Thursday, July 30, 2015

FYI: 8th Cir Reverses Dismissal of TCPA Putative Class Action, Holding "Purpose" of Call -- Not Its "Content" -- Determines Whether Violation Occurred

The U.S. Court of Appeals for the Eighth Circuit recently held that the "purpose" of the call -- as opposed to the "content" of the call -- determined whether certain prerecorded messages violated the federal Telephone Consumer Protection Act, 47 U.S.C. § 227 (TCPA), and Missouri Do Not Call Law, Mo. Rev. Stat. § 407.1098.


A copy of the opinion is available here:


The plaintiffs, residents of Missouri, were both on a federal and state "do not call list."  Nevertheless, they received two unsolicited pre-recorded messages on their home phone line from one of the defendants, as part of a campaign to promote a movie. 


Both messages simply stated: "Liberty.  This is a public survey call.  We may call back later."   The calls, if answered, would have also played a 45 second scripted message that included advertising language.  However, because the plaintiffs did not answer the calls, they only heard the short message regarding a public survey.


The plaintiffs sued in state court on behalf of a putative class of people that the defendants had called using the pre-recorded message for alleged violations of the TCPA and the Missouri Do Not Call Law.  While in state court in Missouri, they moved to certify a class of persons that allegedly included "persons in the United States to whom [defendants] within four years of October 3, 2012, initiated one or more telephone calls to such persons' residential telephone lines…" using the pre-recorded message. 


Later, the defendants removed to federal court and filed motions to dismiss.  While those motions were pending, the district court, sua sponte, questioned whether the putative plaintiffs had standing and instructed the parties to brief that issue.


After the issues were fully briefed, the lower court dismissed the case because none of the messages the named plaintiffs had received "contained an advertisement, telemarketing message, or telephone

solicitation," in violation of the Telephone Consumer Protection Act (TCPA) or the Missouri Do Not Call Law.  The lower court also held that the named plaintiffs were inadequate representatives because their claims were not typical of putative class members under Federal Rule of Procedure 23(a). 


The Eighth Circuit reversed, because it focused only on the content of the two messages left on the plaintiffs' voicemail, and not the purpose of the calls. 


As you may recall, absent a few exceptions, the TCPA prohibits making "any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a message without the prior consent of the called party."  47 U.S.C. § 227(b)(1)(B).  The TCPA provides a private right of action, and allows the recovery of actual monetary loss or "$500 in damages for each violation, whichever is greater."  See 47 U.S.C. § 227(b)(3)(B). 


One of those exceptions can be found in FCC regulations.  The FCC, through its statutory rulemaking power, exempts artificial or pre-recorded calls that are "made for a commercial purpose but [do] not include or introduce an advertisement, or constitute telemarketing."  See 47 C.F.R. § 64.1200(a)(3)(iii).


"Advertisements" include "material advertising the commercial availability or quality of any property, goods, or services." See 47 C.F.R. § 64.1200(f)(1).  The defendants argued that, even if the calls were made for a commercial purpose, the particular messages received by the named plaintiffs (i.e., "Liberty.  This is a public survey call.  We may call back later.") did not violate the TCPA because the messages did not contain an "advertisement" or qualified as "telemarketing" under the FCC's implementing regulations.  The Eighth Circuit agreed that the messages did not mention property, goods, or services, and therefore that the messages were not advertisements prohibited by the TCPA or its implementing regulations.


However, the Eighth Circuit held that, while the content of the calls controlled whether they were "advertisements," their purpose controlled whether they were "telemarketing."


The Eighth Circuit noted that the FCC's implementing regulations define "telemarketing" as the "initiation of a telephone call or message for the purpose of encouraging the purchase or rental of, or investment in, property, goods, or services, which is transmitted to any person." 47 C.F.R. § 64.1200(f)(12).  A "person or entity 'initiates' a telephone call when it takes the steps necessary to physically place [the] call." In the Matter of the Joint Petition filed by Dish Network, LLC, 28 F.C.C. Rcd 6574, 6583 ¶ 26, 2013 WL 1934349, at *8 (F.C.C. May 9, 2013).


The Eighth Circuit refused to consider only the content of the calls, citing Congressional findings indicating that consumers consider "prerecorded calls, regardless of the content [of the] message, to be a nuisance and an invasion of privacy." See TCPA of 1991, Pub. L. No. 102–243, 105 Stat. 2394, § 2(10).


The Court also noted that "'telemarketing' occurs when the context of a call indicates that it was initiated and transmitted to a person for the purpose of promoting property, goods, or services."  See 47 C.F.R. § 64.1200(a)(2)(iii); 47 C.F.R. § 64.1200(f)(12); see also In re Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 18 F.C.C. Rcd at 14098 ¶ 141, 2003 WL 21517853, at *49.


The Court held that, because the calls were initiated and transmitted in order to promote a movie, they qualified as "telemarketing" even though the messages the named plaintiffs received never referenced the film.


Accordingly, the Eighth Circuit held that, even though the putative plaintiffs had only heard the survey "content," and had not heard any "advertisements," the purpose of the calls was to promote a movie.  Thus, the calls constituted "telemarketing" and the FCC exemption did not apply." 


Consequently, the Eighth Circuit held that the lower court erred in concluding that the TCPA and Missouri Do Not Call Law did not apply, and that therefore that the lower court also erred in concluding that the named plaintiffs lacked standing to represent the class and that their claims were not typical of the putative class members. 


The Eighth Circuit held that what "matters for all class members, including the [putative plaintiffs] is that each call [from the defendants] was initiated for the purpose of [promoting a movie."  It reversed and remanded the case for further proceedings.  





Ralph T. Wutscher
Maurice Wutscher LLP
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