Where a consumer reporting agency willfully fails to comply with the requirements imposed on it under the Fair Credit Reporting Act, a consumer has two options to recover damages: The first option allows a consumer to recover any actual damages sustained by the consumer as a result of the failure. The second option allows a consumer to recover “damages of not less than $100 and not more than $1,000.” The question is whether, under the second option, the consumer can recover damages of not less than $100 and not more than $1,000 without proving actual damages caused by the consumer reporting agency’s willful violation of the Act. The U.S. Eleventh Circuit concluded that a consumer does not have to prove actual damages to recover statutory damages under the second option, and, because the District Court reached the opposite conclusion in denying class certification, vacated and remanded the District Court’s class certification order for further proceedings.

With respect to Article III standing, the Court recognized that: “Intangible harms are concrete if they bear a close relationship to harms traditionally recognized as providing a basis for lawsuits in American courts. And violating the Fair Credit Reporting Act by reporting inaccurate information about a consumer’s credit has a close relationship to the harm caused by the publication of defamatory information. The consumer need not prove that the false reporting caused his credit score to plummet; the false reporting itself is the injury. Because the record contains evidence that Experian inaccurately reported to creditors that Mr. Santos’s and Ms. Clements’s accounts entered collections more recently than they did, the plaintiffs have standing. Of course, because the elements of standing are not mere pleading requirements but rather an indispensable part of the plaintiffs’ case, each element must be supported with the manner and degree of evidence required at the successive stages of the litigation.”

Then, with respect to the statutory construction issue: “The first option emphasizes that the actual damages must be sustained by the consumer before the consumer can recover them. And the first option has a causal element that links the consumer’s actual damages to the consumer reporting agency’s conduct. The consumer can only recover damages ‘sustained … as a result’ of the consumer reporting agency’s willful violation of the Act. But the second option doesn’t have any of these requirements. The second option allows consumers to recover ‘damages’ even if their damages are not ‘actual damages,’ that is, even if they do not ‘compensate for a proven injury or loss.’ Consumers can recover ‘damages’ even if they are not ‘sustained by the consumer.’ And there is no causal element like in the first option.  Second, we consider the ‘or’ between the first and second options. The ordinary use of ‘or’ is almost always disjunctive, and the words it connects are to be given separate meanings. So when Congress uses ‘or’ to separate two provisions in a statute, it signals that the two are alternatives.” After providing additional reasons for interpreting the statute in the disjunctive – and rejecting the defendant’s arguments, the Court of Appeal reverses and remands the District Court’s denial of certification as an abuse of discretion.

 

Santos v. Healthcare Revenue Recovery, 90 F.4th 1144 (11^th Cir. 2024).