Shanthi R. Hejamadi and Ricardo Varela v. Midland Funding, LLC, Midland Credit Management, Inc.

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
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No. 24-2385
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SHANTHI R. HEJAMADI AND RICARDO VARELA
v.
MIDLAND FUNDING, LLC, MIDLAND CREDIT MANAGEMENT, INC., AND
JOHN DOES 1 TO 10
Shanthi Hejamadi,
Appellant
_______________
On Appeal from the United States District Court
for the District of New Jersey
(D.C. No. 2:18-cv-13203)
District Judge: Hon. Katharine S. Hayden
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Submitted under Third Circuit L.A.R. 34.1(a)
September 11, 2025
Before: CHAGARES, Chief Judge, PORTER, and ROTH, Circuit Judges.
(Filed: August 19, 2026)
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OPINION*
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* This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not
constitute binding precedent.

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ROTH, Circuit Judge.
Shanti R. Hejamadi appeals the District Court’s decision to grant the motion to
compel arbitration requested by Appellees Midland Fund, LLC (Midland) and Midland
Credit Management, Inc. (MCM). Hejamadi asserts that motions filed by Midland in New
Jersey state court, and by both Midland and MCM in federal court, waived Appellees’ right
to compel arbitration in the instant action.
This case comes to us on appeal for the second time. We previously remanded this
matter to the District Court to consider the impact of a recent Supreme Court decision
which changed the standard we use to evaluate whether a party waived their right to
arbitrate.1 Today, however, we will not reach the merits because Hejamadi never had
standing to bring her claim in the first place. Accordingly, because we lack subject matter
jurisdiction over this action, we will vacate the District Court’s order compelling arbitration
and remand with instructions to dismiss the complaint.
I.
In 2017, Midland purchased a pool of credit card accounts from Citibank, N.A.
which included accounts belonging to Hejamadi. In April 2018, Midland initiated a debt
collection against Hejamadi in New Jersey state court to collect money she allegedly owed
on her account. In response, Hejamadi brought a class action under the Fair Debt
Collection Practices Act (FDCPA), alleging that Midland violated the statute by including
a false statement in its debt collection letters to Hejamadi. Specifically, Hejamadi alleged
1 Morgan v. Sundance, Inc., 596 U.S. 411, 416 (2022) (abrogating PaineWebber Inc. v.
Faragalli, 61 F.3d 1063, 1068–69 (3d Cir. 1995)).

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that the letters stated that flexible payment options may no longer be available, even though
Midland continued to offer those options. Aside from that purportedly false statement,
Hejamadi did not allege that she suffered any harm or that the statement affected her
conduct in any way. Midland thereafter dismissed its debt collection claim and removed
the FDCPA action to federal court.
On November 6, 2018, Midland filed a motion to compel arbitration and dismiss
Hejamadi’s complaint, citing a provision in the credit card agreement that allowed Midland
to initiate arbitration once the account holder asserted a claim against it. Later that month,
Hejamadi filed an amended complaint that added Ricardo Varela, another account holder,
as a plaintiff and MCM, an entity affiliated with Midland, as a defendant. In response,
Midland and MCM filed a second motion to compel arbitration. Hejamadi and Varela
opposed that motion, arguing that the parties needed to conduct discovery to determine
whether an arbitration agreement existed. The District Court agreed with Hejamadi and
Varela—it denied the motion to compel arbitration without prejudice and ordered limited
discovery on arbitrability.
After the parties completed discovery, Midland and MCM filed a renewed motion
to compel arbitration. This time, the District Court granted their motion, which Hejamadi
and Varela appealed. While the appeal was pending, the Supreme Court decided Morgan
v. Sundance, Inc., which held that courts may not create “arbitration-specific variants of
federal procedural rules.”2 Our Court then adopted a revised framework for arbitration
2 596 U.S. at 417.

