National Grid’s Limited Waiver of Caller Identification Requirements Granted by the FCC

The FCC continues to dispose of pending petitions or requests for waiver of its TCPA rules. One slightly unusual request was the petition filed last February by National Grid USA, Inc. (“National Grid”) requesting a limited waiver of section 64.1200(b)(1) of the Commission’s rules to allow it to satisfy its TCPA caller identification requirements by providing a “doing business as” (“DBA”) name it had registered with state utility commissions when placing prerecorded voice calls rather than its legal name. See In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, Petition for Declaratory Ruling and/or Waiver submitted by National Grid USA, Inc., CG Docket No. 02-278, filed Feb. 18, 2014 (“National Grid Petition”).

The FCC’s rule implementing Section 227(d)(3)(A) of the Communications Act requires that “all artificial or prerecorded telephone messages (i) shall, at the beginning of the message, state clearly the identity of the business, individual, or other entity initiating the call.” See 47 C.F.R. § 64.1200(b)(1). The rule specifically requires that all artificial or prerecorded calls from a business must include “the name under which the entity is registered to conduct business with the State Corporation Commission (or comparable regulatory authority).” Id. In adopting this requirement, the FCC clarified that “[w]ith respect to the caller’s name, the prerecorded message must contain, at a minimum, the legal name under which the business, individual or entity calling is registered to operate.” Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, CG Docket No. 02-278, Report and Order, 18 FCC Rcd 14014, 14100, para. 144 (2003) (emphasis added). While the FCC recognized that some businesses use a DBA name in messages, the agency clarified that its rule “does not prohibit the use of such [DBA names], provided the legal name of the business is also stated.” Id.

As a matter of policy, the FCC has observed that “adequate identification information is vital so that consumers can determine the purpose of the call, possibly make a do-not-call request, and monitor compliance with TCPA rules.” Id. In reconsidering its rules in 2005, the FCC declined to reconsider the requirement for businesses to use their registered legal names to identify themselves, concluding that the “use of [DBA names] alone in many instances may make it difficult to identify the company calling.” See Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, CG Docket No. 02-278, Second Order on Reconsideration, 20 FCC Rcd 3788, 3805, para. 41 (2005).

National Grid’s petition for declaratory ruling or waiver requested FCC confirmation that a registered DBA satisfies the caller identification requirements for artificial or prerecorded voice calls under the Commission’s rules. National Grid Petition at 2. National Grid’s Petition argued that the FCC had not ruled on the specific question of whether a DBA name registered with the State Corporation Commission or comparable regulatory agency could be sufficient for compliance with the rule. Id. at 5. National Grid states that it has registered the name “National Grid” with the appropriate regulatory authority in each state where it operates and it asserts that in its circumstances, this registered DBA name satisfies the intent of the rules. Id. at 6. A DBA name that is registered with the appropriate regulatory authority, for example, allows called parties the same ability to search for and identify the caller in the same way that a registered legal or official business name does. Id.

National Grid maintains operating subsidiaries that provide gas and electric service in several northeastern states. Id. at 2-3. These operating subsidiaries retain their specific historic names, including, for example, Niagara Mohawk Power Corporation, or the Nantucket Electric Company. Id. However, all operating subsidiaries use the National Grid name for all public-facing purposes, such as marketing, billing, and customer service, and its customers identify “National Grid” as the provider of their utility services. Id. As a result, National Grid asserts that customers will be able to identify it more easily if the caller is identified by its registered DBA name. Id. at 6.

In the alternative to a declaratory ruling, National Grid requested a waiver to allow it to use only the registered DBA name when placing prerecorded calls to customers. Id. at 7. National Grid stated that good cause exists for a waiver because its customers are only familiar with the registered DBA name of “National Grid,” and likely have never heard of the official legacy utility names. Id. National Grid also contends that use of both the official and DBA names unnecessarily prolong the prerecorded calls. Id. at 8.

