In case there was any doubt that TCPA cases continue to flood federal court dockets nationwide, we recently reviewed the nearly 300 decisions referencing the TCPA that have been published since mid-December. Some of them have obviously made big headlines, like ACA v. FCC or the dueling interpretations of the ACA decision in Reyes v. BCA Fin. Servs. and Herrick v. GoDaddy.com, LLC. But many lesser-known decisions also could prove useful in defending TCPA cases. The decisions are listed by issue category in alphabetical order.
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ACA v. FCC Close to a Slam Dunk for TCPA Defendants
Overview of the Ruling
On March 16, 2018, just before tip-off in the first round of the NCAA tournament, the D.C. Circuit provided the TCPA defense bar with a new playbook of sorts, in the form of a decision that will surely change the game for TCPA litigation. The case, of course, is ACA International v. FCC, and the ruling came down nearly 18 months after oral arguments. ACA Int’l et al. v. FCC, No. 15-1211, Doc. No. 1722606 (D.C. Cir. Mar. 16, 2018). It appears to be worth the wait as the D.C. Circuit slam dunked the former definition of automated telephone dialing equipment (“ATDS”) and the “one-call safe harbor” rule for reassigned numbers.
TCPA Case Law Update
Every month or so, we review all Telephone Consumer Protection Act, 47 U.S.C. 227, et seq. (“TCPA”), decisions across the country to stay abreast of developments as we defend these cases throughout the United States. In this inaugural issue of the TCPA Case Law Update by Vedder Price, we offer summaries of some of the defense-friendly decisions entered in the past month and a half. The decisions are listed by issue category in alphabetical order. We plan to post similar summaries on a roughly monthly basis going forward. We hope you find this information useful as you ward off these pesky but nevertheless risky claims.
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DC Circuit Opts Out of Flawed FCC Ruling
If you follow developments in TCPA case law, you’ve probably heard by now that the DC Circuit Court of Appeals last week overturned the 2015 FCC Order that had required TCPA opt-out notices on both solicited and unsolicited faxes. The court held that the FCC’s rule was “unlawful to the extent that it requires opt-out notices on solicited faxes.” See Bais Yaakov of Spring Valley v. FCC, et al., Case No. 14-1234 (D.C. Cir.). In fact, the DC Circuit—despite years of FCC guidance, 13 consolidated appeals and more than two dozen lawyers participating in the briefing—seemed to view this as a relatively simple issue of statutory construction: “The text of the Act provides a clear answer to the question presented in this case. . . . Congress drew a line in the text of the statute between unsolicited fax advertisements and solicited fax advertisements. Unsolicited fax advertisements must include an opt-out notice. But the Act does not require (or give the FCC authority to require) opt-out notices on solicited fax advertisements. It is the Judiciary’s job to respect the line drawn by Congress, not to redraw it as we might think best.”
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TCPA Class Certification Denials Continue to Pile Up, This Time in Florida
Yet another court has found that consent in a TCPA case is an inherently individualized issue that precludes class certification. In Newhart v. Quicken Loans, Inc., 2016 U.S. Dist. LEXIS 168721 (S.D. Fla. Oct. 13, 2016), the plaintiff moved to certify a class of individuals who had received calls from defendant on their cellular telephones, allegedly in violation of the TCPA. The court denied class certification, finding that “resolving the consent issue will depend upon multiple layers of individualized evidence about each call and the circumstances that preceded it. Therefore, predominance is lacking.” Id. at *6. Importantly, the court did not need to decide “whether any class member actually consented.” Id.
The court held that the consent analysis had two parts. First, the trier of fact must determine “whether each challenged call was made for a telemarketing purpose.” Id. If so, prior express written consent would be required. If not, the consent need not be in writing. Id. Second, the trier of fact must determine whether the defendant “possessed the requisite consent before making each call.” Id. at *6–7. The court’s decision that an individualized analysis was necessary turned largely on its finding that the trier of fact must look at each individual call, not the “purpose of the overall campaign. Id. at *7–8. Analogizing to the TCPA fax provision, the court noted that, “[t]he FCC has expressly recognized, in the unsolicited fax context, that even when some aspect of a series of communications might meet the telemarketing rule, others might not, and so it is necessary to examine the communications separately.” Id. at *8. Because evidence showed that the challenged calls in the case were not uniform in purpose, the telemarketing issue could not be resolved on a class-wide basis. Id. at *10.
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Spokeo as a Class-Action Silver Bullet? Two More Dismissals Based on Lack of Concrete Harm
Despite claims from the plaintiffs’ bar that the Supreme Court’s decision in Spokeo Inc. v. Robins, 136 S. Ct. 1540 (2016), did not significantly change the landscape for class actions, courts continue to rely on Spokeo to dismiss claims that have no concrete injury beyond a statutory violation. In the last month, two more cases — including one federal circuit-level decision and one TCPA decision — were dismissed because the plaintiff was unable to demonstrate Article III standing under Spokeo. These cases demonstrate the important role that Spokeo-related arguments can play in stymying class actions.
