PHYSICIANS HEALTHSOURCE, INC., an Ohio Corporation, individually and as the representative of a class of similarly-situated persons v. CEPHALON, INC.; CEPHALON CLINICAL PARTNERS, L.P.; CEPHALON DEVELOPMENT CORPORATION; SCIMEDICA GROUP, LLC; SCIMEDICA GROUP MARKETING RESEARCH AND CONSULTING, LLC; JOHN DOES 1-10 and SCIMEDICA GROUP, LLC; SCIMEDICA GROUP MARKETING RESEARCH AND CONSULTING, LLC v. BLITZ RESEARCH, INC.
No. 18-3609
United States Court of Appeals for the Third Circuit
March 30, 2020
PRECEDENTIAL. On Appeal from the United States District Court for the Eastern District of Pennsylvania (D.C. Civil No. 2:12-cv-03753). District Judge: Honorable John R. Padova. Submitted Under Third Circuit L.A.R. 34.1(a) October 21, 2019.
GREENAWAY, JR., PORTER, and COWEN, Circuit Judges.
Jeffrey A. Berman, Esq. Glenn L. Hara, Esq. Anderson & Wanca 3701 Algonquin Road Suite 500 Rolling Meadows, IL 60008 Counsel for Appellant
Nicholas H. Pennington, Esq. Joseph E. Wolfson, Esq. Stevens & Lee 620 Freedom Business Center Suite 200 King of Prussia, PA 19406 Counsel for Appellees Cephalon, Inc.; Cephalon Clinical Partners, LP; Cephalon Development Corp.
Sheryl S. Levy, Esq. Cooper Schall and Levy 1204 Township Line Road Drexel Hill, PA 19026 Counsel for Appellees SciMedica Group, LLC; SciMedica Group Marketing Research and Consulting LLC
GREENAWAY, JR., Circuit Judge.
In this digital age with myriad forms of communication, faxes no longer dominate, as they once did. Yet, faxes are the focus of our attention today. Although complicated by a phalanx of parties, the essence of this dispute is whether a pharmaceutical company violated a federal statute by impermissibly sending two faxes to a doctor.
The plaintiff-appellant in this case is Physicians Healthsource, Inc. (“PHI“), the prior employer of the doctor, who was the recipient of the faxes. The appellees in this case are Cephalon, Inc., Cephalon Clinical Partners, L.P., and Cephalon Development Corporation (collectively “Cephalon“), and SciMedica Group, LLC and SciMedica Group Marketing Research and Consulting, LLC (“SciMedica” collectively with
PHI believes these faxes were unsolicited and thus sent in violation of the
The District Court granted summary judgment in favor of Defendants, finding that there was no genuine dispute of material fact that the faxes were solicited and that the TCPA does not require solicited faxes to contain opt-out notices. For the reasons detailed below, we will affirm.
I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY
In 2009, two faxes were sent to Dr. Jose Martinez on behalf of Cephalon.2 At the time, Dr. Martinez worked for PHI, practiced in the area of pain management, and met with Cephalon drug representatives on various occasions to discuss different Cephalon drugs. During certain visits, Cephalon representatives asked Dr. Martinez if they could follow up with him and “send [him] things,” after which faxes were sometimes then sent, faxes that Dr. Martinez never told Cephalon or its representatives to stop sending. JA195. Here though, only two faxes are in dispute.
The first fax at issue, addressed to Dr. Martinez, was an invitation to a dinner meeting program on a drug called AMRIX®. The second fax was an invitation to a promotional product lunch on FENTORA®. Both drugs are pain medications, and both are drugs that Dr. Martinez had discussed with Cephalon representatives previously. Indeed, at his request, Dr. Martinez had received samples of AMRIX® on multiple occasions. Neither fax included opt-out language (i.e., language informing the recipient that he or she could decline future faxes).
Importantly, it is undisputed that PHI provided its fax number to Defendants via business cards. PHI concedes that “at best, Defendants marshalled enough evidence at summary judgment to show . . . [PHI‘s] voluntary communication” of its fax number to Defendants. Appellant‘s Br. 24 (internal quotation marks omitted) (emphasis added). And during his deposition, Dr. Martinez noted that the business cards, with the fax number in question, were made available to drug representatives, so that they could get in touch with him.
