abstract. In TransUnion LLC v. Ramirez, the Supreme Court reinterpreted standing’s injury-in-fact requirement to preclude jurisdiction in cases where a plaintiff alleges a statutory violation divorced from a traditionally recognized concrete harm. Scholars and courts have spilled endless ink examining how these standing developments either enforce or undermine the separation of powers. Yet, few have scrutinized how recent changes in standing doctrine implicate federalism when federal courts sit in diversity.

Through the prism of state wage-and-hour laws, this Note explicates how a stringent reading of standing’s requirements imperils key federalism values. It finds that federal courts in New York have used a strict interpretation of TransUnion’s concrete-injury requirement to prevent workers from bringing certain state wage-and-hour claims in federal court. This version of standing robs state legislatures of their policymaking power, creating undesirable practical and normative outcomes. In contrast, California federal courts have adopted a more permissive stance that gives state legislatures their due and preserves workers’ ability to access a federal forum to vindicate their state-law rights. This dichotomy highlights the divergent approaches federal courts may take when assessing standing in diversity jurisdiction cases in the wake of TransUnion. Given the discretion lower federal courts retain in deciding how to read TransUnion, this Note urges federal courts presiding over state wage-and-hour cases in other jurisdictions—as well as those hearing state-law claims generally—to follow the California approach and apply the concrete-injury requirement permissively.

author. Yale Law School, J.D. 2023. Duke University, B.A. 2020. This Note would not have been possible without the boundless support and encouragement of Saylor Soinski, Catalina Odio, and Camila Reed-Guevara. A special thanks to Douglas NeJaime for supervising this project in its initial stages; to Nancy S. Marder and Judith Resnik for first inspiring my curiosity about federalism; to Pooja Shethji and Jennifer Davidson for teaching me all I know about wage-and-hour law; and, finally, to Doménica Merino and the other editors at the Yale Law Journal for their thoughtful feedback and careful editing. All errors are my own.

Introduction

When Herlinda Francisco sued her employer as part of a wage-and-hour class action,1 she likely thought that the federal court presiding over her claim would apply the New York Labor Law (NYLL) provision governing the dispute with relative ease, just as it had in virtually every similar case.2 Instead, Francisco and the rest of her putative class were in for a surprise. Although the court considered the merits of class certification for their overtime and spread-of-hours claims, it dismissed their allegations that their employer had not provided them with the information about their pay, hours worked, and other employment conditions that New York law demanded. The court homed in on the precondition that litigants in federal court must have suffered a concrete injury in fact to satisfy Article III’s standing requirements, finding that, although the plaintiffs had properly alleged violations of NYLL’s wage-documentation provisions, it was “not clear” that there was “an ‘injury’ that can be recognized by a federal court.”3

The court repeated this novel maneuver in an opinion issued the following day. In that instance, the plaintiff, You Qing Wang, persisted through an entire bench trial and had successfully proven that her employer had failed to provide her with the statutorily required information4 before the court decided that she did not have standing to pursue her state wage-documentation claims in federal court.5 Continuing the trend, the court issued yet another opinion the following day finding that a different set of plaintiff-employees lacked standing to obtain relief for their employer’s wage-documentation violations.6 In each of these cases, the court dismissed wage-documentation claims, which were nearly identical to prior successful claims, on the basis that they failed to address the court’s novel interpretation of standing’s concrete-injury requirement. This confounding outcome exemplifies the maxim that standing is “a word game played by secret rules.”7

This departure from precedent was driven by the Supreme Court’s 2021 decision in TransUnion LLC v. Ramirez,8 which fundamentally altered the landscape of Article III standing doctrine. There, the Court held that all plaintiffs, even those asserting a statutorily created private right, must show that they suffered a concrete injury in fact.9 Further, the Court narrowed the class of injuries that are sufficiently concrete to satisfy standing’s “injury-in-fact” test, holding that the central inquiry under this test is whether the injury has a close historical or common-law analogue.10 Finally, the Court held that in a class action, every individual class member must furnish evidence that they specifically suffered a concrete injury.11 Combined, these developments have vastly curtailed plaintiffs’ ability to access federal courts.

As federal courts have subsequently grappled with how expansively to read TransUnion, state wage-and-hour laws have become one of the primary battlegrounds for this debate. This Note provides the first account of how federal courts have applied TransUnion to these state laws. Examining nearly 100 cases, it finds that, while New York federal courts have utilized TransUnion to exclude litigants, California federal courts have opted for a more permissive approach. By scrutinizing the respective approaches in California and New York—the first two forums to apply TransUnion to state wage-and-hour law—this analysis illuminates how standing doctrine can hinder employees’ access to relief for illegal employment practices.12 Additionally, although courts and scholars traditionally consider only the separation of powers in developing and evaluating standing doctrine, these cases shed light on how standing implicates crucial federalism concerns.

This Note argues that using standing doctrine to exclude workers litigating state wage-and-hour claims is both practically harmful and normatively undesirable. Part I provides doctrinal background on the concrete-injury requirement and how TransUnion has changed the standing landscape. Part II investigates how federal courts in New York and California have applied the new concrete-injury requirement to state wage-and-hour laws. The two states represent different ends of the spectrum; while California courts have applied the requirement sparingly, New York courts have used it to preclude wage-documentation and, in some instances, late-payment claims. Part III analyzes the effects of the New York federal courts’ interpretation on various federalism values. In particular, it asserts that a strict application of the concrete-injury standard consolidates federal power at the cost of the states, undermines the role of states as laboratories of democracy by targeting innovative state laws, and contravenes the goals of federal diversity jurisdiction as articulated in Erie Railroad Co. v.
Tompkins.13 In the face of these dangers, federal courts ought to follow a more permissive approach similar to California’s when applying TransUnion to wage-and-hour claims. This result is even more imperative in light of the practical outcomes for workers, many of whom are now locked out of federal court.