The Supreme Court today denied the petition for certiorari filed by the class action plaintiffs in Bais Yaakov of Spring Valley v. FCC, thus leaving in place the D.C. Circuit’s ruling that “although the [Telephone Consumer Protection Act] requires an opt-out notice on unsolicited fax advertisements, the Act does not require a similar opt-out notice on solicited fax advertisements . . . . [nor does it] grant the FCC authority to require opt-out notices on solicited fax advertisements.” 852 F.3d 1078, 1082 (D.C. Cir. 2017). Our summary of the briefing on the petition is available here.
As we’ve discussed previously, the D.C. Circuit’s ruling (binding nationwide pursuant to the Hobbs Act) makes it much tougher for plaintiffs in TCPA fax suits to certify a class. The plaintiffs’ bar has typically sought to certify classes based on violations of the opt-out notice requirement for solicited faxes, because a class defined in such a way side-stepped the inherently individualized issue of whether the fax was solicited or not. With the opt-out notice requirement for solicited faxes eliminated, plaintiffs’ attorneys have a much tougher challenge. Indeed, in Alpha Tech Pet, Inc. v. Lagasse, LLC, No. 16 C 513, 2017 U.S. Dist. LEXIS 182499 (N.D. Ill. Nov. 3, 2017), a district court relying on the D.C. Circuit’s decision found that individualized issues of consent precluded certification of a class of fax recipients where certification could not be premised on whether the faxes included an opt-out notice. The plaintiff in Alpha Tech has appealed that decision, arguing (among other things) that the D.C. Circuit’s decision is not binding in the Seventh Circuit. Given the significance of this issue for the plaintiff’s bar, we can expect to continue to see collateral challenges like this to the repeal of the FCC’s solicited fax rule notwithstanding that the D.C. Circuit’s decision in Bais Yaakov is now final.
On January 30, 2018, briefing closed on the petition for certiorari filed in the Supreme Court by the class action plaintiffs in Bais Yaakov of Spring Valley v. FCC. The class action plaintiffs are seeking review of the D.C. Circuit’s March 2017 decision (discussed at length here, here, here, and here) holding that the FCC exceeded its statutory authority when it promulgated regulations in 2006 requiring that a fax advertisement sent with the prior express consent of the recipient include an opt-out notice because “although the Act requires an opt-out notice on unsolicited fax advertisements, the Act does not require a similar opt-out notice on solicited fax advertisements . . . . [nor does it] grant the FCC authority to require opt-out notices on solicited fax advertisements.” Bais Yaakov of Spring Valley v. FCC, 852 F.3d 1078, 1082 (D.C. Cir. 2017). Continue reading
Following the D.C. Circuit’s decision in Bais Yaakov of Spring Valley v. FCC, 852 F.3d 1078 (D.C. Cir. Mar. 31, 2017), we explained on this blog and elsewhere that the issue of whether a fax advertisement is solicited or not would come back into play in many cases and make it much harder for the plaintiffs’ bar to certify a class of recipients. And that is precisely what occurred in a recent decision from the Northern District of Illinois in Alpha Tech Pet, Inc. v. LaGasse, LLC, No. 16-cv-513 (N.D. Ill. Nov. 3, 2017): the court granted defendants’ motion to deny class certification. In the process, the court also slammed the door on several arguments proffered by plaintiffs’ counsel in an effort to evade the impact of Bais Yaakov.
The Ninth Circuit Court of Appeals went back to the basics in addressing whether a telemarketing vendor acted as defendant’s authorized agent for purposes of TCPA liability. In Jones v. Royal Admin. Servs., Inc., No. 15-17328, 2017 WL 3401317 (9th Cir. Aug. 9, 2017) (“Jones”), the Ninth Circuit endorsed the time-honored multi-factor test set forth in Restatement (Second) Of Agency, and on that basis affirmed the district court’s grant of summary judgment. The decision provides further reassurance that traditional agency principles apply in assessing potential TCPA exposure related to calls.
As we predicted, the D.C. Circuit today denied the plaintiff’s petition for a rehearing en banc of the panel decision striking down the FCC’s regulations requiring opt-out notices on solicited faxes. The per curiam order notes only that “[u]pon consideration of the petition for rehearing en banc, the response thereto, and the absence of a request by any member of the court for a vote, it is ORDERED that the petition be denied.” This result is hardly surprising given (i) the FCC Chairman’s current position that the panel decision overturning the FCC was correct (an anomaly that is the result of turnover at the Commission following the election results in November 2016) and (ii) the infrequency with which petitions for rehearing en banc are granted. We expect that the plaintiffs’ bar will continue its appeal efforts via a petition for writ of certiorari to the United States Supreme Court, but also expect that effort to meet the same fate as the petition for rehearing.
