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Interesting constitutional standing case

Fed courts aficionados may remember First American Financial v. Edwards, a case that the Court was planning to decide in 2012, but which it unexpectedly dismissed. As Kevin Russell (SCOTUSblog) wrote,

Lost in the hubbub of the health care decision is the Court’s surprise punt in a case that many (including myself) thought would be the sleeper case of the Term. In First American Financial Corp. v. Edwards, No. 10-708, the Court was set to decide what limits Article III of the Constitution places on Congress’s power to create statutory rights enforceable through a private right of action.

The specific question before the Court in Edwards was whether a plaintiff alleging that her title insurance company violated the Real Estate Settlement Procedures Act (RESPA) must show that she suffered an injury from the insurance company’s unlawful conduct beyond the violation of her legal rights under the statute…. The defendant, First American, argued that the plaintiff had suffered no discernible injury from the alleged illegal kickback. Because the rates charged the plaintiff were set by state law, she suffered no financial injury. And she did not show that the quality of the services had been reduced by the kickback. In these circumstances, First American argued, Congress was forbidden by Article III from authorizing suit against the insurance company, even if the plaintiff could prove a violation of her statutory rights.

The Court was thus set up to resolve the question, but decided not to. Now the same Article III standing question is coming up in a cert petition on SCOTUSblog’s “petitions we’re watching” list, Mutual First Federal Credit Union v. Charvat. (Disclosure: The petitioner is represented by Andy Pincus, Archis Parasharami, and Don Falk, colleagues of mine at Mayer Brown LLP, the firm with which I am a part-part-part-time academic affiliate.)

The statute is different — it’s the Electronic Funds Transfer Act — and the technical violation is likewise different: the law required, at the relevant time, that ATM operators give people both an on-screen notice of any fees for withdrawing cash, and attach a sticker alerting people to such fees, and the claim is that the sticker wasn’t attached (though the on-screen notice was present). But the basic Article III issue the same: Petitioners argue that the plaintiff wasn’t actually financially harmed by the lack of a sticker, since he got the notice and consented to the fee, and that absent such a personal injury, plaintiff lacks constitutional standing to sue over the alleged violation.

In any event, it looks like an interesting and important matter to watch. (The petition reports on a pretty substantial circuit split on the constitutional question.) I’ve always been a bit ambivalent about the constitutional standing rules, so I’m not sure what the right answer ought to be; but it will be interesting to see whether the Court decides to provide an answer.

Eugene Volokh teaches free speech law, religious freedom law, church-state relations law, a First Amendment Amicus Brief Clinic, and tort law, at UCLA School of Law, where he has also often taught copyright law, criminal law, and a seminar on firearms regulation policy.

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