Lisa MABARY, Plaintiff-Appellant v. HOME TOWN BANK, N.A., Defendant-Appellee.
No. 13-20211.
United States Court of Appeals, Fifth Circuit.
Nov. 5, 2014.
276 F.R.D. 196 | 888 F.Supp.2d 857
William Frank Carroll, Esq., Thomas Butler Alleman, Aubrey Brook Colvard, Attorney, Cox Smith Matthews, Incorporated, Dallas, TX, for Defendant-Appellee.
Before JOLLY, HIGGINBOTHAM, and SOUTHWICK, Circuit Judges.
PATRICK E. HIGGINBOTHAM, Circuit Judge:
Lisa Mabary filed a class action claim alleging that Home Town Bank violated
I.
On October 19, 2010, Mabary sued Home Town Bank (“Home Town“), on behalf of herself and all others similarly situated, alleging that Home Town violated the EFTA and its implementing Regulation.3 The EFTA requires any ATM operator who imposes a fee on users to provide notice that a fee will be charged and the amount.4 At the time Mabary filed her suit, the statute required that the notice be posted in two places (the “two notice” provision): both externally at the ATM machine (the “posted notice“), and on the screen of the ATM or on a paper printout before the transaction is completed (the “screen notice“).5 If a transaction fee is charged without the required notice, the statute provides that consumers can recover actual damages, statutory damages, costs, and fees.6
In her complaint, Mabary alleged that in 2010 she was charged a $2.00 fee in connection with one or more electronic fund transfers she completed using Home Town‘s ATMs. She claimed the ATMs lacked the posted notice required by the statute. There is no dispute that Mabary received an actual screen notice of the fee and accepted an on-screen prompt to continue with the transaction after the notice. Mabary‘s suit thus did not seek actual damages for herself or for any putative class member. Rather, she sought “statutory damages for violations of a consumer protection law where Plaintiff and the putative class have not suffered any actual out-of-pocket economic injury.” Mabary sought to represent a class of persons to be defined as follows: All persons who: (1) were charged a “terminal fee” at ATMs operated by Defendant when such persons made an electronic fund transfer and/or balance inquiry where, (2) no notice indicating that such fee was to be charged was posted on or at the outside of the ATM machine.
On February 3, 2011, Home Town made a
On February 21, 2011, Home Town filed a motion to dismiss the Amended Complaint under
On October 5, 2011, Home Town filed a Motion to Dismiss or Alternatively for Stay. Home Town argued that Mabary lacked standing because, having received actual notice of the fee, she suffered no
During that process, Congress unanimously enacted H.R. 4367 (the “EFTA amendment“)10 on December 20, 2012, which amended the EFTA by repealing the posted notice requirement, leaving only the screen notice requirement that Mabary indisputably received.
On July 15, 2013, the district court denied Mabary‘s motion for class certification and dismissed her suit with prejudice. Having determined that Mabary‘s claim did not survive the passage of H.R. 4367, the district court also concluded that unnamed class members could not become parties to the litigation on the basis of a class claim that no longer existed.
Mabary timely appealed.
II.
Home Town first contends that Mabary lacks standing to bring her claim because she indisputably received actual notice of the ATM fee and thus suffered no injury-in-fact. Home Town characterizes the form of the notice required by the statute as nothing more than a procedural mechanism whose absence creates no concrete injury. “[D]eprivation of a procedural right without some concrete interest that is affected by the deprivation—a procedural right in vacuo—is insufficient to create Article III standing.”11 But we must disagree that Mabary suffered no concrete injury-in-fact as required by Article III. “Many statutes, notably consumer-protection statutes, authorize the award of damages (called ‘statutory damages‘) for violations that cause so little measurable injury that the cost of proving up damages would exceed the damages themselves, making the right to sue nugatory.”12 The EFTA‘s damages provisions is a valid enforcement mechanism for such an injury here. A user of an ATM is not in the same position to decline an ATM transaction at the initial point, where she walks by the ATM and sees the posted notice that Congress required, as she is at a later point, when she receives on-screen notice only after having retrieved her ATM card, entered personal information such as a Personal Identification Number, and initiated a transaction. Congress‘s determination that consumers were entitled to the fee information they need to decline a
III.
Home Town also argues that its February 3, 2011, Rule 68 Offer of Judgment to Mabary in the amount of $1,000—an offer Mabary did not accept—moots her claim by offering her all relief possible under the EFTA. Because no class had been certified when Mabary‘s claims were mooted, Home Town alleges, the entire case is moot and must be dismissed under Rule 12(b)(1) for lack of subject matter jurisdiction.
