Order on Motions for Summary Judgment as to Coverage
The coverage issue in this insurance dispute is whether, under Florida law, the transmission of unsolicited commercial advertisements by facsimile constitutes “oral or written publication of material that violates a person’s right to privacy,” within a commercial liability policy’s coverage for *1280 “advertising injury,” where it is undisputed that the advertisements did not disclose any private facts about anyone. I conclude that the answer is no.
Accordingly, the partial summary judgment motion of Transportation Insurance Co. as to coverage [D.E. 62] is granted, and the corresponding partial summary judgment motion of the plaintiffs [D.E. 58] is denied. All other pending motions are DENIED AS MOOT.
I. Summary Judgment Standard
Summary judgment is appropriate if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law.
See
Fed. R.Civ.P. 56(c);
DA Mortg., Inc. v. City of Miami Beach,
II. Facts
Enacted in 1991 by Congress, the Telephone Consumer Protection Act, 47 U.S.C. § 227 et seq., provides in relevant part that it is “unlawful for any person ... to use any telephone facsimile machine, computer, or other device to send an unsolicited advertisement to a telephone facsimile machine.” See § 227(b)(1)( C). An unsolicited advertisement is “any material advertising the commercial availability of any property, goods, or services which is transmitted to any person without that person’s prior express invitation or permission.” See § 227(a)(5). The TCPA allows a private right of action for a violation, and permits damages comprising “actual monetary loss” or statutory damages of $500 per violation, whichever is greater. See § 227(b)(3)(A)-( C). If a court finds that a defendant violated the TCPA willfully or knowingly, it may, in its discretion, increase the award to an amount not exceeding treble damages. See id.
In June of 2003, Michael Penzer filed a class action complaint in a Florida state court against Nextel South Corporation. Mr. Penzer alleged that, in May of 2003, Nextel (or one of its authorized agents) sent him an unsolicited facsimile advertisement (a so-called “junk fax”) for wireless telephone services in violation of the TCPA. Mr. Penzer also alleged that Nex-tel’s potential customers were not afforded the option of whether to receive the facsimile advertisements, since Nextel did not seek or receive such permission from those customers. Finally, Mr. Penzer alleged that Nextel acted willfully and knowingly. Mr. Penzer requested actual or statutory damages, to be trebled due to Nextel’s alleged willful and knowing violation of the TCPA.
Several months later, Nextel filed a third-party complaint against Sunbelt, a “blast-fax” advertiser, and Southeast Wireless, an authorized Nextel agent, seeking indemnity and contribution from any liability Nextel might have to the class in the Penzer action. 1 Nextel alleged that Southeast hired Sunbelt to create the unsolicited facsimile advertisement, and that Nextel did not authorize the transmission of the facsimiles or the use of its name or marks. According to the authorized representative agreement between Nextel and Southeast, Southeast was not allowed to use Nextel’s name, trademarks, or service marks without Nextel’s prior written agreement.
In December of 2003, Mr. Penzer filed a third-party complaint against Southeast on behalf of himself and the class. Mr. Pen-zer sought damages and injunctive relief against Southeast under the TCPA.
Southeast requested that its commercial liability insurer, Transportation Insurance Company, defend the class action complaint filed by Mr. Penzer. In February of *1281 2004, Transportation disclaimed coverage on various grounds, and declined to provide Southeast with a defense as to the Penzer class action or the third-party complaint filed by Nextel.
In April of 2004, Southeast and Mr. Penzer entered into a settlement stipulation which included an agreement based on
Coblentz v. American Surety Co. of New York,
In September of 2004, Mr. Penzer, as the assignee of Southeast and pursuant to the settlement stipulation, filed this declaratory judgment action against Transportation. The complaint alleges that Southeast caused 24,000 unsolicited facsimile advertisements to be sent to Mr. Penzer and the class members. The complaint further alleges that coverage for Southeast’s conduct exists under the policy’s “advertising injury” provision, i.e., “oral or written publication of material that violates a person’s right of privacy.” 2
Transportation answered the complaint, and filed a declaratory judgment counterclaim against Mr. Penzer. In its counterclaim, Transportation alleges that it has no obligation under the policy to defend or indemnify Southeast for any violations of the TCPA.
