As we continue to keep an eye on post-Spokeo standing decisions, Judge Alsup of the Northern District of California recently issued a decision on the topic in a ruling granting class certification in a Truth In Lending Act (TILA) suit.
In McLaughlin v. Wells Fargo Bank, 2016 WL 3418337 (N.D. Cal. June 22, 2016), the plaintiff alleged that Wells Fargo had breached its TILA obligation to provide her with an accurate payoff statement regarding her home mortgage.
Defendant contested certification on adequacy grounds, arguing the plaintiff lacked standing under Spokeo to pursue her claims.
Judge Alsup rejected the argument:
The bank argues that the harm alleged by plaintiff borrower is “akin to the no-harm procedural violations” detailed by the Supreme Court in Spokeo. Not so. In Spokeo, the Court acknowledged that not all inaccuracies cause harm or present material risk of harm. As an example, the Court explained that “[i]t is difficult to imagine how the dissemination of an incorrect zip code, without more, could work any concrete harm.” The inaccuracy here is in no way akin to an inaccurate zip code. The bank’s effort to downplay the harm done by an inaccurate payoff statement is unconvincing.
Facing foreclosure, [plaintiff] investigated re-financing her mortgage or conducting a short sale. Her inaccurate payoff statement directly affected her ability to pursue these options for avoiding foreclosure.
Moreover, once an erroneous record (like a payoff statement) finds its way into a bank’s files, bank clerks and officers are prone forever after to cite and rely on the misleading information — to the prejudice of the borrower. The borrower, of course, may recognize the problem but is brought to tears by the obstinance of bank personnel in refusing to deviate from the erroneous record. The borrower gets a run-around. The bank staff shrug their shoulders and point to the misleading payoff statement.
The court thus concluded that the plaintiff had adequately alleged standing under Spokeo and declined to find her to be an inadequate class representative.