The Seventh Circuit Finds No Standing in FCRA Case Based on Job Application Credit Reports

The U.S. Court of Appeals for the Seventh Circuit held that allegations that prospective employers obtained consumer reports in technical violation of the Fair Credit Reporting Act by themselves do not constitute a concrete injury sufficient to confer Article III standing. The Aug. 1 ruling in the case, Groshek v. Time Warner Cable, will make it more difficult for plaintiffs to bring statutory violation cases.

The Fair Credit Reporting Act

Congress enacted the FCRA to protect the privacy rights of job applicants and consumers seeking credit or insurance and to enable job applicants and consumers to correct any errors in their consumer reports by providing them with notice when the consumer reports would be used.

Accordingly, the FCRA places restrictions on when “consumer reports” can serve “as a factor in establishing the consumer’s eligibility for (A) credit or insurance to be used primarily for personal, family, or household purposes; (B) employment purposes; or (C) any other purpose authorized under [the statute].” 15 U.S.C. § 1681a(d). For example, the FCRA prohibits an employer from procuring a consumer report for a job applicant unless: “(i) a clear and conspicuous disclosure has been made in writing to the consumer at any time before the report is procured or caused to be procured, in a document that consists solely of the disclosure,... and (ii) the consumer has authorized in writing... the procurement of the report by that person.” 15 U.S.C. § 1681b(b)(2)(A).

The FCRA also provides a private right of action against users of consumer reports, including potential employers, for any willful or negligent failures to comply with its requirements. See 15 U.S.C. § 1681n(a) & 1681o(a). For willful violations, plaintiffs may recover statutory damages, punitive damages and attorneys’ fees and costs. See 15 U.S.C. § 1681n(a).


Plaintiff Cory Groshek submitted job applications to the defendants Time Warner Cable, Inc. and Great Lakes Higher Education Corp. Their job applications included a disclosure and authorization form notifying Groshek that the defendants may procure a consumer report in making their employment decision. The form also contained a liability release. After Groshek submitted his job application along with the signed disclosure and authorization form, the defendants obtained a consumer report for Groshek.

Shortly thereafter, Groshek filed a putative class action, alleging that the defendants willfully violated the FRCA by including extraneous language in the disclosure and authorization form, which prevented the disclosures from being clear and conspicuous and the authorization that he signed from being valid. The district court dismissed Groshek’s complaint for lack of Article III standing, finding that he had not alleged a concrete injury and rejecting his argument that he suffered both informational and privacy injuries.

Seventh Circuit Decision

The Seventh Circuit affirmed the dismissal, finding that Groshek had not alleged facts demonstrating a concrete harm in Groshek v. Time Warner Cable (7th Cir. Aug. 1, 2017).

Citing Spokeo v. Robins (2016), the Seventh Circuit explained that Article III standing required that a plaintiff allege a “concrete and particularized” injury, which may be intangible, in the context of a statutory violation and not simply a “bare procedural violation.” In determining whether an intangible injury is concrete, the court elaborated that “Congress is well positioned to identify intangible harms that will give rise to concrete injuries, which were previously inadequate at law.” Nevertheless, the Seventh Circuit noted that not every “statutory violation creates an Article III injury,” and plaintiffs must still show that “the statutory violation presented an ‘appreciable risk of harm’ to the underlying concrete interest that Congress sought to protected by enacting the statute.”

The Seventh Circuit then looked to the intent of Congress in enacting the FCRA. The Court observed that the FRCA’s disclosure requirement was “clearly designed to decrease the risk of a job applicant unknowingly providing consent to the dissemination of his or her private information,” while the FRCA’s authorization requirement “further protects consumer privacy by providing the job applicant the ability to prevent a prospective employer from procuring a consumer report... by withholding consent.”

Turning to the allegations in the complaint, the Seventh Circuit found that Groshek had “alleged a statutory violation completely removed from any concrete harm or appreciable risk of harm.” The Court noted that Groshek had only alleged that the defendant’s disclosure form contained extraneous information; but, that he had not alleged that the additional information had resulted in a misunderstanding or confusion, that he would not have provided consent but for the additional information, or that he was unaware that a consumer report would be obtained.

Finally, the Seventh Circuit addressed Groshek’s claims that he had suffered concrete informational and privacy injuries. Noting that informational injuries typically involve the failure to provide information required by statute (which Groshek had not alleged) and that Congress did not intend the FCRA to protect job applicants from technically non-compliant disclosures which were not otherwise misleading, the court found that Groshek had not suffered a concrete informational injury. Similarly, the Seventh Circuit held that Groshek’s conclusory allegation that defendants failed to obtain a valid authorization from him to procure a consumer report were inadequate. Because Groshek admitted that he signed the disclosure and authorization form and did not contend that he was confused by the form (and its liability release), or that he would not have signed the form had the disclosure technically complied with the FCRA, the court held that Groshek had also not suffered a concrete privacy injury. Thus, the Seventh Circuit concluded that Groshek lacked Article III standing because he had not alleged any facts demonstrating that a “real, concrete appreciable risk of harm” existed and that he suffered a “concrete injury.”


Groshek raises the standard for pleading an injury that is sufficient to confer standing in statutory violation cases. This decision, which is consistent with prior Seventh Circuit precedent in Gubala v. Time Warner Cable (7thCir. 2017) and Meyers v. Nicolet Rests. of de Pere (7thCir. 2016), adopts a narrow interpretation of Spokeo in statutory injury cases and finds that purely procedural or technical violations of statutory rights do not constitute a concrete injury and are, thereby, insufficient to establish Article III standing. Plaintiffs (at least in the Seventh Circuit) must now allege a personal or economic injury that they have suffered in addition to a mere statutory violation to survive a motion to dismiss for lack of standing in federal court.