Mere reference to products on a fax sent by a third party does not trigger liability under the Telephone Consumer Protection Act (TCPA), a federal court in Michigan has ruled, dismissing an action against two pharmaceutical companies.
In August 2016, Mohawk, Inc., sent multiple faxes to Health One Medical Center advertising several pharmaceutical products. The faxes promoted various drugs, listing the item number, description, regular price and discounted price. Each fax had Mohawk’s name, address, website and email address on it, and to order the drugs, the customer was directed to fax, call or email Mohawk.
Health One filed a putative class action lawsuit against Mohawk as well as Bristol-Myers Squibb Co. and Pfizer, Inc., both of which had drugs promoted in the faxes. The plaintiff claimed that the pharmaceutical companies “sent the faxes, caused the faxes to be sent, participat[ed] in the activity giving rise to or constituting the violation, or the faxes were sent on its behalf.”
Both Bristol-Myers and Pfizer moved to dismiss the suit, arguing that Health One failed to state a claim under the TCPA. They couldn’t be liable under the statute because the plaintiff alleged no facts showing any action or inaction by the pharmaceutical companies, a business relationship with Mohawk, participation in the creation or transmission of the faxes, or even awareness by the companies of Mohawk and the fact it was selling their products.
Siding with the defendants, the court granted the motion to dismiss.
Beginning its analysis with Pfizer, the court said Health One’s allegation that the company actually sent the fax failed because the plaintiff also claimed Mohawk sent the faxes.
The faxes “include references only to Mohawk, Inc. and instruct the recipient to contact Mohawk, Inc., not Pfizer, Inc.,” U.S. District Court Judge Judith E. Levy wrote. “And other than the allegation that Pfizer, Inc. sent the fax, plaintiff offers no other allegations or facts to justify this allegation. Collectively, the conclusory allegations by plaintiff, undermined by the plain text and images of the faxes, do not plausibly suggest that Pfizer, Inc. played a role in sending the faxes.”
Nor did Health One allege any action or relationship between the defendants that would raise an inference that Pfizer knew Mohawk was sending the faxes, leaving the court unable to find the company caused the faxes to be sent or participated in the activity giving rise to or constituting the violation, or that the faxes were sent on its behalf.
The plaintiff advocated for a broad interpretation of the TCPA, which states that a “sender” who may be liable for violations of the statute includes “the person or entity … whose goods or services are advertised or promoted in the unsolicited advertisement.” Simply by alleging that Pfizer’s products were listed on the fax, Health One told the court it had sufficiently pled a case against the pharmaceutical company.
The court disagreed. It distinguished cases relying on this language, pointing out that the defendants in the prior case law acknowledged a relationship with the sender. In the case at hand, Health One had not alleged the defendants “had any knowledge of, relationship with, or contact with Mohawk, Inc.,” the court said.
While the U.S. Court of Appeals for the Sixth Circuit has not addressed “whether an advertisement that includes an entity’s products is sufficient for that entity to be liable as a sender,” both an Ohio federal court and the Seventh Circuit have rejected this reading of the regulation, Judge Levy wrote, as it would lead to “absurd and unintended result.”
“The reasoning of these cases is persuasive, and plaintiff’s expansive reading of the statute in this case is not justified,” the court said. “Accordingly, plaintiff’s allegation that Pfizer’s product is listed on the faxes is insufficient to sustain the TCPA claim.”
As for Bristol-Myers, the court agreed that it lacked personal jurisdiction over the company because Health One failed to state a prima facie case that the causes of action arose out of the defendant’s contacts with Michigan. Even assuming that the court had personal jurisdiction, however, “the analysis as to whether Pfizer, Inc. violated the TCPA and is liable” would be equally applicable to Bristol-Myers.
To read the opinion and order in Health One Medical Center Eastpointe v. Bristol-Myers Squibb Company, click here.
Why it matters: The contours of who is a “sender” under the TCPA continue to evolve through case law but, for now, are still a murky area. While this case is a win for the defense, the plaintiff has already filed notice of appeal to the Sixth Circuit. If the federal appellate panel agrees to hear the case, it could seize the opportunity to join with the Seventh Circuit to reject the plaintiff’s broad reading of the statute that a mere reference to a product in an allegedly infringing advertisement results in liability under the TCPA.