*1 ^[14] ‐ ^[3709]

Crupar ‐ Weinmann v. Paris Baguette America, Inc.

14 ‐ 3709 ‐ Weinmann Baguette America, Inc.

UNITED STATES COURT OF APPEALS F OR THE S ECOND C IRCUIT _______________

August Term, (Argued: October Decided: June 2017) Docket ‐

_______________

D EVORAH C RUPAR ‐ W EINMANN individually behalf all others similarly

situated,

Plaintiff Appellant,

—v.—

P ARIS B AGUETTE A MERICA I NC ., doing business P aris Baguette,

Defendant Appellee ^[*]

_______________

*2 B e f o r e:

K ATZMANN Chief Judge P OOLER and C HIN , Circuit Judges .

_______________

Appeal a judgment of the district dismissing the plaintiff’s amended with prejudice. The plaintiff brought suit against the defendant alleging a willful violation of the Fair and Accurate Credit Transactions Act of (“FACTA”), Pub. L. 108–159, Stat. (codified as U.S.C. § 1681c(g)). Specifically, when the plaintiff purchased food the defendant’s restaurant, she received a printed receipt that contained card’s expiration date, one of several pieces of identifying information that FACTA prohibits printing on a receipt so to reduce the risk consumer identity theft. plaintiff alleges this action presented material identity theft constitutes an injury fact for sue. Here, however, we find dispositive subsequently passed legislation amending FACTA clarify receipt containing printed date does raise material identity theft. This clarification, coupled absence any specific allegations concerning unintended exposure receipt others, let alone allegations actual theft, leads us conclusion alleges here insufficient satisfy ‐ fact requirement necessary establish III standing. On basis, AFFIRM judgment court.

_______________

G REGORY A. F RANK (Marvin L. Frank, on brief ), Frank LLP, New York, NY; Khaled (Jim) El Nabli, Joseph H. Lilly, Peter Y. Lee, Nabli & Associates, P.C., New York, NY, for Plaintiff ‐ Appellant .

J OSHUA A. B ERMAN (Mary Jane Yoon Eric L. Unis, brief ), Troutman Sanders LLP, New York, NY, Defendant Appellee _______________

K ATZMANN Chief Judge : When does a bare procedural violation a statutory right constitute an injury in fact for standing bring suit in federal court? Although Supreme Court recently addressed this question in Spokeo, Inc. Robins 136 S. Ct. 1540 (2016), as revised (May 2016), inquiry necessarily context ‐ specific statutory right question particular risk sought prevent. Here, we address this issue as relates Fair Accurate Credit Transactions Act (“FACTA”), Pub. L. 108 ‐ Stat. (codified amended U.S.C. § 1681c(g)), an issue first impression Circuit. Guided by unambiguous statutory language receipt card date does not raise material theft, finding alleged by does not present material harm, we conclude allegations her amended complaint do satisfy fact requirement necessary establish III bring suit. Accordingly, AFFIRM judgment dismissing lack standing.

B ACKGROUND

I. Factual History

The brief factual history of this case is drawn from plaintiff’s amended complaint filed after remanded the case the court. FACTA seeks prevent theft by, among other things, requiring venders who accept credit debit cards print “more than last digits the card number or expiration date upon any receipt provided cardholder at point sale or transaction.” U.S.C. § 1681c(g)(1). When Devorah ‐ Weinmann purchased food at Baguette’s midtown Manhattan restaurant September she paid with credit card received printed receipt displaying her card’s expiration date. She alleges during time period, “Paris Baguette routinely gave receipts its customers point sale its various retail stores which displayed expiration dates customers’ credit and/or debit cards, requirements FACTA.” Am. Compl ¶ otherwise devoid specific factual allegations concerning her interaction restaurant or any consequences stemmed display card’s date *5 on printed receipt. Instead, her emphasizes that Congress’s goal passing FACTA was to reduce consumer identity theft by “mak[ing] more difficult for identity thieves obtain consumers’ [c]ard information by reducing amount information identity thieves could retrieve found or stolen [c]ard receipts.” ¶ 26. She further alleges that by “knowingly recklessly print[ing] . . . [c]ard dates on [c]ard receipts,” Paris Baguette violated FACTA, id. ¶ 92, doing so “created real, non ‐ speculative form increased theft,” id ¶