III. Construing Insurance Policies Under Florida Law
In construing an insurance policy, Florida courts look to the “plain language” of the document. The policy is “read as a whole,” endeavoring to “give every provision its full meaning and operative effect.”
Swire Pacific Holdings, Inc. v. Zurich Ins. Co.,
In Florida, whether or not a policy provision is ambiguous is a question of law.
See Arriaga v. Florida Pacific Farms, LLC,
IV. Discussion
The commercial liability policy that Transportation issued to Southeast affords coverage for “damages because of ... ‘advertising injury’ to which this insurance applies.” It specifically states that Transportation “shall have no duty to defend [Southeast] against any ‘suit’ seeking damages for ... ‘advertising injury’ to which this insurance does not apply.”
A. The Relevant Policy Language
The policy defines “advertising injury” as “injury arising out of one or more of the following offenses:
a. Oral or written publication of material that slanders or libels a person or organization or disparages a person’s or organization’s goods, products, or services;
b. Oral or written publication of material that violates a person’s right of privacy;
c. Misappropriation of advertising ideas or style of doing business; or
d. Infringement of copyright, title, or slogan.”
(emphasis added). The terms “publication,” “material,” and “right of privacy” are not defined by the policy.
There are two relevant exclusions in the policy for “advertising injury.” The first excludes coverage for “advertising injury” arising “out of the willful violation of a penal statute or ordinance committed by or with the consent of the insured.” The second excludes coverage for “advertising injury” arising “out of breach of contract other than misappropriation of advertising ideas under an implied contract.”
The policy has liability limits of $1 million for all “personal and advertising injury” to any one person or organization, subject to an annual aggregate limit of $2 million (other than products and completed operations, which are not relevant here).
B. The Parties’ Positions and Cases From Other Jurisdictions
The plaintiffs argue that the transmission of unsolicited commercial advertisements by facsimile constitutes “oral or written publication of material that violates a person’s right to privacy.” Their argument is as follows. First, the commercial advertisement is “material.” Second, the transmission of the advertisement by facsimile is a “publication.” Third, the sending of an unsolicited facsimile violates the “right of privacy” of the recipient, on a theory that the right of privacy includes the right to be left alone. At the very least, the plaintiffs say, the phrase “right of privacy” is ambiguous, and therefore should be interpreted in their favor to provide coverage for Southeast’s violations of the TCPA.
Various federal and state courts, looking at identical or similar policy language, have adopted the interpretation urged by the plaintiffs here, most in cases involving a duty to defend. Among the decisions favorable to the plaintiffs is an unpublished Eleventh Circuit decision applying Georgia law.
See, e.g., Park University Ent., Inc. v. American Casualty Co.,
Transportation, not surprisingly, argues for a different reading of the relevant policy language. Transportation’s argument runs as follows. First, the phrase “oral or written publication of material that violates a person’s right of privacy,” read as a whole and in context, provides coverage only for injuries to privacy rights caused by the content of the material. Second, Florida law interpreting the phrase “publication ... in violation of an individual’s right of privacy” makes clear that coverage exists only when private matters about one person are communicated to another person. Although Southeast’s conduct in having the commercial advertisements sent by facsimile may have violated the TCPA, there is no coverage under the policy because there were no content-based privacy violations.
The reading advocated by Transportation is supported by several federal and state cases involving identical or similar policy language.
See, e.g., American States Ins. Co. v. Capital Associates,
Both sides, then, have support for their respective positions. 3 A leading insurance *1284 treatise, aside from listing some of the cases, has apparently not taken a definitive position on which line of cases is more persuasive, see L. Russ, 9A Couch On Insurance § 129:8 (Nov.2006), but one group of commentators believes that the Seventh Circuit’s decision in American States — a decision which favors Transportation here — -was correctly decided. See W. Block, “The Duty to Defend Advertising Injuries Caused by Junk Faxes: An Analysis of Privacy, Spam, Detection, and Blackmail,” 27 Whittier L. Rev. 925, 930-32 (Summer 2006).
