Sixth Circuit Affirms Dismissal of TCPA Fax Claim Against Third Parties

by Goodwin
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On May 8, 2018, the Sixth Circuit affirmed dismissal of a Telephone Consumer Protection Act (TCPA) claim against Bristol-Myers Squibb and Pfizer.  As the Sixth Circuit noted at the start of its opinion in Health One Medical Center, Eastpointe P.L.L.C. v. Mohawk, Inc. et al., “[s]ome questions seem to arise only in class-action lawsuits.”  Here, the key question was whether third parties Bristol-Myers Squibb and Pfizer had “sent” the faxes challenged by the plaintiff even though they had no knowledge of the faxes and played no role in sending them.  The Sixth Circuit’s analysis of the statutory text of the TCPA and the Federal Communications Commission’s (FCC) guidance instructs companies facing potential derivative liability for the acts of agents and others.

In Health One, the plaintiff alleged that Mohawk violated the TCPA when it sent two unsolicited faxes advertising discounted prices for various prescription drugs.  Among the drugs listed were one manufactured by Bristol-Myers Squibb and one manufactured by Pfizer.  When Mohawk defaulted, plaintiff sought to add Bristol-Myers Squibb and Pfizer as defendants, claiming that the third parties were senders under the TCPA because the faxes were sent for their benefit.  The basis of plaintiff’s argument was its reading of FCC guidance that under the TCPA, a sender is“the person or entity on whose behalf a facsimile unsolicited advertisement is sent or whose goods or services are advertised or promoted in the unsolicited advertisement.”

The Sixth Circuit analyzed the statutory text of the TCPA and the FCC’s guidance and rejected plaintiff’s interpretation.  First, the court explained that the word “send” requires some intentional action on the part of the person or entity alleged to be the sender.  The court explained that Bristol-Myers Squibb and Pfizer were not senders because “neither caused the subject faxes to be conveyed, [or] dispatched them in any way.”  Second, the court explained that the plaintiff read the FCC’s guidance out of context.  The court noted that the cited portion of the guidance related to situations where one entity physically sends a fax after another entity hires that entity to do so.  There, liability must be allocated between two entities that could each be said to be the “sender.”  Here, however, the court concluded that guidance was inapplicable because neither Bristol-Myers Squibb nor Pfizer was even aware that the fax would be sent.  Moreover, the court reiterated that an agency interpreting a statute must “enforce, not elide” a statute’s requirements.  It concluded plaintiff’s reading would elide the word “sender” in favor of a looser standard.

Although limited to the fax context, Health One is instructive both for companies facing TCPA complaints based on the actions of third parties and for companies structuring business arrangements with third parties.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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