Judge Keri G. Katz, Case Number: 37-2022-00041830-CU-NP-CTL, Date: 2023-08-18 Tentative Ruling

Judge: Keri G. Katz, Case: 37-2022-00041830-CU-NP-CTL, Date: 2023-08-18 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - August 17, 2023

08/18/2023 08:30:00 AM C-74 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Keri Katz

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Civil - Unlimited Non-PI/PD/WD tort - Other Motion Hearing (Civil) 37-2022-00041830-CU-NP-CTL FLORES VS ACCURATE BACKGROUND LLC [IMAGED] CAUSAL DOCUMENT/DATE FILED: Motion for Judgment on the Pleadings, 07/12/2023

The court addresses the evidentiary issues. Defendant Accurate Background, LLC's request for judicial notice is DENIED.

The court then rules as follows. Defendant Accurate Background, LLC's motion for judgment on the pleadings is GRANTED WITH LEAVE TO AMEND.

The complaint alleges four causes of action for (1) Violations of Civ. Code §§ 1786.10, 1786.11, and 1786.22 for Failure to Provide Investigative Consumer Report in a Timely Manner; (2) Violations of Civ.

Code §1786.29(b) For Failure to Provide Statutorily Required Notice; (3) Violation of Civ. Code § 1786.10(c) for Failure to Identify All Recipients of Plaintiff's Investigative Consumer Report; and (4) Violation of Civ. Code § 1786.12(e) For Failure to Obtain a Certification Pursuant To § 1786.16(a)(4).

Accurate brings this motion as to all four causes of action.

The first argument Accurate raises is that Plaintiff lacks standing because the complaint does not allege that Plaintiff suffered any harm or injury as a result of the alleged violations of the Investigative Consumer Report Agencies Act [CC§ 1786, et seq.] (ICRAA). The court finds the analysis of the Fair Credit Reporting Act (FCRA) in Limon v. Circle K Stores Inc. (2022) 84 Cal.App.5th 671 dispositive on the issue of standing to bring claims under the ICRAA.

Limon explains that 'as a general matter, to have standing to pursue a claim for damages in the courts of California, a plaintiff must be beneficially interested in the claims he is pursuing.' Limon, 84 Cal.App.5th at 700. Limon goes on, to assess a plaintiff's standing to pursue claims in California courts, one must consider whether the plaintiff suffered an injury- i.e. an ' 'invasion of [his or her] legally protected interests' ' and whether it is ' 'sufficient to afford them an interest in pursuing their action vigorously.' ' (Angelucci supra, 41 Cal.4th at p. 175, 59 Cal.Rptr.3d 142, 158 P.3d 718.) The latter consideration is met where the injury is ' ' '(a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical.' ' ' (Associated Builders supra, 21 Cal.4th at pp. 361–362, 87 Cal.Rptr.2d 654, 981 P.2d 499; Luna Crest supra, 245 Cal.App.4th at p. 883, 200 Cal.Rptr.3d 128.) Limon, 84 Cal.App.5th at 704. Limon then applies this law to the facts before the court.

Here, Limon does not allege he did not receive a copy of the consumer report that Circle K obtained.

Limon does not allege the consumer report obtained by Circle K contains any defamatory content or Calendar No.: Event ID: TENTATIVE RULINGS

2958371 5 CASE NUMBER: CASE TITLE: FLORES VS ACCURATE BACKGROUND LLC [IMAGED] 37-2022-00041830-CU-NP-CTL other per se injurious content. He does not allege the consumer report contained false or inaccurate information. Similarly, there are no allegations of any exposure to a material risk of future harm, imminent or substantial. (See TransUnion LLC. v. Ramirez (2021), ––– U.S. ––––, 141 S. Ct 2190, 210 L.Ed.2d 568 (TransUnion).) Thus, there was no injury to Limon's protected interest in ensuring fair and accurate credit (or background) reporting. Similarly, there was no injury associated with any adverse employment decision based on false or inaccurate reporting. . . .

