Corporate Counsel Analysis: Consumer Class Actions in Which No Harm Occurred

    Outside Publication

    In an article recently posted to the Corporate Counsel website, Locke Lord Partner Tom Cunningham reviewed the status of class action cases in which a plaintiff has suffered no harm.

    Many consumer protection statutes contain a provision for the award of statutory damages and for the recovery of attorney fees by a successful plaintiff, Cunningham wrote in the article. Statutory damages are intended to serve as a proxy in situations where the actual damages suffered by a consumer might be difficult to quantify or value.

    For example, in the typical Telephone Consumer Protection Act case, the harm caused to the plaintiff may be the annoyance of receiving unwanted calls, texts or faxes, the article’s authors noted. Reducing that harm to a dollar value is subjective — some people are more bothered than others. Accordingly, Congress established that a successful plaintiff can recover $500 for each violation of the TCPA. Many other consumer protection statutes, such as the Fair Debt Collection Practices Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act (FCRA) and others contain similar statutory damage provisions to resolve the difficult issue of how a court should “value” the harm caused to plaintiffs.

    But what about cases in which a plaintiff has suffered no harm? In some situations, a violation of a statute may have occurred, but if the plaintiff was unaware of the violation and suffered no adverse consequence, does he or she have standing to bring a class action lawsuit and recover statutory damages? This issue has been repeatedly presented to the U.S. Supreme Court in recent years, but it remains unresolved.

    The complete article is available here. (Subscription required)

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