The Eleventh Circuit recently took a huge bite out of consumers’ ability to bring class actions. In Muransky v. Godiva Chocolatier, Inc., 2020 U.S. App. LEXIS 33995 (11th Cir. Oct. 28, 2020) (en banc), the court uprooted the circuit’s plaintiff-friendly view of standing and forcefully held that consumers can’t sue for technical statutory violations. It’s a real blow to the plaintiffs’ bar, and that’s even without considering that the court vacated a $6.3 million settlement (a third of which was for class counsel’s attorney’s fees) and dismissed the case outright for lack of standing.

The case involved the portion of the FCRA known as the Fair and Accurate Credit Transactions Act (“FACTA”), which (among other things) prohibits merchants from printing more than the last five digits of a credit card number on consumers’ receipts. Damages can easily add up in a FACTA class action, even without any showing of actual damages, merchants can be on the hook for up to $1,000 in damages per violation, plus punitive damages and attorneys’ fees.

Let’s dig into the background that led to the seismic shift in standing rules in the Eleventh Circuit: Back in April 2015, a Godiva customer filed a FATCA class action against Godiva for printing too many credit card digits on receipts, which the plaintiff claimed increased the risk of identity theft. Three weeks later, the Supreme Court granted cert in Spokeo, Inc. v. Robins, in which the Court ultimately confirmed that pleading a “bare procedural violation” isn’t enough to support Article III standing, which “requires a concrete injury even in the context of a statutory violation.”

The looming uncertainty over the outcome of Spokeo caused the parties to settle relatively quickly, and after Spokeo was decided, apparently neither side wanted to go back to square one. The parties pushed through a fairness hearing, and the district court approved the parties’ $6.3 million settlement. Despite the parties’ agreement, some class members weren’t so keen on the settlement and lodged objections, which sent the case to the Eleventh Circuit for a fairness review.

The case has been on a tumultuous path through the Eleventh Circuit. An Eleventh Circuit panel previously upheld the settlement (first in an October 2018 decision and then again via a reissued decision in April 2019), finding that increased risk of identity theft was sufficient concrete injury to establish Article III standing. The panel adopted a new categorical rule for standing: “if Congress adopts procedures designed to minimize the risk of harm to a concrete interest, then a violation of that procedure that causes even a marginal increase in the risk of harm to the interest is sufficient to constitute a concrete injury.” Muransky v. Godiva Chocolatier, Inc., 922 F.3d 1175, 1188 (11th Cir.), reh’g en banc granted, opinion vacated, 939 F.3d 1279 (11th Cir. 2019). This decision—which conflicted with rulings from most other circuits—was widely viewed as opening the floodgates for class actions alleging procedural violations in the Eleventh Circuit.

After rehearing the case en banc, the court (in a 7 to 3 ruling) upended the panel’s new plaintiff-friendly rule, holding in no uncertain terms that alleging only a statutory violation, without any concrete injury, is not enough to establish standing, even if Congress said otherwise. “Federal courts,” the court explained, “retain our constitutional duty to evaluate whether a plaintiff has pleaded a concrete injury—even where Congress has said that a party may sue over a statutory violation.” Thus, the court saw the plaintiff’s allegations of injury for what they were: “But the emperor still has no clothes; the bare procedural violation the plaintiff alleges is just as bare as it ever was. Because the plaintiff alleged only a statutory violation, and not a concrete injury, he has no standing.”


Class counsel is likely still licking its wounds after this one. The court not only aligned itself with most other circuit courts in rejecting Article III standing to bring FATCA claims based on bare procedural violations,[1] it also dismissed the case outright for lack of Article III standing and vacated the parties $6.3 million settlement (which included $2.1 million in attorneys’ fees for the plaintiff plus a $10,000 service award for the named plaintiff). Ouch.

Arguments channeling the court’s three separate dissenting opinions, though, are likely to appear in future briefing from class counsel. While each dissenting judge focuses on different aspects of the majority opinion, all three advocated for increased deference to Congress, and all three agreed that an alleged violation of a “congressionally-created private right” is enough to establish standing. The divergent views are indicative of the lack of certainty among courts grappling with standing post-Spokeo, and potentially preview the arguments that might be made if the Supreme Court ever decides to revisit its decision.

Going forward, plaintiffs in the Eleventh Circuit will have to plead and prove harm beyond a bare statutory violation. More importantly, though, courts will likely require each class member to provide some proof that they actually sustained some actual concrete harm, which is likely to make class certification untenable and to deter plaintiffs from pursuing FATCA and other similar class actions in the circuit.


[1] The court distinguished the only circuit court case “to conclude that a bare violation of FACTA’s receipt requirements could support standing” because that case involved “significantly different facts.” The  D.C. Circuit in Jeffries v. Volume Servs. Am., Inc., 928 F.3d 1059, 1066 (D.C. Cir. 2019) found that the plaintiff had alleged standing where, the Eleventh Circuit noted, the merchant had printed the entire credit card number and expiration date, creating “the nightmare scenario FACTA was enacted to prevent” and providing “sufficient information for a criminal to defraud her.” This factual scenario, the Eleventh Circuit explained, “is different than the violation Muransky complains about, and we do not consider it here.”