AHMED KAMAL, on behalf of himself and the putative class, Appellant in No. 17-2345
J. CREW GROUP, INC.; J CREW INC.; J. CREW INTERMEDIATE LLC; J CREW INTERNATIONAL, INC.; J. CREW OPERATING CORP; J. CREW SERVICES, INC.; CHINOS ACQUISITION CORP; CHINOS HOLDINGS, INC., Appellants in No. 17-2453
Argued: February 8, 2018
Appeal from the United States District Court for the District
of New Jersey (D.C. Civil Action No. 2-15-cv-00190) District
Judge: Honorable William J. Martini
L. Frank [ARGUED] Peter Y. Lee Counsel for
Appellant/Cross-Appellee Ahmed Kamal
O. Bunn [ARGUED] Steven R. Marino DLA Piper 51 John F.
Kennedy Parkway Keara M. Gordon DLA Piper Counsel for
Appellees/Cross-Appellants J. Crew Group, Inc., J Crew Inc.,
J. Crew Intermediate LLC, J Crew International, Inc., J. Crew
Operating Corp, J. Crew Services, Inc., Chinos Acquisition
Corp; Chinos Holdings, Inc.
Before: CHAGARES, SCIRICA, and RENDELL, Circuit Judges.
SCIRICA, Circuit Judge.
to combat credit card and identity theft, the Fair and
Accurate Credit Transactions Act of 2003 (FACTA) prohibits
anyone who accepts credit or debit cards as payment from
printing more than the last five digits of a customer's
credit card number on the receipt. 15 U.S.C. § 1681c(g).
Plaintiff-Appellant Ahmed Kamal brought this suit after
receiving three receipts from Defendants-Appellees J. Crew
Group, Inc. (and related entities) that included both the
first six and last four digits of his credit card number. The
District Court dismissed Kamal's suit under Federal Rule
of Civil Procedure 12(b)(1) for lack of Article III standing
based on its determination that Kamal did not suffer a
concrete injury from the alleged violation.
agree, and we will affirm on that issue. We will vacate and
remand, however, for the District Court to dismiss
Kamal's complaint without prejudice.
begin with a review of FACTA's text and background before
turning to the facts and procedural history.
enacted FACTA in 2003 as an amendment to the Fair Credit
Reporting Act (FCRA), 15 U.S.C. § 1681. FACTA was part
of Congress's effort to prevent identity theft. Pub. L.
No. 108-159, 117 Stat. 1952. Consistent with that purpose,
one of its provisions regulates the information that can be
included on receipts given to customers:
Except as otherwise provided in this subsection, no person
that accepts credit cards or debit cards for the transaction
of business shall print more than the last 5 digits of the
card number or the expiration date upon any receipt provided
to the cardholder at the point of the sale or transaction.
15 U.S.C. § 1681c(g)(1). This provision was
"included . . . to limit the number of opportunities for
identity thieves to 'pick off' key card account
information." S. Rep. No. 108-166, at 13 (2003).
provides for actual damages and attorneys' fees and costs
to remedy negligent violations. 15 U.S.C. § 1681o(a).
Willful violators are liable for "any actual damages . .
. or damages of not less than $100 and not more than $1,
000," punitive damages, and attorneys' fees and
costs. Id. § 1681n(a).
2008, Congress passed the Credit and Debit Card Receipt
Clarification Act (Clarification Act), which provided a
temporary safe harbor to merchants that had violated FACTA by
including card expiration dates on receipts. Pub. L. No.
110-241, 122 Stat. 1565. Although FACTA requires truncation
of card numbers and removal of expiration dates,
Congress found many merchants mistakenly believed it only
required card number truncation, leading to "hundreds of
lawsuits" alleging these merchants' willful failure
to remove the expiration date. Id. §
2(a)(3)-(4). According to Congress, these suits did not
contain "allegation[s] of harm to any consumer's
identity," and "[e]xperts in the field agree that
proper truncation of the card number . . . regardless of the
inclusion of the expiration date, prevents a potential
fraudster from perpetrating identity theft."
Id. § 2(a)(5)-(6). To ensure "consumers
suffering from any actual harm to their credit or identity
are protected while simultaneously limiting abusive lawsuits
that do not protect consumers," id. §
2(b), the Clarification Act amended FACTA so merchants who
printed expiration dates but otherwise complied with FACTA
would not be deemed in willful noncompliance, id.
§ 3; see also 15 U.S.C. § 1681n(d). This
safe harbor covers receipts printed between 2004 and 2008.
Clarification Act § 3; 15 U.S.C. §
December 18, 2014, Kamal visited a J. Crew retail store in
Ocean City, Maryland, and made a purchase with a credit card.
Four days later, he went to another J. Crew store in Rehoboth
Beach, Delaware, and again made a credit card purchase.
Finally, about two weeks later, Kamal went to a J. Crew store
in Wayne, New Jersey, and made a third purchase. Each time,
Kamal "received an electronically printed receipt,"
which he retained, that "display[ed] the first six
digits of [his] credit card number as well as the last four
digits." App. 97, Sec. Am. Compl. ¶ 8. As
Kamal notes, the first six digits identify the issuing bank
and card type. The receipts he received also identified his
card issuer, Discover, by name. Kamal does not allege anyone
(other than the cashier) saw his receipts. Neither does he
allege his identity was stolen nor that his credit card
number was misappropriated.
days after the last purchase, Kamal filed his first Class
Action Complaint, alleging J. Crew willfully violated FACTA
by including on his receipts the first six digits of his
credit card number. Kamal sought statutory and punitive
damages as well as attorneys' fees. J. Crew filed a
motion to dismiss under Federal Rule of Civil Procedure
12(b)(6), arguing its violations had not been willful. Kamal
filed an Amended Complaint, and J. Crew again moved to
dismiss on the same grounds. The District Court denied the
motion, concluding Kamal plausibly alleged a willful
violation. Following the Supreme Court's decision in
Spokeo, Inc. v. Robins, 136 S.Ct. 1540 (2016), J.
