CASES OF NOTE
Eleventh Circuit Reverses Salcedo, Finding One Text Sufficient Injury for TCPA Standing
The Eleventh Circuit remanded a class action lawsuit against GoDaddy with the instruction that the receipt of a single text message in violation of the TCPA is sufficient to allege an injury in-fact – a stark shift from former precedent in the circuit.
In August of 2019, three Plaintiffs – Susan Drazen, Jason Bennett, and John Herrick – filed separate claims, which were later consolidated, against Defendant GoDaddy based on Defendant’s alleged automatically dialed calls and texts to former customers. The parties reached a settlement agreement, in which class members would be offered “the choice between a $150 Voucher or a $35 cash award.” The district court’s approval of the settlement agreement was challenged by Objector-Appellant Juan Enrique Pinto, who objected to the amount of awarded attorney’s fees. On appeal, the Eleventh Circuit, rather than addressing Pinto’s arguments, dismissed the case for lack of jurisdiction. The Court held that the class definition improperly included members who received only one text message (up to 7% of the class), which was insufficient to confer Article III standing under the Eleventh Circuit’s precedent in Salcedo v. Hanna, 936 F.3d 1162 (11th Cir. 2019).
Upon a motion by Plaintiff Drazen, the Eleventh Circuit agreed to re-hear the case en banc, and reconsider their decision in Salcedo. The Court would ultimately overrule Salcedo.
On the question of standing, Plaintiffs asserted that those who receive only one text message suffer a privacy invasion that is similar to the harm of intrusion upon seclusion, against which the TCPA protects. GoDaddy argued that such a ‘privacy invasion’ is not ‘highly offensive to a reasonable person,’ as is the standard for the common-law tort. The Court, agreeing with Plaintiffs, held that the harm was similar in ‘kind,’ even if not in ‘degree’ to the common-law tort of intrusion upon seclusion. The Court also held that receiving one text, though a lower quantum of injury than the common-law standard, has common-law roots, and was recognized by Congress as sufficient to bring a claim under the TCPA.
In short, the Eleventh Circuit reversed Salcedo, and found that the receipt of a single unwanted text message constitutes harm under the TCPA, and remanded for consideration of the issues raised by Pinto.
Drazen v. Godaddy.com, LLC, No. 21-10199 (11th Cir. July 24, 2023)
Ninth Circuit Shuts Down Serial TCPA Plaintiff for Failure to Allege Use of a “Residential” Number
The Ninth Circuit recently affirmed a district court’s dismissal of a TCPA claim filed by Plaintiff Nathan Barton, a frequent TCPA filer. Plaintiff alleged violations of the TCPA against Defendants Leadpoint, Inc. and Reliance First Capital LLC for sending him allegedly unsolicited text messages. Plaintiff’s allegations, however, failed to plausibly allege that his phone number was a “residential” number within the meaning of the TCPA.
Plaintiff alleged that the phone number at issue, a (718) area code number, was on the national-do-not call registry. While such an allegation creates a presumption that the number is residential, that presumption can be rebutted by a number of considerations. Pertinent to the suit at hand, Plaintiff, among other allegations, alleged that he uses the (718) area code number to “shield his (972) area code number” from “unsavory characters,” including telemarketers. In fact, Plaintiff did not allege that he used the (718) area code number for any purpose other than for litigation. Thus, Plaintiff did not have “legitimate privacy concerns regarding that code number.” While the Court held that Plaintiff’s frequent TCPA filings did not evidence bad faith, his failure to allege the use of a “residential” number was fatal to his claim, and his case was dismissed.
Barton v. Leadpoint, Inc., et al., No. 22-35130, 2023 WL 4646103 (9th Cir. July 20, 2023)
Ninth Circuit Clarifies that Owners of Cell Phones Need not be the Customary User to Allege Injury in TCPA Violations
On June 30th, the Ninth Circuit reversed a district court finding that Plaintiff did not suffer harm because she was not the actual user or recipient of a call that violated the TCPA.
Defendant digital content creators engage in telemarketing via texts and calls, targeting an adolescent audience. Plaintiff had listed the number of a cell phone to be used by her 13-year-old-son on the Do-Not-Call Registry (“DNCR”). Defendants obtained personal information from Plaintiff’s son in 2019, and thereafter sent more than five text messages to the cell phone. Plaintiff brought this action pursuant to the TCPA, because she had listed the number on the DNCR specifically to prevent this type of solicitation.
Defendants asserted that Plaintiff was not injured, and therefore lacked standing, because she was not the actual user of the phone or the recipient of Defendants’ text messages. Defendants also argued that Plaintiff’s son ‘opted in’ to receive these communications. The District Court dismissed the claim for lack of standing because Plaintiff was not the actual user of the phone or the recipient of the messages.
The Ninth Circuit reversed, however, finding the fact that Plaintiff received an unsolicited text message at a phone number she placed on the DNCR sufficient to confer standing and noting that it is not required that “the owner of a cell phone is the phone’s customary user [in order] to be injured by unsolicited phone calls.” The Court also found that Defendants’ argument regarding Plaintiff’s son’s consent was relevant to the merits of Plaintiff’s claim, not to a determination of standing. The Court therefore reversed lower court’s dismissal.
Hall v. Smosh Dot Com, Inc., 2023 U.S. App. LEXIS 16623 (9th Cir. June 30, 2023)
Connecticut Law Expands TCPA Restrictions
The end of June 2023 saw the passage of Connecticut Senate Bill 1058, which significantly broadens the state’s telemarketing regulations. The amendments to the state’s telesales statute were signed by Governor Ned Lamont on June 26th, and take effect October 1, 2023.
The new law will:
- Prohibit all telephonic sales calls that lack prior express written consent;
- Limit the hours for permissible telephonic sales calls to 9 am – 8 pm;
- Provide new definitions for “telemarketers,” “voice communication,” and “text or media message;”
- Create a rebuttable presumption that all calls made to Connecticut area codes are to residents of the state;
- Require callers to disclose the identities of the caller and the entity they are calling on behalf of, and the purpose of the call, within the first ten seconds of individual sales calls;
- Mandate callers to ask the recipient at the beginning of the call if they wish to end the call or be removed from the call list, and end the call to later than ten seconds after the recipient makes such request; and,
- Include fines up to $20,000 per violation.
This is a substantial change from former restrictions in the state. Previously, calls were only prohibited when they were unsolicited, recorded, and made by an autodialer. Under the new law, all telephonic sales calls that lack prior express written consent are prohibited, even if made by a live voice. The law also shortens the window of time telemarketing calls may be made by one hour, prohibiting all such calls between the hours of 8 pm until 9 am.
The law will update the definition of ‘telemarketers’ to include their affiliates or subsidiaries that conduct business in Connecticut or make calls to Connecticut area codes. The updated definition of ‘voice communication’ will include calls or messages that are prerecorded, made by a live individual, and ringless voicemails. ‘Text or media messages’ will include a short message that contains written, audio, video, or photographic content and is sent electronically, not including email.
Additionally, requirements under the law include disclosure of the caller’s identity, business, and purpose within ten seconds of beginning the call. It also requires callers to ask at the beginning of the call whether the recipient would like to continue or end the call, or be removed from the internal call list. If the recipient wishes to end the call, the caller must end the call within ten seconds.
Violations of the new law are considered unfair or deceptive trade practices. In addition to penalties imposed under chapter 73a of the Connecticut general statutes, violators may be fined up to $20,000 per violation.
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