The FCC’s standards for grant of a waiver are for “good cause shown.” See In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, Petition for Expedited Declaratory Ruling and/or Waiver Filed by National Grid USA, Inc., Order, CG Docket No. 02-278, DA 15-1321, para. 9, rel. Nov. 16, 2015. Generally, the FCC may grant a waiver if the relief requested would not undermine the policy objectives of the rule in question, and would otherwise serve the public interest. Id. The FCC concluded that National Grid petition meets these standards. Id. at para. 10. First, the FCC found that National Grid had demonstrated that good cause exists to waive the requirement to provide the name under which the entity is registered to conduct business with the State Corporation Commission when making prerecorded voice calls and allow it to use the name “National Grid” when making artificial or prerecorded voice message calls. Id. at para. 11. Also, the relief granted would not undermine the policy objectives of the rule because consumers will continue to have the ability to search for the identity and contact information of the calling party via the appropriate state or local databases for registered DBA names. Id. at para. 12. Because National Grid demonstrated that its customers are unfamiliar with the legacy names that constitute its subsidiaries’ legal or official business names, the FCC acknowledged that use of these legacy names in its prerecorded messages could confuse some customers as to the identity of the calling party. Id. The FCC found it significant that no customer or other entity had filed comments disputing National Grid’s assertions. Id.

The FCC also determined that National Grid had demonstrated special circumstances warrant a deviation from the general rule in that its customers are familiar with its DBA name and not its official or legal names. Id. at para 13. Moreover, it had registered the “National Grid” DBA name with the appropriate regulatory body in each state in which it conducts business and its customers can access the relevant corporate contact information via the state or local databases for registered DBAs in a way similar to researching registered legal or official names. Id.

Prior requests to allow the use of a DBA name in lieu of an official or legal name to satisfy the requirements of section 64.1200(b)(1) had been rejected because of FCC concerns expressed about the adequacy of such names in identifying the calling party. Id. However, the totality of special circumstances presented in this case alleviates these concerns. Id. The FCC determined that limiting this waiver to the use of the DBA name “National Grid” is in the public interest. Id. Rather than interpreting its rule under the declaratory ruling, the FCC granted National Grid’s waiver request, and dismissed its request for declaratory ruling. Id. While the end result was the same for National Grid, it underscores this FCC’s reluctance to provide relief in cases that might not fit squarely within the set of facts National Grid presented. Thus, other businesses seeking this DBA caller identification relief will still be required to file and prosecute their own petitions.

Federal Court Grants Defendant’s Motion For Partial Summary Judgment

The United States District Court for the Middle District of Florida (J. James D. Whittemore) recently granted LTD Financial Services, L.P.’s motion for partial summary judgment in a TCPA case involving pre-recorded calls allegedly placed to plaintiff’s cellular telephone. See Estrella v. LTD Financial Services, LP, No. 14-2624, 2015 U.S. Dist. LEXIS 148249 (M.D. Fla. Nov. 2, 2015). As we have previously covered, district courts across the country have demonstrated a willingness to dispose of cases where the records fail to establish that the calls or text messages at issue were sent using an automatic telephone dialing system (“ATDS”).

In Estrella, the defendant argued it was entitled to summary judgment because there was no evidence to support the plaintiff’s claim that defendant had placed calls to his cell phone using an ATDS or artificial or prerecorded voice, and that the record, in fact, evidenced that each of the alleged calls at issue had been dialed manually. Id. at *2, 5. Indeed, defendant’s senior vice president had testified that each of the relevant calls had been placed manually by defendant’s employees using a “point and click function.” Id. at *5. This function required defendant’s employees to determine which of the phone numbers on the account they wished to call and to then affirmatively click on the desired phone number before the call would be launched. Id. at *5-6. Defendant’s senior vice president also testified that none of the calls made to plaintiff used an artificial or prerecorded voice. Id. at *5.

