United States District Court, S.D. New York
OPINION & ORDER
HONORABLE PAUL A. CROTTY, UNITED STATES DISTRICT JUDGE
Yehuda Katz ("Plaintiff") brings this class action
against Defendants Donna Karan International, Inc., The Donna
Karan Company, LLC, and The Donna Karan Store, LLC
(collectively, "Defendants"), seeking statutory
damages for alleged willful violations of the Fair and
Accurate Credit Reporting Act ("FACTA"), 15 U.S.C.
§ 1681c(g). The Court determines that Article III
standing requires a concrete injury in fact, even where there
is a statutory violation. Since plaintiff has not been
injured, his complaint must be dismissed.
January 30, 2015, the Court granted Defendants' motion to
dismiss Plaintiffs First Amended Complaint (the
"FAC") for failure to state a claim under
Fed.R.Civ.P. 12(b)(6), finding the FAC "devoid of any
well-pleaded facts which allow the plausible inference that
Defendants willfully, knowingly, or recklessly violated
FACTA." ECF 43 at 3-4. The Court held that Plaintiff
failed to allege "any actual damages. Indeed, based on
the facts alleged in the complaint, it is not possible that
Plaintiff was harmed." Id. at 3 n. 2. On
appeal, the Second Circuit heard argument, but before
reaching a decision, the Supreme Court decided Spokeo,
Inc. v. Robins, 136 S.Ct. 1540 (2016), which
"addressed the issue of what plaintiffs must plead to
adequately allege a 'concrete injury' for purposes of
Article III standing." Katz v. Donna Karon Co,
LLC, 653 Fed.App'x 81, 82 (2d Cir. 2016) (summary
order) (quoting Spokeo, 136 S.Ct. at 1549). The
Second Circuit remanded "to allow [Plaintiff] an
opportunity to replead [his] claims to comport with the
pleading standards set forth in Spokeo, and to allow
the district court to address any standing questions in the
first instance." Id. The Court granted
Plaintiff limited leave to amend his complaint, and Plaintiff
filed a Second Amended Complaint (the "SAC"). ECF
52, 53. Defendants moved to dismiss the SAC for lack of
subject matter jurisdiction. ECF 63.
Court has reviewed the parties' submissions, including
supplemental authority and corresponding letters, and
determines that Plaintiff has not suffered a concrete injury
in fact as a result of Defendants' conduct. Accordingly,
Plaintiff lacks Article III standing. Defendants' motion
made two purchases in Defendants' stores using his Visa
Credit Card: the first on January 13, 2014, and the second on
February 2, 2014. SAC ¶¶ 58-61. At both purchases,
Defendants issued Plaintiff electronically-printed receipts
that disclosed the first six and last four digits of
Plaintiff s credit card number, in apparent violation of
FACTA's truncation requirement, which mandates that no
more than the final five digits of credit cards be printed on
receipts. Id., ¶ 72; see 15 U.S.C.
§ 1681 c(g)(1). The first six digits do not disclose any
information about Plaintiff; but rather "identify the
institution that issued the card to the card holder."
See Bin List & Bin Ranges: List of Issuer
Identification Numbers, Bin Database ~ Industry Standard
Fraud Prevention, https://www.bindb.com/bin-list.html.
The contours of the dispute were "super-sized" by
Plaintiffs class action on behalf of similarly-situated
customers, seeking statutory damages of $ 100 to $ 1, 000 per
willful violation, pre- and post-judgment interest, and
attorneys' fees and costs. See SAC ¶¶
75-76; 15 U.S.C. § 168 In. Plaintiff couples his
allegation that Defendants were aware of PACTA'S
applicability with the allegation that the receipt did not
fully comply with FACTA requirements to conclude that
Defendants willfully violated FACTA. See SAC
¶¶ 30, 40-41, 68.
only new fact the SAC contains is Plaintiffs second purchase
and partially-truncated receipt. There is no claim of
economic loss or harm; no suggestion that Plaintiff was
forced to take protective measures; no suggestion that the
receipt was seen by anyone other than the store clerks, the
customer (i.e. Plaintiff), and Plaintiffs attorneys; no claim
of imminent harm; and no claim of actual identity theft.
Instead there are legal arguments and generalized
descriptions of nation-wide identity theft. Plaintiffs
standing theories boil down to four: (1) PACTA'S
truncation requirement is a substantive right, the violation
of which, by itself, automatically creates a concrete Article
III injury; (2) the disclosure created an increased risk of
identity theft, constituting a present intangible harm; (3)
the disclosure violated Plaintiffs privacy interests,
constituting a concrete injury; and (4) the availability of
statutory damages "confirm fs]" Plaintiffs Article
III standing. See SAC ¶ 75; ECF 65 at 18-20.
None of these arguments is sufficient to establish standing.
Motions to Dismiss for Lack of Subject Matter
case is properly dismissed for lack of subject matter
jurisdiction under Rule 12(b)(1) when the district court
lacks the statutory or constitutional power to adjudicate
it." Makarova v. United States, 201 F.3d 110,
113 (2d Cir. 2000). A "plaintiff asserting subject
matter jurisdiction has the burden of proving by a
preponderance of the evidence that it exists."
2003, Congress enacted FACTA, an amendment to the Fair Credit
Reporting Act of 1970 ("FCRA"), 15 U.S.C. §
1681 et seq. FACTA was designed in part "to
prevent criminals from obtaining access to consumers'
private financial and credit information in order to reduce
identity theft and credit card fraud." Pub. L. No.
110-241, § 2(a)(1), 122 Stat. 1565. Among other things,
to reduce the risk of third parties obtaining such
information from lost or stolen sales receipts, FACTA's
"truncation requirement" prohibits merchants who
accept credit or debit cards from printing more than the last
five digits of a customer's credit card number on
receipts. See 15 U.S.C. § 1681c(g)(1). FACTA
creates a private cause of action for willful violations of
its requirements; and entitles consumers to recover either
"any actual damages sustained ... as a result" or
the violation or statutory damages of between $100 and $1,
000. Id. § 1681n(a)(i)(A). Plaintiff seeks only
Constitutional Standing and the "Concreteness"
doctrine of judicial standing is grounded in Article
Ill's limitation of federal jurisdiction to
"cases" and "controversies." U.S. Art.
Ill. § 2. To satisfy "the irreducible
constitutional minimum of standing, " a plaintiff
invoking federal jurisdiction must establish (1) an
"injury in fact, " (2) that is "fairly
traceable to the challenged action of the defendant, "
and (3) is "likely" to be "redressed by a
favorable decision." Lujan v. Defenders of
Wildlife,504 U.S. 555, 560-61 (1992) (internal
quotations and citations omitted). An injury in fact requires
that a plaintiff suffer "an invasion of a legally
protected interest which is (a) concrete and particularized,