Limon, 84 Cal.App.5th at 705. Based the absence of such allegations, Limon concludes that the plaintiff, . . . has not alleged a concrete or particularized injury to his privacy interests sufficient to afford him an interest in pursuing his claims vigorously. (See Angelucci supra, 41 Cal.4th at p. 175, 59 Cal.Rptr.3d 142, 158 P.3d 718; Associated Builders supra, 21 Cal.4th at pp. 361–362, 87 Cal.Rptr.2d 654, 981 P.2d 499; Luna Crest supra, 245 Cal.App.4th at p. 883, 200 Cal.Rptr.3d 128.) Limon, 84 Cal.App.5th at 706. Limon goes on to also reject Limon's claims he suffered 'informational injury' sufficient to confer upon him standing to maintain his action. 'Informational injury that causes no adverse effects'-e.g., where required information is provided but is provided in the wrong format as in the present case-has been held insufficient to satisfy Article III standing. (TransUnion supra, 141 S.Ct. 2190, 2214.) California case law has held similarly. (Boorstein, supra, 222 Cal.App.4th at pp. 472–473, 165 Cal.Rptr.3d 669 [noting a lack of California case law recognizing 'informational injury' and holding 'informational injury' is not cognizable under Civil Code, section 1798.83 et seq.];15 Price v. Starbucks Corp. (2011) 192 Cal.App.4th 1136, 1142–1143, 122 Cal.Rptr.3d 174 [deprivation of information, by itself, is not a cognizable injury under former Labor Code section 226].) Limon has failed to allege any concrete injury in connection with his claim of informational injury. Thus, his alleged informational injury is insufficient under California law to confer upon him standing to pursue his claim in state court. We conclude, under California law, that an informational injury that causes no adverse effect is insufficient to confer standing upon a private litigant to sue under the FCRA.

Limon, 84 Cal.App.5th at 706-707.

Plaintiff's complaint at issue on this motion is lacking in similar respects. As to the first cause of action there are no allegations of harm to Plaintiff as a result of Accurate's alleged failure to timely provide the investigative consumer report, the disclosures, or the certification to Plaintiff. As to the second cause of action there are no allegations of harm to Plaintiff as a result of Accurate's alleged failure to provide the required notice to Plaintiff. As to the third cause of action there are no allegations of harm to Plaintiff as a result of Accurate's alleged failure to identify all recipients of Plaintiff's investigative consumer report.

As to the fourth cause of action there are no allegations of harm to Plaintiff as a result of Accurate's alleged failure to obtain the required certification. In opposition, Plaintiff does not contend that Plaintiff suffered any harm as a result of Accurate's alleged violations of ICRAA. Instead, Plaintiff contends that Plaintiff is not required to make a showing of actual damages in order to establish standing under the ICRAA and that Plaintiff is only required to make a showing of a violation of the ICRAA. None of the arguments Plaintiff raises support such a conclusion.

As pled, the complaint seeks damages pursuant to CC § 1786.50(a)(1) [Cplt. ¶¶ 33, 40, 50, 59; Prayer 3, 4]. This section provides: (a) An investigative consumer reporting agency or user of information that fails to comply with any requirement under this title with respect to an investigative consumer report is liable to the consumer who is the subject of the report in an amount equal to the sum of all the following: (1) Any actual damages sustained by the consumer as a result of the failure or, except in the case of class actions, ten thousand dollars ($10,000), whichever sum is greater.

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2958371 5 CASE NUMBER: CASE TITLE: FLORES VS ACCURATE BACKGROUND LLC [IMAGED] 37-2022-00041830-CU-NP-CTL . . . .

Plaintiff argues subsection (a)(1) provides for recovery of a '$10,000 statutory award' without having to prove actual damages. Such argument is at odds with the interpretation of similar language in the FCRA in Limon. The pertinent language in the FCRA, at 15 U.S.C. 1681n(a)(1)(A), reads: (a) In general Any person who willfully fails to comply with any requirement imposed under this subchapter with respect to any consumer is liable to that consumer in an amount equal to the sum of-- (1)(A) any actual damages sustained by the consumer as a result of the failure or damages of not less than $100 and not more than $1,000; After first addressing the difference between statutory penalties and damages ['statutory 'penalties' are designed to punish a wrongdoer and do not require the existence of an injury, whereas 'damages' are designed to be compensatory and require an injury to compensate' Limon, 84 Cal.App.5th at 700] Limon concludes, . . . the statutory damages provision [15 U.S.C. § 1681n(a)(1)(A)] is intended to compensate a plaintiff for injury. It is designed to provide redress where damages are 'difficult or impossible to quantify or prove.' (Gambles, supra, 234 F.Supp.3d at p. 523.) It is not intended to penalize a company for violation of the FCRA.