Plaintiff attempted to refute defendant’s arguments by submitting an unsworn declaration averring that plaintiff “could tell” defendant was using an ATDS to make the calls because plaintiff would hear “a prolonged silence” and “delays and clicks” upon answering defendant’s telephone calls. Id. at *6. Although the Court first noted that plaintiff’s declaration was neither sworn nor in compliance with 28 U.S.C. § 1746 and therefore could not be considered by the Court in ruling on defendant’s summary judgment motion, the Court nevertheless concluded that the statements contained in plaintiff’s declaration did not establish that defendant used an ATDS to place the calls. Id. at *9. The Court reasoned that, even if accepted, the statements set forth in the declaration did not establish that defendant had used “‘dialing equipment’ that ‘has the capacity to store or produce, and dial random or sequential numbers,’ or that the calls were made using a predictive dialer.” Id. (citing 47 U.S.C. § 227(a)(1); In the Matter of Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 30 FCC Rcd 7961, 2015 WL 4387780 (July 10, 2015)). The Court further explained that “[t]he essential function of an ATDS is ‘the capacity to dial numbers without human intervention.’” Id. at *3 (citing In the Matter of Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 18 FCC Rcd 14014, 2003 WL 21517853 (July 3, 2003)). The Court also noted that there was “no foundation or support for plaintiff’s conclusion that ‘clicks and delays’ and “prolonged silences’ means that an ATDS or predicative dialers was being used to place the calls.” Id. at *10.

In holding that the evidence failed to demonstrate that the defendant had used an ATDS to place calls to plaintiff, the Court also rejected plaintiff’s “broad assertions” that defendant used two predictive dialing systems – Caste Connects and Avaya – that plaintiff claimed “‘are considered to have the present capacity to autodial such that they are an [ATDS].’” Id. The Court rejected plaintiff’s argument, explaining that, while plaintiff’s claim may be true, there was no evidence in the record that defendant used either of those predictive dialing systems to make the calls at issue. Id. at *11.

Supreme Court Hears Oral Argument in Spokeo, Inc. v. Robins

Earlier this week the Supreme Court heard oral argument in Spokeo, Inc. v. Robins, which concerns whether Congress can confer Article III standing on a plaintiff who alleges a violation of a statute (i.e., an injury in law) but no resulting harm (i.e., an injury in fact). For those who were unable to attend the argument, recordings and transcriptions of the argument are available here and here.

Distinguished In-House Counsel to Join TCPA Blog Contributors for CLEs in San Francisco and Los Angeles

Please join Drinker Biddle’s TCPA Team and special in-house counsel guests for a CLE program titled “Braving the Minefield of the Telephone Consumer Protection Act: hot Topics in Litigation and Compliance” that will address recent developments and successful defense strategies related to the TCPA.

San Francisco

Tuesday, November 10
The Ritz-Carlton
600 Stockton Street

Los Angeles

Wednesday, November 11
Beverly Wilshire
500 Wilshire Boulevard

Special Guests

Alycia Horn, Assistant General Counsel, Comcast Cable
Melinda McAfee, Vice President & Associate General Counsel, Abercrombie & Fitch
Allison Marrazzo, Litigation, Patent and Technology Counsel, eBay Inc.

About the CLE Program

The TCPA touches businesses across industries that communicate with consumers via phone calls, text messages and/or faxes. It is a favorite among the plaintiffs’ class action bar given the uncapped aggregate damages of $500 up to $1500 per call, text or fax and record settlements of up to $75 million have been reached. A number of these cases are pending in state and federal courts in California and across the country. New actions are filed every day.

Drinker Biddle’s TCPA Team is at the forefront of recent developments in this space. We are defending many of the nation’s leading companies in putative class actions and advising many others on how to improve their policies and practices in light of the evolving regulatory landscape. Members of our team and noted special in-house counsel guests will take an in-depth look at litigation trends and defense strategies, recent developments before the FCC and in the consolidated appeal of the Commission’s July 10th Order, and compliance tips and best practices.

This program has been approved for 1.0 general credit of California Continuing Legal Education. Should anyone need credit in any state other than California, please let us know at your earliest convenience so we can apply for accreditation.

To register, click here or email us at


Why Everyone Is Upset About The Third Circuit’s Recent TCPA Decisions … And A Few Reasons Why They Shouldn’t Be: Part II

This is the second of two posts discussing the Third Circuit’s recent TCPA decisions. This one, Dominguez v. Yahoo, Inc., No. 14-1751 (3d Cir.), concerns the proper interpretation of the term “automatic telephone dialing system” (“ATDS”), which is front and center in the consolidated appeal from the FCC’s July 10th Declaratory Ruling and Order.

Dominguez v. Yahoo:
What is an ATDS?

