Smith v. Ohio State Univ. , 2017 Ohio 8836 ( 2017 )

[Cite as Smith v. Ohio State Univ., 2017-Ohio-8836.]
IN THE COURT OF APPEALS OF OHIO
TENTH APPELLATE DISTRICT
Deanna Smith et al., :
Plaintiffs-Appellants, : No. 17AP-218
(Ct. of Cl. No. 2015-00919)
v. :
(REGULAR CALENDAR)
The Ohio State University, :
Defendant-Appellee. :
D E C I S I O N
Rendered on December 5, 2017
On brief: Glancy Prongay & Murray LLP, Marc L. Godino,
and Mark S. Greenstone; Kooperman Mentel Ferguson
Yaross Ltd., and Katherine C. Ferguson, for appellants.
Argued: Mark S. Greenstone.
On brief: Vorys, Sater, Seymour and Pease LLP, Robert N.
Webner, and Martha Brewer Motley; Michael DeWine,
Attorney General, Lee Ann Rabe, and Randall W. Knutti, for
appellees. Argued: Robert N. Webner.
APPEAL from the Court of Claims of Ohio
LUPER SCHUSTER, J.
{¶ 1} Plaintiffs-appellants, Deanna Smith and Harmoni Sauder, appeal from a
judgment of the Court of Claims of Ohio dismissing their claims against defendant-
appellee, The Ohio State University ("OSU"), for lack of standing. For the following
reasons, we affirm.
I. Facts and Procedural History
{¶ 2} In 2012, OSU hired Sauder as a facility manager, and, in 2014, OSU hired
Smith as a housekeeper. In October 2015, appellants, individually and on behalf of a class
of others similarly situated, filed suit against OSU under the Fair Credit Reporting Act
No. 17AP-218 2
("FCRA"), 15 U.S.C. 1681, et seq. Appellants alleged that as part of their application and
hiring process, OSU provided a background check disclosure and authorization to each of
them that improperly included extraneous information and a liability release in violation
of 15 U.S.C. 1681b(b)(2)(A)(ii).
{¶ 3} In November 2015, OSU removed the action to the United States District
Court for the Southern District of Ohio, Eastern Division, based on federal question
jurisdiction. In June 2016, the federal court found that appellants failed to allege that
they sustained any injury-in-fact due to OSU's alleged violations of the FCRA, and that
they therefore lacked standing under Article III of the United States Constitution.
Consequently, the federal court remanded the matter to the Court of Claims pursuant to
28 U.S.C. 1447(c).
{¶ 4} In July 2016, OSU moved to dismiss the action in the Court of Claims based
on its contention that, as in federal court, appellants lacked standing to bring their claims
in Ohio state court because they alleged no injury-in-fact resulting from the alleged
violations of the FCRA. In response, appellants argued that Ohio law recognizes standing
even in the absence of an injury-in-fact, when that standing is conferred by statute. In
February 2017, the Court of Claims dismissed appellants' claims against OSU based on its
conclusion that they failed to plead any particularized injury-in-fact and lacked statutory
standing to pursue their claims in the absence of a cognizable injury.
{¶ 5} Appellants timely appeal.
II. Assignment of Error
{¶ 6} Appellants assign the following error for our review:
The Court of Claims committed reversible error in holding
that Appellants lack standing to sue for the FCRA violations
alleged by Appellants.
III. Discussion
{¶ 7} In their sole assignment of error, appellants assert that the trial court erred
in dismissing their FCRA claims against OSU for lack of standing. Appellants argue that
the FCRA conferred standing on them to sue for violations of the requirements contained
therein. According to appellants, this "statutory standing" exists regardless of whether
they could otherwise meet the traditional or common-law requirements of standing,
No. 17AP-218 3
including the necessity of alleging an injury-in-fact. Thus, appellants reason that the
FCRA conferred standing on them to sue in Ohio state court, even without them alleging
any harm beyond the violation of FCRA procedural requirements. We disagree.
{¶ 8} Pursuant to Article IV, Section 1 of the Ohio Constitution, the "judicial
power of the state is vested in a supreme court, courts of appeals, courts of common pleas
and divisions thereof, and such other courts inferior to the Supreme Court as may from
time to time be established by law." Article IV, Section 4(B) of the Ohio Constitution
provides that the "courts of common pleas and divisions thereof shall have such original
jurisdiction over all justiciable matters and such powers of review of proceedings of
administrative officers and agencies as may be provided by law." The Ohio Constitution
does not contain a similar provision regarding the Court of Claims. Further R.C. Chapter
2743, which established the Court of Claims, does not contain language expressly stating
that the court has the power to hear "justiciable matters." However, it is implicit in the
Court of Claims' constitutionally granted "judicial power" that it only has the power to
decide matters capable of being resolved in court.
