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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