is entirely natural - and consistent with ordinary usage - to seek an 'extension' of time even after some lapse," he wrote. "Think of the forgetful student who asks for an 'extension' for a term paper after the deadline has passed, the tenant who does the same after overstaying his lease, or parties who negotiate an 'extension' of a contract after its expiration."

Barrett disagreed, and wrote her first dissent from a majority opinion since joining the court in October. She was joined by Sotomayor and Kagan, which meant that the court split, also for the first time this term, along gender lines.

Barrett said something must be ongoing before it could receive an extension.

"One would not normally ask to 'extend' a newspaper subscription long after it expired," she wrote. "Or request, after child number two, to 'extend' the parental-leave period completed after child number one."

Under the majority's reading, she said, "a refinery could ask to 'extend' an exemption it had in 2010 in the year 2040, with no need to connect the two periods."

- - -

Special organizations for Native Alaskans are eligible for federal covid-19 relief funds even though they are not officially tribal governments, the court ruled in Yellen v. Confederated Tribes of the Chehalis Reservation.

In a 6 to 3 vote, Sotomayor wrote for the majority that Alaska Native Corporations are considered "Indian tribes, regardless of whether they are also federally recognized tribes."

She said the ruling was confirming only "what the federal government has maintained for almost half a century."

Three groups of Native American tribes had sued in federal court to prevent the corporations from receiving a share of the money from the federal Cares Act set aside for tribes. About $500 million was at stake.

Gorsuch, Thomas and Kagan dissented.

Published : June 26, 2021

By : The Washington Post · Robert Barnes