{¶ 9} Standing to sue is part of the common understanding of what makes a case
justiciable and is considered a "jurisdictional requirement." Fed. Home Loan Mtge. Corp.
v. Schwartzwald, 134 Ohio St. 3d 13, 2012-Ohio-5017, ¶ 21-22. "It is fundamental that a
party commencing litigation must have standing to sue in order to present a justiciable
controversy." Id. at ¶ 41. Thus, "[b]efore an Ohio court can consider the merits of a legal
claim, the person or entity seeking relief must establish standing to sue." Ohio Pyro, Inc.
v. Ohio Dept. of Commerce, Div. of State Fire Marshal, 115 Ohio St. 3d 375, 2007-Ohio-
5024, ¶ 27; see Moore v. Middletown, 133 Ohio St. 3d 55, 2012-Ohio-3897, ¶ 23 ("It is well
settled that standing does not depend on the merits of the plaintiff's contention that
particular conduct is illegal or unconstitutional. Rather, standing turns on the nature and
source of the claim asserted by the plaintiffs."). Whether a party has established standing
to bring an action before the court is a question of law reviewed de novo on appeal.
Cuyahoga Cty. Bd. of Commrs. v. State, 112 Ohio St. 3d 59, 2006-Ohio-6499, ¶ 23.
{¶ 10} Ohio courts are not bound by federal standing principles derived from
Article III of the United States Constitution's "cases" and "controversies" requirement.
Leppla v. Sprintcom, Inc., 156 Ohio App. 3d 498, 2004-Ohio-1309, ¶ 30 (2d Dist.), citing
No. 17AP-218 4
Article III, Section 2, U.S. Constitution. However, Ohio courts generally adhere to the
traditional principles of standing that "require litigants to show, at a minimum, that they
have suffered '(1) an injury that is (2) fairly traceable to the defendant's allegedly unlawful
conduct, and (3) likely to be redressed by the requested relief.' " ProgressOhio.org, Inc. v.
JobsOhio, 139 Ohio St. 3d 520, 2014-Ohio-2382, ¶ 7, quoting Moore at ¶ 22, citing Lujan
v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992); see State ex rel. Walgate v. Kasich,
147 Ohio St. 3d 1, 2016-Ohio-1176, ¶ 23 ("The test for Article III standing, like the test for
common-law [standard] in Ohio, requires an injury in fact, causation, and
redressability."). These three requirements are considered the " 'irreducible
constitutional minimum' " of standing. Moore at ¶ 22, quoting Lujan at 560.
{¶ 11} Although not dispositive of the standing issue presented here, the United
States Supreme Court's recent decision in Spokeo, Inc. v. Robins, ___U.S.___, 136 S. Ct.
1540 (2016), is instructive. In Spokeo, the Court analyzed the minimum requirements of
standing in federal court in the context of a FCRA case and reaffirmed the principle that
Congress may not confer standing in the absence of an alleged particularized and concrete
injury-in-fact. The Court acknowledged the role of Congress to "identify intangible harms
that meet minimum Article III requirements," and thus "its judgment is also instructive
and important" regarding the issue of standing. Spokeo at 1549. Consequently, Congress
"may 'elevat[e] to the status of legally cognizable injuries concrete, de facto injuries that
were previously inadequate in law.' " Spokeo at 1549, quoting Lujan at 578. Stated
differently, " 'Congress has the power to define injuries and articulate chains of causation
that will give rise to a case or controversy where none existed before.' " Spokeo at 1549,
quoting Lujan at 580. However, the Court in Spokeo emphasized that the power of
Congress is limited by the injury-in-fact requirement of Article III. Id. at 1547-48. Thus,
for there to be standing under Article III, there must be a "concrete injury even in the
context of a statutory violation." Id. at 1549. In some circumstances, "the violation of a
procedural right granted by statute can be sufficient * * * to constitute injury in fact." Id.
However, in the context of the FCRA, a "violation of one of the FCRA's procedural
requirements may result in no harm." Id. at 1550.
{¶ 12} Here, appellants rely on the concept of "statutory standing" as the basis for
the Court of Claims' jurisdiction to hear their FCRA claims against OSU. Appellants
No. 17AP-218 5
assert that Ohio courts have consistently found standing to exist where the text of a
statute provides a party with a cause of action to sue for a violation of its requirements,
even in the absence of an alleged injury-in-fact. The FCRA provides that "any consumer"
may bring an action in "any * * * court of competent jurisdiction" against "any person"
who willfully fails to comply with "any requirement imposed" under the FCRA. 15 U.S.C.
