Defendants Suable in State Where Calls Inadvertently Received, If Similar Calls Purposefully Directed at Forum Residents, Tenth Circuit Holds

Last week, the U.S. Court of Appeals for the Tenth Circuit applied the Supreme Court’s recent Ford Motor decision on personal jurisdiction to a Rule 12(b)(2) motion to dismiss a TCPA claim.

In Hood v. American Auto Care, LLC, the plaintiff, Alexander Hood, alleged that the defendant (American Auto Care or “AAC,” a Florida company) violated the TCPA by directing automated calls to Mr. Hood’s cell phone without his consent.  No. 20-1157, 2021 WL 6122400, at *1 (10th Cir. Dec. 28, 2021).  According to the complaint, the calls were part of a sweeping telemarketing campaign by AAC that involved calling people from various states, including Vermont and Colorado, to advertise extended vehicle warranties sold by AAC.  Id.  Mr. Hood had previously lived in Vermont and had a Vermont cell phone number, but was living in Colorado at the time he received the calls.  Id.  The U.S. District Court for the District of Colorado granted AAC’s motion to dismiss for lack of personal jurisdiction, finding that the calls to Mr. Hood’s Vermont cell phone number did not “arise out of or relate to” calls that AAC directed at forum residents.  Id. 

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District Courts Find ATDS Allegations Implausible Following Facebook

Courts in the Southern District of California and District of Arizona recently added to the line of decisions addressing ATDS pleading requirements in the wake of the Supreme Court’s landmark ruling in Facebook v. Duguid.  Declining to infer that targeted text messages warranted an inference that the sender used an ATDS, the courts in Wilson v. rater8, LLC, et al., No. 20-cv-1515, 2021 WL 4865930 (S.D. Cal. Oct. 18, 2021), and DeClements v. Americana Holdings LLC, No. CV-20-00166-PHX-DLR, 2021 WL 5138279 (D. Ariz. Nov. 4, 2021), dismissed plaintiffs’ complaints for failure to sufficiently allege the use of an ATDS.

In Wilson v. rater8, the plaintiff filed a class action alleging that defendants violated the TCPA by sending him, after a medical examination, a text asking him to provide feedback regarding his examining physician.  2021 WL 4865930.  The plaintiff alleged that the text was sent using an ATDS.  The court granted defendants’ motion to stay pending the outcome of the Supreme Court’s decision in Facebook.  Following that ruling, defendants moved to dismiss, arguing that plaintiff did not allege sufficient facts to support the claim that an ATDS was used.

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PBM’s Policy Update Fax Not TCPA “Advertisement,” Says Eastern District of Missouri

Earlier this week, the U.S. District Court for the Eastern District of Missouri granted summary judgment for a pharmacy benefit manager (PBM) that allegedly violated the TCPA by sending unsolicited advertisements via fax to thousands of healthcare providers. The defendant was entitled to judgment as a matter of law, the court concluded, because the fax simply notified recipients of changes to insured patients’ coverage and did not promote any products or services.

The case began when a St. Louis healthcare provider (BPP) filed a complaint alleging that defendant CaremarkPCS Health, LLC, violated the TCPA when it sent an unsolicited fax to over 55,000 providers notifying them of new limits on insurance coverage for opioid prescriptions for pediatric and adolescent patients in plans sponsored by Caremark’s clients. BPP v. CaremarkPCS Health, LLC, No. 4:20-cv-126, 2021 WL 5195785, at *1 (E.D. Mo. Nov. 9, 2021). Caremark, which manages prescription drug benefits for various health insurers, asked for summary judgment on the ground that the fax was not an “advertisement” under the TCPA and that plaintiff’s claim therefore failed as a matter of law. Id.

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Does Unused “Capacity” Make a Dialer an ATDS? District Court Says “No” in Ruling on Pleading Requirements After Facebook

Three months after the Supreme Court’s landmark Facebook ruling, a growing number of trial courts have grappled with interpreting and applying the High Court’s directive.  One of the more interesting decisions came out of the Eastern District of Michigan recently.  In Barry v. Ally Fin., Inc., No. 20-cv-12378, 2021 WL 2936636, at *1-7 (E.D. Mich. July 13, 2021), the district court dismissed a putative TCPA class action on the grounds that the plaintiff failed to allege use of an ATDS.  More significantly, the district court interpreted Facebook to hold that to be an ATDS, the dialing system must actually use a random or sequential number generator to call the plaintiff, and not merely have the capacity to do so.

