United States District Court, D. Colorado
MATTHEW DONACA, an individual and on behalf of all others similarly situated, Plaintiff,
DISH NETWORK, LLC, Defendant.
R. BROOKE JACKSON, District Judge.
The case is before the Court on Dish Network, LLC's motion for summary judgment; plaintiff's revised motion for class certification; and Dish's motion to strike certain arguments and exhibits in plaintiff's reply in support of his revised motion for class certification. For the reasons discussed herein, Dish's motion for summary judgment is granted in part and denied in part. The other two motions are denied.
FACTUAL BACKGROUND AND CASE HISTORY
Many of us have at one time or another been annoyed by unsolicited telemarketing calls. In 1991, finding that such calls were a common nuisance and an unreasonable intrusion on citizens' privacy, Congress enacted the Telephone Consumer Protection Act of 1991 ("TCPA"), 47 U.S.C. § 227. One significant provision of the TCPA made it unlawful for any person to "initiate" a telephone call to any residential telephone line using an artificial or prerecorded voice, also known as a robocall, without the prior express consent of the called party. 47 U.S.C. § 227(b)(1)(B). The statute created a private right of action for injunctive and monetary relief. A successful plaintiff can recover his "actual monetary loss" or $500, whichever is greater, for each violation, and the court can increase the award up to three times if it finds that the violation was willful or knowing. 47 U.S.C. § 227(b)(3).
The TCPA also directed the Federal Communications Commission to initiate a rulemaking proceeding which resulted, among other things, in a rule that no person may "initiate" a telephone solicitation to a residential telephone subscriber who has put his or her telephone number on a national do-not-call registry. 47 C.F.R. § 64.1200(c)(2). As with the prerecorded calls, the TCPA created a private right of action for injunctive relief and damages for persons who violate that regulation. Specifically, a person on the do-not call list who has received more than one unsolicited call within a 12-month period by or "on behalf of" the same entity, and as to which certain exceptions do not apply, may recover his actual damages or $500 in statutory damages, whichever is greater. 47 U.S.C. § 227(c)(5).
I suspect that most persons who have received unsolicited telemarketing calls in the wake of the statute and the FCC rules have little knowledge of the private right of action and, in any event, have done nothing other than express their frustrations to family members or friends. Mathew Donaca is not such a person. He has made it his business, literally, to fight back. According to his deposition testimony [ECF No. 149-7], he considers himself to be a consumer rights advocate. He does regular research on telemarketers. He estimates that in 2011 he derived approximately 60% of his income from TCPA-related activity, meaning collecting money through settlements of claims he made against violators. Id. at 10, 12-13, 36-38, 82. He belongs to an email group of consumer rights advocates, many of whom deal in telemarketing, and through which he met his lead counsel in this case. Id. at 86-89.
In the present case Mr. Donaca is aggrieved by nine calls he received between November 16, 2007 and March 25, 2009 marketing Dish's goods and services. Mr. Donaca initially proposed to represent a class of "all persons or entities within the United States who Dish either directly, or through its retailers or authorized agents, sent, or caused to be sent, unsolicited telemarketing calls promoting Dish's goods or services, at any time within the four years prior to the filing of the instant complaint." Complaint [ECF No. 1] at ¶66; First Amended Complaint [ECF No. 24] at ¶57.
Although in one or two cases the source of the challenged calls to Mr. Donaca was not clear, his complaint focused not on calls made directly by Dish but on calls made either by Dish retailers or by telemarketers retained by Dish retailers. Dish contends that it cannot be said to have "initiated" calls that it did not physically make, and that it has no vicarious liability for calls initiated by others. Complicating the second question was the fact that section 227(c)(5) of the TCPA, concerning violations of the do-not-call registry regulation, authorized suits based on calls "by or on behalf of" the same entity, whereas section 227(b)(3), authorizing suits based upon unsolicited prerecorded calls, did not have the "on behalf of" language.
When this case was filed Dish had already raised the "initiate" and "on behalf of" issues in two other cases, and in both cases the courts had referred the issues to the Federal Communication Commission for its interpretation of the TCPA and the FCC's regulations applicable to the issues. Charvat v. EchoStar Satellite, LLC, 630 F.3d 459, 465-68 (6th Cir. 2010); United States v. Dish Network, L.L.C., No. 09-3073, 2011 WL 475067, at *4 (C.D. Ill. Feb. 4, 2011. Dish asked this Court either to dismiss this case without prejudice or to stay the case pending the FCC's resolution of those issues. [ECF No. 14, 15]. The Court for the most part denied the motion [ECF No. 47], but as a practical matter the case was stayed to the extent that various deadlines have been changed and the trial date has been continued twice.
