Among the more interesting developments discussed in our webinar last week on the CFPB’s amicus program was the appeal currently pending before the Eighth Circuit in Charvat v. First National Bank of Wahoo, a case that raises the question whether a plaintiff has Article III standing to sue for an alleged statutory violation that caused no actual injury. Joining me and my partner Alan Kaplinsky in the webinar was Deepak Gupta, who was formerly CFPB Senior Counsel and now has his own law firm which specializes in representing consumers in significant appellate matters. Deepak represents the plaintiff-appellant in Charvat. (The program materials and a recording of the webinar are available for reference.)
Last year, the U.S. Supreme Court granted certiorari in First American Financial Corporation v. Edwards, a case that would have decided whether a plaintiff who cannot show any actual injury from a violation of the Real Estate Settlement Procedures Act’s anti-kickback provision has Article III standing. The U.S. Solicitor General and the CFPB filed a joint amicus brief on behalf of the plaintiff (and Deepak was one of the CFPB attorneys listed on the brief). However, the case came to an anti-climactic conclusion this past June when the Supreme Court issued a one-sentence per curiam order stating that “the writ of certiorari is dismissed as improvidently granted.”
Charvat raises the standing question in the context of the Electronic Funds Transfer Act. The plaintiff had brought a purported class action against a bank seeking statutory damages for the bank’s alleged violation of the requirement that notice of an ATM fee must be posted on the machine. The plaintiff did not allege that the bank had failed to provide the required on-screen notice of the ATM fee before he completed the transaction for which the ATM fee was charged. The district court dismissed the complaint on the grounds that the alleged statutory violation did not establish an injury in fact sufficient to create Article III standing. In his appeal, the plaintiff asks the Eighth Circuit to reverse the district court’s ruling and find that he has Article III standing to seek statutory damages based on the alleged EFTA violation.
We will be closely watching the Eight Circuit proceedings in Charvat because of the significance the court’s ruling could have for the ability of consumers to recover statutory damages under a wide array of other consumer protection statutes where actual damages are often difficult to prove or non-existent. Those statutes include the Truth in Lending Act, the Fair Credit Reporting Act, the Telephone Consumer Protection Act, the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, the Homeowners Protection Act, and the Credit Repair Organizations Act.