Armes v. Sogro, Inc.
932 F. Supp. 2d 931
E.D. Wis.2013Background
- Armes sues Sogro, Inc. for FACTA violation for printing the full card number and expiration date on receipts at Budget Host Diplomat Motel (Lake Geneva, WI) on April 30, 2007; class action covers all receipts after December 4, 2006 with more than last four digits/expiration.
- Sogro operates a single Budget Host Diplomat Motel; class certified March 29, 2011; opt-out expired August 2012.
- Paymentech processed Sogro’s credit/debit card transactions since 1999 and provided receipt guidance; Sogro generally relied on processor for compliance and did not independently verify truncation.
- Armes used personal Visa debit card for a business trip; received a receipt displaying full card data; he did not suffer identity theft or incur actual damages and later learned of FACTA.
- After litigation, Paymentech software update truncated numbers; Sogro offered no benefit from noncompliance; Solus acknowledges unaware of FACTA until served, later acting to conform.
- Armes contends willful FACTA violation; Sogro contends lack of standing, business-purposes limitation, and no willfulness; the court must decide based on cross-motions for summary judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing under Article III | Armes has a legally protected interest in FACTA receipts. | Armes lacks injury beyond statutory violation and seeks only statutory damages. | Armes has standing; receipt truncation injury suffices under FACTA. |
| Business-related purposes and statutory damages | Consumer status drives statutory damages; personal use is still within FACTA protections. | Damages limited to consumer cardholders; business use should not support statutory damages. | Armes qualifies as consumer cardholder; business use does not defeat standing or damages. |
| Willfulness of the violation | Sogro acted willfully by disregarding truncation notices and requirements. | No knowledge or recklessness proven; no willful disregard established. | Genuine issues of material fact exist; summary judgment denied for willfulness. |
| Appropriate disposition of cross-motions for summary judgment | Undisputed facts show willful violation and entitlement to statutory damages. | Questions of fact preclude entitlement to summary judgment for both sides. | Both motions denied; the case proceeds to trial/pretrial scheduling. |
Key Cases Cited
- Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47 (U.S. Supreme Court 2007) (willfulness requires more than negligence; recklessness standard applies)
- Murray v. GMAC Mortg. Corp., 434 F.3d 948 (7th Cir. 2006) (statutory damages available for willful violations even without actual damages)
- Killingsworth v. HSBC Bank Nev., N.A., 507 F.3d 614 (7th Cir. 2007) (willfulness standard under FACTA; recklessness sufficient to support damages)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (U.S. Supreme Court 1992) (standing requirements: injury, causation, redressability)