Claims handling and penalties statutes regulating the business of insurance may not any longer provide causes of action to many policyholders and claimants.
In 2016, the Roberts Court grafted a requirement onto the U.S. Constitution which is not found in it -- standing -- but which is instead found in the Court's cases. Cases decided in lower courts since the Roberts Court raised standing to a constitutional prerogative are divided over whether Congress and State Legislatures can provide standing by providing remedies for statutory violations.
In Spokeo, Inc. v. Robins, ___ U.S. ___, 136 S. Ct. 1540 (2016), the Court raised the judge-made doctrine of standing to constitutional status. "Standing to sue," the Court recognized, "is a doctrine rooted in the traditional understanding of a case or controversy. The doctrine developed in our case law," said the Court in Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016).
One of the elements of standing is "injury in fact," which the Spokeo Court raised to "a constitutional requirement[.]" To establish injury in fact, a person invoking a statutory remedy now must meet a newly-found constitutional requirement that she or he had a legally protected interest that is concrete and individualized to her or him, and that the harm is "actual" or "imminent," not "conjectural" or "hypothetical." Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547-48 (2016). The Spokeo case itself was presented when Mr. Thomas Robins filed a lawsuit claiming an alleged violation of the Fair Credit Reporting Act by an internet search engine service which incorrectly provided information to the world about him. The Roberts Court remanded for a determination of whether Robins adequately alleged an injury in fact in his complaint.
As it has done by replacing "ultimate facts" pleading with "plausibility" pleading, in which allegations of fact in a complaint must be weighed by each individual judge who must dismiss the complaints that he does not think are "plausible," the Roberts Court has laid down another obstacle to filing lawsuits in Federal Courts. It is fundamental to its process to note how many times the Court now finds procedural and constitutional limitations which other Courts somehow must have overlooked.
To be continued on Insurance Claims and Issues Law blog.
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