Case 8:22-cv-00078-CJC-DFM Document 21 Filed 04/22/22 Page 1 of 8 Page ID #:221

1 JS-6 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 SOUTHERN DIVISION 11 ) 12 CHANING GRABNER and DEBRA ) Case No.: SACV 22-00078-CJC (DFMx) ) 13 GRABNER, individually and on behalf ) of all others similarly situated, ) 14 ) ) 15 Plaintiffs, ) ORDER GRANTING IN ) SUBSTANTIAL PART PLAINTIFFS’ 16 v. ) MOTION TO REMAND [Dkt. 16] AND ) REMANDING TO ORANGE COUNTY 17 ) SUPERIOR COURT

EXPERIAN INFORMATION )

18 SOLUTIONS, INC. ) ) 19 ) ) Defendant. 20 ) ) 21 ) ) 22 23 24 I. INTRODUCTION AND BACKGROUND 25 26 On November 24, 2021, Plaintiffs Chaning and Debra Grabner filed this putative 27 class action against Defendant Experian Information Solutions, Inc. in Orange County 28 Superior Court, alleging a violation of the Fair Credit Reporting Act (“FCRA”). (Dkt. 1-

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1 1 at 4-15 [Complaint, hereafter “Compl.”].) Plaintiffs’ FCRA claim is straightforward: 2 they submitted requests to Defendant for a copy of their consumer reports and Defendant 3 produced reports that were missing information required by law, including “that States 4 may enforce the FCRA, that many states have their own consumer reporting laws, that 5 the consumer may have more rights under State law, and that the consumer may wish to 6 contact a State or local consumer protection agency or State attorney general for more 7 information.” (Id. ¶¶ 20-33.) Plaintiffs allege that Defendant knowingly and willfully 8 omitted the information “so that consumers would be less likely to contact their State or 9 local consumer protection agencies and State attorneys general.” (Id. ¶¶ 32-33.) 10 11 Defendant removed to this Court on January 14, 2022, invoking the Court’s federal 12 question jurisdiction. (Dkt. 1 [Notice of Removal].) Now before the Court is Plaintiffs’ 13 motion to remand in which Plaintiffs argue that they have not alleged facts supporting 14 Article III standing and therefore this Court lacks jurisdiction over their case. (Dkt. 16 15 [Motion to Remand, hereinafter “Mot.”].) For the following reasons, Plaintiffs’ motion is 16 GRANTED IN SUBSTANTIAL PART and the Court ORDERS the action remanded 17 to Orange County Superior Court.1 18 19 II. LEGAL STANDARD 20 21 “A suit brought by a plaintiff without Article III standing is not a ‘case or 22 controversy,’ and an Article III federal court therefore lacks subject matter jurisdiction 23 over the suit.” Cetacean Cmty. v. Bush, 386 F.3d 1169, 1174 (9th Cir. 2004) (citing Steel 24 Co. v. Citizens for a Better Env’t, 523 U.S. 83, 101 (1998)). To satisfy Article III’s 25 standing requirement, “a plaintiff must show (1) that it has suffered an ‘injury in fact’ that 26

27 1 Having read and considered the papers presented by the parties, the Court finds this matter appropriate 28 for disposition without a hearing. See Fed. R. Civ. P. 78; Local Rule 7-15. Accordingly, the hearing set for May 2, 2022, at 1:30 p.m. is hereby vacated and off calendar.

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1 is (a) concrete and particularized and (b) actual or imminent, not conjectural or 2 hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; 3 and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a 4 favorable decision.” Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 5 U.S. 167, 181 (2000). 6 7 Defendant, as the removing party asserting federal jurisdiction, bears the burden of 8 establishing Plaintiffs’ Article III standing. Lujan v. Defenders of Wildlife, 504 U.S. 555, 9 561 (1992). “[A] removed case in which the plaintiff lacks Article III standing must be 10 remanded to state court under § 1447(c).” Polo v. Innoventions Int’l, LLC, 833 F.3d 11 1193, 1196 (9th Cir. 2016) (emphasis added); see Davidson v. Kimberly-Clark Corp., 889 12 F.3d 956, 970 n.6 (9th Cir. 2018) (“As a general rule, if the district court is confronted 13 with an Article III standing problem in a removed case—whether the claims at issue are 14 state or federal—the proper course is to remand for adjudication in state court.”); Envtl. 15 Research Ctr. v. Heartland Prod., 29 F. Supp. 3d 1281, 1283 (C.D. Cal. 2014) 16 (remanding the action because the plaintiff lacked a cognizable Article III injury). 17 “Remand is the correct remedy” when a district court lacks subject-matter jurisdiction, 18 because “the federal courts have no power to adjudicate the matter,” while “[s]tate courts 19 are not bound by the constraints of Article III.” Polo, 833 F.3d at 1196 (citing ASARCO 20 Inc. v. Kadish, 490 U.S. 605, 617 (1989)). 21 22 III. DISCUSSION 23 24 Plaintiffs have not alleged facts that support Article III standing. TransUnion LLC 25 v. Ramirez, 141 S. Ct. 2190 (2021) is informative. In TransUnion, the plaintiffs’ credit 26 reports maintained by TransUnion contained alerts from the U.S. Department of Treasury 27 Office of Foreign Asset Control (“OFAC”) that incorrectly identified the plaintiffs as 28 potential terrorists. Id. The Supreme Court assessed the plaintiffs’ standing with respect

