More courts are enforcing arbitration provisions to defeat purported Telephone Consumer Protection Act (“TCPA”) class actions. In re: Midland Credit Management, Inc. (S.D. Cal. Jan. 31, 2019); Petrie v. Gosmith, Inc. (D. Colo. Jan. 31, 2019).
Comment: For the arbitration clauses to apply, the calls or texts must be related to the topic of the agreement, and not some unrelated goods or services.
TCPA Filings in 2018
Some surprising news, TCPA filings have decreased in the past two years from the peak of 4,639 lawsuits in 2016 to 4,380 in 2017, and 3,803 in 2018. The ACA International reports these numbers.
Comment: It may be that businesses submit to more rigorous compliance measures and plaintiffs’ attorneys have already picked “low hanging fruit”.
Ninth Circuit Court of Appeals
The Ninth Circuit Court of Appeals has denied a request for a full re-hearing of its order in Supply Pro Sorbents, LLC v. RingCentral, Inc. The appellate court had previously ruled that a cover sheet that included a one-line statement “send and receive with RingCentral” was not an advertisement such that the entire fax would be converted into an unsolicited advertisement under the TCPA. An earlier appellate ruling had upheld a trial court decision that any damage caused by the above statement was minimal and did not give the recipient constitutional standing to sue under the TCPA.
A hearing will be held March 11 in California before the Ninth Circuit Court of Appeals in Gallion v. Charter Communications. In that case, Charter Communications claimed that the TCPA cell phone call ban is unconstitutional because of its exemptions for other types of speech, including government debt collection. Charter Communications lost, but is appealing the matter and will have oral argument in March.
Comment: This case presents similar issues to the challenge brought by this firm on behalf of American Association of Political Consultants in the Fourth Circuit Court of Appeals which we already argued in December 2018.
U.S. Supreme Court
As you probably know, the Supreme Court is considering whether courts are required to defer to the Federal Communications Commission’s (“FCC”) interpretation of TCPA provisions and will soon hear oral argument in PDR Network, LLC v. Carlton & Harris Chiropractic, Inc., a fax case. In that case, the appellate court held it had to follow the FCC’s interpretation of whether a fax was an unsolicited advertisement or not, even if the fax message offered free goods or services. The briefs filed so far have supported PDR Network’s argument that the Fourth Circuit Court of Appeals ruled incorrectly, and it was not required to follow the FCC’s interpretation.
Comment: The plaintiff, represented by prolific TCPA fax class action attorneys Anderson + Wanca argue contrary, i.e. a fax offering free goods or services can still be an advertisement.
A California court has ruled that a text confirming a hotel reservation and encouraging the recipient to download a travel management app was not telemarketing or advertising and did not require prior express written signed consent. Phan v. Agoda. Plaintiff had provided her telephone number to defendant four times but sued claiming the reservation confirmation texts were advertising. The court disagreed.
Comment: It is important that your “transactional” messages avoid advertising content, but the name of your company, a url, or an app alone likely are not advertising even though such information could lead the consumer to future advertising content.
A California judge has ruled that a plaintiff has to clearly describe what role each defendant has in launching allegedly illegal calls. Ewing v. Encor Solar, LLC, et al.
Comment: This case will support dismissal of some defendants whose role in calls does not include direct control or authorization to make calls.
In a text class action against Planet Fitness, judges ruled that an arbitration clause in the plaintiff’s gym membership agreement did not require arbitration for his subsequent TCPA claim. Ramos v. PF Homestead, LLC. A judge ruled the arbitration clause in the agreement did not contemplate TCPA claims and thus was inapplicable.
Comment: Arbitration clause are effective but must be drafted carefully to protect both sides.
The New Jersey Senate is considering a bill (SB 3032) which already passed the House and is being considered in the current 2019 session by the Senate Economic Growth Committee. The bill would require oral disclosure within the first 30 seconds of the call with the name, mailing address, and telephone number of the person on whose behalf the call is being made.
A well-known plaintiff has lost a case against an individual who argued that he never made nor employed anyone to make outbound telemarketing calls on his behalf, yet the plaintiff still sued. Childress v. Deering. Childress submitted various records purporting to link Deering to a business which made the calls, but the court disagreed.
Comment: I have recently had several clients deal with allegations of liability for calls which they did not place. This case shows that defendants have more options than simply paying off these nuisance allegations.
A New York court has held that a recruitment fax was actually an unsolicited advertisement offering services to the recipient and refused to dismiss the recipient’s TCPA claim. Lackawanna Chiropractic, P.C. v. Trivity Health Support, LLC.
Comment: While job offers and recruitment offers are not unsolicited advertisements, they need to be legitimate and not subterfuge. The same rules apply to polls or surveys which are exempt unless they are advertisements in the guise of a poll.