A federal appeals court ruled (PDF) yesterday that a lawsuit alleging that Spokeo's "people search engine" violates the Fair Credit Reporting Act can move forward.

Spokeo operates a "people search" engine that gathers publicly available information from social networks, phone books, and real-estate and business websites. The engine then makes the information available via its online search portal. The company's search results tell users that it "does not verify or evaluate each piece of data," and it says the information it shows should not be used to determine "eligibility for credit, insurance, employment, or for any other purposes covered under the FCRA," referring to the Fair Credit Reporting Act.

Thomas Robins, a Virginia resident, sued Spokeo in 2011. In a proposed class-action complaint, Robins said that Spokeo's search engine is producing "in-depth consumer reports" in violation of FCRA.

As detailed in Robins' complaint, Spokeo offers a variety of information about consumers, including the names of family members, employment information, education, ethnicity, and marital status. Spokeo also offers a chart showing the consumer's "economic health" and "wealth level."

Robins' own report was wildly inaccurate, according to his complaint. The profile said he was in his 50s, married with children, and employed in a "professional or technical field." His economic health was listed as "very strong" and Robins' wealth level was listed as "Top 10%."

None of those facts is true, say Robins' attorneys. They alleged the incorrect information has caused harm to Robins' employment prospects, as well as "actual harm in the form of anxiety, stress, concern, and/or worry."

The district court judge threw the case out, saying that Robins had no standing because he had failed to allege a real injury. But in 2014, the US Court of Appeals for the 9th Circuit disagreed, saying that the case should move forward.

Spokeo petitioned the Supreme Court, which took the case. Last year, in a muddled 6-2 opinion (PDF), the high court said that an FCRA lawsuit like Robins' could only proceed if the plaintiff had an injury that was "concrete and particularized" and that the Ninth Circuit's analysis was incomplete.

Do-over

Now the Ninth Circuit has reconsidered the case in light of the Supreme Court opinion, and a three-judge panel has ruled (PDF) that Robins still has a case.

"It does not take much imagination to understand how inaccurate reports on such a broad range of material facts about Robins's life could be deemed a real harm," writes US Circuit Judge Diarmuid O'Scannlain for a unanimous panel. "Given the ubiquity and importance of consumer reports in modern life—in employment decisions, in loan applications, in home purchases, and much more—the real-world implications of material inaccuracies in those reports seem patent on their face."

Plaintiff's attorney Jay Edelson told Ars via e-mail that he thinks Robins v. Spokeo Inc. will be "the definitive decision" about who has standing to sue on this matter.

"We are very pleased with the decision, which recognizes Congress' intent to protect consumers' interests in accurate credit reporting about themselves," said Edelson. "Thomas Robins did not ask for Spokeo to publish any information about him, let alone wildly inaccurate information that we believe violates federal law. He and others who have had their rights violated deserve their day in court, and we are happy they will now have it."

Robins and his attorneys will now presumably head back to district court to litigate the now six-year-old case. US District Judge Otis Wright, who is overseeing the case, has not yet ruled on whether the litigation can proceed as a class action.

Spokeo didn't respond to a request for comment about the 9th Circuit decision.