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1 to two claims. First, the plaintiffs claimed a violation of 15 U.S.C. § 1681e(b) for 2 TransUnion’s failure to “follow reasonable procedures to assure maximum possible 3 accuracy” which resulted in the misleading OFAC alerts. Id. at 2208. For that claim, the 4 Supreme Court found that some plaintiffs—those whose credit reports containing the 5 misleading OFAC alerts were disseminated to third parties—had standing, while other 6 plaintiffs—those whose credit reports were not disseminated to third parties—did not 7 have standing. Id. at 2208-13. 8 9 The Supreme Court next assessed the plaintiffs’ claim under 15 U.S.C. § 1681g 10 that “TransUnion breached its obligation to provide them with their complete credit files 11 upon request.” Id. at 2213. More specifically, the plaintiffs alleged “TransUnion sent 12 [them] copies of their credit files that omitted the OFAC information, and then in a 13 second mailing sent the OFAC information.” Id. Finding no Article III standing for this 14 claim, the Supreme Court explained that plaintiffs were complaining of “bare procedural 15 violations, divorced from any concrete harm.” Id. at 2213 (quotations omitted). The 16 Supreme Court further explained that the plaintiffs had not presented any evidence that 17 TransUnion’s statutory violations prevented them from contacting TransUnion to correct 18 any incorrect information in their credit reports before dissemination to any third parties 19 or that they would have tried to correct the misleading information before dissemination 20 to any third parties if the initial credit files that TransUnion provided them had contained 21 the misleading OFAC information. Id. at 2213-14. 22 23 Here too, Plaintiffs are complaining of a non-disclosure of information— 24 Defendant’s failure to apprise them “that States may enforce the FCRA, that many states 25 have their own consumer reporting laws, that the consumer may have more rights under 26 State law, and that the consumer may wish to contact a State or local consumer protection 27 agency or State attorney general for more information.” Plaintiffs do not allege that such 28 non-disclosure resulted in any particular harm to them. Like the plaintiffs in TransUnion,

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1 Plaintiffs do not allege any concrete action Defendant’s statutory violation prevented 2 them from taking. Indeed, Plaintiffs are even further from establishing Article III 3 standing than the plaintiffs in TransUnion. In TransUnion, TransUnion issued credit 4 reports to the plaintiffs that failed to provide information specifically pertaining to the 5 plaintiffs: that they were marked as potential terrorists, which is highly prejudicial to 6 one’s reputation. It is no stretch to imagine that one would jump to correct a report that 7 he is a potential terrorist if only he were supplied the report. But the Supreme Court was 8 unwilling to draw that inference. Here, the gap between non-disclosure and inferred 9 action is much wider. The omitted information in this case includes generalized 10 statements regarding the availability of legal aid and redress at the state level. That is not 11 the type of information that would obviously spark action from its recipient and Plaintiffs 12 do not allege that they had some need to contact state authorities that Defendant’s non- 13 disclosure prevented or hindered them from fulfilling. 14 15 Defendant cites Tailford v. Experian Info. Sols., Inc., 26 F.4th 1092 (9th Cir. 16 2022), but that case is readily distinguishable. In Tailford, the plaintiffs brought a claim 17 under 15 U.S.C. § 1681g for Experian’s failure to, among other things, disclose inquiries 18 made by third parties and the identify of third parties who had procured the plaintiffs’ 19 information, which in turn hindered the plaintiffs from opting out of certain disclosures 20 and thereby jeopardized plaintiffs’ privacy interests, which the FCRA was designed to 21 protect. Id. at 1097, 1098-1101. In other words, in Tailford, there was a direct line 22 between the plaintiffs’ procedural right to know which third parties were inquiring about 23 or collecting their information and the plaintiffs’ substantive right to keep their 24 information private from such third parties, a substantive right that the FCRA was 25 specifically designed to protect. And the allegations in the complaint in Tailford made it 26 easy to draw that line: the plaintiffs identified the third parties to whom their information 27 was provided without their knowledge, explained that they had no knowledge of or 28 opportunity to disagree with the provision of their [information] to third parties, and

