907 F.3d 948
6th Cir.2018Background
- In Sept. 2016 Fulton (a dental practice) received a one-page fax from defendants (LexisNexis/Enclarity) titled a "Fax Number Verification" asking recipients to validate/update provider contact information; the fax lacked any TCPA opt-out notice.
- The fax referenced a website/FAQs explaining the information would populate a Master Provider Referential Database sold/licensed to health insurers, pharmacies, PBMs, pharmacies, life sciences companies, and others; the FAQs stated validated data could be used to "invite" providers to networks and to send notifications and could "drive more business to you."
- Fulton sued as a putative class under the TCPA (for sending an unsolicited advertisement by fax without an opt-out) and asserted a state-law conversion claim; defendants moved to dismiss under Rule 12(b)(6).
- The district court dismissed the TCPA claim, reasoning the fax was informational (not advertising) and that Sandusky required the commercial nature to be evident on the face of the fax.
- The Sixth Circuit reversed, holding that (1) Sandusky does not limit inquiry to the four corners of the fax and (2) Fulton plausibly alleged the fax was a pretextual commercial solicitation (i.e., an unsolicited advertisement) supporting a TCPA claim; the conversion claim remains in federal court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the verification fax qualifies as an "unsolicited advertisement" under the TCPA | Fax was a pretext to collect/verify contact info that defendants and their customers would use to send future marketing faxes; exhibits show commercial use | Fax was purely informational to protect PHI and update records; nothing on its face offers goods/services or solicits business | Reversed: Plaintiff plausibly alleged a pretextual solicitation; court may consider attached exhibits at 12(b)(6) stage |
| Whether courts are limited to the four corners of the fax when assessing TCPA advertising status | Plaintiff relied on attached FAQs and website materials showing downstream commercial use | Defendants and district court relied on Sandusky to confine inquiry to the fax text | Court held Sandusky does not restrict courts to the face of the fax; exhibits integral to the pleading may be considered |
| Standard for pleading a pretextual commercial purpose at motion to dismiss | Only plausible allegations of commercial pretext are required at pleading stage | Plaintiff must show concrete evidence of imminent advertising or profit motive beyond speculation | Court adopted a permissive pleading standard (following Boehringer): plausible allegation of pretext suffices at 12(b)(6) |
| Effect of reversal on state-law conversion claim | Conversion claim depends on TCPA claim and remains properly before district court | District court had dismissed conversion as better decided in state court after dismissing federal claim | Because TCPA claim survives, conversion claim stays in federal court and is remanded for further proceedings |
Key Cases Cited
- Sandusky Wellness Ctr., LLC v. Medco Health Solutions, Inc., 788 F.3d 218 (6th Cir. 2015) (distinguishes informational faxes from solicitations; recognizes pretextual faxes can be advertisements)
- Physicians Healthsource, Inc. v. Boehringer Ingelheim Pharm., Inc., 847 F.3d 92 (2d Cir. 2017) (at motion-to-dismiss stage a plaintiff need only plausibly allege commercial pretext)
- Commercial Money Ctr., Inc. v. Illinois Union Ins. Co., 508 F.3d 327 (6th Cir. 2007) (documents referred to in the pleadings and integral to claims may be considered on a Rule 12(b)(6) motion)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must state a claim that is plausible on its face)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility and requirement to allege sufficient factual matter)