A recent decision from the District of Maryland denied the Defendant’s motion for summary judgment because the Plaintiff had in the Court’s view raised a genuine issue of material fact regarding whether he had revoked his consent to receive automated debt-related calls. But the Court also denied the Plaintiff’s motion for class certification for the same reason, finding that individualized issues regarding the provision and revocation of that consent would predominate over any alleged common issues. See Ginwright v. Exeter Fin. Corp., No. 16-0565 (D. Md. Nov. 28, 2017).
The Plaintiff in Ginwright alleged that Exeter Finance (“Exeter”) had violated the TCPA and state law by calling his cell phone without his consent. Exeter is an automobile finance company that purchases retail installment contracts from various car dealerships and assumes responsibility for servicing the loan. Id. at 1-2. Its agreements vary from customer to customer depending on the dealership at which a given loan originated. Id.
The Plaintiff bought a vehicle and listed his cell phone number on a credit application that included a provision that consented to “prerecorded/artificial voice messages, text messages, and/or automatic dialing equipment while servicing or collecting [the] account.” Id. Exeter eventually began calling him to collect on his loan, which had become overdue. Id. at 4. The Plaintiff alleged that he asked Exeter to stop calling him during five separate calls, id. at 5, and Exeter’s records reflected that “consent to receive calls was not granted” on five occasions. Id. at 5.
The Plaintiff eventually filed suit and moved to certify a class of all persons who had received automated non-emergency calls on a cellular telephone. Id. at 15. Exeter opposed that motion, arguing that individualized questions regarding consent and revocation predominated. Exeter also moved for summary judgment on Plaintiff’s individual claim, arguing that he could not unilaterally revoke his consent because he had provided it in a bilateral contract. Id. at 14-23. The Court denied both motions.
As for the class certification motion, the Court began by finding that the Plaintiff could not establish Rule 23(a) commonality because Exeter had used two different dialing systems during the proposed class period. Id. at 19. It reasoned that, “[t]o the extent the technology is different, the resolution of whether one of the dialing systems is an ATDS may not have classwide applicability.” Id. It also held that consent and revocation issues made it impossible to determine on a classwide basis that violations had been “knowing and willful,” or “whether there should be an injunction or damages applicable to any individual class member’s situation.” Id.
The Court next determined that, even if the Plaintiff had satisfied the Rule 23(a) factors, he had failed to satisfy any of the Rule 23(b) factors. The following factual issues necessitated an individualized determination of consent and revocation for each proposed class member and destroyed predominance under Rule 23(b)(3): 1) Exeter’s customers do not complete a uniform credit application or retail installment sales contract; 2) the relevant forms contain different language and terms; 3) whether or not a consumer provided a cell phone number on these forms would differ on a case-by-case basis; and 4) whether a customer revoked consent, either orally or in writing, is an individualized question. Id. at 21. As a result, “individualized issues relating to consent and revocation, on which claims will ultimately turn, predominate over any common issues such that ‘myriad mini-trials cannot be avoided’ on issues of consent and revocation.” Id. (citation omitted).
As for the motion for summary judgment, Exeter argued that the Plaintiff had given his prior express consent to be contacted in connection with his auto loan when he provided his cell phone number on his credit application at the dealership where he had purchased his vehicle. Although Ginwright had tried to revoke that consent when he received debt collection calls, Exeter argued that he could not unilaterally revoke consent that had been provided in a bilateral contract based on the Second Circuit’s recent decision in Reyes v. Lincoln Automotive Financial Services, 861 F.3d 51 (2d Cir. 2017). The Court disagreed, rejected the Second Circuit’s decision in Reyes, and held that the Plaintiff could revoke his consent despite the consent clause in the credit application, reasoning that the FCC’s ruling giving consumers the “right to revoke consent” applied broadly and remedially, and that a prohibition on revocation of consent based on a consent provision in a contract would effectively circumvent the TCPA in the debtor-creditor context. Critically, though, it failed to identify any provision in the TCPA that would allegedly provide the FCC with the power to alter the common law in this manner. See id. at 12. Our previous blog post and article highlight the interplay between the Reyes decision and the FCC’s 2015 ruling regarding revocation of consent.
Although not a complete victory for creditors, the Ginwright decision does give businesses ammunition with which to fend off class claims in revocation of consent cases such as this one.