Barr Ruling Cures Claims Arising During Life of Government-Debt Exception, Holds Texas District Court

Last week, the U.S. District Court for the Southern District of Texas concluded that plaintiffs can bring claims for violations of 47 U.S.C. § 227(b) that arose while the government-debt exception (“GDE”) to that provision was still on the books.  The decision comes amid growing contention among courts in the wake of the U.S. Supreme Court’s decision last year in Barr v. American Association of Political Consultants, 140 S. Ct. 2335 (2020), which struck down the GDE as an unconstitutional content-based restriction on speech.

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Ninth Circuit Vacates Certification of Nationwide Classes, Holding that Defendant Did Not Waive Personal Jurisdiction Challenge by Not Raising It Precertification

On August 10, 2021, a divided Ninth Circuit panel vacated a trial court’s certification of two nationwide classes, finding that the defendant had not waived its personal jurisdiction objection to class certification by not raising the issue at the pleading stage. See Moser v. Benefytt, Inc., No. 19-56224, 2021 WL 3504041 (9th Cir. Aug. 10, 2021).

This case arose as a putative nationwide class action filed by Kenneth Moser in federal court in California against Benefytt Technologies, Inc., formerly known as Health Insurance Innovations, Inc. (HII), alleging that HII was responsible for unwanted sales calls that violated the TCPA. Moser was a resident of California, whereas HII was incorporated in Delaware and had a principal place of business in Florida.

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Telemarketers’ Alleged Conduct Establishes Personal Jurisdiction over Principal with No Direct Forum Ties, Seventh Circuit Holds

The Seventh Circuit has reversed a decision from last year by the U.S. District Court for the Northern District of Illinois dismissing a TCPA claim for lack of personal jurisdiction over an alleged principal of the caller.  That decision, which we covered here, concluded that the plaintiff had not established an agency relationship between defendant Health Insurance Innovations, Inc. (“HII”) and the unnamed “lead generators” that had made the allegedly unsolicited calls.  Bilek v. Fed. Ins. Co., No. 19-8389, 2020 WL 3960445, at *5 (N.D. Ill. July 13, 2020).  As a result, the Northern District held that it lacked specific personal jurisdiction over HII, which had no connection to the forum state beyond its alleged relationship with the telemarketers that called the plaintiff in Illinois.  Id.

On appeal, the plaintiff argued that he had plausibly alleged an agency relationship and that the district court should therefore have imputed the caller’s conduct to HII when assessing whether it could exercise specific personal jurisdiction over the latter.  Bilek v. Fed. Ins. Co., No. 20-2504, 2021 WL 3503132, at *6 (7th Cir. Aug. 10, 2021).

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Eastern District of Pennsylvania Court Holds Text Claim Satisfies Article III, Then Dismisses for Failure to Allege Enough Facts to Make Claim Plausible

A judge in the U.S. District Court for the Eastern District of Pennsylvania recently concluded that receipt of unwanted text messages in violation of the TCPA can constitute an injury-in-fact for purposes of Article III standing, but nevertheless dismissed the claim (without prejudice) pursuant to Rule 12(b)(6) based on its threadbare allegations.

In Camunas v. National Republican Senatorial Committee, the plaintiff (Rolando Camunas) alleged that he received no less than six unsolicited text messages from the defendant (NRSC) asking him to donate to a political party.  Civil Action No. 21-1005, 2021 WL 2144671, at *1 (E.D. Pa. May 26, 2021).  In his complaint, Camunas described the messages as “generic and obviously pre-written” and alleged that they were sent using an automatic telephone dialing system (ATDS), in violation of the TCPA.  Id.

