TCPA Tracker - March 2021
Recent NewsInovalon Seeks Timely and Favorable Decision on Junk Fax Petition
On March 9, 2021 Inovalon, Inc. submitted a letter urging the FCC to answer Inovalon’s Petition for Declaratory Ruling and affirm that “faxes with no direct commercial purpose, and offering no commercially available products or services to the recipients, are not ‘advertisements’ under the TCPA and JFPA.” The letter, an ex parte notice, updates the Commission on new activity in the junk fax class action against Inovalon Eric B. Fromer Chiropractic, Inc. v. Inovalon Holdings, Inc., et al, No. 17-cv-03801-GJH. The case has been stayed for over two years pending a decision from the FCC on Inovalon’s petition. On February 4, 2021, the Plaintiff filed a motion to lift the stay, arguing that the Fourth Circuit Court’s recent decision in Carlton & Harris Chiropractic, Inc. v. PDR Network, LLC, 982 F.3d 258, 264 (4th Cir. Dec. 7, 2020) establishes that the Commission’s interpretations of the TCPA are not binding, and thus the stay is unwarranted. According to Inovalon, the Plaintiff’s motion reinforces the need for the FCC to “promptly grant Inovalon’s non-controversial Petition.”
On February 19, 2021 the American Bankers Association and various other trade associations met with David Strickland, Acting Legal Advisor, Consumer, Enforcement, and International, for FCC Chairwoman Jessica Rosenworcel, via telephone to discuss a so-called “error” in the December 30, 2020 Report and Order. According to the Associations, the FCC inadvertently imposed a prior written consent requirement on informational prerecorded/artificial voice calls to residential numbers made outside of the Informational Calls Exemption. In a subsequent Notice of Ex Parte, the Associations outline their interpretation of the alleged error and ask the Commission to issue an Erratum to clearly establish that “prior express consent” is sufficient level of consent for the aforementioned type of calls. This is the second recently filed Notice of Ex Parte concerning communication between the Associations and the FCC. Representatives from the Associations also met with members of the FCC’s Consumer Government Affairs Bureau via telephone on January 25, 2021. Aside from the portions relating to the meeting participants, the two Notices are almost identical. On March 8, 2021, USTelecom – The Broadband Association filed a letter in support of the Association’s request.
FCC Petitions Tracker
Kelley Drye’s Communications group prepares a comprehensive summary of pending petitions and FCC actions relating to the scope and interpretation of the TCPA.
Number of Petitions Pending
- 29 petitions pending
- 1 petition for reconsideration of the rules to implement the government debt collection exemption
- 1 application for review of the decision to deny a request for an exemption of the prior express consent requirement of the TCPA for “mortgage servicing calls”
- 1 request for reconsideration of the 10/14/16 waiver of the prior express written consent rule granted to 7 petitioners
New Petitions Filed
Click here to see the full FCC Petitions Tracker.
Cases of Note
In Gabertan v. Walmart, Inc., the Western District of Washington dismissed a putative class action against Walmart Pharmacy for a text message sent during the COVID-19 pandemic, finding that the text message fell within the emergency purpose exception to the TCPA.
Plaintiff alleged that in early April 2020, Walmart Pharmacy sent a single, unauthorized message to him: “Are you 60+, high-risk, self-quarantining, or have COVID-19 symptoms? Use curbside pickup or have your Rx mailed.” The text also included a shortlink with “more info.” Plaintiff argued that the message in question was intended to promote Walmart’s goods and services, and therefore was an advertisement in violation of the TCPA. Defendant responded that it was a facially informational communication made for emergency purposes, which generally does not violate the TCPA.
The TCPA contains an “emergency purpose” exception that the Western District of Washington had previously held should be construed broadly. Further, an FCC Declaratory Ruling from March 2020 had concluded that the COVID-19 pandemic is an imminent health risk, and that the TCPA does not prohibit healthcare providers from making informational calls necessitated by it which are directly related to the pandemic’s health risks to the public.
The Court held that the message fell “squarely” within the TCPA’s emergency exception, “particularly as explained by the FCC’s March 2020 Declaratory Ruling,” and granted Defendant’s motion to dismiss.