C. Discussion
As noted earlier, in
Hooters,
1. The Third District’s Decision in Compupay
In Florida, the common-law tort of invasion of privacy includes four distinct claims: “(1) appropriation — the unauthorized use of a person’s name or likeness to obtain some benefit; (2) intrusion — physically or electronically intruding into one’s private quarters; (3) public disclosure of private facts — the dissemination of truthful private information which a reasonable person would find objectionable; and (4) false light in the public eye — publication of facts which place a person in a false light even though the facts themselves may not be defamatory.”
Allstate Ins. Co. v. Ginsberg,
In
State Farm Fire & Cas. Co. v. Com-pupay, Inc.,
“The clause does not cover causes of action under the broader umbrella of invasion of privacy torts. Thus, the policy covers actions within traditional invasion of privacy tort: a publication of personal matter. It does not include coverage for a physical invasion of the complainant’s person unaccompanied by the other elements of the cause of action .... [The employee’s] complaint lacks any factual allegations of publica *1285 tion which would bring the claim within this provision.”
Id. (emphasis added).
As I read it, the Third District’s decision in
Compupay
rested on two independent bases: that the clause only covered invasion of privacy actions involving “publication of a personal- matter;” and that the employee had not alleged any “publication.” At oral argument I suggested to Transportation’s counsel that, given the lack of “publication” in
Compupay,
the Third District’s interpretation of the policy language might be dicta. On reflection, however, the better way to read the Third District’s opinion is as providing alternative holdings to support the ultimate conclusion that there was no duty to defend. And under Florida law, alternative holdings are binding.
See, e.g., Parsons v. Fed. Realty Corp.,
If there were any doubts about the binding nature of this holding in
Compupay,
any such doubts have been erased by the Florida Supreme Court, which has read
Compupay
as a decision construing policy language:
“Compupay
is not a decision directly addressing the issue of whether unwelcome conduct including touching in a sexual manner and sexually offensive comments state a cause of action for the Florida common law tort claim of invasion of privacy.... [W]e note that in
Compupay,
the [Third District], basing its decision on the specific language of the insurance policy at issue in that case, found that the policy did not cover the cause of action under the broad umbrella of invasion of privacy torts.”
Ginsberg,
A district court sitting in diversity should follow the decision of a Florida intermediate appellate court “unless ‘there is some really persuasive indication that the Florida Supreme Court would go the other way.’ ”
Gares v. Allstate Ins. Co.,
I recognize that under Florida law “tort law principles do not control judicial construction of insurance contracts,”
FCCI Ins. Co. v. Horne,
2. Why Hooters Is Not Persuasive
Even if I have read
Compupay
incorrectly, my conclusion remains the same, as I have decided not to follow the
*1286
Eleventh Circuit’s unpublished decision in
Hooters.
Under Eleventh Circuit law, an unpublished decision is not “controlling authority” and is “persuasive only insofar as [its] legal analysis warrants.”
Bonilla v. Baker Concrete,
Thus, even if I were writing on a blank slate, I would agree with Transportation that the phrase “oral or written publication of material that violates a person’s right of privacy” is unambiguous, and that advertising injury coverage under this provision exists only when the content of the material published violates a person’s right to privacy. Having reviewed all of the relevant cases on the issue, the most persuasive analysis, in my view, is that of Judge Easterbrook in American States:
“Privacy” is a word with many connotations. The two principal meanings are secrecy and seclusion, each of which has multiple shadings. A person who wants to conceal a criminal conviction, bankruptcy, or love affair from business relations asserts a claim to privacy in the sense of secrecy. A person who wants to stop solicitors from ringing his doorbell and peddling vacuum cleaners at 9 p.m. asserts a claim to privacy in the sense of seclusion. Some other uses of the word “privacy” combine these senses: for example, a claim of a right to engage in consensual sexual relations with a person of the same sex, or to abort an unwanted pregnancy, has both informational (secrecy) and locational (seclusion) components, with an overlay of substance (the objection to governmental regulation).
