Supreme Court Decision Protects Small Businesses from Possible Frivolous Lawsuits

Date: June 25, 2021

WASHINGTON, D.C. (June 25, 2021) – NFIB applauds the U.S. Supreme Court’s decision in the case TransUnion LLC v. Ramirez. The case concerned whether a class action lawsuit can be brought when a majority of the class has not been injured. NFIB filed an amicus brief in the case arguing that all members of the class must have suffered an actual injury, contrary to the Ninth Circuit’s decision below.

“Small businesses suffer greatly from frivolous lawsuits and today’s decision will help small employers avoid being the target of such lawsuits,” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center. “This case had the potential to set a dangerous precedent in incentivizing lawyers to turn every dispute into a statutory-damages lawsuit, based on technical statutory violations and without proving the class represented suffered concrete injuries. NFIB is pleased the Supreme Court once again ruled that all plaintiffs need to suffer actual injury to be compensated.”

TransUnion LLC v. Ramirez questioned whether either Article III or Federal Rule of Civil Procedure 23 permits a damages class action when the majority of the class suffered no actual injury, let alone an injury comparable to what the class representative suffered. In reversing the Ninth Circuit, the Supreme Court held that members of the class must have suffered a “concrete harm,” beyond technical statutory violations, to have Article III standing.

The NFIB Small Business Legal Center protects the rights of small business owners in the nation’s courts. NFIB is currently active in more than 40 cases in federal and state courts across the country and in the U.S. Supreme Court.

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