The U.S. Court of Appeals for the Ninth Circuit issued a significant ruling clarifying the standing requirements for class action lawsuits seeking monetary damages, particularly in the wake of the Supreme Court’s decision in *TransUnion LLC v. Ramirez*. The appellate panel reversed a lower court’s decision, determining that while unnamed class members must present evidence of standing after certification, the standard for doing so at the summary judgment stage remains the conventional one—allowing for circumstantial evidence.
The case centers on James Healy’s class action against Milliman, Inc., a firm that compiles consumer medical history reports for insurers. Healy alleged that Milliman violated the Fair Credit Reporting Act (FCRA) by producing inaccurate reports.
The Allegations Against Milliman
Healy’s suit stemmed from a life insurance application he made in 2020. Milliman provided a report to the insurer that incorrectly attributed serious medical conditions (like liver disease and diabetes) to Healy, flagging them with “red flags.” These errors led to the denial of his insurance application, despite Healy being in good health. He also claimed Milliman failed to properly investigate his complaints afterward.
Healy successfully sought certification for an “inaccuracy class,” defined as consumers who received a Milliman report containing information that did not pertain to them, evidenced by a conflict between the applicant’s social security number and the SSN on the data source, coupled with a high or medium-risk flag. Healy identified over 311,000 such reports.
The Standing Showdown at Summary Judgment
Following class certification, Milliman moved for partial summary judgment, arguing that Healy needed to prove standing on a class-wide basis. Milliman contended that simply having a mismatched Social Security Number (SSN) on a report doesn’t automatically prove the health data attached was inaccurate for the applicant—it could be a simple data transposition error.
The District Court sided with Milliman. Relying on the Supreme Court’s *TransUnion* ruling, the district court held that Healy needed to present “at least some direct evidence of concrete injury on a class-wide basis” at summary judgment and found that mismatched SSNs alone were insufficient direct proof.
Healy appealed this ruling, arguing that unnamed class members should only have to prove standing when they seek to recover individual damages, not at the summary judgment stage.
The Ninth Circuit’s Core Ruling: *TransUnion* Applied
The Ninth Circuit panel, led by Judge Sidney R. Thomas, issued a nuanced opinion. The court agreed with Milliman on one key point derived from *TransUnion*: for a class action seeking money damages, unnamed class members *must* demonstrate standing after class certification, specifically at the summary judgment stage.
The court reasoned that the Supreme Court’s directive in *TransUnion*—that “every class member must have Article III standing in order to recover individual damages”—compels this earlier demonstration. The appellate court noted that *TransUnion* examined the evidence for both named and unnamed plaintiffs at trial to determine who had standing for specific claims, suggesting standing proof isn’t reserved only for the final claims process.
“We conclude that *TransUnion* requires unnamed members of a certified class for money damages to demonstrate standing at summary judgment,” the opinion stated.
Circumstantial Evidence is Still Allowed
However, the Ninth Circuit parted ways with the District Court regarding the *type* of evidence required to survive summary judgment.
The District Court had erroneously demanded “direct evidence” of injury. The appellate panel clarified that this misapplied settled summary judgment law. To defeat a motion for summary judgment, a plaintiff does not need to prove their case definitively; they only need to show there is a “genuine question of material fact” that a rational fact-finder *could* rule in their favor.
Crucially, the court confirmed that plaintiffs can rely on either direct evidence or circumstantial evidence to establish this genuine dispute.
The court found that Healy had presented significant circumstantial evidence: 311,226 reports containing mismatched SSNs alongside high-risk flags. While the District Court dismissed this as not being “direct evidence,” the Ninth Circuit held that such evidence is precisely what is permissible at summary judgment in FCRA cases—it is evidence “tending to show” inaccuracy.
The appellate court found the lower court imposed an overly strict standard by requiring Healy to show that a jury would “necessarily” agree that mismatched SSNs equal misattributed health records. Instead, Healy only needed to show that a rational fact-finder *could reasonably infer* that conclusion.
Remand for Reassessment
Because the District Court applied the wrong legal standard—demanding direct evidence and an overly high burden of proof—the Ninth Circuit reversed the partial grant of summary judgment. The case was remanded, sending it back to the District Court to re-examine Healy’s evidence under the correct summary judgment rules, allowing for a reasonable inference based on the circumstantial evidence provided.
The ruling clarifies the procedural hurdle for plaintiffs in damages-based class actions in the Ninth Circuit: standing must be addressed post-certification, but the evidence threshold at that point remains the standard summary judgment test.