Case 8:22-cv-00077-CJC-DFM Document 20 Filed 04/25/22 Page 1 of 8 Page ID #:214

1 JS-6 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 SOUTHERN DIVISION 11 ) 12 CHARLOTTE MUHA, individually and ) Case No.: SACV 22-00077-CJC (DFMx) ) 13 on behalf of all others similarly situated, ) ) 14 ) Plaintiff, ) 15 ) ORDER GRANTING IN v. ) SUBSTANTIAL PART PLAINTIFF’S 16 ) MOTION TO REMAND [Dkt. 13] AND ) REMANDING TO ORANGE COUNTY 17 EXPERIAN INFORMATION ) SUPERIOR COURT

SOLUTIONS, INC. )

18 ) ) 19 Defendant. ) ) 20 ) ) 21 ) ) 22 23 24 I. INTRODUCTION AND BACKGROUND 25 26 On November 24, 2021, Plaintiff Charlotte Muha filed this putative class action 27 against Defendant Experian Information Solutions, Inc. in Orange County Superior 28 Court, alleging a violation of the Fair Credit Reporting Act (“FCRA”). (Dkt. 1-1 at 4-15

-1- Case 8:22-cv-00077-CJC-DFM Document 20 Filed 04/25/22 Page 2 of 8 Page ID #:215

1 [Complaint, hereafter “Compl.”].) Plaintiff’s FCRA claim is straightforward: she 2 submitted a request to Defendant for a copy of her consumer report and Defendant 3 produced the report which was missing information required by law, including “that 4 States may enforce the FCRA, that many states have their own consumer reporting laws, 5 that the consumer may have more rights under State law, and that the consumer may wish 6 to contact a State or local consumer protection agency or State attorney general for more 7 information.” (Id. ¶¶ 18-29.) Plaintiff alleges 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 Plaintiff’s 13 motion to remand in which Plaintiff argues that she has not alleged facts supporting 14 Article III standing and therefore this Court lacks jurisdiction over her case. (Dkt. 16 15 [Motion to Remand, hereinafter “Mot.”].) For the following reasons, Plaintiff’s 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.

-2- Case 8:22-cv-00077-CJC-DFM Document 20 Filed 04/25/22 Page 3 of 8 Page ID #:216

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 Plaintiff’s 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 Plaintiff has not alleged facts that support Article III standing. TransUnion LLC v. 25 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

-3- Case 8:22-cv-00077-CJC-DFM Document 20 Filed 04/25/22 Page 4 of 8 Page ID #:217

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 and 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, Plaintiff is complaining of a non-disclosure of information—Defendant’s 24 failure to apprise her “that States may enforce the FCRA, that many states have their own 25 consumer reporting laws, that the consumer may have more rights under State law, and 26 that the consumer may wish to contact a State or local consumer protection agency or 27 State attorney general for more information.” Plaintiff does not allege that such non- 28 disclosure resulted in any particular harm to her. Like the plaintiffs in TransUnion,

-4- Case 8:22-cv-00077-CJC-DFM Document 20 Filed 04/25/22 Page 5 of 8 Page ID #:218

1 Plaintiff does not allege any concrete action Defendant’s statutory violation prevented her 2 from taking. Indeed, Plaintiff is even further from establishing Article III standing than 3 the plaintiffs in TransUnion. In TransUnion, TransUnion issued credit reports to the 4 plaintiffs that failed to provide information specifically pertaining to the plaintiffs: that 5 they were incorrectly marked as potential terrorists, which is highly prejudicial to one’s 6 reputation. It is no stretch to imagine that one would leap into action to correct a report 7 that he is a potential terrorist if only he were supplied the report. But the Supreme Court 8 was 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 Plaintiff 12 does not allege that she had some need to contact state authorities that Defendant’s non- 13 disclosure prevented or hindered her 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 harmed 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

-5- Case 8:22-cv-00077-CJC-DFM Document 20 Filed 04/25/22 Page 6 of 8 Page ID #:219

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 Plaintiff’s complaint is her 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 Plaintiff’s right to privacy nor her right to have 11 her 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, Plaintiff does not particularize the allegation to herself—she does not say that 15 she was less likely to contact state authorities, but rather that consumers in general were 16 less likely to call state authorities. And even if Plaintiff outright alleged that she herself 17 was less likely to call state authorities because of Defendant’s alleged failure to inform 18 her of such authorities, the Court would not find a concrete injury without additional 19 allegations. An allegation of a lesser likelihood of taking an action is not the same as an 20 allegation of a plan to take that action that was hindered by Defendant’s non-disclosure. 21 Plaintiff has not alleged that she had some reason to contact state authorities, would have 22 done so if the requisite information was provided, and incurred some harm or face the 23 substantial risk of some harm arising from the missed opportunity to contact state 24 authorities. Put simply, unlike the complaint in Tailford, the Court cannot, without 25 speculating, discern from Plaintiff’s complaint any action she would have taken or harm 26 she would have avoided if Defendant had provided the non-disclosed information. See 27 Orpilla v. Schenker, Inc., 2020 U.S. Dist. LEXIS 83567 (C.D. Cal. May 12, 2020) 28 (remanding for lack of Article III standing because employer’s failure was a “mere

-6- Case 8:22-cv-00077-CJC-DFM Document 20 Filed 04/25/22 Page 7 of 8 Page ID #:220

1 procedural violation” and the plaintiff did not allege that she would have behaved any 2 differently had her employer abided by the FCRA’s disclosure and authorization 3 requirements). Given that Plaintiff lacks Article III standing, this case must be remanded 4 to state court. Polo, 833 F.3d at 1196; see Miranda v. Magic Mountain, LLC, 2018 WL 5 571914, at *3 (C.D. Cal. Jan. 25, 2018); Edelstein v. Westlake Wellbeing Props., LLC, 6 2017 WL 5495153 (C.D. Cal. Nov. 15, 2017). 7 8 Finally, the Court rejects Plaintiff’s 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 Plaintiff that she has 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-00077-CJC-DFM Document 20 Filed 04/25/22 Page 8of8 Page ID #:221

1 || IV. CONCLUSION 3 For the following reasons, Plaintiff's motion to remand is GRANTED IN 4 ||SUBSTANTIAL PART, except for her request for fees. The Court ORDERS this 5 |}action remanded to Orange County Superior Court. 7 g DATED: April 25, 2022 Zo je 9 □ Oe 10 CORMAC J. CARKEY 11 UNITED STATES DISTRICT JUDGE 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

8.