New York Court Certifies Two Classes in TCPA Class Action

TCPA Connect

Certifying two classes in a Telephone Consumer Protection Act (TCPA) class action, a New York federal court found that questions of individualized consent did not predominate and that the plaintiffs did not need to demonstrate that they personally registered their numbers on the National Do Not Call Registry.

In January 2017, the car dealership Honda of Manhattan (HOM) closed. HOM agreed with its sister dealership, Manhattan Luxury Automobiles (MLA), that MLA would offer service to HOM customers.

HOM sent its customers emails and text messages notifying them that MLA could service their vehicles, along with an option to opt out of future communications.

Some HOM customers who had purchased or leased vehicles from HOM had signed contracts purportedly agreeing that HOM could contact them and share certain personal information with certain third parties.

MLA then sent text messages offering vehicle maintenance, service and inspections to HOM customers who did not affirmatively opt out of communications. Many HOM customers received more than one message.

Five individuals filed suit under the TCPA, alleging that MLA violated the statute by sending unsolicited text messages. The plaintiffs moved to certify three classes, including the automatic telephone dialing system (ATDS) class consisting of all HOM customers who received a text message from MLA to a nonbusiness cellphone using a specified platform with certain content.

The second proposed class, or National Do Not Call Registry (NDNCR) class, consisted of all members of the ATDS class who received at least two such text messages in a 12-month period when their phone numbers had been registered on the NDNCR.

Finally, the third proposed class was comprised of all members of the ATDS class who received messages while MLA failed to institute procedures to maintain a list of persons who requested not to receive telemarketing calls—the Internal Do-Not-Call List (IDNC) class.

MLA objected to certification of all three classes. It raised two primary defenses to certification of the classes: that individualized inquiries would be required to determine whether each class member consented to receive text messages and whether each class member registered his or her phone number on the NDNCR.

U.S. District Court Judge Lorna G. Schofield disagreed.

Considering consent, the court found the issues could be resolved with classwide evidence.

Although MLA argued that certain class members signed two forms when they purportedly consented to receive texts (a contact authorization form and a privacy notice and acknowledgment), because every class member signed the same forms, “the legal issue of whether those signatures support a consent defense and whether that consent can be transferred to [MLA] can be adjudicated with common proof,” the court said.

Alternatively, MLA pointed to the opportunity for HOM customers to opt out of future communications, asserting that it only sent messages to those customers who did not opt out.

“The legal issues of whether failure to opt out constitutes consent again can be litigated on a common basis because every class member received the same opportunity to opt out,” Judge Schofield explained.

Turning to the NDNCR class, Judge Schofield rejected MLA’s position that only a person who registered his or her own number on the NDNCR can assert a claim under the TCPA and that class members might have inherited a phone number that is registered on the NDNCR by a prior user of that number.

Judge Schofield reasoned, “Whether each class member registered their number on the NDNCR is irrelevant, so that issue cannot predominate over common issues.” She further stated, “The NDNCR regulation provides that, once a phone number is registered, it remains protected until it is affirmatively removed from the registry.”

47 C.F.R. § 64.1200(c)(2) provides that do-not-call registrations “must be honored indefinitely, or until the registration is cancelled by the consumer or the telephone number is removed by the database administrator.”

“That provision anticipates the issue [MLA] raises, that as phone numbers change hands, the NDNCR may not always perfectly reflect which consumers requested to be included,” the court said. “To resolve the potential ambiguity about who is protected from unwanted calls, the regulation provides that numbers remain protected until they are removed, regardless of whether they ‘should’ still be on the list. ”

Judge Schofield granted the plaintiffs’ motion for class certification for the ATDS and NDNCR classes but dismissed the IDNC class for lack of standing. None of the named plaintiffs ever requested not to receive messages from MLA prior to receiving a message. “Thus, even if Defendant had complied perfectly with the IDNC provision of the TCPA, Plaintiffs still would have received those messages,” the court held.

To read the opinion and order in Watson v. Manhattan Luxury Automobiles, Inc.click here.

Why it matters: The New York court’s decision provides a reminder that some courts will not require plaintiffs to have personally registered their number on the NDNCR in order to receive its protections. In addition, the court was not persuaded that individual questions of consent predominated, instead holding that they could be determined on a classwide basis. The court’s decision to dismiss the IDNC class is in accord with several other courts’ holdings that a plaintiff must ask not to be called further to have standing to assert an IDNC claim.

manatt-black

ATTORNEY ADVERTISING

pursuant to New York DR 2-101(f)

© 2022 Manatt, Phelps & Phillips, LLP.

All rights reserved