• by Wendy Davis  @wendyndavis, September 23, 2011

A federal judge has ruled that online data broker Spokeo won't have to face trial on allegations that it violated federal fair credit laws.

The Web user who sued, Thomas Robins of Virginia, didn't adequately allege that he had been injured by wrong information on Spokeo, U.S. District Court Judge Otis Wright II in the Central District of California ruled. Wright specifically rejected Robins' assertion that information on Spokeo hampered his job search.

"The alleged harm to Plaintiff's employment prospects is speculative, attenuated and implausible," the judge wrote in a one-page order issued last week.

Wright added that people only have the right to sue violations of the Fair Credit Reporting Act if they're injured. "Otherwise, federal courts will be inundated by Web surfers' endless complaints," he wrote.

The ruling reflects a change of position for Wright, who came to the opposite conclusion four months ago and ruled that Robins could proceed with his case. After Wright issued that earlier ruling, Spokeo asked him to send the matter to the 9th Circuit Court of Appeals for further review. That move apparently spurred Wright to reevaluate his May ruling.

Robins' lawyer, Jay Edelson, says he intends to appeal to the 9th Circuit. "We believe the court got it right the last time," Edelson says. "We look forward to presenting our arguments on appeal."

Spokeo operates a search engine that allows Web users to search for detailed reports about people by name, email address, screen name or phone number. The company, which gathers information from social-networking sites and other databases, sells a variety of information, including estimates of individuals' financial wealth. Spokeo also offers some basic data for free.

Robins says that Spokeo correctly lists neighborhood and siblings' names, but inaccurately reports other data -- including his age, marital status and field of employment. He argues that Spokeo violates fair credit laws, which require consumer reporting agencies to disclose their sources to consumers and let them dispute wrong information.

Regardless of the outcome of the court case, Spokeo could still face action by the Federal Trade Commission. The digital rights group Center for Democracy & Technology complained last year about Spokeo to the FTC, which has the power to halt unfair or deceptive trade practices.

The FTC hasn't yet publicly indicated whether it intends to take action regarding the company.