On June 25, 2020, the FCC issued a Declaratory Ruling that granted a Petition that had been filed in 2018 by the P2P Alliance—a “coalition of providers and users of peer-to-peer (P2P) text messaging services.” The Petition had asked the FCC to clarify whether texts sent via its messaging platform were subject to the TCPA restrictions on automated dialing. The FCC did not decide if the Petitioner’s messaging platform is an autodialer, as the record was not sufficient to do so. But it did clarify in the abstract that, “if a texting platform actually requires a person to actively and affirmatively manually dial each recipient’s number and transmit each message one at a time and lacks the capacity to transmit more than one message without a human manually dialing each recipient’s number… then such platform would not be an ‘autodialer’ that is subject to the TCPA.”
Michael Daly
Articles by Michael Daly:
Court Enters Summary Judgment Against Plaintiff, Finds No Triable Issues Regarding Revocation of Consent
The Eastern District of California recently entered summary judgment against a plaintiff because it found that the plaintiff failed to revoke his consent to receive auto-dialed calls on his cell phone. Wright v. USAA Savings Bank, No. 19-0591, 2020 WL 2615441, at *1-5 (E.D. Cal. May 22, 2020). The case illustrates that defendants in the Ninth Circuit can still prevail on consent and other issues even though they may face an uphill battle on ATDS issues.
The plaintiff in Wright applied for a credit card and listed his cell phone number on the application. Id. at *1. He developed terminal cancer in 2018 and failed to make payments on the credit card. Id. Between July 2018 and January 2019, defendants’ agent called Mr. Wright’s cellphone number using the Aspect Dialing System to collect the credit card debt. Id. Evidence established that the Aspect Dialing System is a predictive dialer that does not have and is not capable of using a random or sequential number generator to dial numbers. Id.
Supreme Court Holds Oral Argument via Teleconference in Barr v. American Association of Political Consultants
On May 6, 2020, the Supreme Court held oral argument via teleconference in Barr v. American Association of Political Consultants. The argument focused on the two questions presented in Barr. First, whether the Telephone Consumer Protection Act’s (TCPA) government debt exception is an unconstitutional content-based restriction on speech. And second, if the government debt exception is unconstitutional, whether the remedy is to sever the exception or instead strike the TCPA’s restrictions on automated telephone equipment in their entirety. A recording of the argument is available below (audio begins at the :30 mark) and a transcript is available on the Supreme Court website.
D.C. High Court Holds that Businesses Do Not Face Strict Liability for Junk Faxes Advertising Their Products, Agency Principles Apply
FDS Restaurant, Inc. v. All Plumbing, Inc., No. 16-CV-1009, 2020 WL 1465919 (D.C. Mar. 26, 2020)
In a recent TCPA junk-fax case, the District of Columbia Court of Appeals drew the intuitive conclusion that businesses do not incur TCPA liability whenever their products are advertised via fax. The proposition that strict vicarious liability does not apply to advertised businesses is a simple one, but—as the D.C. Court of Appeals noted—courts have diverged as to the proper standard to apply for assessing vicarious liability for faxes sent in violation of the TCPA. In FDS Restaurant, the D.C. Court of Appeals had to decide for itself which standard to apply in this context.
Attorney Facing Civil RICO Claim Ordered to Produce Attorney–Client Communications Made in Furtherance of Alleged Scheme to Manufacture TCPA Claims
A federal court presiding over a civil RICO action recently ordered prolific plaintiff’s attorney Jeffrey Lohman to produce his firm’s communications with its clients. See Navient Sols., LLC v. Law Offices of Jeffrey Lohman, P.C., No. 19-461, 2020 WL 1172696, at *1 (E.D. Va. Mar. 11, 2020). This decision shows that the crime-fraud exception may overcome the attorney–client privilege where a lawyer allegedly participates in a scheme to manufacture TCPA claims. It also suggests that such conduct might form the basis of a civil RICO claim.
The plaintiff in that case, Navient Solutions, alleged that the defendants, including Lohman, operated a fraudulent scheme to manufacture TCPA lawsuits. The defendants allegedly recruited student-debtors into signing up for a sham debt-relief program and told them to stop making loan payments owed to Navient, to pay defendants instead, and to follow a script to induce telephone calls from Navient that would — and ultimately did — form the basis for TCPA claims that were filed by Lohman and others. After patiently uncovering these facts in discovery in various TCPA cases, Navient went on the offensive by bringing a civil RICO claim predicated on alleged mail and wire fraud involved in the scheme.
