Volume 22 Number 18, October 7, 2002
(Excerpted From Page 2)
ARE EMOTIONS 'ACTUAL?' 4th CIRCUIT
TACKLES PRIVACY ACT DAMAGES
The federal appeals panel in Richmond
has ruled 2-1 that a plaintiff must prove actual damages in order
to recover the Privacy Act's minimal award of $1,000. The ruling,
which offers one of the most detailed discussions of Privacy Act
damages, drew a sharp dissent and likely will be appealed to the
entire appeals court (en banc).
The ruling, by the U.S. Court of Appeals for the
Fourth Circuit reversed a district court award of $1,000 to a Virginia
coal miner ("Buck Doe") whose Social Security number was wrongly
disseminated in the course of a black lung benefits claim.
The Fourth Circuit majority, while not reaching
the issue of whether "emotional distress" is included within the
Privacy Act's definition of actual damages, indicated that it was.
However, the majority went to great lengths to emphasize that Privacy
Act plaintiffs must prove they actually suffered emotional distress.
"Buck Doe did not produce any evidence of tangible
consequences stemming from his alleged angst over the disclosure
of his SSN. He claimed no medical or psychological treatment, no
purchase of medications (prescription or over-the-counter), no impact
on his behavior, and no physical consequences. Further, no evidence
of any kind corroborates the conclusory allegations in Buck Doe's
affidavit," wrote Judge Karen Williams.
"Under these circumstances, we need not reach the
issue of whether the term 'actual damages' as used in the Act encompasses
damages for non-pecuniary emotional distress because, regardless
of the disposition of that issue, Buck Doe's claims fail for lack
of evidentiary support. In turn, because we have concluded that
'actual damages' are a prerequisite to the recovery of statutory
minimum damages, and because Buck Doe utterly failed to produce
evidence sufficient to permit a rational trier of fact to conclude
that he suffered any "actual damages," the district court's entry
of summary judgment in Buck Doe's favor as to his entitlement to
a statutory 'actual damages' award must be reversed," she wrote.
In dissent, M. Blane Michael wrote, "Congress creates
statutory damages remedies because it wants to encourage civil enforcement
suits in situations where actual damages are difficult to prove.
. . (T)he danger that plaintiffs with meritorious cases will 'walk
away from the courthouse empty handed' is especially great when
the wrong to be remedied is the invasion of privacy because damages
arising from that wrong can be hard to quantify. This is because
the typical injury caused by invasions of privacy is mental distress."
The case stems from the handling of over one
million claims for black lung benefits by the Labor Dept.'s Office
of Workers' Compensation Programs (OWCP) and its Division of Coal
Mine Workers' Compensation. OWCP assigned an "OWCP number" to identify
each claim, but when a coal miner applied for benefits, he was asked
to provide his SSN voluntarily and was informed that the number
may be used to facilitate determination of benefits eligibility.
OWCP then substituted the SSN as the "OWCP number."
Hearing forms sent out by some administrative law
judges (ALJs) included the SSNs, meaning that they were (1) disclosed
to other applicants, their employers, and counsel, and (2) frequently
included in publicly released ALJ and Benefits Review Board decisions
that, in turn, were published in benefits decision reporters and
made available in computerized legal research databases. Buck Doe
and six other unnamed plaintiffs filed suit under the Privacy Act.
The district court, citing Buck Doe's testimony
that dissemination of his SSN caused stress, ruled that he established
actual damages and awarded him $1,000, the Privacy Act's minimum.
The 5th, 9th, 11th and D.C. Circuits
have all ruled that to recover the Privacy Act's minimal damage
of $1,000, plaintiffs do not have to prove actual damages, only
an adverse effect caused by a willful or intentional violation.
On appeal, the government urged the Fourth Circuit to follow the
Sixth's Circuit's holding that the Privacy Act only allows for recovery
of out-of-pocket losses.
Judge Karen Williams declined to go that far,
but said that her finding that plaintiff must prove actual damages
was consistent with the 6th Circuit's view that waivers
of sovereign immunity (i.e., the government agreeing by statute
that it can be sued) must be narrowly construed in favor of the
Judge Williams' standards for the need to prove
emotional distress were based largely on the 4th Circuit's
1996 opinion in Price v. City of Charlotte
(93 F.3d 1241), from which she quoted extensively, even though it
was not a Privacy Act case.
