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“[N]ovel and unsupported interpretation of Article III” rejected by the Second Circuit.

July 9, 2012 2:48 PM | Posted by Glover, Anthony | Print this page

In Mahon v. Ticor Title Ins. Co., No. 10-3005-cv, 2012 WL 2369194 (2nd Cir. June 25, 2012), the plaintiff brought a purported class action against her title insurer and a related title insurer, on behalf of herself and similarly situated individuals, but failed to allege that the related title insurer injured her, as required to establish Article III standing to bring suit against the related title insurer. The putative class consisted of insureds who paid for title insurance from the defendants in Connecticut and who qualified for but paid more than a reduced refinance rate. The complaint alleged that the defendants' practice of overcharging on title insurance for refinanced properties violated the Connecticut Unfair Trade Practices Act, and asserted claims for unjust enrichment, breach of implied contract, and money had and received. The plaintiff specifically alleged that Chicago Title's conduct that injured her personally, but did not allege any interaction with Ticor Title Insurance Company and Ticor Title Insurance Company of Florida. 

The United States District Court for the District of Connecticut dismissed two defendants (the Ticor entities) from the case on the basis that the plaintiff lacked Article III standing to sue them because she does not allege that they injured her. On appeal, the plaintiff argued that the district court erred because Article III requires only that she have suffered an injury at the hands of one, and not all, of the named defendants. If this constitutional minimum is satisfied, the plaintiff argues that a plaintiff may sue certain other parties whether or not they injured her.

The Second Circuit noted that the plaintiff’s proposed interpretation of Article III—that it permits suits against non-injurious defendants as long as one of the defendants in the suit injured the plaintiff—is unprecedented. The opinion went on to state that “[n]o decision that we can discern has ever adopted such a broad interpretation of constitutional standing.” The Second Circuit likewise declined to adopt such a broad interpretation, and affirmed the district court’s ruling.