Betz v. Glob. Telesourcing

MEMORANDUM OPINION

BERYL A. HOWELL, Chief Judge.

Plaintiff Na'eem Betz, proceeding pro se, brings the instant suit against defendant Global Telesourcing, LLC, alleging that defendant called his wireless telephone number that was registered on the national do-not-call list, in violation of the Telephone Consumer Protection Act of 1991 (“TCPA”), 47 U.S.C. § 227, and its implementing regulations. Am. Compl., ECF No. 12. In response, defendant filed a counterclaim for common law fraud, alleging that plaintiff made false allegations that defendant violated the TCPA. See generally Def.'s Answer & Countercl. Pl.'s Am. Compl. (“Def.'s Answer & Countercl.”), ECF No. 13. Pending before the Court are defendant's motion for sanctions under Federal Rule of Civil Procedure 11, see Def.'s Mot. Sanctions (“Def.'s Mot.”), ECF No. 15, and plaintiff's motion to dismiss defendant's counterclaim for lack of subject matter jurisdiction, see Pl.'s Mot. Dismiss Def.'s Countercl. (“Pl.'s Mot.”), ECF No. 16.

For the reasons set forth below, the defendant's motion for sanctions is denied with leave to renew, the Court dismisses defendant's counterclaim, sua sponte, pursuant to Federal Rule of Civil Procedure 12(b)(6), for failure to state a claim on which relief may be granted, and plaintiff's motion is denied as moot. Put another way, after resolution of this flurry of pretrial

motions requiring judicial attention, this case remains pending for plaintiff to proceed on his original claim.

I. BACKGROUND

Following brief review of the statutory and regulatory background, the factual history underlying the claims and procedural history of this case are summarized below.

A. Statutory and Regulatory Background

Congress enacted the TCPA in 1991 to curb abusive telemarketing practices that threatened consumer privacy. TCPA, Pub. L. No. 102-243, § 2(6), 105 Stat. 2394, 2394 (finding that “[m]any consumers are outraged over the proliferation of intrusive, nuisance calls to their homes from telemarketers”). The TCPA bans invasive telemarketing practices and directs the Federal Communications Commission (“FCC”) to prescribe implementing regulations. See Mims v. Arrow Fin. Servs., LLC, 565 U.S. 368, 373-74 (2012). To that end, Congress instructed the FCC consider whether to create “a single national database to compile a list of telephone numbers of residential subscribers who object to receiving telephone solicitations.” 47 U.S.C. § 227(c)(3). In 2003, the FCC issued a final rule establishing a national Do Not Call (“DNC”) registry with the Federal Trade Commission (“FTC”).^[1] See Rules and Regulations Implementing the Telephone Consumer Protection Act (TCPA) of 1991, 68 Fed.Reg. 44144-01 (July 25, 2003) (codified at 47 C.F.R. § 64.1200). Once an individual registers their residential or wireless telephone number on the DNC list, the TCPA regulations restrict the telephone solicitations that can be made to that number. Id. at 44146-47; see also 47 C.F.R. §§ 64.1200(c)-(e). If an

individual does receive telephone solicitations in violation of the TCPA's regulations, the TCPA provides a private right of action for “[a] person who has received more than one telephone call within any 12-month period by or on behalf of the same entity in violation of the regulations prescribed under [the TCPA].” 47 U.S.C. § 227(c)(5).

Limited exemptions to liability are provided under DNC regulations, including if the subscriber consented to the calls or if an “established business relationship” (“EBR”) existed between the caller and the subscriber. 47 C.F.R. § 64.1200(f)(15). The FCC defines an EBR as

a prior or existing relationship formed by a voluntary two-way communication between a person or entity and a residential subscriber with or without an exchange of consideration, on the basis of the subscriber's purchase or transaction with the entity within the eighteen (18) months immediately preceding the date of the telephone call or on the basis of the subscriber's inquiry or application regarding products or services offered by the entity within the three months immediately preceding the date of the call, which relationship has not been previously terminated by either party.

