Class Action and Product Insights for Your Business
April 08, 2021 - Appellate & Supreme Court, Class Action, FCRA

Relief for the Unharmed: Supreme Court Considers Whether Article III & Rule 23 Permit Certification Where Most Class Members are Uninjured (Ramirez v. TransUnion)

Relief for the Unharmed: Supreme Court Considers Whether Article III & Rule 23 Permit Certification Where Most Class Members are Uninjured (Ramirez v. TransUnion)

The United States Supreme Court has repeatedly declined to resolve a question that has sharply divided the Circuits: whether a class may be certified even though it contains uninjured members. See e.g., Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036, 1050 (2016). On March 30, 2021, the Supreme Court heard argument on related issues in TransUnion LLC v. Ramirez, No. 20-297, a case with potentially significant implications for parties embroiled in class action lawsuits.

The question certified by the Supreme Court was: “Whether either Article III or Federal Rule of Civil Procedure 23 permits a damages class action when the vast majority of the class suffered no actual injury, let alone an injury anything like what the class representative suffered.”

Case Background

Ramirez v. TransUnion arose in 2011, when Sergio Ramirez visited a California car dealership with his wife and father-in-law looking to buy a car. The dealership pulled Mr. Ramirez’s credit report and informed him that they could not sell him a car because Mr. Ramirez’s name was on a “terrorist list.” Mr. Ramirez’s TransUnion credit report indicated that Mr. Ramirez’s name was a match to one listed on a database maintained by the Treasury Department’s Office of Foreign Assets Control (“OFAC”), which identifies terrorists, individuals who pose threats to national security, and international drug or weapons traffickers. Mr. Ramirez was “embarrassed, shocked, and scared.”

The next day, Mr. Ramirez requested a copy of his credit report and received two separate mailings from TransUnion: the first mailing included his credit file along with a summary of rights required by law, and the second was a letter, unaccompanied by an additional summary of rights, alerting Mr. Ramirez that his name “is considered a potential match to information listed on the [OFAC] database.” After receiving the mailings, and out of an abundance of caution, Mr. Ramirez cancelled an upcoming vacation. 

Mr. Ramirez brought suit against TransUnion, alleging three violations of the Fair Credit Reporting Act (“FCRA”). Mr. Ramirez alleged that TransUnion failed to maintain reasonable procedures to assure maximum possible accuracy of the information about him when preparing a consumer report, violated obligations to consumers to provide “all” information upon request (because the OFAC information came to him in a separate mailing) and violated its obligation to provide consumers with a summary of their rights. The Northern District of California certified the case as a class action that included everyone who, in a six-month period, requested and received a copy of their credit report, sent in two contemporaneous but separate mailings, and showing that the individual’s name was a potential match to a name on the OFAC list.

At trial, the jury heard only Mr. Ramirez’s story. Mr. Ramirez introduced no evidence that anyone else in the class suffered a credit denial or other adverse consequence as a result of the OFAC name-match appearing on their credit report. Mr. Ramirez stipulated that more than 75% of the members of the class never even had a credit report showing a potential name match disseminated to a third party during the relevant class period. Nevertheless, the jury found for the class on all claims and awarded statutory and punitive damages totaling over $60 million.

On appeal, a divided Ninth Circuit held for Mr. Ramirez and found that the entire class had standing, because the “material risk of harm” conferred standing on even the members of the class whose credit reports were not disseminated to third parties.

The Written Arguments

In the weeks prior to the Supreme Court argument, TransUnion, Mr. Ramirez and a number of amici — including the Chamber of Commerce — submitted briefs to the court.

TransUnion argued that the lower court erred in certifying the class for at least two reasons. First, uninjured class members did not have Article III standing, as there was no evidence that any class member other than Mr. Ramirez even opened and read the mailings from TransUnion, let alone experienced any injury on account of information in the mailings regarding an OFAC name match. Second, TransUnion argued that Mr. Ramirez was an atypical class member with a uniquely sympathetic experience, as compared to other class members who TransUnion alleged “suffered at most a technical violation and some minor confusion in the privacy of their own homes.”

Mr. Ramirez argued that all class members were injured because all members suffered a material risk of harm given that TransUnion made the reports available to creditors and employers and the OFAC information in the reports was both highly sensitive and distressing in nature. Furthermore, Mr. Ramirez argued that he was typical of the class as defined and that it was of no consequence that he suffered additional concrete harm as a result of TransUnion’s mailings.  

The Chamber of Commerce submitted a brief in support of TransUnion, arguing that the uninjured class members lacked Article III standing and Mr. Ramirez was atypical of the class. As argued by the Chamber of Commerce, “an affirmance [of the Ninth Circuit’s holding] would embolden [enterprising] lawyers to seek out atypical clients in order to leverage their uniquely sympathetic experiences into a multimillion-dollar damages award or settlement — all based on technical statutory violations and all without having to show that the class they represent has suffered concrete injuries that the members could have brought in court themselves.” In such a scenario, an atypical plaintiff pursuing statutory damages may be able to garner a remedy disproportionate to the actual harm suffered by the vast majority of the class.  

The Oral Arguments

At oral argument, the Justices took up the issues of whether, given that the majority of class members never had their credit reports disseminated to third parties, the class should have been certified, and whether Mr. Ramirez was typical of the class.

Justices Alito, Gorsuch, Kavanaugh, and Barrett signaled skepticism toward the idea that class members whose credit reports were not disseminated had Article III standing, given that they may not have even known that their credit reports contained an OFAC alert, let alone suffered consequences akin to those suffered by Mr. Ramirez. As argued by counsel for TransUnion, members of the class whose credit reports were not disseminated should have “brok[en] out the champagne, not [broken] out a lawsuit.” Similarly, Justice Barrett asked whether, for these class members, there had been “no harm, no foul,” and Justice Kavanaugh analogized that “inaccurate information [fell] into a database,” but didn’t make a sound.

Chief Justice Roberts offered potentially conflicting observations on the standing issue. He opined that class members whose credit reports were not disseminated had “sufficient standing to at least [clear their credit reports] up,” even if their “damages aren’t terribly significant . . .” However, he also asked what the concrete injury would be in a hypothetical case where Congress passed a law providing statutory damages to anyone driving within a quarter mile of a drunk driver but a suit was brought by a plaintiff who, for days, was unaware of his or her proximity to the drunk driver. Justice Thomas took a different approach, asking simply whether counsel for Mr. Ramirez agreed that all members of the class were required to have standing; counsel conceded that they were.

Although most of the Justices focused primarily on the injury and standing questions, Justices Breyer and Sotomayor focused their questions on typicality. While they suggested that Mr. Ramirez’s claims were typical of the class, the two Justices noted that if TransUnion believed Mr. Ramirez’s injuries to be atypical, TransUnion should have so argued at trial, where the jury heard only from Mr. Ramirez. Assistant Solicitor General Nicole Reaves similarly honed in on typicality, arguing that all class members had standing, but that the Court should remand the case for a determination of whether Mr. Ramirez’s injuries were (and therefore Mr. Ramirez was) typical of the class.


TransUnion presents an extreme case—the vast majority of class members arguably suffered no injury, while the named plaintiff suffered atypical and significant injury. Of broader interest, however, the Court’s decision may offer insight into how the Court as presently constituted will approach the issue of standing and class certification for uninjured class members. TransUnion may also address for the first time the implications for class certification where the class representative experienced a materially different, and more severe, injury than all or most other class members. Morrison & Foerster will continue to follow this case.