In re Monitronics Int'l, Inc., Telephone Consumer Protection Act Litig., MDL NO. 1:13–MD–2493 (BAILEY)

223 F.Supp.3d 514

IN RE: MONITRONICS INTERNATIONAL, INC., TELEPHONE CONSUMER PROTECTION ACT LITIGATION

This Document Relates to All Cases

MDL NO. 1:13–MD–2493 (BAILEY)

United States District Court, N.D. West Virginia, Clarksburg .

Signed December 22, 2016

Becca J. Wahlquist, Snell & Wilmer L.L.P., Los Angeles, CA, Gordon H. Copland, Steptoe & Johnson, PLLC, Bridgeport, WV, William D. Wilmoth, Steptoe & Johnson PLLC, Wheeling, WV, for UTC Fire & Security Americas Corp., Inc.

ORDER GRANTING SUMMARY JUDGMENT

JOHN PRESTON BAILEY, UNITED STATES DISTRICT JUDGE

Pending before this Court are Defendant UTC Fire & Security Americas Corporation, Inc.'s Motion for Summary Judgment [Doc. 735] and Defendant Honeywell's Motion for Summary Judgment [Doc. 761]. Both motions have been fully briefed and are ripe for decision.

Defendants UTC Fire and Security Americas Corporation, Inc. ("UTC") and Honeywell International, Inc. ("Honeywell") seek summary judgment on the issue of liability in this multi-district litigation case, consisting of, at this time, 30 cases.

All cases are filed seeking damages under the Telephone Consumer Protection Act, 47 U.S.C. §§ 227(b) and (c). These cases contain allegations that UTC and/or Honeywell are vicariously liable for calls made in violation of the Act. There are no allegations that UTC or Honeywell actually placed the telemarketing calls.

Legal Standard

Rule 56(e) of the Federal Rules of Civil Procedure provides that "an opposing party may not rely merely on allegations or denials in its own pleading; rather, its response must—by affidavits or as otherwise provided in this rule—set out specific facts showing a genuine issue for trial. If the opposing party does not so respond, summary judgment should, if appropriate, be entered against that party."

Rule 56 further provides that summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R. CIV. P. 56(c) ; see Celotex Corp. v. Catrett , 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). A genuine issue exists "if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Thus, the Court must conduct "the threshold inquiry of determining whether there is the need for a trial—whether, in other words, there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson , 477 U.S. at 250, 106 S.Ct. 2505.

Additionally, the party opposing summary judgment "must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp. , 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). That is, once the movant has met its burden to show absence of material fact, the party opposing summary judgment must then come forward with affidavits or other evidence demonstrating there is indeed a genuine issue for trial. Fed. R. Civ. P. 56(c) ; Celotex Corp ., 477 U.S. at 323–25, 106 S.Ct. 2548 ; Anderson , 477 U.S. at 248, 106 S.Ct. 2505. "If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Anderson , 477 U.S. at 249, 106 S.Ct. 2505 (citations omitted).

Discussion

"The TCPA was enacted in response to ‘[v]oluminous consumer complaints about abuses of telephone technology.’

Mims v. Arrow Financial Services, LLC , 565 U.S. 368, 132 S.Ct. 740, 744, 181 L.Ed.2d 881 (2012). In Mims , the Supreme Court summarized Congress' findings on the matter:

In enacting the TCPA, Congress made several findings .... ‘Unrestricted telemarketing,’ Congress determined, ‘can be an intrusive invasion of privacy.’ TCPA, 105 Stat. 2394, note following 47 U.S.C. § 227 (Congressional Findings) (internal quotation marks omitted). In particular, Congress reported, ‘[m]any consumers are outraged over the proliferation of intrusive, nuisance [telemarketing] calls to their homes.’ Ibid. (internal quotation marks omitted). ‘[A]utomated or prerecorded telephone calls' made to private residences, Congress found, were rightly regarded by recipients as ‘an invasion of privacy.’ Ibid. (internal quotation marks omitted).

Id. at 745.

"The unanimous decision in Mims also isolated four practices that the TCPA was designed to halt:

[T]he TCPA principally outlaws four practices. First, the Act makes it unlawful to use an automatic telephone dialing system [ (‘autodialer’) ] or an artificial or prerecorded voice message, without the prior express consent of the called party, to call any ... cellular telephone, or other service for which the receiver is charged for the call. See 47 U.S.C. § 227(b)(1)(A). Second, the TCPA forbids using artificial or prerecorded voice messages to call residential telephone lines without prior express consent. § 227(b)(1)(B). Third, the Act proscribes sending unsolicited advertisements to fax machines. § 227(b)(1)(C). Fourth, it bans using automatic telephone dialing systems to engage two or more of a business' telephone lines simultaneously. § 227(b)(1)(D).