In Nicklaw v. CitiMortgage, Inc., 2016 U.S. App. LEXIS 18206 (11th Cir. Oct. 6, 2016), the court held that the plaintiff lacked Article III standing to pursue a claim where the class action complaint alleged statutory violations and sought only statutory damages. The only claim asserted by the plaintiff in Nicklaw was that the plaintiff failed to comply with a New York statute requiring it to sign and record a certificate of discharge within 30 days of a mortgage satisfaction. Based on the defendant’s alleged failure to do so, the plaintiff sought monetary damages. The court held that plaintiff alleged “neither a harm nor a material risk of harm that the district court could remedy.” This opinion marked the first time that the Eleventh Circuit had applied the Spokeo framework and will undoubtedly have a ripple effect on district court cases within the circuit (and beyond) when defendants make similar arguments. Although Nicklaw is not a media or privacy case, it certainly provides a roadmap for all manner of class actions.
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Another Desperate TCPA ATDS Claim Bites the Dust
Try as they might, Telephone Consumer Protection Act (TCPA) plaintiffs’ lawyers continue to face judicial resistance to deeming all phones autodialers (automatic telephone dialing systems or ATDS’s). In the latest example, the U.S. Southern District of California granted summary judgment to the defendant, finding the plaintiff’s “evidence” of autodialer use too speculative and too disconnected to the specific calls at issue. See Chyba v. Bayview Loan Serv., 2016 U.S. Dist. LEXIS 133849 (S.D. Cal. Sept. 27, 2016). As the court reasoned, “[N]o matter the name given to the equipment, the ‘basic function’ of an autodialer is ‘the capacity to dial numbers without human intervention.’” Id. at *5 (quoting In re Rules and Regulations Implementing the Tel. Consumer Prot Act of 1991, 18 FCC Rcd. 14014, 14092 (July 3, 2003)).
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Judges Can’t Stand TCPA Claims
Telephone Consumer Protection Act (TCPA, 42 U.S.C. § 227) claims often are a waste of time and money. The plaintiffs frequently are serial (some having filed dozens of claims) and usually want to receive the alleged spam so they can sue and cash in. The harm is slim to non-existent, and the economic burden of the litigation on defendants (and the courts) is staggering. In a ruling on August 8, U.S. Northern District of Illinois Judge St. Eve ruled that she wouldn’t “stand” for this state of affairs any longer (or at least not with respect to the facts before her). She found that because the plaintiff was not in the “zone of interests” intended to be protected by the TCPA, the plaintiff lacked statutory standing. See Tel. Sci. Corp. v. Asset Recovery Solutions, 2016 U.S. Dist. LEXIS 104234, at *50 (N.D. Ill. Aug. 8, 2016).
As a result of selling a tool for screening alleged robocalls, plaintiff Telephone Science Corporation (TSC) claimed it had received a lot of calls in violation of the TCPA. Id. at *4. Judge St. Eve ruled that because the whole purpose of TSC’s business was to identify/screen robocalls, it couldn’t sue under the TCPA based on receipt of those robocalls. Id. at *48–50. In other words, TSC’s claims did not implicate the interests against privacy intrusion and nuisance underpinning the TCPA.
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Defense Implications of Campbell-Ewald: The Sky is NOT Falling
I. Introduction
On January 20, 2016, the U.S. Supreme Court issued its highly anticipated opinion in Campbell-Ewald Co. v. Gomez, ruling that an unaccepted settlement offer, or offer of judgment, without actual payment and/or entry of judgment does not moot a named plaintiff’s class action claims. In essence, the ruling prevents defendants from offering (but not paying) complete individual relief and then arguing for dismissal of a putative class action based on satisfaction of the class representative’s individual claim. Although this ruling was a loss for class action defendant Campbell-Ewald Co. (“Campbell”), the opinion potentially validates a powerful tool for class action defendants going forward because it suggests that actual payment of complete individual relief and/or entry of judgment for that individual relief, rather than a mere offer, is sufficient to fully satisfy a class representative’s individual claim, resulting in the entry of judgment based on the absence of Article III standing and in dismissal of the class claims without prejudice.
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TCPA case stays related to ACA, Campbell-Ewald, and Spokeo Continue to Multiply
In two federal decisions handed down on the same day (Dec. 17, 2015), federal courts in California and Georgia gave early Christmas presents to defense lawyers by granting requests to stay TCPA cases based on proceedings before the U.S. D.C. Circuit Court of Appeals and the U.S. Supreme Court. See Fontes v. Time Warner Cable, Inc., 2015 U.S. Dist. LEXIS 169580 (C.D. Ca. Dec. 17, 2015); Luster v. Jewelers, 2015 U.S. Dist. LEXIS 169115 (N.D. Ga. Dec. 17, 2015). These decisions highlight how TCPA cases have increasingly become simultaneous multi-front battles before district courts, courts of appeal, the Supreme Court, and the FCC and how proceedings in one or more other venues often can influence defense at the district court level (even without perfect party or claim parity among the various matters).
In Fontes, defendant Time Warner Cable argued that the ATDS and pre-recorded message putative class action should be stayed again (it had already been stayed once pending action by the FCC) because of “re-assigned number” issues addressed by the FCC in its July 10, 2015 Declaratory Ruling and Order and the subsequent appeal of that order to the D.C. Circuit. See 2015 U.S. Dist. LEXIS 169580 at *10 (consolidated case pending as ACA Int’l, et al. v. Fed. Commncn’s Comm., No. 15-1211 (D.C. Cir. 2015)). The court agreed and granted the stay, reasoning that “in light of the close divide amongst the FCC commissioners and the fact that at least one commissioner believes the FCC’s ruling is ‘flatly inconsistent with the TCPA,’ there is a legitimate possibility that the Court of Appeals may overturn that ruling. Accordingly, the proper interpretation of the TCPA remains unclear.” Id. at *12.
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