The district court below rejected Home Town‘s claim,14 as do we. Although an offer of complete relief (even an unaccepted one) will generally moot a plaintiff‘s claim,15 we agree with the district court that these circumstances fit within the “relation back” exception.16 That doctrine prevents a defendant from “picking off” a named plaintiff by mooting her individual claim before the court has an opportunity to rule on the question of class certification, if the plaintiff has timely and diligently pursued a motion for class certification that actually results in a class being certified.17 The doctrine allows certification to “relate back” to the filing of the complaint, when the plaintiff‘s claims presented a live controversy, such that class members “take the place of the named plaintiff(s) for Article III purposes while the plaintiff(s) still possessed live claims.”18 If the district court on remand “ultimately grants the motion to certify, then the Rule 68 offer to the individual plaintiff” will not fully satisfy the class action claim; “if the court denies the motion to certify, then the Rule 68 offer of judgment renders the individual plaintiff‘s claims moot.”19
We disagree, moreover, with Home Town‘s contention that this Court‘s “relation back” rationale does not survive the Supreme Court‘s recent decision in Gene-sis Healthcare Corp. v. Symczyk.20 There, the Supreme Court held that a collective action under the Fair Labor Standards Act (“FLSA“) was no longer justiciable when plaintiff conceded, and the Third Circuit decided, that an earlier unaccepted offer of complete judgment mooted the plaintiff‘s individual claim. But the Supreme Court noted, and expressly did not decide, a circuit split on “whether an unaccepted offer that fully satisfies a plaintiff‘s claim is sufficient to render the claim moot” when the collective action class has not yet been certified.21 The Supreme Court also rejected the plaintiff‘s reliance on Rule 23 class action cases, explaining that “Rule 23 actions are fundamentally different from collective actions under the FLSA.”22
Mabary did not voluntarily accept a full settlement offer before filing a motion for class certification, a scenario we have identified as being outside the scope of the “relation back” doctrine.23 Nor did Home Town‘s offer of judgment satisfy both the individual and class-wide statutory maximum claims.24 Home Town‘s attempt to “pick off” Mabary‘s claim before the court could decide the issue of class certification fits squarely within the “relation back” doctrine, which saves her claim from mootness at this stage.
IV.
We turn to whether the EFTA amendment eliminating the “two notice” provision applies to Mabary‘s claims, which are based on ATM withdrawals that pre-date the amendment. Our starting point is the “deeply rooted” presumption against retroactivity of Landgraf v. USI Film Products.25 We first determine whether Congress unambiguously has prescribed the statute‘s proper reach, determined by applying normal rules of statutory construction to the express language to determine Congress‘s intent.26 Failing that, we then look to “whether the new statute would have retroactive effect, i.e., whether it would impair rights a party possessed when he acted, increase a party‘s liability for past conduct, or impose new duties with respect to transactions already completed.”27 “[E]very statute, which takes away or impairs vested rights acquired under existing laws, or creates a new obligation, imposes a new duty, or attaches a new disability, in respect to transactions or considerations already past, must be deemed retrospective.”28 And these retroactive effects being “a sufficient, rather than a necessary, condition for invoking the presumption against retroactivity,” the “outer limits of impermissible retroactivity” are even broader, defined instead by
H.R. 4367 is silent on the statute‘s temporal reach, neither expressly indicating that it is retroactive nor giving any clear indication that Congress intended the amendment apply retroactively. Home Town‘s argument that retroactive application of the EFTA amendment “would vindicate its purpose more fully is not sufficient to rebut the presumption against retroactivity,”31 nor does it give us license to read into the statute an intent that does not appear there. We look, then, to whether applying the EFTA amendment retroactively to Mabary‘s claims would have an impermissible retroactive effect, and determine that it would. Retroactive application would impermissibly attach
V.
The district court determined that because Mabary‘s claim did not survive the repeal of the “two notice provision,” the basis of any class claim ceased before certification and a class could not be certified to vindicate a defunct statutory right. Although this Court generally reviews the district court‘s denial of class certification for abuse of discretion,37 we review de novo determinations of questions of law.38 Holding as we do that the repeal of the “two notice” provision does not apply retroactively to Mabary‘s claim, the EFTA amendment poses no more a barrier for putative class members than it does for Mabary, for claims alleging violations before the amendment was enacted.39 We thus VACATE the district court‘s denial of class certification and REMAND for the district court to decide whether the class
E. GRADY JOLLY, Circuit Judge, dissenting:
With due respect, it is difficult to determine which feature of the majority‘s opinion is more stunning: that it finds standing on the basis of a new theory of law that has not been so much as hinted at, much less urged, by the plaintiff in this case; or that this “delayed-notice” theory of injury on which it finds standing is so utterly unsupported by law or fact. Mabary is represented by able counsel, and it is gratuitous for the majority to aid Mabary with a standing theory of its own devising. Instead, we should consider the standing argument that she actually makes—that is, simply by virtue of her statutory cause of action, it follows that she also has standing to sue. This argument is foreclosed by Article III of the Constitution, however, and, lacking any injury in fact, Mabary lacks standing.