Id. at 745." Mey v. Honeywell Intern., Inc. , 2013 WL 1337295, *1 (S.D.W.Va. March 29, 2013) (Copenhaver, J).

"The TCPA is a remedial statute and thus entitled to a broad construction. See, e.g., Holmes v. Back Doctors, Ltd., 695 F.Supp.2d 843, 854 (S.D. Ill. 2010) (‘It is true that ... the TCPA is a remedial statute.’). As such, it ‘should be liberally construed and should be interpreted (when that is possible) in a manner tending to discourage attempted evasions by wrongdoers.’ Scarborough v. Atlantic Coast Line R. Co. , 178 F.2d 253, 258 (4th Cir. 1949). At the same time, a remedial purpose ‘will not justify reading a provision "more broadly than its language and the statutory scheme reasonably permit.’ " Touche Ross & Co. v. Redington , 442 U.S. 560, 578, 99 S.Ct. 2479, 61 L.Ed.2d 82 (1979) (quoting SEC v. Sloan , 436 U.S. 103, 116, 98 S.Ct. 1702, 56 L.Ed.2d 148 (1978) )." Id.See also In re Monitronics Intern., Inc., Tel. Consumer Protection Act Litigation , 2015 WL 1964951, *3 (N.D.W.Va. April 30, 2015) (Keeley, J) (same).

Movants do not dispute that there can be vicarious liability on the part of a seller under the TCPA, nor could they. Smith v. State Farm Mut. Auto Ins. Co. , 30 F.Supp.3d 765 (N.D. Ill. 2014) ; Kristensen v. Credit Payment Svcs. , 12 F.Supp.3d 1292 (D.Nev. 2014) ; Mey v. Honeywell Intern., Inc. , 2013 WL 1337295 (S.D.W.Va. March 29, 2013) ; Cunningham v. Kondaur Capital , 2014 WL 8335868 (M.D. Tenn. Nov. 19, 2014), report and recommendation approved, 2015 WL 1412737 (M.D. Tenn. Mar. 26, 2015).

"In Charvat v. EchoStar Satellite, LLC , 630 F.3d 459, 468 (6th Cir. 2010), the Sixth Circuit was faced with the issue of whether the TCPA and its accompanying regulations permitted a plaintiff to recover damages under Sections 227(b) and (c)from a defendant that did not place any illegal calls but whose independent contractors did so in attempts to sell the products and services of the defendant. The Sixth Circuit invoked the doctrine of primary jurisdiction and referred the matter to the Federal Communications Commission ("FCC") to allow the agency to interpret certain provisions of the TCPA and its accompanying regulations. The FCC issued a declaratory ruling clarifying that, even though a seller may not have initiated or made a call under the TCPA, the seller may nonetheless be vicariously liable under the TCPA based on federal common law principles of agency for violations of Sections 227(b) and (c) that are committed when a third-party telemarketer initiates or places an unlawful call on behalf of the seller. In re Dish Network, LLC , 28 FCC Rcd. 6574, 2013 WL 1934349 (May 9, 2013)." Cunningham v. Kondaur Capital , 2014 WL 8335868, at *5 (M.D. Tenn. Nov. 19, 2014), report and recommendation approved, 2015 WL 1412737 (M.D. Tenn. Mar. 26, 2015).

The FCC opined that "a seller cannot avoid liability simply by delegating placing the call to a third-party. The FCC determined that ‘while a seller does not generally "initiate" calls made through a third-party telemarketer within the meaning of the TCPA, it nonetheless may be held vicariously liable under federal common law principles of agency for violations of [ ] section 227(b)... that are committed by third-party telemarketers.’ See id. at 6574. This includes ‘a broad range of agency principles, including not only formal agency, but also principles of apparent authority and ratification.’ Id. at 6584." Hossfeld v. Gov't Employees Ins. Co. , 88 F.Supp.3d 504, 510 (D. Md. 2015) (Quarles, J).

The FCC also stated:

[T]he seller is in the best position to monitor and police TCPA compliance by third-party telemarketers.... 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. This would particularly be so if the telemarketers were judgment proof, unidentifiable, or located outside the United States, as is often the case.... Even where third-party telemarketers are identifiable, solvent, and amenable to judgment, limiting liability to the telemarketer that physically places the call would make enforcement in many cases substantially more expensive and less efficient, since consumers (or law enforcement agencies) would be required to sue each marketer separately in order to obtain effective relief.

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