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Fifth Circuit Finds Injury In Fact after Single Text Message

The Fifth Circuit recently held that a TCPA plaintiff who received a single text message suffered an Article III injury sufficient to support standing for his claim.  In Cranor v. 5 Star Nutrition, L.L.C., No. 19-51173, 2021 WL 2133433 (5th Cir. May 26, 2021), the plaintiff alleged that 5 Star Nutrition violated the Telephone Consumer Protection Act (TCPA) when it sent him several unsolicited advertising text messages.  The parties entered into a settlement agreement to avoid litigation.  After the settlement, 5 Star Nutrition sent one final promotional text message and the plaintiff filed suit, claiming that the single text message harmed him by invading his privacy, interfering with his right to his cellular phone and telephone line, and intruding upon his seclusion.

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S.D. Fla. Court Remands Case to State Court, Finding No Article III Injury

The Southern District of Florida recently remanded a case back to state court because the defendant that removed the case failed to establish that plaintiff suffered an Article III injury. Harris v. Travel Resorts of America, Inc., Civ. No. 2:20-14369-AMC (S.D. Fla. Mar. 31, 2021). Notably, the Court also found that plaintiff should be able to recover its attorneys’ fees in seeking remand given the defendant’s reversing its prior position on whether the Court had subject-matter jurisdiction over the case.

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Auto Service Contractor Not Subject to Court’s Jurisdiction in Texas Resident’s TCPA Claim, Holds State’s Federal Northern District

The Northern District of Texas handed down a decision exploring the jurisdictional limitations on TCPA plaintiffs’ ability to hale out-of-state defendants into a plaintiff’s local federal court.

The case, Horton v. Sunpath, Ltd., involved a Texas resident (Lucas Horton) who launched a TCPA suit against a Massachusetts-based corporation (Sunpath).  Horton alleged that Sunpath’s agent, Northcoast Warranty Services, placed several calls to his cell phone using an automatic telephone dialing system and pre-recorded messages, despite the number’s listing on the National Do-Not Call Registry.  No. 3:20-cv-1884-B-BH, 2021 WL 982344, at *1 (N.D. Tex. Feb. 16, 2021).  On the calls, Horton stated, Northcoast encouraged him to purchase an auto service policy administered by Sunpath.  Id.  The calls continued for about three months until Horton purchased a policy from Sunpath in May 2020.  Id.  Horton filed suit against Sunpath about a month later in the Northern District of Texas.  Id.

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TCPA Plaintiff Argues He Wasn’t Injured in Attempt to Dodge Federal Jurisdiction

Usually, it is the plaintiff that argues he or she was injured, not the defendant. But, in an effort to stay in state court, some TCPA plaintiffs have taken the counterintuitive position that they did not suffer an injury in fact under Article III of the U.S. Constitution and, therefore, their claims cannot be heard in federal court.

“[T]o satisfy Article III’s standing requirements, a plaintiff must show (1) it has suffered an ‘injury in fact’ that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.” Friends of Earth, Inc. v. Laidlaw Environmental Servs. (TOC), Inc., 528 U.S. 167, 180–181 (2000).

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Another Court Rejects Threadbare Allegations of So-Called Vicarious Personal Jurisdiction

The District of Arizona recently dismissed Winters v. Grand Caribbean Cruises, Inc., No. 20-0168, 2021 WL 511217 (D. Ariz. Feb. 11, 2021), for lack of personal jurisdiction, finding that the plaintiffs had failed to establish that the caller’s contact with Arizona could be imputed to Grand Caribbean.

The plaintiffs alleged that Grand Caribbean violated the TCPA by using a prerecorded voice to initiate calls to numbers on the Do-Not-Call Registry.  Grand Caribbean moved to dismiss for lack of personal jurisdiction, among other things.

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District Court (Again) Holds Text Messages Insufficient to Confer Article III Standing

The Southern District of Florida recently dismissed a TCPA claim sua sponte for lack of subject matter jurisdiction, finding that the plaintiff had not alleged a concrete injury-in-fact.  See Perez v. Golden Trust Insurance, Inc., 470 F. Supp. 3d 1327 (S.D. Fla. 2020).

Perez alleged that Golden Trust had violated the TCPA when, without his consent, it used an ATDS to send two telemarketing text messages to his cell phone.  Golden Trust argued that the complaint should be dismissed because Perez did not properly allege the use of an ATDS.

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