As we reported last year, Judge Baylson of the Eastern District of Pennsylvania granted summary judgment in favor of Yahoo! because he found that its email-to-text alert system did not use an automatic telephone dialing system (“ATDS”). Plaintiff Bill Dominguez alleged that Yahoo! used an ATDS to send thousands of unsolicited text messages (27,809 over 17 months) to his cell phone. The text messages were part of a Yahoo! service that allowed account holders to have incoming email messages automatically truncated and forwarded to cell phones as text messages. One such account holder was Jose Gonzalez, who neglected to disable or update the service after his cell phone number was reassigned to Mr. Dominguez. Uninterested in Mr. Gonzalez’s emails, Mr. Dominguez contacted Yahoo!, which told him that the service could only be stopped if the Yahoo! account holder (Mr. Gonzalez) disabled it himself. Mr. Dominguez then filed suit and sought statutory damages of at least $500 per text message, which would come to nearly $14,000,000 for him (before trebling) and an unknown but presumably enormous number for the putative class he hoped to represent.

One of the primary issues on summary judgment was whether the Yahoo! service used an ATDS, which the statute defines as “equipment which has the capacity—(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.” 47 U.S.C. § 227(a)(1). Yahoo! argued that its system was not an ATDS because it did not use a “random or sequential number generator” to “store or produce telephone numbers to be called.” Rather, its system only sent messages to a user that had authorized them and only when that user received an email. The plaintiff, on the hand, argued that the definition of an ATDS captured not only systems that can “store or produce” numbers randomly or sequentially, but also systems that can “dial … numbers” randomly or sequentially from a stored list.

The district court agreed with Yahoo!, finding that the plaintiff had not offered any evidence to show that its system had the capacity to randomly or sequentially produce telephone numbers (as opposed to simply storing telephone numbers). The district court rejected the plaintiff’s reading of the statute, finding that it improperly focused on the manner in which calls are “dial[ed]” rather than how they are “store[d] or produce[d].” The district court also rejected the plaintiff’s reliance on FCC rulings that purported to expand the definition of an ATDS to include predictive dialers that dial stored numbers without human intervention, finding that the FCC’s statements were not entitled to Chevron deference because they contradicted statutory language that was clear and unambiguous. Dominguez took an appeal to the Third Circuit.

In a short non-precedential opinion, the Third Circuit vacated the district court’s entry of summary judgment and remanded with instructions that the district court “address more fully in the first instance whether Yahoo!’s equipment meets the statutory definition.” Dominguez, slip op. at 8. The plaintiffs’ bar was quick to tout the ruling and make predictions about its impact (never mind that it is non-precedential) and suggestions that it endorsed an expansive definition of an ATDS (never mind that it instructed the district court to address that “in the first instance”). However, a careful review of the opinion reveals that it actually reaffirmed important rulings by the district court that may rein in attempts by the plaintiffs’ bar to expand the ATDS definition.

First, the Third Circuit did not rule that the Yahoo! system was an ATDS. Rather, it vacated the entry of summary judgment because “[t]he only evidence Yahoo! can point to that is probative of whether its equipment has the requisite capacity is the conclusory affidavit of its expert.” Id. at 8. As an aside, that turns the summary judgment standard on its head; if the only evidence of the system’s “capacity” came from the defendant, it follows that no such evidence came from the plaintiff, which would be reason enough to enter summary judgment in favor of the defendant even if the defendant had offered only “conclusory” evidence—or indeed no evidence at all. In any event, the opinion neither means that dialing platforms like the one used by Yahoo! are an ATDS nor precludes the district court in this case from finding on remand that the Yahoo! system is not one.

Second, the Third Circuit agreed with a critical holding that rebuffs some of the more expansive ATDS interpretations. Specifically, it agreed with the district court that, in order to qualify as an ATDS, a system must have the capacity to “store or produce” numbers randomly or sequentially, not merely the capacity to “dial” such numbers randomly or sequentially from a stored list. Id. at 7. In doing so, it endorsed a definition that is narrower than the one advocated by many plaintiffs and adopted by some courts.