Nevertheless, believing these faxes were sent in violation of the TCPA, PHI subsequently filed a putative class action complaint asserting damages, as “[u]nsolicited faxes damage their recipients . . . [who] lose[] the use of [their] fax machine, paper, and ink toner.” Docket 1. PHI thus
Defendants filed summary judgment motions claiming the two faxes were not subject to the TCPA‘s requirements because they were sent with prior express permission, meaning they were solicited and thus not prohibited by the TCPA, and also arguing that solicited faxes did not need to contain opt-out notices.3 The District Court granted both summary judgment motions. See Physicians Healthsource, Inc. v. Cephalon, Inc., 340 F. Supp. 3d 445, 453–54 (E.D. Pa. 2018). PHI timely appealed.
II. JURISDICTION AND STANDARD OF REVIEW
The District Court had jurisdiction under
III. ANALYSIS
This case presents no genuine dispute of material fact regarding whether the faxes sent were solicited—they were—and whether solicited faxes needed to contain opt-out language—they do not. As such, we will affirm the District Court‘s grant of summary judgment in favor of Defendants.
A. The Two Faxes Were Solicited
In this case, the issue of whether the two faxes were solicited or unsolicited boils down to whether the voluntary provision of a fax number, akin to the voluntary provision of a telephone number, constitutes express consent, invitation, and permission, and whether “express consent” and “express invitation or permission“—as found in the TCPA—are interchangeable. Because we find that—and because PHI concedes to the fact that—there was a voluntary provision of a fax number to Defendants, and because we find that “express consent” and “express invitation or permission” are interchangeable, we conclude that the voluntary provision of a fax number constitutes express consent, invitation, and permission, such that the two faxes in this case were solicited.4
i. Voluntary Provision of a Number
Under the TCPA, it is unlawful to send an unsolicited fax advertisement unless three conditions are met.
The voluntary provision of a number—phone or fax—by a message-recipient to a message-sender, constitutes express consent such that a received message is solicited and thus not prohibited by the TCPA, if the message relates to the reason the number was provided. See, e.g., Daubert v. NRA Grp., LLC, 861 F.3d 382, 389 (3d Cir. 2017); see also Fober v. Mgmt. & Tech. Consultants, LLC, 886 F.3d 789, 793 (9th Cir. 2018) (concluding that the provision of a phone number and receipt of a call that relates to “the reason why the called party provided his or her phone number in the first place” constitutes express consent such that the calls were deemed solicited); KHS Corp. v. Singer Fin. Corp., No. 16-55, 2018 WL 4030699, at *4 (E.D. Pa. Aug. 23, 2018) (concluding the same, but in the context of fax advertisements, and collecting cases).
In Daubert, a plaintiff alleged a violation of the TCPA due to the receipt of sixty-nine calls that he alleged were unsolicited. 861 F.3d at 387. The defendant argued that the district court was wrong in granting summary judgment on the plaintiff‘s TCPA claim, contending instead that a jury could conclude the plaintiff had provided his “prior express consent” to receive calls regarding a medical bill. Id. at 389. This Court proceeded to analyze the TCPA‘s scope “guided by the statute‘s text, the Federal Communications Commission‘s (FCC‘s) interpretations of the statute, the statute‘s purpose, and our understanding of the concept of consent as it exists in the common law.” Id. at 389. We first afforded express consent its ordinary meaning. Id. Then, we noted that: “On the issue of prior express consent the FCC has found that ‘persons who knowingly release their phone numbers have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary.‘” Id. (quoting In re Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 7 F.C.C. Rcd. 8752, 8769 (1992)) (emphasis added).
We then summarized the FCC‘s relevant ruling, namely, that the provision of a number to a party evidences prior express consent by the number-provider to be contacted at the number provided for purposes relating to why the number was provided. Id. at 390. And we noted that “[t]he FCC‘s rulings make no distinction between directly providing one‘s cell phone number to a creditor and taking steps to make that number available through other methods, like consenting to disclose that number to other entities for certain purposes.” Id. (citation and quotation marks omitted). Finally, we affirmed that “Congress did not intend to depart from the common law understanding of consent . . . that it‘s given voluntarily.” Id. at 390 (citation and quotations marks omitted) (emphasis added).
