Including a barcode that can be scanned to provide account information in the window portion of an envelope is enough to satisfy the Spokeo test for determining concrete harm, according to a federal judge in New Jersey.
The judge, Jose Linares, issued the ruling in the case of Stever v. Harrison. The defendant had filed a motion to have the class-action case dismissed. The ruling dismissed the defendant’s order.
The defendant, a law firm, sent collection letters that contained a barcode which was visible in the glassine window portion of the envelope. When scanned, the code revealed a string of numbers, which could include the account number of the defendants and/or a reference or registration number. The plaintiffs filed a class-action lawsuit, alleging a breach of the Fair Debt Collection Practices Act, which prohibits using any language or symbol, other than the debt collector’s address, on any envelope when communicating with a consumer.
The defendant attempted to have the case dismissed by establishing that the plaintiffs have not suffered a concrete injury as a result of the incident. Numerous ARM industry participants have attempted to use a Supreme Court ruling in the case of Spokeo v. Robins, which determined that an individual must suffer an “injury-in-fact” in order to bring a case in federal court. The Supreme Court ruling overturned a decision in the Ninth Circuit Court of Appeals and opened the door for defendants to claim that plaintiffs have not suffered an “injury-in-fact” when bringing suits alleging violations of the FDCPA, Telephone Consumer Protection Act, or Fair Credit Reporting Act.
Here, the principal question presented by Defendants’ standing argument is whether the mailing of debt collection letters containing a barcode that could lead to the disclosure of personal identifying numbers have caused Plaintiffs to suffer a “concrete” harm. The Court finds that such allegations satisfy the concrete requirement of the injury in fact analysis.
Judge Linares notes that the Appeals Court in which his courtroom is based — The Third Circuit — has not yet issued a direct ruling on whether a plaintiff can plead an injury in the wake of the Supreme Court’s Spokeo ruling. The Third Circuit has recently used Spokeo in a ruling on a FCRA lawsuit, which Linares uses as a reference.
The defendants argued that the inclusion of the barcode was nothing more than a procedural violation. An argument that Judge Linares did not agree with. The Third Circuit has also ruled that disclosing any additional information, including a debtor’s account number, is a possible invasion of privacy.
That is, in enacting the FDCPA, Congress granted every individual the right to have his or her status as a debtor concealed from the public. To the extent Plaintiffs can successfully argue that the existence of the barcode threatened that right, Plaintiffs have sufficiently stated a concrete injury.
The defendants also tried to argue that the barcode and account number were subject to the “benign language exemption” of the FDCPA, which Linares also tossed aside.
Similarly, because this Court finds that the disclosure of the barcode is not “benign” under the FDCPA, this Court finds that even if the benign language exception had been expressly adopted in this Circuit, the suspect barcode would not fall within that exception because the barcode at issue is not “benign.”
A copy of the ruling is available here.
