After Oral Argument, Supreme Court Dismisses Labcorp Appeal of Class Certification Based On Article III Standing and Circuit Split Persists

On April 29, 2025, the Supreme Court heard oral argument in Labcorp v. Davis, in which it considered the question of whether Article III standing must be determined for all members of the class, including uninjured members, at the outset of class certification. The issue presented is one that has deeply divided the federal courts of appeals after it was left open by the Court’s prior rulings in TransUnion LLC v. Ramirez and Spokeo, Inc. v. Robins. On June 5, 2025, the Supreme Court dismissed the case as improvidently granted, leaving the question unresolved.

Backdrop: Labcorp Case Before the Ninth Circuit

In 2020, a class actional lawsuit was filed against Labcorp alleging that its express self-check-in kiosks violated federal and California disability laws because they were not accessible to blind individuals. The District Court certified two classes of legally blind Labcorp patients who were unable to access the kiosks: a nationwide class for purposes of injunctive relief under the ADA and a California class for purposes of monetary damages under the California statute.

On appeal, the Ninth Circuit affirmed the class certifications. Labcorp petitioned for review, arguing that only those who actually used the kiosks had Article III standing to sue and all uninjured members included in the class could not sustain their claims because they lacked an Article III injury.

The Supreme Court granted certiorari. The question presented for the Court’s consideration was as follows:

May a federal court certify a class action pursuant to Federal Rule of Civil Procedure 23(b)(3) when some members of the proposed class lack any Article III injury?

Labcorp’s Argument: Article III Standing Necessary for Class Certification

Petitioner Labcorp’s argument hinged on the predominance requirement of Rule 23(b)(3). Citing to In re Rail Freight Fuel Surcharge Antitrust Litigation and In re Asacol Antitrust Litigation from the D.C. Circuit and First Circuit, respectively, counsel for Labcorp noted that, when a class is defined to include plaintiffs without Article III standing, the Article III issue predominates and swamps any common issues.

Labcorp explained that, if a class is defined on the front end such that both injured and uninjured individuals are encompassed by the definition of the class, thousands of mini-trials would have to be conducted to separate them, which it argued would become more important than any other common issues.

The justices questioned Labcorp as to why uninjured members would require standing given that, ordinarily, only one person must satisfy the standing criteria in order to invoke the jurisdiction of the Court.

Moreover, the justices highlighted that, specifically in the class context, absent class member claims are added to the case when it is certified, but they are not added as new parties. Based on this distinction, the justices further questioned why it would be necessary to prove whether individuals were injured or uninjured at the outset.

The justices’ final line of questioning pertained to when the appropriate time would be to determine Article III standing, with one of the justices suggesting that the determination of Article III standing is only pertinent when apportioning damages.

The rationale for this was that courts do not do anything with respect to uninjured members’ claims until the damages stage. Thus, because uninjured class members’ claims are “just riding along [and] not affecting the litigation in any way,” the justices highlighted that this cast doubt on the necessity of a showing of Article III standing at the outset.

Respondent’s Argument: Article III Standing Not a Requirement for Absent Members

Counsel for Respondent Davis began his argument highlighting that centuries of precedent dictate that only the representative of a class, who is actually before the court as a named party, must prove Article III standing at the outset of class certification and not the absent class members.

Further, Davis’ counsel argued that the understanding has always been that absent class members are not parties over whom the court exercises jurisdiction unless and until the court is doing one of two things: exercising its remedial power with respect to an absentee or deciding a question that it wouldn’t otherwise have to decide, such as an individual question.

The justices’ main line of questioning revolved around how uninjured members would be eventually left out of the damages calculation. Counsel noted that there would have to be an administratively feasible mechanism outlined at the outset to weed out the uninjured members for damages purposes.

Counsel for Davis ended by arguing that Labcorp’s proposed alternative could actually have disastrous consequences for other defendants. As is, defendants can “rest easy knowing that they’ve prevailed in a class action and someone isn’t going to run into state court and bring the exact same claim and say, a-ha, we didn’t have Article III standing in that first case.” This, counsel argued, would disturb the finality of class-wide judgments.

Supreme Court’s Dismissal of the Case and Kavanaugh’s Dissent

On June 5, 2025, the Supreme Court dismissed the case, noting that it had been improvidently granted. Justice Kavanaugh, however, dissented, and the concerns highlighted in his dissent were foreshadowed by his questioning concerning real-world consequences during argument.

Justice Kavanaugh stated that he “would hold that a federal court may not certify a damages class that includes both injured and uninjured members.” His rationale was that, when there is a damages class that includes both injured and uninjured members, the case could not by definition meet the Rule 23 requirement that common questions predominate.

Turning attention to real-world consequences, Justice Kavanaugh noted that classes that are overinflated with uninjured members threaten massive liability for businesses that are targeted with class actions. This, he said, can coerce businesses into unjustifiably costly settlements, which could have severe and widespread consequences. When forced into unjustifiably costly settlements, businesses would then raise the costs of doing business and would be forced to pass on the costs to consumers in the form of higher prices, to retirement account holders in the form of lower returns, and to workers in the form of lower salaries and lesser benefits.

Future of Article III Standing and Class Certification with a Surviving Circuit-Court Split

Currently, there is a three-way split amongst circuits regarding the question of Article III standing and class certification.

The D.C. Circuit and First Circuit permit certification of a class only if the number of uninjured members is de minimis. The Ninth Circuit permits certification even if the class includes more than a de minimis number of uninjured class members. The Eighth and Second Circuits have taken the strictest approach, rejecting certification if any members are uninjured.

Because the Supreme Court still has not ruled on the issue, defendants should continue to scrutinize potential standing deficiencies for both class representatives and absent class members as well. However, there may yet be a resolution, as the issue has been raised again in State Farm Mut. Auto. Ins. Co. v. Jama.

In its petition for certiorari, State Farm poses the question of whether a Rule 23(b)(3) damages class can be certified when some members of the proposed class lack any Article III injury. Whether the Supreme Court will grant certiorari is unclear, but if it does, there will be a renewed opportunity for the Court to answer the question and resolve the longstanding circuit split on the issue.