The Sixth Circuit recently held that a facsimile which lacks commercial components on its face does not constitute an advertisement under the Telephone Consumer Protection Act and ruled that the possibility of remote economic benefit to a defendant is “legally irrelevant” to determining whether the fax violates the TCPA. The Sixth Circuit’s narrow rule stands out among decisions from other courts that have adopted an expansive interpretation of “advertisement” under the TCPA, and demonstrates that the scope of the TCPA is indeed subject to limitations. Read More
The United States Supreme Court recently granted certiorari in a Telephone Consumer Protection Act class action challenging text messages which a U.S. Navy vendor sent to recruit new sailors. In Campbell-Ewald Company v. Gomez, No. 14-857, the Supreme Court will review (1) whether a defendant’s offer to provide complete relief as to individual claims deprives the plaintiff of Article III standing, and (2) whether such an offer can also prevent a putative class plaintiff from proceeding where no class has yet been certified.
In Campbell-Ewald, the plaintiff brought suit under the TCPA for himself and a putative class of individuals who the plaintiff claimed had not provided consent to receive a recruiting text message from the Navy. Before the plaintiff moved for class certification, the defendant made a Rule 68 “offer of judgment” offering the plaintiff complete monetary and non-monetary relief. When the plaintiff rejected the offer, the defendant moved to dismiss on the basis that its offer of complete relief mooted both the plaintiff’s individual and class claims under Article III.
The district court denied the motion to dismiss. On appeal, the Ninth Circuit agreed with that aspect of the district court’s ruling. The Supreme Court’s review should resolve a split among the circuits as to the effect of a Rule 68 offer in the class action context. A decision, however, is not likely until June 2016. Our recent client alert by Irene C. Freidel and Jennifer J. Nagle, To Offer or Not to Offer: Post Genesis, Uncertainty Continues Regarding the Impact of Rule 68 Offers of Judgment in the Class Action Context, provides additional discussion of Rule 68 and offers of judgment in class actions, more generally.
Campbell-Ewald is the second case in which the Supreme Court recently granted cert., which could have potential impacts on TCPA class action litigation. In addition, in Spokeo, Inc. v. Robins, No. 13-1339, which will also be heard next term, the Supreme Court will consider whether a plaintiff must have suffered actual harm in order to have standing to sue for statutory damages under the Fair Credit Reporting Act. That statute, like the TCPA, appears to permit recovery of statutory damages upon the showing of a violation, and the federal circuit courts of appeal are currently split over whether a plaintiff may state a claim for statutory damages without separately showing injury-in-fact as a necessary prerequisite for standing. The Supreme Court’s resolution of this issue in the FCRA context may have significant implications for class action and individual litigation under a wide range of federal statutes, including the TCPA. For more information on the Spokeo case, please see our recent post in K&L Gates Consumer Financial Services Watch blog.
A new decision once again highlights the dangers that companies face if their independent contractors engage in conduct that violates the Telephone Consumer Protection Act, and highlights the need to monitor contractor compliance with the TCPA. In City Select Auto Sales, Inc. v. David/Randall Assocs., Inc., a federal court in New Jersey recently found a roofing company, David/Randall Associates, liable for $22.4 million under the TCPA for the actions of its blast fax solutions provider, Business to Business Solutions (B2B). The plaintiff had alleged that the roofer and its president were liable for the transmission of fax advertisements 44,832 times to 29,113 different fax numbers by its independent contractor, B2B, without obtaining the prior express invitation or permission of the recipients and without including an FCC-required opt-out notice.
The Ninth Circuit recently held that a consumer’s TCPA class action against Sirius XM Radio Inc. (“Sirius XM”) was not subject to Sirius XM’s arbitration agreement. The consumer brought suit alleging that the satellite radio provider violated the TCPA by placing automated calls to his cellular phone without his consent. Sirius XM sought to compel arbitration on an individual basis. The consumer countered that although he purchased a car that was preloaded with a trial subscription to Sirius XM radio, the purchase agreement made no mention of a contract governing the satellite radio service. Rather, the consumer asserted that he did not receive Sirius XM’s terms and conditions until more than a month after he purchased the car, but that those terms required cancellation of service within three days of activation of the trial subscription. Because of the manner in which Sirius XM delivered its terms and conditions to purchasers of cars with trial subscriptions, the Ninth Circuit found that the consumer could not have provided assent to be bound by the arbitration provision. Thus, the Ninth Circuit ruled that neither the arbitration provision nor the class action waiver it contained was enforceable. The decision was issued in a case styled Knutson v. Sirius XM Radio Inc., — F.3d —-, 2014 WL 5802284 (9th Cir. Nov. 10, 2014).