Elizabeth Larroque v. First Advantage LNS Screening Solutions, Inc.

Filing 23

ORDER by Magistrate Judge Jacqueline Scott Corley granting 8 Motion to Stay (ahm, COURT STAFF) (Filed on 1/4/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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ELIZABETH LARROQUE,

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Plaintiff,

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ORDER GRANTING MOTION TO
STAY

v.

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FIRST ADVANTAGE LNS SCREENING
SOLUTIONS, INC.,

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United States District Court
Northern District of California

Case No. 15-cv-04684-JSC

Re: Dkt. No. 8

Defendant.

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In this putative class action, Defendant First Advantage LNS Screening Solutions, Inc.

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(“Defendant”) moves to stay the action pending the United States Supreme Court’s decision in

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Spokeo, Inc. v. Robins. (Dkt. No. 8.)1 Upon consideration of the parties’ submissions, the Court

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concludes that oral argument is not necessary, see Civ. L.R. 7-1(b), and GRANTS Defendant’s

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motion to stay.
BACKGROUND

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A.

Procedural History
On August 11, 2015, Plaintiff filed the instant case in the San Mateo County Superior

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Court. (Dkt. No. 1-1 at 38, 31-37.) Defendant timely removed the action to this Court on October

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9, 2015. (Dkt. No. 1.) In the complaint, Plaintiff alleges that Defendant furnished a consumer

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report regarding Plaintiff to Pacific Hotel Management, LLC (“Pacific”) without first having

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Pacific certify that it had complied with the disclosure and authorization requirements set forth in

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Section 1681b(b)(1) of the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681. (Dkt. No. 1-1

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Record citations are to material in the Electronic Case File (“ECF”); pinpoint citations are to the
ECF-generated page numbers at the top of the documents.

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at 33-35.) Plaintiff seeks to represent a class of all persons as to whom Defendant furnished

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consumer reports for employment purposes without first obtaining certification of the employer’s

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compliance with Section 1681b(b)(1). (Id. at 35.) She seeks only statutory and punitive damages.

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(Id. at 37.) Plaintiff does not allege that either she or any putative class member suffered actual

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harm or actual damages. (See generally id.)

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B.

The Supreme Court’s Pending Spokeo Decision

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On April 27, 2015 the Supreme Court granted certiorari in Spokeo, Inc. v. Robins, No. 13-

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1339, 134 S. Ct. 1892 (Apr. 15, 2015). The question the Supreme Court will resolve in Spokeo is

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whether a statutory violation in the absence of concrete harm is enough to confer Article III
standing upon a plaintiff. There is a circuit split on this issue, but the Ninth Circuit answered the

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United States District Court
Northern District of California

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question in the affirmative, holding that an individual has standing to sue a defendant for violation

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of the FCRA without alleging actual harm—that is, “violation of a statutory right is usually

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sufficient injury in fact to confer standing[.]” Spokeo, Inc. v. Robins, 742 F.3d 409, 412-13 (9th

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Cir. 2014). The Supreme Court held oral argument in Spokeo on November 2, 2015 and is

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expected to issue its opinion in 2016.

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DISCUSSION

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“[T]he power to stay proceedings is incidental to the power inherent in every court to

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control the disposition of the causes of action on its docket with economy of time and effort for

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itself, for counsel, and for litigants.” Landis v. N. Am. Co., 299 U.S. 248, 254 (1936). “A trial

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court may, with propriety, find it is efficient for its own docket and the fairest course for the

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parties to enter a stay of an action before it, pending resolution of independent proceedings which

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bear upon the case.” Leyva v. Certified Grocers of Cal., Ltd., 593 F.2d 857, 863 (9th Cir. 1979).

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In deciding whether to grant a stay, a court may weigh the following: (1) the possible damage

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which may result from the granting of a stay; (2) the hardship or inequity which a party may suffer

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in being required to go forward; (3) the orderly course of justice measured in terms of the

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simplifying or complicating of issues, proof, and questions of law which could be expected to

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result from a stay.” CMAX, Inc. v. Hall, 300 F.2d 265, 268 (9th Cir. 1962) (internal quotation

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marks and citation omitted). However, “[o]nly in rare circumstances will a litigant in one case be
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compelled to stand aside while a litigant in another settles the rule of law that will define the rights

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of both.” Landis, 299 U.S. at 255. A district court’s decision to grant or deny a Landis stay is a

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matter of discretion. See Dependable Highway Exp., Inc. v. Navigators Ins. Co., 498 F.3d 1059,

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1066 (9th Cir. 2007). The proponent of a stay has the burden of proving such a discretionary stay

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is justified. Clinton v. Jones, 520 U.S. 681, 708 (1997).