Third, the Third Circuit left unanswered the question that likely will be at the center of TCPA litigation in the near future: how courts (including the district court in this case on remand) will treat the FCC’s recent statements about the meaning of “capacity” in the definition of ATDS. To be sure, the Third Circuit correctly characterized the FCC’s views that “capacity” mean potential ability, not “present ability.” Id. at 6-7. But by no means did the Third Circuit indicate that it was endorsing that ruling, which is now the subject of consolidated Hobbs Act appeals to the United States Court of Appeals for the District of Columbia Circuit. Indeed, it is not even apparent from the opinion that the Third Circuit was aware of the pendency of those appeals, and the opinion suggests that in this particular case the plaintiff may have waived the “capacity” argument altogether by conceded below that a system’s present capacity is the relevant consideration. In any event, the opinion does not shed any light on the practical implications of applying the FCC’s interpretation to a particular dialing platform.

In short, while the Third Circuit’s opinion is a short term setback to Yahoo! in this particular case, it does not appear to pose long term concerns to either Yahoo! specifically or defendants generally. To the contrary, the opinion pushes back against efforts to ignore the clear statutory requirement that an ATDS must have the capacity to store or produce numbers using a random or sequential number generator, and largely skirts the critical question of how courts should treat the FCC’s recent statements about the meaning of “capacity” in this context. TCPA observers looking for a case grappling with the implications of those statements will need to wait for another case (or for the proceedings on remand in this one).

Wisconsin District Court Stays TCPA Suit Pending Review of the FCC’s July 10 Order

On October 20, 2015, the U.S. District Court for the Eastern District of Wisconsin granted defendant Performant Technologies, Inc.’s (“Performant”) motion to continue a stay pending judicial review of the FCC’s July 10 TCPA order (previously discussed here) “in the interest of judicial economy.” Gensel v. Performant Technologies, Inc., No. 13-C-1196 (E.D. Wis. Oct. 20, 2015).

In this case, plaintiff Gensel alleges, among other things, that Performant repeatedly called her cell phone number in an attempt to collect on another person’s debt, in violation of the TCPA. Gensel’s cell phone carrier had previously reassigned the debtor’s number to her. On January 28, 2015, the court granted Performant’s motion to stay the case based on the primary jurisdiction doctrine, pending a ruling from the FCC on two petitions relating to the application of the TCPA to debt collection calls, the construction of the term capacity in the ATDS context, and reassigned numbers.

The FCC issued its order in July, the judicial review of which is currently pending (our previous coverage of the petitions for review of the FCC’s order and the consolidated appeal can be found here). In relevant part, the FCC ruled that the TCPA’s use of the term “capacity” in the ATDS context includes not only current, but also potential capacity. It also found that the term “called party” refers to the subscriber or the non-subscriber customary user of a telephone number included in a calling plan and created a very limited safe harbor for certain calls to reassigned numbers.

Relying on the court’s inherent power to manage its docket, the court granted Performant’s motion to continue the stay. In doing so, the court noted that it is unlikely that the FCC will be overruled on the number reassignment/safe harbor issue. The court also noted, however, that the contrary result on the meaning of the term “capacity” is much more likely. Citing at length to the statements of the dissenting Commissioners in the July order, the court stated that “it seems to the Court, as it seemed to the dissenting Commissioners, that the FCC majority’s interpretation of the term ‘capacity’ contradicts the plain language of the statute. If so, then the FCC’s ruling on this issue is not entitled to deference on appeal.” Furthermore, the construction of the term “capacity” is central to the Gensel case. Accordingly, the court found that a stay pending the outcome of judicial review is in the interest of judicial economy.

Given that the issues currently on appeal are at the center of so many pending TCPA cases, it would not be surprising to see other courts taking a similar approach, continuing to stay proceedings pending the conclusion of judicial review of the FCC’s order.

Why Everyone Is Upset About The Third Circuit’s Recent TCPA Decisions … And A Few Reasons Why They Shouldn’t Be

Defendants’ discussions of the Third Circuit’s recent decisions in Leyse v. Bank of America and Dominguez v. Yahoo have been all doom and gloom. Some of that disappointment is understandable, as the Third Circuit vacated notable defense rulings and expanded the scope of consumers who have statutory standing to file suit under the TCPA. On closer examination, however, both of the decisions offer not only a sword to plaintiffs but a shield to defendants. This is the first of two posts that will dissect those decisions and discuss their implications for the ever-growing number of defendants that are facing TCPA claims.

