The Western District of Washington recently adopted a “preponderance of the evidence” standard for establishing the prerequisites of Federal Rule of Civil Procedure 23 and denied class certification in a TCPA case because the plaintiffs’ expert testimony did not meet the rigors of even a preponderance standard. See Southwell v. Mortgage Investors Corp. of Ohio, No. 13-1289 , 2014 U.S. Dist. LEXIS 112362 (W.D. Wash. Aug. 12, 2014).
Capital One Agrees to $75 Million TCPA Settlement
Capital One and three collections agencies recently announced the largest proposed cash settlement in TCPA history – $75.5 million. This is more than double the amount of the prior record – a $32 million settlement from Bank of America.
The plaintiffs allege that Capital One and the other defendants used an ATDS to place debt collection calls to 21 million cell phone numbers without the requisite consent. Under the terms of the proposed settlement, Capital One will contribute $73 million to the settlement fund, while AllianceOne Receivables Management Inc., Leading Edge Recovery Solutions, LLC and Capital Management Services, L.P. will contribute $1.4 million, $996,205 and $24,220, respectively. The settlement agreement estimates that claimants will receive at least $20-$40 and allocates up to 30% of the settlement fund for an award of attorneys’ fees and costs in an amount to be set by the court. The settlement fund is non-reversionary. Capital One also agreed to take steps to ensure TCPA compliance going forward though it expressly disclaimed any liability in connection with the settlement.
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FCC Seeks Comment on Petition Concerning Prior Express Consent
On August 1, 2014, the FCC issued a Public Notice seeking comment on a petition filed by Santander Consumer USA, Inc. (“Santander”), which requests an expedited declaratory ruling from the FCC to clarify the meaning of “prior express consent” with respect to non-telemarketing calls and text messages to cellular telephones, which include informational messages (e.g., messages regarding school closings or messages containing flight status information) and debt collection messages under the TCPA. Comments in response to the Public Notice are due September 2, 2014, and reply comments are due September 15, 2014.
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FCC Seeks Comment on Petitions Concerning the FCC’s Rule on Opt-Out Notices for Fax Advertisements
On July 25, 2014, the FCC issued a Public Notice seeking comment on five petitions, filed by American Caresource Holdings, Inc. (“ACH”), CARFAX, Inc.(“CARFAX”), UnitedHealth Group, Inc. (“UnitedHealth”), MedLearning, Inc. and Medica, Inc. (“Medica”), and Merck and Company, Inc.(“Merck”) (collectively, the “Petitioners”) requesting a declaratory ruling and/or a waiver of section 64.1200 (a)(4)(iv) of the FCC’s rules. This rule requires certain fax advertisements to include an opt-out notice. ((See 47 C.F.R. § 64.1200 (a)(4)(iv).)) Comments in response to this Public Notice must be filed by August 8, 2014; reply comments are due August 15, 2014.
Court Lets Debt-Collector Amend Answer and Assert Counterclaim for Plaintiff’s Debt
In a TCPA class action case concerning debt collection calls, the Southern District of California recently granted a debt-collector defendant’s motion to file an amended answer and assert a counterclaim for breach of contract arising from the plaintiff’s approximately $22,000 debt for the purchase of a used vehicle. See Horton v. Calvary Portfolio Servs., LLC, No. 13-cv-0307, 2014 U.S. Dist. LEXIS 102569 (S.D. Cal. July 24, 2014).
Ninth Circuit Affirms Summary Judgment, Taco Bell Not Vicariously Liable for Third-Party Text Message
In an unpublished opinion, the Ninth Circuit recently affirmed a district court’s ruling that Taco Bell was not vicariously liable for text messages sent by a third party advertising a Taco Bell product. See Thomas v. Taco Bell Corp., No. 12-56458, 2014 WL 2959160 (9th Cir. July 2, 2014). The ruling is one of the first appellate decisions to consider vicarious liability for section 227(b) violations in the wake of an FCC declaratory ruling that had endorsed and indeed provided guidelines on that topic. See In re DISH Network, LLC, 28 F.C.C. Rcd. 6574 (2013). Unfortunately for companies grappling with these issues, the unpublished Ninth Circuit decision does not provide any additional clarity.