California Courts of Appeal Split on Standing Requirement

On June 4, 2026, California’s First District Court of Appeal held that the state’s law on “standing” requires no “concrete” injury to pursue federal Fair Credit Reporting Act (FCRA) claims in state court. The court’s opinion in Askins v. CRST Expedited reflects stark differences between federal and state standing requirements and deepens the split of authority in the California Courts of Appeal. Standing is not a merits issue but, rather, is a threshold requirement that a lawsuit must meet to proceed in court.

The Lower Court’s Opinion

The FCRA includes a “concurrent jurisdiction” clause, allowing claims to be brought in either federal or state court. Since the U.S. Supreme Court’s 2016 decision in Spokeo, Inc. v. Robins, requiring a plaintiff to allege a concrete harm to have standing to assert a FCRA claim in federal court, more claims are brought or remain in state court.

In October 2022, California’s Fifth District Court of Appeal issued a surprising but employer-friendly ruling, holding that a plaintiff must assert a concrete injury to have standing to pursue FCRA violations in California state courts. Meanwhile, in San Mateo County Superior Court, the Askins plaintiff, on behalf of a putative class, alleged that the defendant employer conducted background checks without compliant disclosure and authorization forms. The plaintiff successfully moved for class certification. The defendant subsequently moved for class decertification, based on the Fifth District Court of Appeal ruling. The trial court granted the motion for decertification, holding that the plaintiff’s apparent confusion and lack of knowledge regarding the forms and background check process was insufficient to establish standing under state law. The plaintiff appealed.

The First District Court of Appeal Decision

In Askins, the court acknowledged the contrary authority but declined to follow the conclusion reached by the Fifth District Court of Appeal. The court first contrasted the Article III standing necessary to pursue claims in federal court (that is, the requirement of “concrete harm,” as established in Spokeo) with the less stringent and more “prudential” considerations in California’s standing analysis, which focuses on statutory interpretation for causes of action based on statute.

After confirming that the plaintiff needed to meet the California standing requirements, the court next focused on its statutory interpretation of the FCRA section at issue, Section 1681n. The court analyzed the legislative intent and statutory purpose of the last amendments to this section in 1996, which expanded the remedies available to consumers for “willful” violations of the FCRA. The 1996 amendment added to the original language — which only included “actual damages sustained by the consumer as a result of the failure [to comply with the FCRA]” — another category of damages for those “of not less than $100 and not more than $1,000.” The court reasoned that this section therefore allows a consumer to recover either actual damages or statutory damages.

The First District Court of Appeal then parted ways with the Fifth District Court of Appeal, interpreting the definitions and structure of this section to signify that Congress intended the actual damages phrase and the secondary damages phrase to have two separate meanings. The court found that the second phrase allowed a consumer to recover statutory damages between $100 and $1,000 even when actual damages could not be proven. The court further noted that this interpretation is consistent with multiple federal appellate courts that have similarly held that Congress authorized statutory damages for willful FCRA violations, even without proof of harm.

The court ultimately held that Section 1681n does not require proof of an actual injury and that a statutory violation itself confers the necessary standing under California law. Because the plaintiff properly alleged that the defendant had violated the FCRA by failing to provide the required disclosure before obtaining a background check report, the plaintiff had standing to assert his FCRA claims.

Checklist: Fair Credit Reporting Act (FCRA) Compliance

Next Steps

Employers that use background check companies to conduct background checks should continue to be mindful of the obligations the FCRA and like laws, including California law, impose on employers. 

Toolkit: Conducting Background Investigations and Reference Checks

They should also consider whether to undertake a broader (and privileged) assessment of their background screening and hiring practices to strengthen compliance with the FCRA and related state or local laws, such as fair chance hiring laws (e.g., California, Washington, and Philadelphia) and laws limiting employers’ use of credit reports. Possible action items are as follows:

• Review and update job applications and related forms for impermissible inquiries regarding criminal records.
• Review written and electronic communications about the hiring process, including conditional job offer templates, background check disclosures, and pre-adverse action and adverse action notices.
• Review background check packages to help ensure a lawful justification for seeking credit reports.
• Review the hiring and screening process to help ensure compliance, including the timing of background checks, the distribution of mandatory notices, and the application of mandatory deferral periods.

Rod M. Fliegel is an attorney with Littler in San Francisco. Rachel E. Simons is an attorney with Littler in Sacramento. © 2026 Littler. All rights reserved. Reposted with permission.