Consumer Finance Insights
June 12, 2017

District of New Jersey Dismisses FACTA Suit on Spokeo Grounds

Even a year after it issued its opinion in Spokeo v. Robins, the Supreme Court’s decision on Article III standing continues to be hotly contested.  On June 6, 2017, the District of New Jersey cited Spokeo in dismissing an amended Fair and Accurate Credit Transactions Act (FACTA) case.  The decision in Kamal v. J. Crew Group rejected plaintiff’s argument that the defendant’s inclusion of ten digits of his credit card number on receipts he received from defendant caused him actual harm or the material risk of future harm.  The court’s analysis in this case provides a road map for defendants seeking to dismiss similar actions.

In Kamal, the plaintiff alleged that J. Crew printed receipts identifying the first six digits of his credit card number in addition to the last four.  2017 WL 2443062, at *1 (D.N.J. June 6, 2017).  He claimed this conduct violated FACTA, which prohibits businesses from printing more than the last five digits on receipts.  Plaintiff sued, and sought to represent a nationwide class.  Plaintiff did not allege any actual damages, but sought recovery under FACTA’s statutory-damage scheme.

Plaintiff claimed that he suffered a cognizable injury in two ways.  First, he claimed that he suffered a violation of his privacy rights because his personal information was disclosed.  The court rejected this argument, concluding that plaintiff had suffered no privacy-right violation because the ten digits of his credit card number were disclosed to him, not to some third party.  The court explained, “Kamal gave his credit-card number to J. Crew, which then printed a receipt containing part of that number and handed it back to Kamal.”  Id. at *3.  As further support for this finding, the court noted that plaintiff continued to shop at J. Crew even after the alleged privacy-right violation.  Id. at *3, n.4.  In response to plaintiff’s argument that the court should respect Congress’s judgment in passing a law prohibiting companies from printing more than the last five digits on receipts, the court noted that in passing FACTA, Congress sought to “ensure that consumers suffering from any actual harm to their credit or identity are protected.”  Id. at *4.  The court added that Congress did not contemplate opening the door to suits that did not involve any actual harm.  Id.  Second, plaintiff claimed the disclosure created a material risk of future harm.  In rejecting this argument, the court took judicial notice that credit card numbers are 16 digits long, and the first six digits relate to the card issuer.  The court then concluded that J. Crew’s disclosure had provided no more information than Congress had permitted in FACTA.

For defendants facing statutory claims like those in Kamal, the decision is a helpful roadmap to a potential standing challenge.

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