Robert J. Gallagher v. Santander Consumer USA, Inc.

United States Court of Appeals
For the Eighth Circuit
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No. 23-3387
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Robert J. Gallagher
Plaintiff - Appellant
v.
Santander Consumer USA, Inc.
Defendant - Appellee
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Appeal from United States District Court
for the Eastern District of Missouri - St. Louis
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Submitted: September 25, 2024
Filed: January 13, 2025
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Before SMITH, ERICKSON, and STRAS, Circuit Judges.
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STRAS, Circuit Judge.
Can a lender keep a car title for 15 days after a borrower pays off the loan?
Robert Gallagher wants to find out on behalf of a potential class of Missouri
consumers. Only he has failed to identify an injury-in-fact, so we vacate the grant
of summary judgment and instruct the district court to remand the case to state court.

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I.
Gallagher borrowed money from Santander Consumer USA to buy a car.
When the time came to pay off the loan, he made the final payment by electronic-
funds transfer. Based on its standard practice, Santander waited 15 days before it
sent the title.
Under Missouri law, a “lienholder shall release [its] lien” within “five
business days” after it “receives payment in full,” including “by way of electronic
funds transfer,” or “pay . . . liquidated damages.” Mo. Rev. Stat. § 301.640.1, .4
(emphasis added). Hoping to recover them on behalf of a class of borrowers affected
by Santander’s 15-day policy, Gallagher sued in Missouri state court. See id.
§ 507.070.
Removal of the case to federal court ended in summary judgment for
Santander. Gallagher wants us to reverse, but we told the parties to be ready to
discuss whether this case belongs in federal court at all.
II.
The reason is simple: “we have an independent obligation to assure ourselves
of subject-matter jurisdiction.” Hekel v. Hunter Warfield, Inc., 118 F.4th 938, 941
(8th Cir. 2024) (citation omitted). What is potentially absent is “standing,” Spokeo,
Inc. v. Robins, 578 U.S. 330, 338 & n.6 (2016) (identifying the requirements and
observing that they apply to a class representative), something that Santander had
“the burden of establishing” as the one who “invok[ed] federal jurisdiction,” Lujan
v. Defs. of Wildlife, 504 U.S. 555, 561 (1992); see Fox v. Dakkota Integrated Sys.,
LLC, 980 F.3d 1146, 1151 (7th Cir. 2020) (observing that, when “a case is removed
from state court . . . the defendant, as the proponent of federal jurisdiction, must
establish the plaintiff’s Article III standing” (emphasis omitted)). Both parties
believe it exists and want us to go straight to the merits. If they are wrong, the case
is headed back to state court. See Wallace v. ConAgra Foods, Inc., 747 F.3d 1025,

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1033 (8th Cir. 2014); see also 28 U.S.C. § 1447(c) (stating that in removal cases,
“[i]f at any time before final judgment it appears that the district court lacks subject
matter jurisdiction, the case shall be remanded” (emphasis added)).
The missing ingredient here is an injury-in-fact, “an invasion of a legally
protected interest that is concrete . . . and actual[,] . . . not conjectural or
hypothetical.” Spokeo, 578 U.S. at 339 (citation omitted). Although Gallagher
claims that the violation of a statute is all he needed, a “bare ‘statutory violation’” is
not enough. Hekel, 118 F.4th at 942 (quoting Spokeo, 578 U.S. at 341). As we have
explained, there must be some “concrete harm in addition to and ‘because of’” it.
Id. (quoting TransUnion v. Ramirez, 594 U.S. 413, 426–27 (2021)). In other words,
the delay must have caused an injury that itself “satisf[ies] the requirement of
concreteness.” Id. (quoting Spokeo, 578 U.S. at 341).
“Central to assessing concreteness is whether the asserted harm has a close
relationship to a harm traditionally recognized as providing a basis for a lawsuit in
American courts—such as physical harm, monetary harm, or various intangible
harms.” TransUnion, 594 U.S. at 417 (citation omitted). Gallagher has not
identified a monetary harm, like a failed effort to sell the car or to use it as collateral
while Santander retained the title. See Lloyd v. FedLoan Servicing, 105 F.4th 1020,
1028 (8th Cir. 2024) (noting that “denial of credit can give rise to an actual claim for
damage”); see also Connecticut v. Doehr, 501 U.S. 1, 11 (1991) (observing that a
clouded title can “significant[ly]” affect “property interests,” including by
“impair[ing] the ability to sell . . . the property” or “reduc[ing] the chance of
obtaining a . . . loan or additional mortgage”); Bassett v. Credit Bureau Servs., Inc.,
60 F.4th 1132, 1136 (8th Cir. 2023) (explaining that making payments in response
to an allegedly unlawful debt-collection letter is a “tangible harm,” but just
“receiv[ing] the letter” is not). Nor is there evidence that the delay affected his credit
rating. Cf. TransUnion, 594 U.S. at 432 (holding that “the publication to a third
party of a credit report bearing a misleading . . . alert injure[d] the subject of the
report”).

