The Telephone Consumer Protection Act ("TCPA") continues to confound even the most well-intentioned compliance officers, particularly in light of the Federal Communications Commission's ("FCC") July 2015 Order, broadening the definition of an "autodialer" and the scope of covered calls. However, recently two federal district courts have dismissed TCPA claims brought by Plaintiffs that were in the business of answering autodialed calls for economic purposes. Both courts, relying in part on the Supreme Court's analysis in Spokeo v. Robins, dismissed the Plaintiffs' claims after conducting a more meticulous analysis of standing to bring a claim under the TCPA.
In Stoops v. Wells Fargo Bank, the U.S. District Court for the Western District of Pennsylvania found that a Plaintiff who bought prepaid cell phones for the sole purpose of receiving calls to generate TCPA lawsuits lacked standing to assert a claim. Melody Stoops bought over 35 prepaid cell phones and although she lived in Pennsylvania, she registered the phones with area codes in economically distressed areas of Florida. Stoops believed the numbers would be more likely to have previous owners who had defaulted on loans. After activating the phones, Stoops waited for autodialed calls from creditors. Over the course of three months, Wells Fargo made 95 calls to Stoops' phones in an effort to collect the mortgage debt of two of its customers. Stoops sued Wells Fargo for making autodialed calls to her phones without consent, in violation of the TCPA. Wells Fargo moved for summary judgment.
The court granted Wells Fargo's summary judgment motion based on a finding that Stoops did not have standing to assert a claim under the TCPA. Wells Fargo argued that Stoops lacked Article III standing because she was not a member of the class that the TCPA was designed to protect and did not suffer the type of harm that the law was designed to prevent. The court considered the three types of standing that a plaintiff must meet in order to bring a claim: statutory standing, Article III constitutional standing, and prudential standing. The parties did not dispute that Stoops had statutory standing under the TCPA. However, the court found that Stoops lacked both Article III constitutional and prudential standing. In enacting the TCPA, Congress's intent "was to protect consumers from the nuisance, invasion of privacy, cost, and inconvenience that autodialed and prerecorded calls generate." Because Stoops admitted that her only purpose in buying her phones was to receive autodialed calls, enabling her to file TCPA lawsuits, she did not suffer an economic injury or injury-in-fact to establish Article III constitutional standing to meet the standard articulated in Spokeo. Furthermore, Stoops could not establish prudential standing because she did not assert a claim within the personal privacy zone of interests protected by the TCPA. The court found that because Stoops bought cell phones with the hope of receiving calls from creditors for the sole purpose of collecting statutory damages, her interests were not protected under the TCPA.
In Telephone Science Corp. v. Asset Recovery Solutions, the U.S. District Court for the Northern District of Illinois, citing the court's analysis in Stoops, found that a business that intentionally answered autodialed calls for profit did not fall within TCPA's zone of interests. Telephone Science Corporation, a company that operates a service to help consumers avoid robocalls, sued Asset Recovery Solutions, a debt purchasing company that uses a "predictive dialer" in connection with its business. Telephone Science's service determines if a call is coming from an autodialer, and if it is, the call is routed through its servers and Telephone Science answers the call for the consumer. Telephone Science alleged that Asset Recovery placed over 12,000 robocalls to its voice over Internet protocol ("VoIP") phone numbers since March 2014 in violation of the TCPA. In August 2015, the court granted Asset Recovery's motion to stay the proceedings pending the Supreme Court's decision in Spokeo, to determine if the claims should be limited to calls that generated an alleged monetary injury in order to assert a valid TCPA violation. In January 2016, the court granted Telephone Science's motion to lift the stay and leave to file an amended complaint. Asset Recovery moved to dismiss for lack of Article III constitutional standing and for failure to state a claim under the TCPA.
In its motion to dismiss, Asset Recovery argued that Telephone Science lacked standing because it did not incur actual damages or an "injury in fact" for each call answered. The court disagreed, finding that Telephone Science's allegations suggested that it incurred a per-minute charge for at least some of the robocalls it answered, thus it had sufficient Article III standing to bring a claim. However, the court ultimately found that Telephone Science failed to establish that Article III standing was sufficient to prove statutory standing to bring a claim under the TCPA. Asset Recovery argued that Telephone Science did not have statutory standing because it was outside of the TCPA's zone of interests. Asset Recovery reasoned that the law does not cover a business that seeks to only answer autodialed calls as service to consumers; instead, the TCPA guards against an individual consumer's invasion of privacy, the nuisance, and the cost that results when consumers receive certain unwanted calls. The court agreed with Asset Recovery, stating that the law does not confer a private right of action for every person that has Article III constitutional standing under the TCPA since the Congressional intent was to confer standing only for individualized violations of privacy rights. Because Telephone Science's relevant "interest" was commercial data collection and not individual privacy rights, it did not fall within the statute's zone of interests. Accordingly, the court granted Asset Recovery's motion to dismiss for lack of statutory standing under the TCPA.
While individuals and corporations continue to litigate TCPA claims, it appears that Stoops and Telephone Science indicate a trend to carefully scrutinize the merits of Article III standing and statutory standing for plaintiffs who invite autodialed or prerecorded calls for commercial or economic purposes.
Stoops v. Wells Fargo Bank, N.A., 2016 U.S. Dist. LEXIS 82380 (W.D. Pa. June 24, 2016).
Telephone Science Corp. v. Asset Recovery Solutions, 2016 U.S. Dist. LEXIS 104234 (N.D. Ill. August 8, 2016).
Spokeo, Inc. v. Robins, 2016 U.S. LEXIS 3046, 136 S. Ct. 1540 (May 24, 2016).