The Eleventh Circuit’s Minority View of Article III Results in Dismissal of Another TCPA Case

The District Court for the Southern District of Florida recently dismissed a TCPA lawsuit for lack of Article III standing, holding that five unsolicited text messages did not constitute a concrete injury.  Muccio v. Global Motivation, Inc., __ F. Supp. 3d __, 2022 WL 17969922 (S.D. Fla. Dec. 27, 2022).  In so doing, the court applied the Eleventh Circuit precedent in Salcedo v. Hanna, which held that a single, unsolicited text message did not itself constitute a concrete injury.

In Muccio, the plaintiffs alleged receiving five unsolicited text messages from defendant Global Motivation, Inc.  The complaint alleged that the text messages did not include the ability to opt-out of future messaging and failed to identify the name of the sender or include the sender’s contact information.  The court decided the motion on Article III standing.  The mere existence of a statutory right, the court explained, even if violated, does not excuse the need for a plaintiff to allege a concrete injury.  The complaint, however, merely sought to redress “inconvenience, invasion of privacy, annoyance, and violation of their statutory rights.”  Applying the rule set forth in Salcedo v. Hanna, the Muccio court dismissed the suit without prejudice for failure to allege a concrete injury.

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FCC Acts on Pending Reconsideration Petitions of its 2020 TCPA Exemptions Order

The Telephone Consumer Protection Act of 1991 (TCPA) restricts many types of calls to residential and wireless telephone numbers if they are made without the prior express consent of the called party or a statutory exemption applies, but the statute authorizes the FCC to exempt certain calls from these restrictions.  In 2020, the FCC in its TCPA Exemptions Order adopted measures to implement the 2019 Telephone Robocall Abuse Criminal Enforcement and Deterrence Act (TRACED Act).  The TRACED Act required that the FCC ensure that any exemption to TCPA prior express consent that the FCC grants under section 227(b)(2)(B) or (C) of the Communications Act, allowing callers to make artificial voice, prerecorded voice, or autodialed calls without prior consent, include certain conditions.  Specifically section 8(a) of the TRACED Act requires that any exemption contain requirements with respect to:  “(i) the classes of parties that may make such calls; (ii) the classes of parties that may be called; and (iii) the number of such calls that a calling party may make to a particular called party.”  The FCC in 2020 determined it would limit the number of exempted calls that can be made to residential phone lines; require that callers making exempt calls allow consumers to opt out of receiving future exempt calls; and codify existing FCC exemptions for certain types of calls to wireless numbers, including calls by package delivery companies, financial institutions, prison inmate calling services, and healthcare providers.

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First Circuit Rejects Classwide Settlement, Finds That Would-Be Class Representatives Could Not Adequately Represent Subclasses With Materially Different Claims

The First Circuit recently reversed the District of Massachusetts’s approval of a settlement award that improperly lacked any subclasses within the 4.8-million-person putative class, finding it “too difficult to determine whether the settlement treated class members equitably.”  Murray v. Grocery Delivery E-Services USA, No. 21-1931, — F.4th — (1st Cir. Dec. 16, 2022).

The complaint alleged that defendant Grocery Delivery E-Services USA, d/b/a HelloFresh violated the TCPA through its marketing tactics by (1) calling former customers using an automated dialer, (2) calling former customers that were listed on the National Do-Not-Call registry, and (3) calling former customers that had asked HelloFresh not to contact them.  The named plaintiffs—through a single plaintiff’s attorney that purported to represent the entire 4.8-million-person class—negotiated a $14 million settlement with HelloFresh, which the District Court approved without identifying any subclasses of plaintiffs.

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Eleventh Circuit Finds Complaint’s Ambiguity in Number of Calls Received Warrants Remand for Article III Standing Analysis

Recently, the Eleventh Circuit remanded a TCPA suit for the district court to rule on Article III standing, finding that the trial court should have addressed the standing issue because plaintiffs failed to plead the number of telephone calls allegedly received.