Though the facts of Daubert differ from the facts of this case it is instructive on the TCPA and when prior express
Here, it is undisputed that PHI voluntarily provided a business card with a fax number on it to Defendants (i.e., knowingly released the number such that the provision was an invitation to be contacted), and it is undisputed that the two faxes related to prior conversations Cephalon‘s drug representatives had with Dr. Martinez as part of an ongoing business relationship.7
We stress that this case does not involve implied permission, but voluntary provision, which has been equated to express consent in the telephone context, and which here, we equate to express consent in the fax context.
There is no question that Daubert centered on telephone calls and not faxes. 861 F.3d at 387. But Daubert, in a similar vein to this case, addressed situations in which phone calls could be deemed solicited or unsolicited and then either permissible or impermissible in accordance with the TCPA. Id. at 389.
Our dissenting colleague is concerned that the FCC‘s use of “in effect” shows that “releasing a contact number is merely implied consent through conduct” but the FCC itself was speaking to the issue of “prior express consent.”
Further, consent in this case is buttressed by the fact that the fax number was provided in the first place, namely, so that PHI could be contacted. See also Fober, 886 F.3d at 793 (“FCC orders and rulings show that . . . transactional context matters in determining . . . consumer‘s consent . . . . To fall within the prior express consent exception, a call must relate to the reason why the called party provided his or her phone number” (internal citation and quotation marks omitted)).
ii. Express Consent and Express Invitation or Permission Are Interchangeable
The plain language of the TCPA shows that “express consent” and “express invitation or permission” are interchangeable and applicable to both phone calls and faxes. Our analysis of the TCPA “is guided by the statute‘s text, the [FCC‘s] interpretations of the statute, the statute‘s purpose, and our understanding of the concept [in question].” Daubert, 861 F.3d at 389 (internal citation and quotation marks omitted).
The TCPA does not define either “express consent” or “express invitation or permission,” and when phrasing in a statute is undefined, we give it its ordinary meaning. Id. “The ordinary meaning of express consent is consent ‘clearly and unmistakably stated.‘” Id. (quoting Black‘s Law Dictionary 346 (9th ed. 2011)). Consent is “[a] voluntary yielding to what another proposes or desires; agreement, approval, or permission regarding some act or purpose, esp. given voluntarily by a competent person; legally effective assent.” CONSENT, Black‘s Law Dictionary 368 (10th ed. 2014) (emphasis added). Similarly, express permission is “clearly and unmistakably granted by actions or words, oral or written,” and permission is “the official act of allowing someone to do something.” PERMISSION, Black‘s Law Dictionary 1321-1322 (10th ed. 2014). Notably, the definition of “consent” contains “permission.”
Further, and as stated above, “[o]n the issue of prior express consent the FCC has found that ‘persons who knowingly release their phone numbers have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary.‘” Daubert, 861 F.3d at 389 (quoting 7 F.C.C. Rcd. at 8769). Likewise, the FCC has found that calls received after “prior express invitation or permission” are not “unsolicited calls.” See In re Rules & Regulations, 7 F.C.C. Rcd. at 8766 n.47 (defining “telephone solicitation” and using the “prior express invitation or permission” language as opposed to “express consent” language) (emphasis added).8 The TCPA prohibits telephone calls save in part for those made with “prior express consent.”
It is true that the TCPA prohibits faxes save those communicated with “express invitation or permission,” and does not say “express consent,” but both the language‘s plain meaning and the FCC‘s interpretation show that “express consent” is interchangeable with “express invitation or permission.” Compare
While PHI suggests that the District Court “applied the lower standard for ‘consent,‘” arguing the standards for fax advertisements (those bound by “express invitation or permission“) are “more stringent” than those for phone calls, we must disagree. See Appellant‘s Br. 19–20. “Express consent” and “express invitation and permission” are synonymous in the context of the TCPA, and accordingly the standards are not different.