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Defendant moves to stay the action pending the Supreme Court’s review of the Ninth

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Circuit’s decision in Spokeo. The Spokeo decision will directly impact whether, as a matter of

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law, Plaintiff has standing to bring this action. Under these circumstances, the Landis factors

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weigh strongly in favor of staying this action pending the Spokeo decision. In fact, Plaintiff’s
counsel has brought the same Section 1681b(b)(1) claim on behalf of another individual against a

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United States District Court
Northern District of California

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different credit reporting agency on two other occasions, and those courts both stayed the litigation

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pending the Spokeo decision. See Stone v. Sterling Infosys., Inc., No. 2:15-cv-00711-MCE-DAD,

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2015 WL 4602968, at *2-3 (E.D. Cal. July 29, 2015) (“Stone I”); see also Stone v. Sterling

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Infosys., Inc., No. 1:15-cv-007351-SJO-PJW (C.D. Cal. Oct. 21, 2015) (Dkt. No. 28 at 6) (“Stone

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II”). The same conclusion is appropriate here.

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The possible prejudice to Plaintiff is minimal, as the Spokeo decision will likely be issued

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within the next six months per the Supreme Court’s customary practice. The prejudice to Plaintiff

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is particularly low where, as here, Plaintiff has not alleged that she or any members of the class

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suffered any actual harm. Moreover, this case is in its early stages, so there are no deadlines that

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will be affected by a stay. In contrast, Defendant will suffer significant hardship if the case is not

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stayed because it will be required to defend a large putative class action—engaging in expansive

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discovery and possibly class certification briefing—that may be rendered moot and unnecessary

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within in the next six months by the Spokeo decision. Judicial resources also may be

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unnecessarily expended reviewing the adequacy of the pleadings, resolving discovery disputes,

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and considering class certification in a case that the Court may not have subject matter jurisdiction

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to entertain. Because the Spokeo decision is squarely on point, the orderly course of justice

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likewise weighs in favor of a stay. Notably, Plaintiff does not dispute Defendant’s argument that

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the Landis favors support a stay.
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Instead, Plaintiff relies on Eleventh Circuit cases holding that grants of certiorari do not

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change the law and therefore should not serve as the basis for a Landis stay. To be sure, the Ninth

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Circuit’s Spokeo decision holding that a statutory violation alone is enough to confer standing

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remains binding precedent in this case. But the Supreme Court’s decision may deprive Plaintiff of

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standing, eliminating the Court’s jurisdiction over this action. The Eleventh Circuit cases that

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Plaintiff cites did not involve grants of certiorari addressing whether a plaintiff has standing to

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bring suit in the first instance. And indeed, numerous courts throughout the Ninth Circuit have

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granted a stay given the grant of certiorari in Spokeo. See, e.g., Larson v. Trans Union LLC, NO.

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12-CV-05726 WHO, 2015 WL 3945052, at *8 (N.D. Cal. June 26, 2015); Ramirez v. Trans Union
LLC, No. 12-cv-00632-JSC, 2015 WL 6159942, at *1 (N.D. Cal. June 22, 2015); Stone I, 2015

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United States District Court
Northern District of California

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WL 4602968, at *3. A stay is likewise appropriate here.

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Plaintiff’s argument that a stay is not justified because he may be entitled to remand this

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action to state court in the event that the Spokeo decision divests him of standing fares no better.

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Even assuming for the purposes of argument that Plaintiff would have standing to proceed in state

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court, permitting this action to proceed in federal court will be an unnecessary waste of this

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Court’s judicial resources. Defendant has therefore met its burden of establishing that staying this

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action until the Supreme Court issues an opinion in Spokeo would be efficient for the Court’s own

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docket and the fairest course for the parties. See Leyva, 593 F.2d at 863.

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CONCLUSION

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For the reasons described above, the Court GRANTS Defendant’s motion to stay this

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action pending a decision in Spokeo. Once the Supreme Court issues its decision in Spokeo,

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Plaintiff shall notify the Court in writing and request the rescheduling of the initial case

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management conference. This Order disposes of Docket No. 8.

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IT IS SO ORDERED.
Dated: January 4, 2016

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________________________
JACQUELINE SCOTT CORLEY
United States Magistrate Judge

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