Mark Ensminger entered into an engagement agreement with Credit Law Center, LLC, to perform credit repair services. Under the agreement, CLC charged a $300 retainer on March 6, 2015, but had already sent dispute letters to credit bureaus on March 4, 2015, which Ensminger valued at $390 based on the deletion of six false debts. Ensminger sued, alleging that CLC violated the Credit Repair Organization Act by accepting the advance payment before fully performing the services. The district court initially allowed the claim to proceed, finding that Ensminger had standing because he lost the time value of his money between the payment date and the service completion date. However, at summary judgment, the district court reversed its earlier stance, ruling that Ensminger lacked standing because he had already received services worth more than the retainer before the payment was collected, meaning he suffered no concrete injury.
The Tenth Circuit applied the Article III standing requirement that a plaintiff must suffer an injury in fact that is concrete and particularized. The court noted that while Congress can create causes of action for statutory violations, a violation alone does not establish an injury in fact under current precedent. Ensminger argued that the loss of the time value of his $300 retainer for 36 days constituted a concrete injury. The court rejected this, emphasizing that CLC had performed services valued at $390 on March 4, before collecting the $300 retainer on March 6. Because Ensminger received the benefit of the bargain before paying, he suffered no pecuniary harm. The court clarified that the standing inquiry is distinct from the merits of the CROA claim and that federal courts should not consider the merits at the jurisdictional stage. Citing TransUnion LLC v. Ramirez, the court held that a concrete injury must be de facto, and since Ensminger received services exceeding the payment amount prior to payment, no concrete injury existed.
This decision reinforces the requirement that plaintiffs in CROA cases must demonstrate a concrete, actual injury beyond a mere statutory violation. It clarifies that if a consumer receives services of equal or greater value before an advance payment is collected, they lack standing to sue for the timing of the payment. The case is remanded with instructions to dismiss the complaint for lack of standing, leaving the question of whether the CROA violation occurred on the merits unresolved.
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