Leyse v. Bank of America:
Who Has Standing To Sue?

In Leyse, a telemarketer placed a single prerecorded telemarketing call to a residential telephone that was shared by roommates Mark Leyse and Genevieve Dutriaux. Leyse filed a putative class action in the District of New Jersey (and, as it happens, several other courts across the country) and alleged that neither he nor Dutriaux had consented to the call.

The defendant moved to dismiss Leyse’s claims because it had intended to call Dutriaux, and as the unintended recipient of the call Leyse should not qualify as a “called party” who would have standing to sue under the statute. (For prior discussions of the term “called party,” see here.) Leyse opposed that motion and argued that the statute permits any “person or entity” to sue irrespective of whether they are a “called party.” The trial court granted the motion and dismissed Leyse’s claim, reasoning that Leyse was at most an incidental recipient of the call who consequently lacked statutory standing. Leyse then took an appeal to the Third Circuit.

The Third Circuit recently reversed. In doing so, it rejected the line of cases that had held that statutory standing extends only to a “called party,” which some courts have interpreted as the “intended recipient” and others have interpreted as the phone’s “subscriber,” “regular user,” or “primary user.” Instead, it held that Section 227(b)(1)(B) identifies who must provide consent (the “called party”) and Section 227(b)(3) identifies who may file suit (any “person or entity”). See Opinion at 12-13 nn.6-9 (citing cases). Simply put, in the Third Circuit’s view, “the text of [Section 227] does not limit the universe of plaintiffs who may file suit….” Id. at 14.

But the Third Circuit went on to explain that standing is not unlimited. On the contrary, standing is limited not only by “Article III of the U.S. Constitution,” which provides that “only certain plaintiffs will have suffered the particularized injury required to maintain an action in federal court,” id. at 14, but also by the Supreme Court’s decision in Lexmark Int’l, Inc. v. Static Controls Components, Inc., 134 S.Ct. 1377, 1388 (2014), which held that “a statutory cause of action extends only to plaintiffs whose interests ‘fall within the zone of interests protected by the law invoked.’” Id. at 15. The decision is notable because it appears to be one of the first to apply the Lexmark standard to the TCPA.

The remainder of the decision focused on trying to “delineate the zone of interests protected by the statute,” which the Third Circuit did by “looking at the prohibitions that the private right of action is intended to enforce.” Id. at 16. It concluded as follows:

It is the actual recipient, intended or not, who suffers the nuisance and invasion of privacy. This does not mean that all those within earshot of an unwanted robocall are entitled to make a federal case out of it. Congress’s repeated references to privacy convince us that a mere houseguest or visitor who picks up the phone would likely fall outside the protected zone of interests. On the other hand, a regular user of the phone line who occupies the residence being called undoubtedly has the sort of interest in privacy, peace, and quiet that Congress intended to protect….

Id. at 21. Because the Court concluded that standing depends on who actually answered the call, it closed by noting that “the burden of proof will, therefore, be on Leyse in the District Court to demonstrate that he answered the telephone when the robocall was received.” Id. at 23.

The outcome of the Third Circuit’s application of the Lexmark standard is troubling to be sure; because there is no way to prevent a third party from answering a call, there is no foolproof way to prevent lawsuits like this one. But all is not lost. On the contrary, a defendant will still be able to defend a case like this by showing that it had consent from the “called party.” See id. at 22 (“The caller may invoke the consent of the ‘called party’ as a defense even if the plaintiff is someone other than the ‘called party.’ Thus, if Dutriaux were the ‘called party’ by virtue of being the intended recipient of the calls, her consent to receive robocalls would shield Bank of America from any suit brought by Leyse.”).

Moreover, the court went out of its way to note that it was not deciding the meaning of the term “called party,” which is one of the principle issues being reviewed by the D.C. Circuit in the consolidated appeal from the FCC’s July 10th Declaratory Ruling and Order. See id. at 18 (“the parties did not brief the issue, and we need not decide it here.”). Accordingly, defendants in the Third Circuit can continue to argue that the “called party” is the intended rather than actual recipient of a call. Defendants can also continue to dispute whether a plaintiff has constitutional standing, which is a separate issue that the Supreme Court will soon revisit. See id. at 15 n.11.