On January 31, 2013 plaintiff filed its first motion for class certification. [ECF No. 102]. He asked the Court to certify a class "consisting of all persons or entities within the United States who received unsolicited telemarketing calls promoting Dish goods or services, at any time on or after November 8, 2007, the date four years before Mr. Donaca commenced this action." Id. Dish's response was filed on May 8, 2013. [ECF No. 150].
On the day after Dish's response was filed, the FCC released its long-awaited ruling on the interpretation of the terms "initiate" and "on behalf of." The FCC ruling was released on May 9, 2013. In re Matter of the Joint Petition Filed by Dish Network, LLC, CG Docket No. 11-50, FCC 13-54, 2013 WL 1934349 (May 9, 2013). The Commission's construction of the term "initiate" sustained Dish's position that calls are initiated only by the person who physically places the call:
We conclude that a person or entity "initiates" a telephone call when it takes the steps necessary to physically place a telephone call, and generally does not include person or entities, such as third-party retailers, that might merely have some role, however minor, in the causal chain that results in the making of a telephone call.
Id. at **8.
However, the Commission made it clear, contrary to Dish's position, that a seller of goods and services such as Dish can be held vicariously liable for unlawful prerecorded calls and live calls under federal common law agency principles, including classical agency (where a principal manifests assent that an agent shall act on the principal's behalf and subject to the principal's control); apparent authority (where the principal is accountable for the results of a third-party's belief about the actor's authority to act as an agent when the belief is reasonable and traceable to a manifestation of the principal); and ratification (such as when the principal knowingly accepts the benefits of the actor's conduct). Id. at **11. The Commission explained:
We thus agree that, consistent with the statute's consumer protection goals, potential seller liability will give the seller appropriate incentives to ensure that their telemarketers comply with our rules. By contrast, allowing the seller to avoid potential liability by outsourcing its telemarketing activities to unsupervised third parties would leave consumers in many cases without an effective remedy for telemarketing intrusions.
Id at **12.
We clarify that, while a seller does not generally initiate calls made through a third-party telemarketer, it nonetheless may be vicariously liable under federal common law agency-related principles for violations of either section 227(b) or 227(c) committed by telemarketers that initiate calls to market its products or services.
Id. at **15.
As I said, Dish filed its response to plaintiff's motion for class certification on the day before the FCC ruling came down. Dish argued, among other things, that plaintiff's proposed class definition was overbroad. In plaintiff's reply [ECF No. 160], filed May 28, 2013, he narrowed his class definition to correspond with call detail records his counsel had obtained in discovery, specifically to three "calling platforms, " essentially meaning a company that has software for placing telemarketing calls. An entity can contract with a calling platform to place such calls on a mass scale. Mr. Donaca now proposed a class defined as "all persons or entities who received Dish telemarketing calls through the Five9, Dynamic Interactive, and NDS calling platforms, at any time on or after November 8, 2007." Id at 11. He also proposed that the class be divided into two sub-classes, one for prerecorded calls and the other for live calls to persons on the do-not-call registry. Id.
The problem was, as Dish leapt to point out, Mr. Donaca was not a member of the proposed class. Perhaps a bit red in the face, plaintiffs just a few days before the scheduled certification hearing filed a motion for leave to modify his proposed definition of the class again. [ECF No. 205]. This time the proposal was a class consisting of "[p]ersons who received calls promoting DISH goods or services from the following CID/ANIs, on the following Dates, from or at the direction of the following Dealers and their affiliates: [there followed a chart in which 16 telephone numbers were matched with dates ranging from November 16, 2007 to February 15, 2012 and also matched to a list of seven dealers. Id. at 2. Plaintiffs continued to suggest the two subclasses (prerecorded and live calls). Id. at 3.
The Court held a hearing on the motion for class certification on July 11, 2013. The upshot was that the Court denied certification of the class proposed in plaintiff's reply brief (of which Mr. Donaca was not a member) but, at the parties' request, granted the plaintiff leave to file a new motion for class certification. The Court set a new briefing schedule, vacated the then existing trial date, and set a new trial date (April 7, 2014). [ECF No. 208, 212].
Plaintiff's "revised motion for class certification" was filed on September 13, 2013. [ECF No. 221]. This is the class certification motion that is presently pending. It has been fully briefed, and even the briefing generated is own motion, i.e., Dish's motion to strike certain arguments and exhibits in plaintiff's reply brief. [ECF No. 253]. The Court held a hearing on the motion to certify a class on December 12, 2013 and then took the motion under advisement in order to prepare a written order.
The currently proposed class has the same definition as that proposed by plaintiff shortly before the first certification hearing. It is comprised of
Persons who received calls promoting DISH goods or services from the following CID/ANIs, on the following Dates, from or at the direction of the ...