Sixteen plaintiffs in Evans v. Ocwen Loan Servicing, LLC, No. 21-14045, 2022 WL 17259718 (11th Cir. Nov. 29, 2022), alleged that defendants violated the TCPA by using an Automated Telephone Dialing System (ATDS) to call them.  The complaint included the exact number of calls allegedly received by only eight of the plaintiffs, and stated “that the ‘[e]xact number of calls’” received by the other eight was “‘not confirmed at this point.’”  Id. at *1.  The district court dismissed, concluding that the system at issue was not an ATDS.  The Court of Appeals vacated and remanded, however, finding that the district court failed to address “a significant jurisdiction issue.”  Id.

The court explained that recent Eleventh Circuit precedent establishes that the receipt of more than one unwanted call is sufficient to establish the concrete injury necessary for standing, but the Eleventh Circuit rulings do not “address whether a single call is sufficient to confer [Article III] standing.”  Id. (citing Glasser v. Hilton Grand Vacations Co., LLC, 948 F.3d 1301, 1306 (11th Cir. 2020) and Cordoba v. DIRECTV, LLC, 946 F.3d 1259, 1270 (11th Cir. 2019)).  Thus, the appellate court reasoned, “the resolution of the standing question could differ depending on how many calls each plaintiff is alleged to have received.”  Id.  Because the complaint did not specify the number of calls allegedly received by eight of the plaintiffs, the court reasoned that they could have received “zero, one, or more than one,” and each option “would potentially present a different resolution to the standing issue.”  Id.  Accordingly, the court vacated the district court’s dismissal (without reaching the ATDS issue) and remanded to the district court to address Article III standing.

Interestingly, the Evans court did not cite Salcedo v. Hanna, 936 F.3d 1162 (11th Cir. 2019), which, as we reported on here, held that receipt of a single text message does not constitute the concrete injury needed for Article III standing.  The failure to address Salcedo leaves open the possibility that the Eleventh Circuit could impose a different standard for calls and texts (a possibility further suggested because Salcedo emphasized that Congress did not address text messages in the TCPA because text messages did not exist when the statute was enacted).  Regardless of how the standing issue is ultimately resolved though, the Evans decision still emphasizes the need for plaintiffs to be specific in pleading the number of communications received, particularly in jurisdictions that have either suggested or held that this number impacts standing.  Further, defendants should consider whether to challenge standing (in light of overall case strategy) when the complaint fails to allege specific facts that would preclude this defense.

Eighth Circuit Affirms Summary Judgment, Finding that Fax was not “Unsolicited Advertisement”

The Eighth Circuit in BPP v. CaremarkPCS Health, L.L.C., 2022 WL 16955461 (8th Cir. 2022), recently affirmed a district court’s decision to grant summary judgment because the fax at issue was not an “unsolicited advertisement” within the meaning of the TCPA.  The outcome hinged on the specific content of the fax at issue.

Plaintiff alleged that Caremark—a pharmacy benefits manager—violated the TCPA when it sent a fax announcing a new option for healthcare services provided by Caremark’s clients.  The fax explained that Caremark’s clients had “the option to apply” a new limit on certain prescriptions and explained that certain prescriptions were exempt from this new limit.  Caremark (and its vendor that sent the fax at issue) moved for summary judgment.  The district court granted the summary judgment motion, and Plaintiff appealed arguing that the fax was an “unsolicited advertisement” within the meaning of the TCPA.  The Eighth Circuit disagreed and affirmed the district court’s summary judgment decision.

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Recent Ninth Circuit Opinions Address Standing and the Meaning of “Automatic Telephone Dialing System”

The Ninth Circuit recently issued two noteworthy TCPA decisions.  Most recently, in Borden v. eFinancial, LLC, No. 21-35746, 2022 WL 16955661 (9th Cir. Nov. 16, 2022), the Court addressed one of the most hot-button issues in this space:  the definition of “automatic telephone dialing system” (“ATDS”).  Shortly before that, in Chennette v. Porch.com, Inc., 50 F.4th 1217 (9th Cir. 2022), the Ninth Circuit discussed both Article III and statutory standing.

Borden and the ATDS Definition

In a unanimous opinion, the Ninth Circuit recently affirmed the dismissal of a text message TCPA suit based on its holding that to qualify as an ATDS, dialing equipment “must generate and dial random or sequential telephone numbers,” not just any numbers.  See Borden, 2022 WL 16955661, at *1.