II. Procedural History

In 2013, Crupar Weinmann filed initial complaint, which defendant moved dismiss, primarily basis she failed plead facts allege plausibly Paris Baguette willfully violated FACTA. Following full briefing oral argument, district court granted defendant’s motion dismiss. See Weinmann Baguette Am., Inc. CIV. JSR, WL *1, *5 (S.D.N.Y. June dismissed claims prejudice, “convinced would be able plausibly plead claim willful FACTA, even if she were given *6 opportunity replead.” *5. Crupar ‐ Weinmann then moved for reconsideration, asserting both court misconstrued pleading standard a willful FACTA and erred in dismissing her with prejudice and without leave amend; denied this motion on both grounds. See Crupar ‐ Weinmann v. Baguette Am., Inc. , F. Supp. 3d 411, 413–14 (S.D.N.Y. ‐ Weinmann then appealed, and October we heard

argument in both case and related case involving similar legal question, Katz Donna Karan Company, LLC, et al. , ‐ 464. Shortly thereafter, Supreme Court heard oral argument in Spokeo , which raised questions concerning whether who “allege[s] violation, divorced any concrete harm, [can] satisfy in fact requirement III.” S. Ct. We held both case Katz until Court rendered its decision Spokeo which clarified doctrine ways we explain more detail below. Given Spokeo ’s elucidation, subsequently vacated remanded both cases “to allow plaintiffs an opportunity replead their claims comport pleading standards set forth Spokeo *7 allow district courts address any standing questions first instance,” and we retained appellate jurisdiction over outcomes. Cruper ‐ Weinmann v. Paris Baguette Am., Inc. 653 F. App’x 82 (2d Cir. 2016).

On remand, Crupar ‐ Weinmann her complaint, Paris Baguette again moved dismiss, and district again dismissed plaintiff’s complaint prejudice, time concluding she lacked standing bring claims for violations FACTA’s requirements. Cruper Weinmann Baguette Am., Inc. CIV. (JSR), WL (S.D.N.Y. Jan. Weinmann then moved renew appeal; granted motion, parties submitted letter briefing addressing propriety district court’s dismissal light Spokeo

D ISCUSSION

I. Standard Review

We review de novo court’s decision dismiss complaint lack pursuant Fed. R. Civ. P. 12(b)(1) 12(b)(6), “construing favor accepting true all material factual allegations *8 contained therein.” Donoghue v. Bulldog Inv’rs Gen. P’ship , F.3d 170, (2d Cir.

II. Standing Allege A Bare Procedural Violation Law

On appeal, challenges court’s dismissal basis that she did not plead concrete injury fact establish III standing bring suit against Baguette. A. Standing Doctrine After Spokeo

In Lujan Defenders Wildlife Supreme Court explained “irreducible constitutional minimum standing contains three elements”: (1) “an injury fact” “a legally protected interest” is both “(a) concrete and particularized, and (b) actual or imminent, conjectural or hypothetical,” (2) “a causal connection between injury conduct complained of,” and (3) “likely, opposed merely speculative, injury will be redressed by favorable decision.” U.S. 560–61 (1992) (citations internal quotation marks omitted). As here, controversy Spokeo implicated “concrete particularized” element fact analysis. See Spokeo S. Ct. There, Court considered claim against *9 Spokeo, “people search engine,” alleging when Spokeo trawled online sources generate profile plaintiff, collected and reported inaccurate information about him, including his age, education, and marriage and family status, as well as job and socioeconomic position. Id . at The plaintiff asserted Spokeo qualified as “consumer reporting agency” under Fair Credit Reporting Act 1970 (“FCRA”), 84 Stat. 1127 (codified as at 15 U.S.C. §§ et seq. ), and that, as result, Spokeo was required “to ‘follow reasonable procedures assure maximum possible accuracy’ consumer reports, . . . limit circumstances which such agencies provide consumer reports ‘for employment purposes,’ . . and post toll free numbers for consumers request reports,” among other protections. Spokeo S. Ct. (quoting U.S.C. §§ 1681e(b), 1681b(b)(1), 1681j(a)). Importantly, with FACTA, violators FCRA can be liable both actual statutory damages. Spokeo putative class action lawsuit alleged publishing incorrect information about similarly situated individuals, Spokeo willfully failed comply FCRA’s requirements, id. case turned whether harms stemming *10 violations of the FCRA could satisfy the concreteness element of injury ‐ in ‐ fact standing analysis. Supreme Court concluded that while the Spokeo could

“allege procedural violation, divorced any concrete harm, satisfy fact requirement of Article III,” that did “not mean . . . that real cannot satisfy requirement of concreteness.” Id. at (emphasis added). After all, “Congress is well positioned identify intangible harms meet minimum III requirements, [and] its judgment is also instructive important,” “may ‘elevat[e] status legally cognizable injuries concrete, de facto injuries were previously inadequate law.’” (quoting Lujan U.S. Given variety ways consumer reporting agency could run afoul FCRA, Court recognized while any given “violation one FCRA’s procedural requirements may result no harm,” “Congress plainly sought curb dissemination false information by adopting procedures designed decrease risk.” Id Thus, critical question purposes “whether particular violations alleged case entail degree meet *11 concreteness requirement.” Id. (emphasis added). Court remanded the case lower to engage inquiry first instance. Id.