Limon, 84 Cal.App.5th at 703. Such analysis is contrary to Plaintiff's argument that the language of CC § 1786.50(a)(1) provides for a type of statutory penalty so as to allow for recovery in the absence of actual damages.

Plaintiff's interpretation of CC § 1786.50(a)(1) is also at odds with the interpretation of virtually identical language in Labor Code § 432.7(c) ['actual damages or two hundred dollars ($200), whichever is greater'] in Starbucks Corp. v. Superior Court (2008) 168 Cal.App.4th 1436, 1440 ['[n]othing in the statutes in question authorizes job applicants to automatically recover $200 per person without proof they were aggrieved persons with an injury the statute was designed to remedy']. And, although not binding authority, Plaintiff's interpretation is contrary to Walker v. Black Knight Management Services, LLC (C.D. Cal. 2015) 2015 WL 13919079 at *2 ['an ICRAA claim requires actual damages'].

Plaintiff attempts to distinguish Limon based on the differences in language between 15 U.S.C. § 1681n(a)(1)(A) and CC § 1786.50(a)(1). The court finds the inclusion of the words 'willful' in subsection (a) and of the word 'damages' in the second phrase of subsection (a)(1)(A) does not require a different statutory analysis than that of Limon. Plaintiff also attempts to distinguish Limon based on the differences in the alleged violations at issue. However, irrespective of the underlying violations, neither the complaint in Limon nor the complaint at issue on this motion alleges actual damages. Limon is indistinguishable with respect to the absence of this essential allegation. To the extent Plaintiff relies on an informational harm claim, as set forth above, Limon explains, 'under California law, that an informational injury that causes no adverse effect is insufficient to confer standing upon a private litigant to sue under the FCRA.' Limon, 84 Cal.App.5th at 707. The same analysis applies to Plaintiff's informational injury claim under ICRAA.

Plaintiff also raises arguments based on the legislative history of CC § 1786.50 and in particular the increase in the amount of the statutory damages award. Plaintiff argues the legislature designed the ICRAA so that its statutory award is available even where a consumer has not incurred actual damages.

However, nothing in the language of the statute indicates such intent and Plaintiff offers no other authority to support this argument. The general principles of statutory interpretation Plaintiff relies on, and Plaintiff's discussion of the 'action to enforce any liability' language of CC § 1786.52 as compared Calendar No.: Event ID: TENTATIVE RULINGS

2958371 5 CASE NUMBER: CASE TITLE: FLORES VS ACCURATE BACKGROUND LLC [IMAGED] 37-2022-00041830-CU-NP-CTL with the '[a]ny consumer who suffers damages' language of CC § 1785.31, are not dispositive given the interpretation of similar statutory language in Limon and the other authorities above. Plaintiff's reliance on White v. Square, Inc. (2019) 7 Cal.5th 1019 and Angelucci v. Century Supper Club (2007) 41 Cal.4th 160 for the argument that 'California courts have repeatedly held that the specific statute in question must be examined when determining standing challenges under California law' is misplaced. These cases recognize the general principle that '[s]tanding rules for statutes must be viewed in light of the intent of the Legislature and the purpose of the enactment' [White, 7 Cal.5th at 1024] or as stated in Angelucci, '[s]tanding rules for actions based upon statute may vary according to the intent of the Legislature and the purpose of the enactment' [Angelucci, 41 Cal.4th at 175]. Plaintiff offers no analysis of any differences in legislative intent and purpose between the FCRA and ICRAA.

As this is the first pleading challenge, and at Plaintiff's request, the court allows Plaintiff 10 days leave to amend.

If this tentative ruling is confirmed the Minute Order will be the final order of the court and the parties shall not submit any further order on this motion.

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