As we’ve previously reported, on March 31, the DC Circuit issued a 2-1 opinion in the Bais Yaakov appeal holding that “the FCC’s 2006 Solicited Fax Rule is . . . .unlawful to the extent that it requires opt-out notices on solicited faxes.” Slip Op. at 4. Given the profound impact we expect that ruling to have in TCPA fax litigation, it is no surprise that the plaintiffs’ bar is fighting that decision: on April 28, 2017, the plaintiff intervenors in the Bais Yaakov appeal filed a petition for rehearing en banc before the full D.C. Circuit. Continue reading
A New York U.S. District Court Judge granted summary judgment in favor of defendant Rite Aid Headquarters Corp. in a putative TCPA class action involving flu vaccine reminder calls. The opinion in Zani v. Rite Aid Headquarters Corp., 14-cv-9701, was recently unsealed after originally being filed under seal on March 30, 2017. In Zani, the court found that Rite Aid’s call to the plaintiff’s cellphone that used a pre-recorded voice to remind him to get his flu shot fell under what the Court referred to as the “Health Care Rule,” which exempted the call from the prior written consent requirement for telemarketing calls under the TCPA. Continue reading
As discussed here, the Central District of California recently granted summary judgment in favor of an insurance company after finding that a prerecorded call to the insured’s mobile phone, which reminded her to review her health plan options for the following year, was not telemarketing and therefore did not require “prior express written consent.” See Smith v. Blue Shield of Cal. Life & Health Ins. Co., No. SACV 16-00108-CJC-KES (C.D. Cal. Jan. 13, 2017).
But just a few weeks ago, a different judge in the Central District reached the opposite conclusion in a similar case, and denied the defendant’s motion to dismiss. See Flores v. Access Ins. Co., No. 2:15-cv-02883-CAS-AGR (C.D. Cal. Mar. 13, 2017) (available here). These two decisions illustrate how courts continue to grapple with the distinction between “telemarketing” and “informational” calls. Continue reading
In a post immediately following the November 8, 2016 oral argument in Bais Yaakov of Spring Valley v. FCC, No. 14-1234 (D.C. Cir.), we noted that, based on the lines of questioning from the bench, the three judge panel of Judges Brett M. Kavanaugh, Cornelia T.L. Pillard, and A. Raymond Randolph appeared to be leaning toward a 2-1 decision with Judges Kavanaugh and Randolph likely forming the majority that would find that the FCC was not empowered to require opt-out notices on solicited faxes. On March 31, the DC Circuit issued its opinion and confirmed our analysis, finding in a 2-1 opinion authored by Judge Kavanaugh (joined by Judge Randolph) that “the FCC’s 2006 Solicited Fax Rule is . . . .unlawful to the extent that it requires opt-out notices on solicited faxes.” Slip Op. at 4. The Court therefore vacated the 2006 Fax Order and remanded to the FCC for further proceedings. It declined to address the propriety of the waiver program, finding it moot in light of its holding. Slip. Op. at 11 n.2. Continue reading
The Central District of California recently granted summary judgment to a health insurer after finding that a pre-recorded message delivered to the insured’s cell phone reminding her to review her health plan options for the coming year was not telemarketing. Smith v. Blue Shield of Cal. Life & Health Ins. Co., No. 16cv108 (C.D. Cal. Jan. 13, 2017), ECF No. 73.
In Smith, the plaintiff completed an application for health insurance through California’s Affordable Care Act Healthcare Marketplace, Covered California. As part of that application process, Plaintiff provided her cell phone number as “the best number at which to contact her.” As required by law, the insurance was set to automatically renew for 2016, and in 2015, Blue Shield attempted to contact Smith by sending written materials to her mailing address (as also required by law) to inform her of the changes to her plan and provide her with alternatives. Plaintiff’s materials, however, were returned to Blue Shield as undeliverable. As with other insureds whose materials were returned, Blue Shield followed up with a pre-recorded message stating in relevant part: “This is an important message from Blue Shield of California. It’s time to review your 2016 health plan options and see what’s new. Earlier this month, we mailed you information about your 2016 plan and benefit changes. It compares your current health plan to other options from Blue Shield. You can also find out more online at blueshieldca.com. If you have not received your information packet in the mail, or if you have any questions, please call the number on the back of your member ID card.” Plaintiff received the call on December 3, 2015; on December 6, 2015, she completed an application for a different insurance plan for the 2016 year. Continue reading