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FCC Releases Declaratory Ruling Addressing the TCPA Compliance Status of Ringless Voicemails

On November 21, 2022, the Federal Communications Commission (FCC) released a Declaratory Ruling and Order (Declaratory Ruling), in which it determined that “ringless voicemail” to wireless phones requires prior consumer consent to transmit because it is a “call” made using an artificial or prerecorded voice and thus is covered under section 227(b)(1)(A)(iii) of the 1991 Telephone Consumer Protection Act (TCPA). The Declaratory Ruling was issued even though the petitioner, All About the Message, LLC (AATM) had requested withdrawal of its 2017 Petition for Declaratory Ruling seeking to have the FCC declare that ringless voicemail, based on the technology and the lack of direct charge to wireless consumers, is not subject to the TCPA and the agency’s implementing rules. Addressing AATM’s withdrawal request, the FCC stated that it believed a ruling was necessary to resolve a controversy and remove uncertainty about the status of ringless voicemail under the TCPA.

Codified in section 227 of the Communications Act of 1934, the TCPA addresses certain practices considered to be an invasion of consumer privacy or, in some instances, a risk to public safety. Section 227(b)(1)(A)(iii) prohibits making any non-emergency call using an automatic telephone dialing system (autodialer) or an artificial or prerecorded voice to a wireless telephone number without the prior express consent of the called party. AATM sought an FCC ruling that delivery of a voicemail message directly to a consumer’s cell phone voicemail is not covered by the TCPA. AATM relied on several arguments, but primarily claimed that its ringless voicemail message was not a “call” because its proprietary software creates a landline-to-landline session directly to the telephone company’s voicemail server without charge to the subscriber and is not shown as a call on any consumer bill.

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DNJ Enters Default Judgment on Breach of Contract Counterclaim in Manufactured TCPA Lawsuit

The United States District Court of New Jersey recently granted default judgment to Defendant Slack Technologies (“Defendant”) for its breach of contract counterclaim against Plaintiff Gino D’Ottavio (“Plaintiff”), who deliberately sent himself over 1,500 text messages but represented that the texts were unsolicited and sent improperly by Defendant.

In D’Ottavio v. Slack Technologies, No. 1:18-cv-09082-NLH-AMD, 2022 WL 15442211 (D. N.J. Oct. 26, 2022), Plaintiff filed a lawsuit against Defendant for allegedly knowingly and/or willfully and negligently violating the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227. Plaintiff asserted he received numerous unsolicited text messages after signing up for Defendant’s service. Defendant denied Plaintiff’s claims and asserted that Plaintiff abused a feature on Defendant’s website. Defendant specifically asserted, “Plaintiff is a serial filer of TCPA claims who personally solicited 1,590 text messages from Defendant by entering his own phone number and clicking a ‘SEND LINK’ button in an effort to manufacture a lawsuit.” Defendant brought four counterclaims against Plaintiff: (1) willful and wanton misconduct; (2) common-law fraud; (3) breach of express contract; and (4) breach of the implied covenant of good faith and fair dealing.

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Second Circuit Reaffirms that Solicited Faxes are Not Subject to Certain TCPA Protections, Grants Judgment Suggested by Defendant

The Second Circuit recently affirmed a Southern District of New York judgment denying injunctive relief against Educational Testing Service (“ETS”), which was sought by serial TCPA-plaintiff, Bais Yaakov of Spring Valley.  See Bais Yaakov of Spring Valley v. Educational Testing Service, No. 21-399-cv, No. 21-541-cv, 2022 WL 6543814 (2d Cir. Oct. 31, 2022).

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The FCC Has Illegal and Scam Robotexting in its Sights, Proposed New Text Blocking Rules

For those regularly monitoring the FCC’s various TCPA dockets, you now have a new docket to follow: CG Docket No. 21-402. The FCC announced on September 27, 2022 that all Commissioners had voted to commence a new robotext proceeding, releasing the text of a Notice of Proposed Rulemaking (Notice) the same day. Comments and reply comments will be due 30 and 45 days respectively from the time a summary of the Notice is published in the Federal Register, which has not yet occurred as of the publication of this post.

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