A recent decision by the U.S. Court of Appeals for the Sixth Circuit calls into question the viability of “junk fax” class actions brought under the Telephone Consumer Protection Act (TCPA) when the defendant company does not maintain fax log records identifying successful fax transmissions.

The TCPA makes it “unlawful for any person within the United States . . . to use any telephone facsimile machine . . . to send, to a telephone facsimile machine, an unsolicited advertisement.” 47 U.S.C. § 227(b)(1)(C). In Sandusky Wellness Center v. ASD Specialty Healthcare, a medical practice sued the defendant under the TCPA on behalf of itself and other plaintiffs similarly situated for damages arising out of the distribution of a one-page fax advertising the drug Prolia. No. 16-3741, 2017 U.S. App. LEXIS 12353, at *1 (6th Cir. July 11, 2017).

After extensive discovery, on September 11, 2015, the plaintiff filed a motion for class certification, seeking to represent a class of “[a]ll persons who were successfully” sent the fax advertising Prolia. Sandusky Wellness Ctr., LLC v. ASD Specialty Healthcare, Inc., No. 3:13 CV 2085, 2016 U.S. Dist. LEXIS 1864, at *3 (N.D. Ohio Jan. 7, 2016). Judge Jack Zouhary of the U.S. District Court for the Northern District of Ohio denied the motion, finding that the Sandusky case is “the exact type of case that would devolve into a series of mini-trials, which Rule 23(b)(3) seeks to prevent.” Id. at *13. The plaintiff appealed.

In a lengthy decision, the Sixth Circuit found that the lower court did not abuse its discretion in denying class certification and focused on whether two factors prevented class certification: (1) individualized issues regarding class member consent and (2) the inability to identify class members.

First, the Sixth Circuit held that questions concerning whether class members consented to receive the fax presented individualized issues that kept “common questions from predominating and preclude[d] certification.” Sandusky, 2017 U.S. App. LEXIS 12353, at *16. The Sixth Circuit explained that, if the proposed 40,343-member class were certified, then a court would be required to manually “filter[] out” the class members who provided prior consent to receive the fax and who would not be able to recover. Id. at *18.

As the lower court concluded after reviewing sample consent forms, this could only be accomplished by cross-checking the full distribution list against individual consent forms. Therefore the inquiry was too “individualized” for the plaintiff to maintain a class. Id. at *19. Notably, the Sixth Circuit also rejected the plaintiff’s proposal to create sub-classes because the lower court would still have to engage in the “painstaking sorting process” to determine the members of the individual sub-classes. Id. at *22.

Second, without deciding which provision of Rule 23 applied (i.e., superiority, predominance or ascertainability), the Sixth Circuit concluded that the inability to reliably identify class members “was a separate and valid concern recognized by the district court.” Id. at *32. In particular, the Sixth Circuit observed that the defendant successfully transmitted faxes to only 40,343 of the 53,502 individuals on the distribution list. Id. at *23. Since the 13,159 individuals who never received the fax would not be entitled to relief, there needed to be a method to identify those individuals in order for the case to proceed on a classwide basis. But in Sandusky, no such method existed. Neither the defendant nor the vendor that sent the faxes maintained fax logs at the time litigation began. Further, as the district court found and the Sixth Circuit affirmed, class member affidavits were “not feasible” because “the reliability of an individual’s recollection of having received a seven-year-old, single-page fax would be dubious at best.” Id. at *29. The Sixth Circuit concluded:

Perhaps if [the plaintiff] had brought suit earlier, fax logs would have existed, and their absence would not pose an independent barrier to class certification. Or, [the plaintiff] could have filed an individual claim against [the defendant] and presented a copy of the Prolia fax as evidence of receipt. Instead, [the plaintiff] did neither of these things. By choosing to file a class action when it did, [the plaintiff] shouldered the burden of proving that its proposed class satisfied Rule 23. It simply did not meet that burden here.

Id. at *32.

It will be interesting to see whether courts in other circuits follow the Sixth Circuit’s approach in Sandusky, especially with respect to the court’s analysis that the failure to identify class members could present a problem for plaintiffs under Rule 23’s ascertainability, predominance or superiority requirements.