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SCOTUS holds assignee of claims claims have standing eve if they have no interest in the proceeds of verdict or settlement

By Bill Watkins, Esq.

The Supreme Court decided Sprint v. APCC, which dealt with an interesting assignment issue. At base, the Court was asked to decide whether a plaintiff who has been assigned rights to pursue a legal claim, but will collect no proceeds from the outcome of the suit, has standing under Article 3 to bring suit. The Court held that such a plaintiff does have standing to sue.

This case arose out of the pay phone industry. A common practice in the industry is for pay phone service providers to assign claims against long-distance carriers to aggregators such as APCC. Because many of the claims are very small, the aggregators take assignments from multiple operators and then bring suit. The aggregator is paid a fee for this service and the settlement amount or proceeds from litigation goes back to the pay phone operator.

Reviewed a number of precedents and held that American courts have long found ways to allow assignees to bring suit. Lawsuits by assignees, including assignees for collections only, are cases in controversies of the sort traditionally amendable to, and resolved by, the judicial process. Emphasize that within the past decade it has expressly held that an assignee can sue based on his assignor?s injuries. The Court, as an example, cited that a qui tam relator possesses Article 3 standing to bring suit under the False Claims Act, which authorizes a private party to bring suit to remedy an injury that the United States suffered.

Full post as published by South Carolina Appellate Law Blog on June 25, 2008 (boomark / email).