District Court Decertifies TCPA Class Due to Consent Issues

The Central District of California recently decertified a class of TCPA plaintiffs because consent issues were so individualized that the plaintiffs could not satisfy the predominance requirement. Trenz v. On-Line Administrators, Inc., No. 15-8356, 2020 WL 5823565 (C.D. Cal. Aug. 10, 2020). The case highlights that a defendant can defeat certification by showing that class members provided their numbers in different “transactional contexts,” which can give rise to individualized issues regarding the existence and scope of consent.

In 2008, Volkswagen Group of America, Inc. (“Volkswagen”) launched its Target and Retain Aftersales Customers (“TRAC”) program. Id. at *1. Through this program, it paid for over 900 dealerships across the country to retain Peak Performance Marketing Solutions, Inc. (“Peak”) to place service reminder calls to their customers. Id. A class action alleging the use of autodialers and automated voices to make calls without the plaintiff’s consent eventually followed. Id.

The court denied plaintiffs’ first motion for class certification. Nonetheless, plaintiffs amended their pleading and ultimately succeeded in certifying two classes. Id. at *2. The court’s certification order expressed “reservations” regarding whether the proposed classes satisfied the Rule 23(b)(3) predominance requirement. Id. at *3. Ultimately, however, it found that the defendants would need to produce “significantly more” evidence to show that customers had provided “actual consent to be contact by an autodialer” such that “individualized inquiries actually predominated over the common questions.” Id.

The defendants eventually moved to decertify one of the classes, which was defined as follows:

All persons within the United States who received any telephone call from Defendants or their agents to said person’s wireless number through the use of any automatic telephone dialing system, as part of Defendant Volkswagen Group of America’s ‘Target and Retain Aftersales Customers’ program, from October 26, 2011 until October 15, 2013.

Id. at *2-3.

The defendants argued that they had developed the “requisite . . . evidence of consent” that the court’s certification order had found lacking. Id. Specifically, the defendants asserted that certification was improper because “records obtained from just forty-eight” of the dealerships showed “a variety of circumstances across the [c]lass bearing on whether individual class members consented to receiving phone calls under the TRAC program.” Id. at *6.

The defendants argued that “the individual transactional context in which the class member’s phone number was provided, and therefore the inquiry into whether they consented under the TCPA, would vary depending on whether the class member (1) was provided free service plans or warranties pursuant to which they would expect to be contacted about future servicing of their vehicle; (2) was provided with varying Gramm-Leach-Bliley Act (“GLBA”) disclosure forms, in connection with vehicle financing, notifying the class member of dealer use of their contact information; and (3) was provided with additional, varying privacy notices and contracts, . . . wherein the class member consented to being contacted about future vehicle servicing, for ‘marketing’ purposes, and for the sale of additional ‘products and services.’” Id. at *3, 7 (emphasis added). In light of these varying factual circumstances, the defendants argued, the consent issue would have to be litigated “on a class member-by-class member basis, meaning that individual questions predominate.” Id.

The court agreed with the defendants and decertified the class because the defendants had now “provided evidence” to establish “the lack of predominance.” Id. at *7. Based on that evidence, the court held that “[t]he necessity of individual inquiries is a clear bar to class certification in TCPA matters.” Id. at *8. It concluded that the defendants correctly identified factual circumstances relevant to “whether any individual [c]lass [m]ember provided consent . . . and if they did, the scope of that consent.” Id. at *7. It also noted that the plaintiffs could not establish predominance because of the ‘“nearly endless’ permutations of the transactional contexts” under which consumers had “provided prior express consent to the receipt of TRAC calls.” Id. at *8. The court held that “[g]iven the individualized nature of the consent inquiries required in this matter,” no “degree of sub-classing” would bring the class “into compliance with Rule 23(b)(3).” Id.

The Trenz decision demonstrates that TCPA defendants should carefully consider whether consumers provided their numbers in different “transactional contexts.” Even subtle differences in the circumstances surrounding the provision of a number may give rise to individualized issues regarding the existence and scope of consent. The decision also serves as a helpful reminder that defendants should still pursue these procedural defenses even if a court initially certifies a class. As in Trenz, a court’s certification order may provide insight regarding the information a defendant needs to convince a court to revisit its decision.

Matthew M. Morrissey

About the Author: Matthew M. Morrissey

Matthew Morrissey focuses his practice on high-stakes litigation. He frequently defends clients facing class actions arising under federal and state consumer protection and privacy laws. Matt also represents clients in complex commercial disputes, securities litigation and other financial services matters pending in courts across the country. Matt develops business-focused resolution strategies for clients in all phases of the litigation process. He has achieved significant victories in contentious disputes at both the trial court level and on appeal. He has also obtained highly favorable results in private arbitration and mediation proceedings.

Michael P. Daly

About the Author: Michael P. Daly

Mike Daly has spent two decades defending, counseling and championing clients that interact with consumers. His practice focuses on defending class actions, handling critical motions and appeals, and maximizing the defensibility of marketing and enforceability of contracts. Clients large and small have trusted him to protect their businesses, budgets and brands in complex cases across the country.

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