But the most important implication of the ruling may be the one that the court does not discuss, namely its effect on class certification. Because class certification is the point at which claims can go from annoying to annihilating, any additional arrow in defendants’ quiver is a good thing. And the Leyse decision appears to be just that. For example, if the proper plaintiff in a TCPA case is the consumer who “answered the telephone when the robocall was received,” id. at 23, and answering parties only have constitutional and statutory standing if they not only have an “injury in fact” but also are a “regular user of the phone line who occupies the residence,” it follows that plaintiffs in a putative class action must prove that they can establish those things on a classwide basis. It is difficult to fathom how references to a calling log alone would ever be able to ascertain such people, let alone prove their claims on a classwide basis. So while the Leyse decision may make it easier for certain consumers to assert individual claims, it also appears to make it harder for consumers to certify a class action.

Missouri Attorney General Files Telemarketing Actions Against Charter Communications, Inc. and Farmers Insurance; Resolves Action Against Farmers with Simultaneously-filed Consent Judgment

The Missouri Attorney General’s Office recently filed a complaint in the Eastern District of Missouri against Charter Communications, Inc. (“Charter”), a cable, internet, and telephone company. The complaint alleges violations of the TCPA, the Telemarketing Sales Rule, the Missouri No-Call Law, and the Missouri Telemarketing Practices Law, and seeks what amounts to multi-millions of dollars in civil penalties. See State of Missouri ex rel. v. Charter Commc’ns, Inc., No. 15-01593 (E.D. Mo. filed Oct. 19, 2015).

The Attorney General’s Office alleges to have received over 350 complaints from Missouri consumers regarding Charter’s telemarketing practices since September of 2011. Compl. ¶ 53. Specifically, the complaint alleges that Charter provided consumer lists to third-party vendors to market its products and services, and that Charter is “responsible for any illegal actions conducted in the course of any joint venture with any third party,” including any TCPA or other statutory violations committed by its vendors. Id. ¶¶ 25, 38. According to the complaint, these consumer lists contained the identities of both subscribers and non-subscribers to Charter’s services. Id. ¶ 42. Many of the consumers on the lists allegedly did not give Charter permission to call them or are on the Missouri Do-Not-Call and/or Federal Do-Not-Call Lists. Id. ¶ 50.

Additionally, the complaint alleges that Charter and its telemarketers placed “at least thousands of telemarketing calls to Missouri consumers, even after the consumers asked that Charter stop calls and had not rescinded that request.” Id. ¶ 51. In instances where a consumer requested not to receive additional calls, the complaint alleges that the amount of time it took to add consumers to Charter’s internal do-not-call list (45 days) and the number of calls placed to consumers during that 45-day period was unreasonable. Id. ¶ 52.

As relief, the Attorney General’s Office is seeking civil penalties, permanent injunctions, and other equitable relief. Specifically, the Attorney General’s Office is seeking a civil penalty of up to $16,000 for each violation of the Telemarketing Sales Rule, a minimum of $500 for each violation of the TCPA, a civil penalty up to $5,000 for each violation of the Missouri No-Call Law, and a civil penalty in such amount as allowed by law for each violation of the Missouri Telemarketing Law. See Prayer for Relief. Notably, on the same day this complaint was filed, the Attorney General filed a complaint and consent judgment against Farmers Insurance Exchange, Truck Insurance Exchange and Fire Insurance Exchange alleging violations of state no-call and telemarketing laws for $575,000.

Given the significant statutory penalties that are at stake in this type of Attorney General action, this complaint demonstrates how important it is for companies to ensure that they and their vendors have adequate compliance procedures in place. Having appropriate preventive measures is the only way to avoid real (or perceived) violations, thereby greatly decreasing the chance of costly litigation.

Supreme Court Hears Oral Argument In Campbell-Ewald Company v. Gomez

Last week the Supreme Court heard oral argument in Campbell-Ewald Company v. Gomez, a TCPA case that concerns (among other things) whether the claims of the named plaintiff in a putative class action will be mooted by an unaccepted offer of complete relief.  For those who were unable to attend the spirited oral argument, audio and a transcript are available here.