Kreger v. Medicredit, Inc.
8:16-cv-01481
M.D. Fla.Jul 19, 2016Background
- Kreger received at least 18 calls from Medicredit to his cellular phone between Sept. 2014 and 2015, placed using an automatic telephone dialing system, without his consent; he asked Medicredit to stop but calls continued.
- Kreger sued under the Telephone Consumer Protection Act (47 U.S.C. § 227) in state court; Medicredit removed to federal court.
- Medicredit moved to dismiss, arguing Kreger’s claim is barred by res judicata based on the Prater v. Medicredit class settlement and final judgment approving that settlement.
- The Prater settlement defined the class as persons called by Medicredit on cell phones via an ATDS without valid consent between Jan. 28, 2010 and July 13, 2015; notice included mailed notice (via reverse look-ups), publication in People magazine, and a settlement website.
- The Court considered whether (1) Prater provided the constitutionally required notice to bind absent class members and (2) the four elements of claim preclusion were satisfied, and whether a stay should be entered to permit Kreger to seek a late opt-out.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Kreger’s TCPA claim is barred by res judicata from Prater | Kreger: res judicata does not apply; Medicredit failed to meet its burden and notice/practicability was inadequate | Medicredit: Prater settlement and final judgment preclude Kreger’s identical TCPA claim as he is a settlement class member | Held: Yes — res judicata bars Kreger’s claim; all four elements satisfied |
| Whether notice in Prater satisfied due process / Rule 23(c)(2)(B) "best practicable notice" requirement | Kreger: he never received actual notice; publication was inadequate | Medicredit: mailed notice to identifiable members, publication, website, and phone/mail contacts satisfied practicable notice; Prater court already found notice adequate | Held: Notice was the best practicable under circumstances; due process satisfied |
| Whether Kreger qualifies as a settlement class member (privity/identity of parties) | Kreger: (argues lack of adequate notice; sought to challenge preclusion) | Medicredit: Kreger’s facts fall within Prater class definition and he did not validly opt out | Held: Kreger satisfies the settlement class definition; parties are identical/privity exists |
| Whether to stay the case to permit a late-filed opt-out motion in Prater | Kreger: requests stay to pursue a belated opt-out petition | Medicredit: opposed (argued dismissal appropriate) | Held: Court declines to stay — plaintiff gave no timetable and stay length was speculative |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (legal standards for pleading)
- Ashcroft v. Iqbal, 556 U.S. 662 (threadbare recitals insufficient)
- Juris v. Inamed Corp., 685 F.3d 1294 (res judicata and due process for absent class members)
- Adams v. S. Farm Bureau Life Ins. Co., 493 F.3d 1276 (adequacy of class notice and best practicable notice standard)
- Ragsdale v. Rubbermaid, Inc., 193 F.3d 1235 (elements of res judicata)