Court Denies Class Certification Due to Plaintiff’s Lack of Objective Criteria and Lack of Evidence
The Western District of Michigan recently denied a motion to certify a class after holding that the class was not ascertainable and the plaintiff had not offered persuasive evidence in support of the motion. Visser v. Caribbean Cruise Line, Inc., No. 13-1029, 2020 WL 415845 (W.D. Mich. Jan. 27, 2020).
The plaintiff alleged that Caribbean Cruise Line had violated the TCPA by using either an ATDS or an artificial or prerecorded voice without his prior consent. Specifically, he alleged that the call began with a prerecorded message that was followed by a live person who told him that he had won a free all-inclusive cruise. The plaintiff stated the caller told him that he had entered his phone number into a website called “leadpile.com.” Not believing this was true, the plaintiff told the caller that he had questions about the cruise. The caller then transferred the plaintiff to an agent who answered Plaintiff’s questions and provided details about the cruise.
How The High Court Could Reshape The TCPA’s Future
TCPA Blog’s Mike Daly was quoted in a Law360 article analyzing the potential impact of the Supreme Court’s decision to review the constitutionality of the TCPA’s restrictions on the use of automatic telephone equipment.
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Supreme Court Agrees To Review The Constitutionality of the TCPA
Given how often TCPA cases are filed—and how often they push the envelope of the statute’s scope and the courts’ jurisdiction—it should come as no surprise that the Supreme Court is often asked to bring some sanity to the statute’s enforcement. Last year was no exception.
For example, a plaintiff petitioned the Supreme Court to reverse the Third Circuit’s decision that facsimiles that merely ask to confirm contact information are not “advertisements” for purposes of the TCPA. Such facsimiles are advertisements, the plaintiff had argued, because businesses send them “to enhance the accuracy of their database and thus increase their profits.” That may be so, the Third Circuit held, but that does not mean that they qualify as “advertisements” that promote goods or services. “After all,” the court observed, “a commercial entity takes almost all of its actions with a profit motivation.” The Supreme Court declined to review that decision in November. See Robert W. Mauthe, M.D., P.C. v. Optum, Inc., No. 19-413, 2019 WL 6257433 (U.S. Nov. 25 2019).
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Florida Federal Court Stays Putative Class Action to Await Guidance from the FCC and Eleventh Circuit as to What Constitutes an ATDS
It can fairly be said that the statutory definition of “automatic telephone dialing system” (“ATDS”) has generated far more questions than answers—for courts and litigants alike. This is especially true in the wake of ACA International v. FCC, 885 F.3d 687 (D.C. Cir. 2018), where the D.C. Circuit set aside the FCC’s sweeping interpretation of the ATDS definition, and thus handed the baton back to the Commission to provide guidance on what is (and is not) an ATDS. But almost two years later, the FCC has yet to issue its ruling.
In the many TCPA cases that turn on the definition of ATDS, defendants may wish to file a motion to stay the action so that the court can await guidance from the FCC’s anticipated ruling on this issue. Indeed, over the course of the last year, multiple federal judges, at least in Florida, have been willing to grant such motions, particularly because the ATDS definition is also center stage in an appeal pending before the Eleventh Circuit. See Glasser v. Hilton Grand Vacations Co., LLC, No. 18-14499 (11th Cir. filed Oct. 24, 2018).
Court Denies Atypical Plaintiff’s Motion to Certify Unascertainable Fail-Safe Class
The Middle District of Florida has denied a motion for class certification, finding the proposed class definition would have created a fail-safe class, the class members were not ascertainable, and the plaintiff’s claims were not typical of the class. Fennell v. Navient Solutions, LLC, No. 17-2083, 2019 WL 3854815, at *2 (M.D. Fla. 2019)
The plaintiff in Fennell alleged that, despite her revocation of consent, Navient had used an ATDS to repeatedly call her to collect a debt. Id. at *1. In response, Navient argued that, although it had used predictive dialers to call other people, it had not used that equipment to call the plaintiff because her delinquent loans had been assigned to Navient’s “Cures Unit,” which only made calls through manual dialing. Id. at *1, *2.