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1 explained concrete actions they took once they learned of the identity of the third parties, 2 including contacting the third parties to inquire why the third parties had requested their 3 information and asking Experian not to provide their information to such third parties. 4 See Tailford v. Experian Solutions Information, Inc., No. 19-cv-02191-CJC, Dkt. 40 5 (First Amended Complaint) ¶¶ 85-94. 6 7 The only possible hook for standing discernible from Plaintiffs’ complaint is their 8 allegation that Defendant’s omission made it so “consumers would be less likely to 9 contact their State or local consumer protection agencies and State attorneys general.” 10 (Compl. ¶ 33.) Unlike in Tailford, neither Plaintiffs’ right to privacy nor their right to 11 have their information accurately reported, which the Ninth Circuit identified as the core 12 purposes of the FCRA, see Tailford, 26 F.4th at 1099 (9th Cir. 2022), are directly 13 implicated by an alleged hinderance to the ability of consumers to call state authorities. 14 Further, Plaintiffs did not particularize the allegation to themselves—they do not say that 15 they were less likely to contact state authorities, but rather that consumers in general were 16 less likely to call state authorities. And even if Plaintiffs outright allege that they 17 themselves were less likely to call state authorities because of Defendant’s alleged failure 18 to inform them of such authorities, the Court would not find a concrete injury without 19 additional allegations. An allegation of a lesser likelihood of taking an action is not the 20 same as an allegation of a plan to take that action that was hindered by Defendant’s non- 21 disclosure. Plaintiffs have not alleged that they had some reason to contact state 22 authorities, would have done so if the requisite information was provided, and incurred 23 some harm or face the substantial risk of some harm arising from the missed opportunity 24 to contact state authorities. Put simply, unlike the complaint in Tailford, the Court 25 cannot, without speculating, discern from Plaintiffs’ complaint any action they would 26 have taken or harm they would have avoided if Defendants had provided the non- 27 disclosed information. See Orpilla v. Schenker, Inc., 2020 U.S. Dist. LEXIS 83567 (C.D. 28 Cal. May 12, 2020) (remanding for lack of Article III standing because employer’s

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1 failure was a “mere procedural violation” and the plaintiff did not allege that she would 2 have behaved any differently had her employer abided by the FCRA’s disclosure and 3 authorization requirements). Given that Plaintiffs lacks Article III standing, this case 4 must be remanded to state court. Polo, 833 F.3d at 1196; see Miranda v. Magic 5 Mountain, LLC, 2018 WL 571914, at *3 (C.D. Cal. Jan. 25, 2018); Edelstein v. Westlake 6 Wellbeing Props., LLC, 2017 WL 5495153 (C.D. Cal. Nov. 15, 2017). 7 8 Finally, the Court rejects Plaintiffs’ request for attorneys’ fees. Pursuant to 28 9 U.S.C. § 1447(c), when a motion to remand is brought, “[a]n order remanding the case 10 may require payment of just costs and any actual expenses, including attorneys fees, 11 incurred as a result of the removal.” While the decision to award fees is in the Court’s 12 broad discretion, “absent unusual circumstances, courts may award attorneys’ fees…only 13 where the removing party lacked an objectively reasonable basis for seeking removal.” 14 Martin v. Franklin Capital Corp., 546 U.S. 132, 141, 126 S. Ct. 704 (2005). As is clear 15 from the parties’ briefing, standing based on the presence or absence of “downstream 16 consequences” in the FCRA context is a fluid and developing legal issue. Each case 17 presents different facts that may or may not establish standing based on the general 18 propositions announced by the Ninth Circuit and Supreme Court. While the Court firmly 19 agrees with Plaintiffs that they have not pled Article III standing, the Court did not find 20 Defendant’s arguments objectively unreasonable. 21 22 \\ 23 \\ 24 \\ 25 \\ 26 \\ 27 \\ 28

-7- ase 8:22-cv-00078-CJC-DFM Document 21 Filed 04/22/22 Page 8of8 Page ID #:228 2 || IV. CONCLUSION 4 For the following reasons, Plaintiffs’ motion to remand is GRANTED IN 5 SUBSTANTIAL PART, except for their request for fees. The Court ORDERS this 6 |}action remanded to Orange County Superior Court. 8 9 DATED: — April 22, 2022 Ko | je 10 ‘ fi i CORMAC J. CARNEY 12 UNITED STATES DISTRICT JUDGE 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

8.