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waiver in White v. Samsung Elecs. Am., Inc.,3 and we remanded Hejamadi and Varela’s
appeal for the District Court to consider whether Midland and MCM waived their right to
arbitrate. Following another round of briefing from the parties, the District Court applied
the White framework to find that Midland and MCM did not waive their right to arbitrate.
Accordingly, the court granted Appellees’ motion to compel arbitration and dismissed
Hejamadi and Varela’s amended complaint. Hejamadi appealed for the second time.4
II.
Article III standing is a fundamental requirement, rooted in the bedrock
constitutional principle that our jurisdiction is limited to actual “[c]ases” or
“[c]ontroversies.”5 Despite the many years of litigation in this case—including a review
by a prior panel of our Court and a remand to District Court—the passage of time alone
cannot confer the jurisdiction Article III requires. We have an “independent obligation” to
ensure that Hejamadi has standing before reaching the merits, and we conclude that
Hejamadi lacks standing because she has not alleged the requisite injury-in-fact.6 This
jurisdictional defect precludes us from reaching the arbitration issue for which we
previously remanded the case.
3 61 F.4th 334, 340 (3d Cir. 2023).
4 Before submitting her opening brief, Hejamadi moved to remand the case to the District
Court, contending that our recent decision in George v. Rushmore Serv. Ctr., LLC, 114
F.4th 226 (3d Cir. 2024) established that she lacked standing. The motions panel denied
the request for summary remand.
5 U.S. Const. art. III, § 2; see also Spokeo, Inc. v. Robins, 578 U.S. 330, 337–38 (2016).
6 Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006).

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Article III standing requires that “[t]he plaintiff must have (1) suffered an injury in
fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is
likely to be redressed by a favorable judicial decision.”7 An injury-in-fact is “an invasion
of a legally protected interest which is (a) concrete and particularized; and (b) actual or
imminent, not conjectural or hypothetical.”8 One way for a plaintiff to establish a concrete
injury is to allege an informational injury based on the denial of information to which the
plaintiff is statutorily entitled, coupled with “adverse consequences related to the purpose
of the statute.”9 An injury can also be sufficiently concrete if it bears a “close relationship”
to a harm traditionally recognized as providing a basis for suit in American courts.10
Applying those principles in Huber v. Simon's Agency, Inc., we identified two ways a
plaintiff bringing claims under the FDCPA could establish a concrete injury: (1) an
informational injury resulting from the omission of information to which the plaintiff is
entitled or (2) reliance on inaccurate information that caused harm, which parallels the
common-law tort of fraudulent misrepresentation.11
In George, our Court vacated a district court order compelling arbitration in an
FDCPA case for lack of standing.12 The facts in George were similar to the facts here—
the plaintiff brought suit under the FDCPA, asserting that a debt collection letter she
received omitted information to which she was legally entitled, and that the letter was
7 Spokeo, 578 U.S. at 338.
8 George, 114 F.4th at 234.
9 Kelly v. RealPage Inc., 47 F.4th 202, 212 (3d Cir. 2022).
10 TransUnion LLC v. Ramirez, 594 U.S. 413, 417 (2021).
11 84 F.4th 132, 146, 148–49 (2023).
12 George, 114 F.4th at 240.

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“false, deceptive, and misleading.”13 However, because the complaint alleged neither
adverse consequences flowing from the omitted information nor harm resulting from the
allegedly misleading statements, we held that the plaintiff failed to allege a concrete
injury.14
Turning to the case before us, we conclude that Hejamadi similarly does not have
standing. Hejamadi’s amended complaint only alleged that the debt collection letter she
received contained a false statement. The complaint included no allegations whatsoever
regarding any downstream consequences Hejamadi suffered as a result of the language she
contends was misleading. Given our recent precedent, that fatal omission makes clear that
Hejamadi lacks standing.
We recognize that the standing question presented here arises in an unusual
procedural posture because Hejamadi raised her lack of standing only after the District
Court ordered arbitration—an outcome she sought to avoid. As a result, Appellees argued
in their response to the motion to remand that a determination that Hejamadi lacks standing
would reward her gamesmanship. Appellees also pointed to a footnote in George, where
we suggested that the standing requirements could be relaxed “in a case where
gamesmanship is apparent—a case, perhaps, where a plaintiff deliberately submits an on-
the-fence complaint and later argues she lacks standing in order to void an arbitration
order.”15 But while we do not discount the equitable concerns raised by Appellees, those
13 Id. at 236.
14 Id. at 236–38.
15 George, 114 F.4th at 240 n.20.

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concerns cannot displace our “independent obligation” to ensure that the requirements of
Article III are satisfied before exercising jurisdiction.16 We likewise conclude that
Hejamadi’s conduct does not rise to the level of gamesmanship contemplated in George.
When Hejamadi filed her amended complaint, neither the Supreme Court nor our Court
had yet clarified the requirements of Article III standing in a manner that would have put
her on notice that she lacked standing. Consequently, this turn of events leaves us without
jurisdiction to reach the merits of Hejamadi’s claim.
III.
For the foregoing reasons, we will vacate the District Court’s decision to grant
Midland and MCM’s motion to compel arbitration and remand with instructions to dismiss
the case for lack of standing.
16 Hartig Drug Co. v. Senju Pharma Co. Ltd., 836 F.3d 261, 267 (3d Cir. 2016).

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