Broadening standing for bringing Telephone Consumer Protection Act claims, the Third Circuit Court of Appeal ruled that a man who answered a prerecorded call intended for his roommate could sue the caller under the statute.
Mark Leyse answered a prerecorded call in 2005 from Bank of America marketing a new credit card intended for his roommate, Genevieve Dutriaux. Leyse filed a putative class action against the bank under the TCPA and Bank of America moved to dismiss the suit for lack of standing.
A federal district court judge agreed that Leyse was not a “called party” as required by Section 227(b)(1)(B) of the statute. But, emphasizing the intent behind the TCPA, the federal appellate panel reversed.
“Limiting standing to the intended recipient would disserve the very purposes Congress articulated in the text of the act,” the court wrote. “If the caller intended to call one party without its consent but mistakenly called another, neither the actual recipient,- nor the (uninjured) intended recipient could sue, even if the calls continued indefinitely. We doubt Congress meant to leave the actual recipient with no recourse against even the most unrelenting caller.”
Instead, the court said that Leyse’s “status as a regular user of the phone line and occupant of his residence that was called brings him within the language of the Act and the zone of interests it protects.”
District courts across the country have split over the question of who is entitled to sue under the statute, the panel noted. One group of decisions—from courts in New Jersey and New York—has limited standing to the “intended recipient” of the call. Judges in California and Florida have taken a more generous view of the “called party” to include a “subscriber” or “regular user” of the phone. Other courts in California and Florida used a slightly different standard, allowing standing for the “subscriber” or “primary user” without reference to a “called party” under the statute.
A number of courts have adopted a more broader test for standing in recognition that the TCPA authorizes any “person or entity” to sue under Section 227(b)(3), not just the “called party.” Following these decisions—found in Florida, West Virginia, Missouri, Alabama, Michigan, Illinois, and Pennsylvania—the court used a “zone of interests” analysis to establish standing under the statute.
The court noted that the Congressional intent behind the statute was to protect consumers from “the proliferation” of prerecorded telemarketing calls to private residences. The court also found support in the legislature’s finding that seemed to equate the “called party” with the “receiving party,” a position suggested by decisions from the Seventh and Eleventh Circuits.
The Federal Communications Commission’s recent declaratory ruling and order added the weight of authority to a broader interpretation. In it, the FCC defined “called party” as “the subscriber, i.e., the consumer assigned the telephone number dialed and billed for the call, or the non-subscriber customary user of a telephone number included in a family or business calling plan,” and rejected proposals to interpret the term to be the “intended recipient” or “intended called party.”
“From this evidence, it is clear that the Act’s zone of interests encompasses more than just the intended recipients of prerecorded telemarketing calls,” the panel wrote. “It is the actual recipient, intended or not, who suffers the nuisance and invasion of privacy. This does not mean that all those within earshot of an unwanted robocall are entitled to make a federal case of it. Congress’s repeated references to privacy convince us that a mere houseguest or visitor who picks up the phone would likely fall outside the protected zone of interests. On the other hand, a regular user of the phone line who occupies the residence being called undoubtedly has the sort of interest in privacy, peace, and quiet that Congress intended to protect.”
The district court’s concerns about callers being uncertain whether a prerecorded call will violate the statute depending upon who answers the phone were misplaced, the court said. “The caller may invoke the consent of the ‘called party’ as a defense even if the plaintiff is someone other than the ‘called party,’” the Third Circuit said. “Thus, if Dutriaux were the ‘called party’ by virtue of being the intended recipient of the call, her consent to receive robocalls would shield Bank of America from any suit brought by Leyse.”
As for damages, the panel added in a footnote that “we see no reason why the statutory sum could not be divided among the injured parties.”
The TCPA is a remedial statute, the court reiterated, and should be construed to benefit consumers. “Given the variety of arrangements that exist for sharing living spaces and telephones, there may be close cases under the zone-of-interests test—at least until cell phones entirely displace landlines,” the panel wrote. “Leyse’s, however, is by no means a close call.”
To read the opinion in Leyse v. Bank of America, click here.
Why it matters: The Third Circuit “zone of interest” decision potentially opens the courthouse doors to additional plaintiffs alleging liability under the TCPA. Perhaps the best hope for callers would be a decision from the U.S. Supreme Court on the scope of a “called party.”