American States contends that its advertising-injury coverage deals with secrecy rather than seclusion. The language reads like coverage of the tort of “invasion of privacy,” where an oral or written statement reveals an embarrass *1287 ing fact, or ... brings public attention to a private figure, or casts someone in a false light through publication of true but misleading facts. Perhaps the language reasonably could be understood to cover improper disclosures of Social Security numbers, credit records, email addresses, and other details that could facilitate identity theft or spamming.
... [The Fourth Circuit in Int’l Science & Technology Inst, Inc. v. Inacom Comm., Inc.,106 F.3d 1146 , 1150 (4th Cir.1997) (dictum) ] used the word [“privacy”] in the sense of seclusion: an unexpected fax, like a dangling telephone or knock on the door, can disrupt a householder’s peace and quiet, even though it is easy to throw a junk fax, like a piece of junk mail, in the trash without any risk that someone will observe activities that occur inside one’s home. [The TCPA], in [§ ] 227(b)(1)( C), doubtless promotes this (slight) interest in seclusion, as it also keeps telephone lines from being tied up and avoids consumption of the recipient’s ink and paper____ But the question is not how the word “privacy” was used in the debates that led to § 227(b)(1)( C), but what the word means in this insurance policy. To say ... that § 227(b)(1)( C) protects privacy, and then stops the analysis, is to avoid the central question in this case: whether the policy covers the sort of seclusion interest affected by faxed ads.
... The structure of the policy strongly implies that coverage is limited to secrecy interests. It covers a “publication” that violates a right of privacy. In a secrecy situation, publication matters; otherwise secrecy is maintained. In a seclusion situation, publication is irrelevant. A late-night knock on the door or other interruption can impinge on seclusion without any need for publication. Contacting one customer at a time may not be “publication” at all for purposes of advertising-injury coverage. Perhaps automated faxes to hundreds of recipients could be deemed a form of publication, but this would be irrelevant to the seclusion interest. To put this differently, § 227(b)(l)( C) condemns a particular means of communicating an advertisement, rather than the contents of that advertisement — while an advertising-injury coverage deals with informational content.
American States,
There is a further reason why Transportation’s reading is the correct one. Under Florida law, clauses within a paragraph of an insurance policy should be read together.
See Excelsior Ins. Co. v. Pomona Park Bar & Package Store,
V. Conclusion
Under Florida law, advertising injury coverage for “oral or written publication of material that violates a person’s right of privacy” does not extend to unsolicited facsimile transmissions of commercial advertisements. Transportation therefore does not have a duty to indemnify the plaintiffs for Southeast’s violations of the TCP A. 8
A final judgment will be issued separately.
Notes
. Sunbelt was never served with process.
. Mr. Penzer also alleged coverage under the "property damage” provisions of the policy, but that claim has since been withdrawn.
. The federal and state cases which have decided the issue presented here are collected and discussed in R. Johan Conrod, Jr., “Insurance Coverage of Claims of Violations of the Telephone Consumer Protection Act,”
. Even if the language in
Compupay
construing the policy language is dicta, it is persuasive dicta, and I choose to follow it in the absence of any other Florida decisions on point.
See, e.g., General Star Indemnity Co.
v.
West Florida Village Inn, Inc.,
. Let me also add that if(as the plaintiffs suggest) Transportation is guilty of trying to use Florida tort law principles to support its reading of the relevant language in the policy, the plaintiffs are similarly guilty of trying to use the TCPA to suggest that Southeast’s violations constituted invasions of privacy under the policy (pursuant to an intrusion/seclusion theory).
. Thus, when warranted, the Eleventh Circuit itself has refused to follow prior unpublished decisions.
See, e.g., Twin City Fire Ins. Co. v. Ohio Cos. Co., Inc.,
. The rationale articulated in
Pomona Park
appears to be closely related to the principle of "ejusdem generis,” which provides that "where general words follow an enumeration of specific words, the general words are construed as applied to the same kind or class as those that are specifically mentioned.”
Fayad v. Clarendon Nat. Ins. Co.,
. In light of my conclusion that there is no coverage, I do not address the additional arguments made by Transportation.