1681n(a) and 1681p. Appellants argue that this statute conferred standing on them to sue
OSU, regardless of whether they alleged any injury-in-fact.
{¶ 13} "Statutory standing" in Ohio has been described as the statutory grant of
authority to sue. Wooster v. Enviro-Tank Clean, Inc., 9th Dist. No. 13CA0012, 2015-
Ohio-1876, ¶ 12. The Supreme Court of Ohio has indicated that, in addition to standing
authorized by "common-law," which requires injury-in-fact, causation, and redressability,
"standing may also be conferred by statute." ProgressOhio.org, Inc. at ¶ 17, citing
Middletown v. Ferguson, 25 Ohio St. 3d 71, 75 (1986); State ex rel. Walgate at ¶ 23; see
State ex rel. Mason v. State Emp. Relations Bd., 133 Ohio App. 3d 213, 217 (10th
Dist.1999) (common-law standing principles were not required because the Ohio General
Assembly conferred standing on "any person" seeking to enforce Ohio's Sunshine Law
under R.C. 121.22). For a statute to confer standing in the absence of a concrete injury,
the statute must "clearly express[] an intention to abrogate the common-law
requirements for standing." ProgressOhio.org, Inc. at ¶ 22. Under this framework
outlined in ProgressOhio.org, Inc., the "common-law" standing requirements must be
established unless the party is suing pursuant to a statute that expresses a clear intent to
abrogate those requirements.1
{¶ 14} Thus, Ohio and federal law have diverged on the issue of whether a party
may have standing to sue in the absence of an injury-in-fact. However, even though Ohio
1 Application of the "statutory standing" concept, as an exception to Ohio's common-law standing
requirements, appears to have originated in Middletown v. Ferguson, 25 Ohio St. 3d 71 (1986). In
Middletown, the Supreme Court of Ohio stated that, "[a]s the United States Supreme Court has
recognized," standing is not limited to common-law standing, but "may also be conferred by a specific
statutory grant of authority." Id. at 75, citing Sierra Club v. Morton, 405 U.S. 727, 731-32 (1972).
However, the Middletown court's reliance on the Sierra Club decision for this proposition of law
ultimately has proven to be misplaced in view of the Spokeo decision. Thus, the continued viability in
Ohio of "statutory standing" as an exception to Ohio's common-law standing requirements is
questionable. Nonetheless, any full reexamination of the application of this doctrine in Ohio in view of
the Spokeo decision is unnecessary in this case because application of that doctrine here would require us
to expand it to federal legislation, which, for the reasons discussed below, we are unwilling to do.
No. 17AP-218 6
courts have, in some circumstances, found standing despite no allegation of concrete
injury, appellants fail to cite, and our independent research does not reveal, any case in
which an Ohio court has analyzed and found standing to exist on the basis of a federal
statute despite the absence of an alleged injury-in-fact. To the extent the "statutory
standing" doctrine constitutes an exception to the traditional principles of standing in
Ohio, we decline to extend that exception to this circumstance involving the application of
a federal statute. To find statutory standing here under the standard expressed in
ProgressOhio.org, Inc., we would need to find that Congress intended to abrogate the
Ohio common-law requirements to establish standing. However, there is no indication
that Congress intended the pertinent FCRA statute to supplant the traditional
requirements of standing in Ohio state court. Further, such a finding would be improper
as it would permit Congress to affect the parameters of standing in Ohio courts, even
though it is well-settled that Ohio law determines standing in Ohio courts. Expanding
Ohio's statutory standing doctrine based on Congressional action would be particularly
problematic considering determinations regarding the outer limits of standing implicate
issues regarding the constitutional authority of Ohio's judiciary and the separation of
power between the branches of government. Lastly, permitting Congress to abrogate
Ohio common-law standing principles, even though Congress cannot abrogate essentially
the same principles in federal courts, would constitute a significant anomaly.
{¶ 15} For these reasons, we find that the trial court correctly found that appellants
lacked standing to sue OSU for its alleged violations of FCRA procedural requirements.
Accordingly, we overrule their sole assignment of error.
IV. Disposition
{¶ 16} Having overruled appellants' sole assignment of error, we affirm the
judgment of the Court of Claims of Ohio.
Judgment affirmed.
TYACK, P.J., and BROWN, J., concur.