Gabertan v. Walmart, Inc., No. 20-cv-5520-BHS, 2021 U.S. Dist. LEXIS 41988 (W.D. Wash. Mar. 5, 2021).
A federal court in the Northern District of West Virginia has denied a defendant’s motion to dismiss in part in Mey v. Cunningham, holding that the definition of automatic telephone dialing system (ATDS) under the TCPA includes any stored-number systems. The court, however, granted the defendant’s motion to dismiss three out-of-state plaintiffs, finding that it lacked personal jurisdiction over those plaintiffs’ claims.
The court’s decision that it lacked personal jurisdiction over the three out-of-state plaintiffs was based on the Supreme Court’s 2017 decision in Bristol-Myers Squibb Co. v. Superior Court, where the Court held that out-of-state consumers in a California mass tort action could not participate in the action because California courts lacked specific jurisdiction over their claims. 137 S. Ct. 1773 (2017). Specific jurisdiction requires a plaintiff to demonstrate that: (1) the defendant purposefully availed itself of the privilege of conducting activities in a state; (2) the plaintiff’s claims arise out of those activities directed at the state; and (3) the exercise of personal jurisdiction would be constitutionally reasonable. Federal courts have applied Bristol-Myers Squibb in the class action context by requiring all named plaintiffs to demonstrate that their claims allegedly arose out of contacts with the forum state.
Applying Bristol-Myers Squibb, the Mey court dismissed three out-of-state named plaintiffs’ claims because their allegations did not demonstrate that the allegedly prohibited calls at issue arose out of contacts with West Virginia.
The Fourth Circuit, which includes the Northern District of West Virginia, has not weighed in on the Circuit split over the definition for an ATDS under the TCPA. As we have previously reported, the Second, Sixth, and Ninth circuits have held that an ATDS includes technology that dials from a stored list of numbers. The Third, Seventh, and Eleventh circuits require that an ATDS use a random or sequential number generator.
The Mey court relied heavily on the Sixth Circuit’s ruling in Allan, finding that a number generator produces numbers, not store them, which means a natural reading of the statutory language is that “using a random or sequential number generator” solely modifies “produce,” and not “store.” Second, again following Allan, the Court found that if a number is stored using a number generator, common sense dictates it is also produced by that number generator, which would render the term superfluous. Finally, the Court agreed with Allan that the prior express consent exception and the private debt exception found elsewhere in the statute would make little sense if the TCPA did not generally prohibit calling from stored lists of numbers since those calls are made to known numbers. Put differently, the Court concluded that if calls from stored lists were not prohibited by the TCPA, there would be no need for the exceptions.
The Mey court also offered up a new explanation. Relying on the Supreme Court’s decision in Barr, the court reasoned that if the TCPA did not prohibit autodialers using stored lists, then the Supreme Court would have ruled that the statute did not prohibit debt collection calls using an ATDS, rather than handing down an opinion severing the government debt exception to the TCPA. Barr v. Am. Ass’n of Pol. Consultants, Inc, 140 S. Ct. 2335 (2020). Thus, the Court dismissed the ATDS claims.
Mey v. DirecTV, LLC, No. 5:17-cv-00179, 2021 U.S. Dist. LEXIS 35823 (N.D. W. Va. Feb. 25, 2021)
In Tuso v. Nat’l Health Agents, LLC, the Eastern District of California granted a motion to dismiss because the plaintiff’s allegations failed to establish venue. Under federal law, venue is proper in either: (1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located; or (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred. 28 USC § 1391.
Plaintiff’s allegations concerning venue lacked factual explanation. He alleged only “that (1) he reside[d] in the [Eastern District of California] and (2) the wrongful conduct giving rise to th[e] case was directed at Plaintiff in th[e] [Eastern District of California].”
According to the Court, such “bare-bone and conclusory” allegations did not meet the Twombly standard and were insufficient to establish venue. Therefore, the Court granted Defendant’s motion to dismiss without prejudice.
Tuso v. Nat’l Health Agents, LLC, No. 2:20-cv-02130, 2021 U.S. Dist. LEXIS 40088 (E.D. Cal. Mar. 3, 2021)