318 F.R.D. 712
N.D. Ill.2016Background
- PHI sued A-S Medication Solutions and individuals under the TCPA for sending an unsolicited advertising fax to 11,422 successfully delivered fax numbers in a February 2010 fax blast. The court considered PHI’s motion to certify a Rule 23(b)(3) class and granted it.
- Allscripts previously held the MSG business and maintained customer contact data in a Salesforce database; A-S purchased the MSG assets (including customer lists) in a 2009 APA and had temporary remote access to Allscripts’ Salesforce.
- A-S sent the contested fax in February 2010; forensic records show the fax blast used a list generated from Allscripts’ Salesforce, not A-S’s own Alpha database.
- Defendants assert the fax recipients had previously provided their fax numbers (and permission to receive faxes) to Allscripts, and argue any consent should extend to A-S as a business continuation/affiliate.
- PHI contends there was no prior express invitation or permission to A-S, that any permission cannot be transferred, and that the fax lacked the FCC-required opt-out notice (a defect A-S says the FCC later waived retroactively).
- The court found the proposed class ascertainable and that Rule 23(a) and 23(b)(3) requirements (numerosity, commonality, typicality, adequacy, predominance, and superiority) were met, certifying the TCPA class; class-wide resolution of transferability of consent and applicability of the FCC waiver were determinative.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the fax was an unsolicited advertisement under the TCPA | The fax advertised A-S services and was sent without prior express invitation or permission to A-S | The fax was sent to customers whose fax numbers and implied permission were stored in Allscripts’ Salesforce | Court treated the fax as a common-issue advertisement suitable for class treatment; merits reserved but class certified |
| Whether prior express invitation or permission existed and is provable class-wide | No express permission was given to A-S; any claimed Allscripts consent cannot be transferred to A-S | Allscripts obtained consent when customers provided fax numbers; A-S acquired that right via asset purchase/continuation and Salesforce access | Court found proof of consent (or lack thereof) can be addressed with class-wide evidence and that transferability is a common issue for the class to resolve |
| Whether prior consent can be transferred from Allscripts to A-S (successor/affiliate/continuation) | Consent cannot be transferred between separate entities; EBR rules prohibit transfer between affiliates for faxes | A-S argues it was a continuation of Allscripts’ MSG and statutory/regulatory provisions allow extension to affiliates in certain circumstances | Court held transferability is a common, class-wide question that must be resolved before addressing individualized consent issues |
| Whether omission of FCC opt-out notice defeats defendants’ consent defense (or is excused by FCC waiver) | The fax lacked required opt-out language; omission makes consent irrelevant under Seventh Circuit precedent | A-S points to an FCC retroactive waiver of the opt-out requirement for faxes sent with prior consent | Court concluded the applicability of the FCC waiver and its effect in private litigation is a class-wide question and does not prevent certification |
Key Cases Cited
- Mims v. Arrow Fin. Servs., LLC, 565 U.S. 368 (2012) (FCC implements TCPA; establishes scope of FCC rulemaking authority)
- Ira Holtzman, C.P.A. v. Turza, 728 F.3d 682 (7th Cir. 2013) (omission of opt-out notice defeats consent defense under TCPA)
- Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011) (commonality standard for class certification)
- Messner v. Northshore Univ. HealthSystem, 669 F.3d 802 (7th Cir. 2012) (predominance analysis under Rule 23(b)(3))
- Am. Honda Motor Co. v. Allen, 600 F.3d 813 (7th Cir. 2010) (court must probe facts overlapping merits when evaluating class certification)