I.
The basic requirements of standing are familiar: “a plaintiff must show (1) an injury in fact, (2) a sufficient causal connection between the injury and the conduct complained of, and (3) a likelihood that the injury will be redressed by a favorable decision.” Susan B. Anthony List v. Driehaus, ___ U.S. ___, 134 S.Ct. 2334, 2341, 189 L.Ed.2d 246 (2014). Mabary does not claim any economic injury—nor could she: it is undisputed that she received actual notice of the fee and chose to complete the transaction anyway. Nonetheless, the majority finds standing, supposing that “a user of an ATM is not in the same position to decline an ATM transaction at the initial point, where she walks by the ATM and sees the posted notice ..., as she is at a later point, when she receives screen notice only after having retrieved her ATM card, entered personal information such as a Personal Identification Number, and initiated a transaction.” Hardly concrete injury; hardly an injury in fact when no such fact is even claimed by the plaintiff. Put differently, the majority concludes that the few seconds’ delay between when Mabary might have seen posted notice and when she saw the screen notice is an Article III injury in fact because, theoretically, she could have been dissuaded by the posted notice before she invested time and effort into initiating the transaction.
This is a novel theory of injury in fact, one that Mabary never mentioned at any point in this case1 and one that, so far as I can tell, no court has ever endorsed. Indeed, to my way of thinking, it is, respectfully, silly stuff. But even assuming that the delayed-notice theory is viable in the abstract, it fails on the facts of this case to yield an injury that is cognizable under Article III.
To constitute an Article III injury in fact, Mabary‘s injury must be “concrete” and “particularized,” rather than “speculative” or “conjectural.” Clapper v. Amnesty Int‘l USA, ___ U.S. ___, 133 S.Ct. 1138, 1147, 1149, 185 L.Ed.2d 264 (2013) (internal quotation marks omitted). Her purported delayed-notice injury easily and surely falls on the speculative-or-conjectural side of this distinction. According to the majority, “a user of an ATM” is better
To be sure, in the world of speculation, posted notice may just as well have made no difference at all. Allow this dissent to speculate along with the majority. Perhaps Mabary knew that Home Town‘s ATMs would charge her a fee even before she began the transactions.2 Or perhaps Mabary was in a hurry on the days on which she used Home Town‘s ATMs, such that she had already decided to complete the transactions whether or not she would be charged a fee. “[S]tanding,” however, “is not an ingenious academic exercise in
II.
But of course (though it is no matter to the majority), Mabary fails to even suggest that she had standing based on a delayed-notice theory. Instead, she asserts that she suffered an injury in fact because the EFTA provided her a right not to be charged a fee absent the statutorily required notice, and Home Town violated that right.3 There remains the constitutional question implicated by Mabary‘s argument: can Congress, by authorizing a remedy for the bare violation of a statute, create Article III standing where it would not otherwise exist? Although this ques-
It is an elementary principle that Article III limits the power of the federal judiciary to “cases” and “controversies,”
This long-settled principle resolves this case. Mabary cannot show that she suffered a cognizable injury in fact, so she can sue only if the existence of her statutory cause of action sufficed to satisfy Article III. But since Congress cannot create standing ex nihilo, the existence of that cause of action does not allow Mabary to bring this injury-less suit.
Mabary offers one quote from Warth v. Seldin, 422 U.S. 490, 514, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975), to support her position. There, the Court stated that “Congress may create a statutory right or entitlement the alleged deprivation of which can confer standing to sue even where the plaintiff would have suffered no judicially cognizable injury in the absence of statute.” But this statement does not mean (as Mabary seems to urge) that Congress may confer standing upon a plaintiff who has suffered no concrete, de facto injury. Instead, as the Court has later explained, it means merely that Congress may “elevat[e] to the status of legally cognizable injuries concrete, de facto injuries that were previously inadequate in law.” Lujan, 504 U.S. at 578. In other words, Congress‘s creation of a cause of action can make an injury legally cognizable, but it can‘t make a non-injury justiciable in an Article III court. To hold differently defies the Supreme Court‘s oft-repeated observation that the requirement of injury in fact is “an outer limit to the power of Congress [that] is a direct and necessary consequence of the case and controversy limitations found in Article III.” Id. at 580 (Kennedy, J., concurring).
For these reasons, I respectfully dissent.