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Another District Court Joins Creasy Split

Recently, the Eastern District of Missouri added to the split among courts deciding whether they can hear TCPA claims alleging robocall violations that occurred when the now-invalidated government debt exception was part of the statute.  As we have previously reported on here, some district courts have joined Creasy v. Charter Communications, Inc., 2020 WL 5761117 (E.D. La. Sept. 28, 2020), in holding that subject matter jurisdiction is lacking in such cases, but a growing number—now including the Eastern District of Missouri—have disagreed.  Miles v. Medicredit, Inc., No. 4:20-cv-001186, 2021 WL 872678 (E.D. Mo. Mar. 9, 2021).

The scenario at issue in this case is a familiar one.  Defendant Medicredit is a medical debt collector.  Plaintiff Miles contended that Medicredit violated the TCPA’s prohibition on making calls using an ATDS or an artificial or prerecorded voice by placing six such calls to his cell phone, without his consent, in January and February 2018.  Not so, Medicredit responded, for the prohibition at issue, 47 U.S.C. § 227(b)(1)(A)(iii), was unconstitutional at the time Medicredit allegedly made the calls to Miles because the provision contained an exception, for calls to collect government debts, that the Supreme Court later invalidated as a content-based restriction on speech that violated the First Amendment.  Thus, Medicredit argued in its motion to dismiss that the court, having no statutory basis to enforce the alleged violations, lacked subject matter jurisdiction to hear the suit.

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Northern District of Florida Picks Side in Creasy Split

In the aftermath of Barr v. American Association of Political Consultants, Inc.—the Supreme Court decision from July that held the TCPA’s government-debt exception to be an unconstitutional content-based restriction on speech—the country’s district courts cannot agree on whether they may adjudicate TCPA claims alleging conduct that transpired during the life of the exception (i.e., during the period from November 2, 2015 to July 6, 2020). Click here to see our collection of posts on this issue, which we have been following closely. Continue reading   »

4th Circuit Declines to Consider Dish Network’s “Premature” Appeal of District Court’s $11 Million Final Disbursement Order

As readers of this blog may recall, the Middle District of North Carolina recently denied Dish Network’s request for reversion of $11 million in unclaimed funds from the jury-awarded damages in a TCPA class action trial.  See Krakauer v. Dish Network, LLC, No. 14-0333 (M.D.N.C. Oct. 27, 2020). Noting that the TCPA is a deterrence statute, the District Court held that allowing unclaimed funds to revert to the defendant would undermine the function of the damage award, and it determined that such funds should either escheat to the government or be donated to an appropriate charity whose work is related to the objectives of the TCPA. But the District Court did not decide the ultimate recipient of the unclaimed funds, appointing a special master to identify and evaluate potential cy pres recipients and make recommendations to the court.

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Court Issues Sua Sponte Dismissal of Serial Plaintiff’s Complaint

The Eastern District of Pennsylvania recently dismissed a serial TCPA plaintiff’s complaint sua sponte because the court concluded that it did not have personal jurisdiction over the defendant. Perrong v. REWeb Real Estate, LLC, No. CV 19-4228, 2020 WL 4924533 (E.D. Pa. Aug. 21, 2020).  The case demonstrates that courts are becoming increasingly frustrated with “professional plaintiffs” who repeatedly file TCPA claims against businesses and pressure them “to settle independent of the merits of the case.” Id. at *3.

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Alleged Oversight and Monitoring of a Messaging Campaign Deemed Inadequate to Establish Agency

Another court decision reminds us that conclusory allegations that an agency relationship exists should not be sufficient to impute TCPA liability on the alleged beneficiary of a messaging campaign. Pleadings that lack plausible allegations showing “some degree of control over who sent the text and the manner and means by which it was sent” can lead to dismissal – with prejudice, if the plaintiff has run out of a reasonable number of opportunities to amend.

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FCC Affirms that Health Plans and Providers Cannot Offer Post-Call Opt-Out in Lieu of “Prior Express Consent”

The FCC’s Consumer and Governmental Affairs Bureau last week issued a declaratory ruling resolving a long-pending Petition on the question of whether certain healthcare-related calls, given their significance and value for consumers, should be entirely exempted from the TCPA’s prior express consent requirement, or at least exempted as long as consumers are allowed to opt out of the calls. The Bureau declined the petitioner’s invitation to create new healthcare exemptions or expand the scope of exemptions already in place for certain types of health-care-related calls.

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