"An award of compensatory emotional distress damages
requires evidence 'establish[ing] that the plaintiff suffered demonstrable
emotional distress, which must be sufficiently articulated; neither
conclusory statements that the plaintiff suffered emotional distress
nor the mere fact that a . . . violation occurred supports an award
of compensatory damages.' A plaintiff's own conclusory allegations
that he felt 'embarrassed,' 'degraded,' or 'devastated,' and suffered
a loss of self-esteem, will not suffice to create a disputed issue
of material fact for the jury regarding the presence of compensable
emotional distress, "she wrote. She cited the 5th Circuit's
1998 opinion in Brady v. Fort Bend County (145
F.3d 691) a Section 1983 case, in which the court held that "vague
and conclusory" testimony that a claimant was "highly upset," could
not "accept it mentally," "didn't feel like the same person," or
"spent more time on the couch" did not satisfy the specificity standard
for compensable emotional distress.
"Where, on the other hand, a plaintiff can produce
evidence that emotional distress caused chest pains and heart palpitations,
leading to medical and psychological treatment which included a
formal diagnosis of 'major depressive disorder,' as well as necessitated
prescription medication, it is clear that some amount of compensatory
damages for emotional distress is warranted," she wrote, citing
the 4th Circuit 2001 case, Knussman v. Maryland
(272 F.3d 625).
"In determining whether sufficient evidence exists
to support an award of more than nominal damages for emotional distress,
we examine factors such as the need for medical, psychological,
or psychiatric treatment, the presence of physical symptoms, loss
of income, and impact on the plaintiff's conduct and lifestyle,"
Judge Williams wrote.
"Buck Doe's evidence of emotional distress in this
case falls far below the level which our precedent demands before
the issue of compensatory damages for emotional distress may be
submitted to the finder of fact. He testified that he was 'greatly
concerned and worried' about the disclosure of his SSN; that he
felt his privacy had been violated in 'words he cannot describe';
that he felt the consequences of the disclosure of his SSN could
be 'devastating' for himself and his wife, and that the disclosure
of his SSN had 'torn [him] all to pieces,' in a manner that 'no
amount of money' could ever compensate." She was joined by Judge
J. Michael Luttig
In dissent, Judge M. Blane Michael said the
problem with the majority's approach is that, "even on the most
restrictive reading, the statute plainly awards $1,000 in statutory
damages to a plaintiff who can prove $1, or even one penny, of actual
"The Price framework was simply
not designed to help courts decide whether a plaintiff's testimony
adequately supports damages awards for such small sums. Consider
the various factors that Price regards as adequate
corroboration of emotional distress: 'medical, psychological, or
psychiatric treatment, the presence of physical symptoms, loss of
income, and impact on the plaintiff's conduct and lifestyle.' I
think it highly unlikely that any plaintiff would seek medical,
psychological, or psychiatric treatment, lose income, or undergo
a change of lifestyle because of one dollar's worth of emotional
distress. Physical symptoms (sleeplessness, for example) might be
present even in very minor cases of emotional distress, but then
again they might not. All these factors are of course relevant to
deciding whether a plaintiff experienced significant emotional distress
-- the kind that could support a substantial compensatory damages
award. But they have little to say about whether claims of very
minor emotional distress are genuine, and the majority agrees that
if emotional distress counts as 'actual damages' at all, proof of
very minor emotional distress entitles the plaintiff to statutory
damages under the Privacy Act," he wrote.
"The Price framework is unhelpful
in evaluating claims of very minor emotional distress for a simple
reason: no plaintiff in a lawsuit under § 1983 (or any other
cause of action without a statutory damages provision) ever sets
out to prove that he suffered one dollar's worth, let alone one
penny's worth, of emotional distress. When a plaintiff winds up
with nominal damages, this means either that he conceded the absence
of actual injury and sought to vindicate an abstract right or that
he sought substantial damages and lost. A nominal damages award
surely does not mean that the plaintiff has tried, but failed, to
prove that he suffered one dollar's worth of emotional distress,"
"First, Congress created the statutory damages remedy
as an incentive to suit because it recognized that damages from
government invasions of privacy are hard to prove. Second, Congress
recognized that the typical injury caused by the invasion of privacy
is emotional distress. Third, Congress intended for the statutory
damages remedy to be available to plaintiffs who suffered even very
minor harms as a result of the government's intentional or willful
invasion of their privacy," he continued.
In a footnote, he said, "If the Secretary is correct
in her contention that 'actual damages' includes only out-of-pocket
losses, proof of actual damages cannot be a prerequisite to the
recovery of statutory damages. Conversely, I believe that the majority's
holding commits this
circuit to the position that the term 'actual damages'
includes at least emotional distress that would qualify as 'demonstrable'
under Price." (Buck Doe, Virginia
Privacy Litigation, et al. v. Elaine L. Chao, Sec. of Labor, et
al.: CA-4 -- No. 00-2247 & --2292; Sept. 20.)