Id. § 64.1200(f)(5). A subscriber may, however, terminate an EBR by specifically requesting “not to receive telemarketing calls made by or on behalf of that person or entity . . . even if the subscriber continues to do business with the seller.” Id. §§ 64.1200(d), (f)(5)(i). The FCC has “recognize[d] that companies often hire third party telemarketers to market their services and products. In general, those telemarketers may rely on the seller's EBR to call an individual consumer to market the seller's services and products.” In Re Rules & Reguls. Implementing the Tel. Consumer Prot. Act of 1991, 18 F.C.C. Rcd. 14014, 14083 (2003). The seller or telemarketer has the burden of proving the existence of an EBR. See Rules and Regulations Implementing the TCPA, 68 Fed.Reg. at 44159 (“Any seller or telemarketer using the EBR as the basis for a telemarketing call must be able to demonstrate, with clear and convincing evidence, that they have an EBR with the called party.”).

B. Factual Background

Plaintiff is a resident of Washington, D.C., and has registered his telephone number (ending in 8063) on the DNC list since 2012. Am. Compl. ¶¶ 7, 13. Defendant is a limited liability company located in Virginia that provides customer service functions and contact programs on behalf of its clients. Id. ¶¶ 8, 9. Between February 24, 2021, and March 18, 2021, defendant called plaintiff's registered telephone number ten times on behalf of Comcast, based on plaintiff's alleged status as a current Comcast customer. Id. ¶ 13; Def.'s Answer & Countercl. at 12. Plaintiff never answered any of these calls, Def.'s Answer & Countercl. at 12, and defendant never left a voicemail identifying the nature of the calls, the name of the entity responsible for initiating the calls, or a telephone number at which the entity could be reached, Am. Compl. ¶ 18.

C. Procedural Background

On May 7, 2021, plaintiff initiated this litigation, claiming that defendant's ten calls to his wireless telephone number violated the TCPA because plaintiff's number had been placed on the national DNC registry and plaintiff had never consented to receive solicitation calls from defendant. Compl. ¶ 33, ECF No. 1. Three days later, an attorney for defendant sent an e-mail to plaintiff requesting that he abandon his claim because defendant did not violate the TCPA and, if plaintiff refused, defendant would “defend itself fully including sanctions for claims found to be frivolous.” See Am. Compl. Ex. E: E-Mail from William E. Raney to plaintiff (May 10, 2021), ECF No. 12-6. In the e-mail, defendant's attorney explained that defendant “only made those calls to [plaintiff] on behalf of Comcast based on [his] status as a current customer and pursuant to an established business relationship.” Id. Two days later, the attorney emailed plaintiff again, relaying the same contentions and notifying plaintiff that his number had been added to defendant's internal do-not-call list and that defendant intended to seek sanctions under

Federal Rule of Civil Procedure 11 if plaintiff persisted in pursuing litigation. See Id. E-Mail from William E. Raney to plaintiff (May 12, 2021) at 1, ECF No. 12-6.

Subsequently, on July 4, 2021, plaintiff filed an amended complaint, again alleging that defendant's ten calls violated the TCPA and including additional allegations concerning the lack of an EBR between defendant and plaintiff. Am. Compl. ¶ 16. Defendant filed an answer to the Amended Complaint, as well as a counterclaim for common law fraud, alleging that plaintiff made false representations that defendant violated the TCPA. See generally Def.'s Answer & Countercl. Defendant additionally filed a Rule 11 motion for sanctions against plaintiff, arguing that plaintiff's claim is objectively frivolous and lacks evidentiary support, entitling defendant to “an order . . . imposing monetary sanctions against” plaintiff and “to an order dismissing with prejudice all claims in the first amended complaint.” Def.'s Mot. at 8-9. Plaintiff then moved to dismiss defendant's counterclaim under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction. Pl.'s Mot. at 1. Both motions are now ripe for resolution.

II. DISCUSSION

Defendant's motion for sanctions is addressed first before discussing plaintiff's motion to dismiss defendant's counterclaim.

A. Motion for Rule 11 Sanctions

Federal Rule of Civil Procedure 11(b) provides, in relevant part, that by presenting a pleading, written motion, or other paper to the Court:

an . . . unrepresented party certifies that to the best of the person's knowledge, information, and belief, formed after an inquiry reasonable under the circumstances:

(1) it is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation;

(2) the claims, defenses, and other legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law;

(3) the factual contentions have evidentiary support or, if specifically so identified, will likely have evidentiary support after a reasonable opportunity for further investigation or discovery; and

(4) the denials of factual contentions are warranted on the evidence or, if specifically so identified, are reasonably based on belief or a lack of information.

Fed. R. Civ. P. 11(b). Pursuant to Rule 11(c), if “the court...