B. Post Spokeo Second Circuit Standing Doctrine We recently had opportunity apply Spokeo to another consumer class action lawsuit concerning a statute a wide ranging set procedural rights and requirements, Truth Lending Act (“TILA”), Pub. L. 90–321, 82 Stat. (1968) (codified as at U.S.C. §§ 1601 et seq. ), Strubel Comenity Bank F.3d (2d Cir. Unlike single violation alleged here, Strubel involved a variety alleged violations TILA, all related required disclosures concerning plaintiff’s rights responsibilities a card holder borrower bank. Id. 185–86. Applying Spokeo recognized “an alleged procedural violation can by itself manifest concrete injury where Congress conferred procedural right protect concrete interests where procedural presents ‘risk real harm’ concrete interest.” We noted, however, an important limitation: “[E]ven where has accorded rights protect concrete interest, may fail demonstrate concrete where *12 violation of procedure at issue presents no material risk of harm to underlying interest.” Id. 190. A central inquiry, then, is whether particular bare procedural violation may present material risk harm to underlying concrete interest Congress sought to protect. Accordingly, Strubel held those defendant’s practices “could cause consumers unwittingly satisfy their own obligations thereby to lose their rights . . raise[d] sufficient degree risk real harm necessary [establish] concrete III standing,” while other allegations where “fail[ed] demonstrate harm concrete TILA interest [defendant’s] alleged failure[s]” were properly dismissed lack standing. III. Material Risk Harm under FACTA

Applying Strubel key inquiry here whether Baguette’s alleged — printing Weinmann’s card date receipt — presents material underlying concrete interest Congress sought protect passing FACTA. We find dispositive clarified FACTA Credit Debit Card Receipt *13 Clarification Act of (“Clarification Act”), stating that “[e]xperts the field agree that proper truncation the card number, . . . regardless of the inclusion of the expiration date, prevents a potential fraudster perpetrating identity theft or credit card fraud.” Pub. L. 110–241, § 2(a)(6), Stat. (2007) (emphasis added). This makes clear that Congress did not think that inclusion credit card expiration date on a receipt increases risk material identity theft. Weinmann counters that Clarification Act maintained

FACTA’s prohibition on printing card expiration dates on receipts, which reflects Congress’s continued belief action does pose material harm. While we acknowledge Clarification Act maintained FACTA’s prohibition practice, decline draw proposed inference, because same Act, expressly observed inclusion expiration dates did raise material theft, presumably curtail “hundreds lawsuits [that] were filed [after FACTA’s passage] alleging failure remove date was willful . . even where account number was properly truncated[, n]one *14 of these lawsuits contained an allegation of harm to any consumer’s identity.” Pub. L. 110–241 § 2(a)(4)–(5), 122 Stat. at 1565. Congress could not have been clearer in stating that “[t]he purpose this Act is to ensure that consumers suffering any actual harm to their or are protected while simultaneously limiting abusive lawsuits that do not protect consumers but only result in increased cost business potentially increased prices to consumers.” § 2(b), 122 Stat. at Given clarification FACTA, coupled with our holding Strubel that a plaintiff must allege that, a minimum, bare “procedural violation presents a ‘risk real harm’ [her] concrete interest,” F.3d conclude that plaintiff here has not alleged that Baguette’s bare procedural violation FACTA posed a material harm her. We thus join our sister Circuit concluding, a case with a nearly identical set allegations, “[i]n these *15 circumstances, is hard imagine how expiration date’s presence could have increased [plaintiff’s] would be compromised.” Meyers Nicolet Rest. De Pere, LLC F.3d (7th Cir.

C ONCLUSION

For these reasons, join Seventh Circuit holding printing an date an otherwise properly redacted receipt does constitute an fact establish III bring claim alleging FACTA. Accordingly, judgment AFFIRMED

[*] Clerk Court respectfully directed amend caption conform caption above.

[1] This not say is impossible allege different “bare procedural violation” U.S.C. § 1681c(g) which some plaintiff might have standing. In circumstance like this, however, where plaintiff alleges no particular beyond purely violation, has found particular procedural does increase relevant material harm, lacks proceed such suit.