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The only possible harm on this record is intangible: his title was clouded for
longer than it should have been. The question for us is whether this type of harm
has “a close historical or common-law analogue” that can satisfy the concreteness
requirement. Id. at 424. Gallagher identifies two possibilities, but neither one
works.
A.
The first invokes the traditional “jurisdiction of courts of equity to remove
clouds from title.” Simmons Creek Coal Co. v. Doran, 142 U.S. 417, 449 (1892). If
courts could hear those cases, then the existence of a cloud alone must have
“traditionally . . . provid[ed] a basis for a lawsuit in American courts.” TransUnion,
594 U.S. at 417.
The remedy in those cases, however, was purely prospective: an injunction
ordering the cloud removed. See, e.g., Hopkins v. Walker, 244 U.S. 486, 490 (1917).
Gallagher, by contrast, seeks damages for past conduct, which makes sense given
that Santander had already delivered clean title by the time he sued. There was
nothing left for prospective relief to fix.
The mismatch matters because standing depends on the “form of relief”
requested. TransUnion, 594 U.S. at 431. The fact that there may be an analogue
supporting “standing to seek injunctive relief does not necessarily mean that
[Gallagher] has standing to seek retrospective damages.” Id. at 436; cf. Murthy v.
Missouri, 603 U.S. 43, 59 (2024) (observing that whether “injuries are relevant”
depends on whether the plaintiff seeks “compensatory” or “forward-looking relief”).
Clouded-title cases do not work as an analogy for another reason. The injury
is the cloud itself, the ongoing interference with a property owner’s rights. See Ward
v. Chamberlain, 67 U.S. 430, 445 (1862) (observing that “equity will interfere” if
“an [unfounded or void] instrument is outstanding”). Yet in this case, there has been
no showing that Santander’s delay has caused any ongoing injury to Gallagher’s

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rights, nor that he feared it would.1 The analogy, in other words, gets the parties no
closer to one “traditionally recognized” as providing damages. TransUnion, 594
U.S. at 417.
B.
Neither does slander of title, but for a different reason. Although it remedies
past harm, the similarities largely end there.
An “unusual tort,” TXO Prod. Corp. v. All. Res. Corp., 509 U.S. 443, 469
(1993) (Kennedy, J., concurring in part and concurring in the judgment), slander of
title remedies “pecuniary loss or injury” due to publication of a false statement that
casts doubt on the ownership of property, Erickson v. Nationstar Mortg., LLC, 31
F.4th 1044, 1048 (8th Cir. 2022) (citation omitted). Uncommon as it may be, it has
long “provid[ed] a basis for a lawsuit in American courts.” TransUnion, 594 U.S.
at 417; see, e.g., Surgett v. Lapice, 49 U.S. 48, 52 (1850); M’Cluny v. Silliman, 28
U.S. 270, 271 (1830); Like v. McKinstry, 41 Barb. 186, 188 (N.Y. Gen. Term 1863);
see also TXO Prod. Corp. v. All. Res. Corp., 419 S.E.2d 870, 878 (W. Va. 1992)
(observing that “slander of title long has been recognized as a common law cause of
action,” dating back at least to the time of Queen Elizabeth I, circa 1591). The only
question is whether the injury underlying Gallagher’s tardy-title claim resembles one
in a slander-of-title case. See TransUnion, 594 U.S. at 417.
It turns out it does not. Missing is the pecuniary harm that must flow from the
publication of the false statement. See Landstrom v. Thorpe, 189 F.2d 46, 51 (8th
1 The analogy might have worked if “exposure to” the extended cloud had
caused Gallagher some “independent[]” concrete harm at the time. TransUnion, 594
U.S. at 437–38 (recognizing that standing for a damages claim may exist when a
past injury resulted from “the mere risk” of a possible future injury); see Clemens v.
ExecuPharm, Inc., 48 F.4th 146, 156 (3d Cir. 2022) (holding that a risk of future
harm “can satisfy concreteness” in a suit for damages if “additional, currently felt
concrete harms” flowed from it). Nothing like that, however, exists here.

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Cir. 1951) (recognizing that an action for slander of title “is not one for words
spoken, but . . . for special damages for the losses sustained by reason of the
speaking and publication of the slander” (citation omitted)); Bentley v. Reynolds, 26
S.C.L. (1 McMul.) 16, 19–20 (1840) (holding that “words occasioning actual
damage[] are actionable” in a slander-of-title action (emphasis added)). Examples
include accumulating extra interest due to a belief that the loan still exists, see
Fountain v. Mojo, 687 P.2d 496, 501 (Colo. App. 1984); losing out on a sale because
a credit check showed a continuing lien on the car, see Greenlake Inv. Co. v.
Swarthout, 161 S.W.2d 697, 699 (Mo. Ct. App. 1942); Like, 41 Barb. at 193; and
incurring attorney fees to clear the title, see Lau v. Pugh, 299 S.W.3d 740, 750 (Mo.
Ct. App. 2009). Gallagher does not even try to identify a monetary harm, much less
one that resembles any of those.
Without a financial injury, this case starts to look a lot like TransUnion.
There, just like here, “the mere presence of an inaccuracy . . . cause[d] no concrete
harm.” TransUnion, 594 U.S. at 434. Santander’s practice of holding on to the title
for an extra 10 days may be frustrating, and it may even violate Missouri law, but it
does not automatically result in an Article III injury. See id. at 442 (“No concrete
harm, no standing.”); Spokeo, 578 U.S. at 342 (noting that “not all inaccuracies cause
harm”).
III.
We accordingly vacate the district court’s judgment with instructions to
remand the case to state court.
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