Crew moved to dismiss for lack of subject matter jurisdiction
under Rule 12(b)(1), contending Kamal lacked standing because
he did not suffer a "concrete" injury. The District
Court agreed that Kamal had not alleged a sufficiently
concrete injury and thus lacked standing under Article III.
It granted J. Crew's motion without prejudice and allowed
Kamal to file another amended complaint.
filed his Second Amended Complaint-the operative complaint in
this matter. In an effort to address the deficiencies leading
to the dismissal of his Amended Complaint, Kamal alleges two
"concrete" harms: "the printing of the
prohibited information itself and the harm caused by such
printing increasing the risk of identity theft." App.
104, Sec. Am. Compl. ¶ 36. To support these allegations,
Kamal contends "[t]he extensive legislative findings by
Congress, the Federal Trade Commission, the Department of
Justice, and the industry" demonstrate that J.
Crew's conduct "created a real, non-speculative harm
in the form of increased risk of identity theft."
Id. The Complaint accordingly includes statements
from Congress, industry experts, and government officials to
show FACTA was intended to address identity theft. For
example, Kamal notes that "[e]xperts . . . told Congress
that both non-redacted Card numbers and expiration dates are
particularly dangerous in the hands of sophisticated
criminals." App. 104, Sec. Am. Compl. ¶ 37.
Similarly, Kamal says, "the Senate found that the
specific provision at issue here protected consumers, like
Plaintiff, from an intangible harm in the form of enhanced
risk of identity theft." App. 106, Sec. Am. Compl.
Complaint also explains how FACTA's truncation
requirement responds to identity theft. Kamal alleges that
"[o]ne common modus operandi of identity thieves is to
obtain Card receipts that are lost or discarded, or through
theft, and use the information on them to commit fraud and
theft." App. 101, Sec. Am. Compl. ¶ 28. FACTA
"makes it more difficult for identity thieves to obtain
consumers' Card information by reducing the amount of
information identity thieves could retrieve from found or
stolen Card receipts." App. 103, Sec. Am. Compl. ¶
33. In other words, Congress was responding to "the
possibility that identity thieves would be able to piece
together credit card numbers and expiration dates to invade
consumers' privacy and exploit their financial
resources." App. 106, Sec. Am. Compl. ¶ 42.
these additional allegations, J. Crew again moved to dismiss
on standing grounds. The District Court noted the two
injuries alleged in the Second Amended Complaint-the printing
of the prohibited information and the increased risk of
identity theft-and rejected both in turn. See Kamal v. J.
Crew Grp., Inc., No. 15-0190, 2017 WL 2587617, at *3
(D.N.J. June 14, 2017).
court first held the printing of the information on the
receipt was not itself a concrete injury. J. Crew's
conduct in giving Kamal a receipt that included his credit
card's first six digits did "not implicate
traditional common law privacy interests" because
"J. Crew did not 'disclose' Kamal's personal
information" and "the [card's] first six digits
do not pertain to the customer's individual bank
account." Id. As to "the judgment of
Congress," Spokeo, 136 S.Ct. at 1549, the
court- relying on quoted portions of the Clarification Act-
determined that "Congress sought [through FACTA] to
'ensure that consumers suffering from any actual
harm to their credit or identity are protected,
'" Kamal, 2017 WL 2587617, at *4 (quoting
Clarification Act § 2(b)) (emphasis added in District
Court opinion). Because Kamal had not sustained any actual
harm, the court held there was no injury in fact.
District Court next evaluated whether Kamal's alleged
increased risk of identity theft constituted a concrete
injury. The court was unable to "reasonably infer that
printing the first six and last four digits of [Kamal's]
credit card materially increased the risk of future
harm." Id. at *4. The court stated that the
first six digits of a credit card number identify the bank or
card issuer, information that permissibly appears elsewhere
on a receipt. It also examined the intervening events that
must occur for Kamal's identity to be stolen and found
this chain of future events too speculative to constitute a
because Kamal had alleged only a technical violation of FACTA
and not a concrete injury, the District Court held Kamal
lacked standing and granted J. Crew's motion, dismissing
without prejudice the Second Amended Complaint. The District
Court gave Kamal leave to file another amended complaint.
moved for reconsideration, or alternatively, for amendment of
the court's order "so as to redenominate it final
and appealable," as Kamal intended to stand on the
Second Amended Complaint to establish his Article III
standing. Pl.'s Mem. of Law Supp. Mot. Reconsider at 5,
Kamal v. J. Crew Grp., Inc., D. Ct. Dkt. No. 87-1,
Civ. No. 15-0190 (D.N.J. June 8, 2017). The District Court
denied the motion for reconsideration but amended its order
to provide for a dismissal with prejudice based on
Kamal's intent to stand on his complaint. Kamal appealed,
and J. Crew filed a ...