The District Court was thus correct in finding that there was undisputed evidence establishing that PHI provided business cards with its fax number to drug company representatives, thereby giving express consent, invitation, and permission to receive related information, and thus in finding that the two faxes were solicited. See Physicians Healthsource, 340 F. Supp. 3d at 452–54.9
The TCPA is silent regarding solicited faxes. See generally
The FCC‘s 2006 Solicited Fax Rule was in opposition to the TCPA‘s clear language, and the FCC did not have the ability to regulate solicited faxes:
Congress drew a line in the text of the statute between unsolicited fax advertisements and solicited fax advertisements. Unsolicited fax advertisements must include an opt-out notice. But the Act does not require (or give the FCC authority to require) opt-out notices on solicited fax advertisements. It is the Judiciary‘s job to respect the line drawn by Congress, not to redraw it as we might think best. . . . The FCC may only take action that Congress has authorized.
Id. (internal citation omitted) (emphasis in the original).
There is no question that the plain language of the TCPA indicates that it relates to and regulates “unsolicited” messages. See, e.g.,
IV. CONCLUSION
We will affirm the District Court‘s grant of summary judgment in favor of Defendants because there is no genuine dispute of material fact that the two fax advertisements were solicited, and solicited fax advertisements do not require opt-out language.
PORTER, Circuit Judge, dissenting.
I respectfully dissent because I believe the majority overlooks genuine disputes of material fact on the central issue of prior express permission, applies the wrong legal standard, and because the established-business-relationship exception to the Junk Fax Prevention Act‘s express-consent requirement does not apply.
I
There is a genuine dispute of material fact about whether Dr. Martinez or PHI gave Cephalon prior express permission to send the fax advertisements. The majority places significant weight on Dr. Martinez‘s deposition testimony that PHI‘s “business cards, with the fax number in question, were made available to drug representatives.” Maj. Op. 5–6. The use of passive voice in that sentence is telling: Like most physician practices, PHI simply leaves business cards in the reception area for patients and anyone else to pick up. JA 200. There is no evidence that PHI or Dr. Martinez specifically gave business cards to Cephalon‘s drug representatives as an express grant of permission to send fax advertisements. Of course, there are many reasons why physicians make their business cards available to patients and others who enter the office. But it is not apparent on this record that PHI did so expressly to solicit fax advertisements from Cephalon. I think the majority too easily finds express permission from a fact that is ambiguous at best. See, e.g., Maj. Op. 11 (“Here, it is undisputed that PHI voluntarily provided a business card with a fax number on it to Defendants[.]“).
During his deposition, Dr. Martinez was also queried whether Cephalon‘s visiting representatives would “sometimes” ask if they could follow up and send him “things.” JA 194. Dr. Martinez answered affirmatively—yes, the representatives sometimes asked that question. But the deposition examiner‘s question was so indeterminate (“sometimes” asked?) and nondescript (what are “things“?) that it obscures rather than illuminates.
The examiner chose not to ask Dr. Martinez the obvious follow-up question: Did the Cephalon representatives with whom Dr. Martinez spoke ask if they could send him the fax advertisements at issue? In any event, Dr. Martinez later explained that he never “specifically requested” the two fax advertisements in dispute. JA at 217. So I cannot agree with the majority‘s suggestion that this deposition snippet shows that Dr. Martinez agreed to receive follow-up information about the drugs discussed with Cephalon‘s representatives. Maj. Op. 11 n.6; see also Physicians Healthsource, Inc. v. A-S Medication Sols., LLC, — F.3d —, 2020 WL 881329, at *3 (7th Cir. Feb. 24, 2020) (noting FCC regulations interpreting “express permission to receive a faxed ad requires that the consumer understand that by providing a fax number, he or she is agreeing to receive fax advertisements“).1
The majority contends, however, that “PHI concedes that ‘at best, [Cephalon] marshalled enough evidence at summary judgment to show . . . [PHI‘s] voluntary communication’ of its fax number to [Cephalon].” Maj. Op. 5 (quoting Appellant‘s Br. 24); see also Maj. Op. 12 n.7 (“[T]here is literally no question, only a concession, that a fax number was voluntarily provided to Defendants[.]“). Passively providing a fax number to the general public—even voluntarily—is not equivalent to express permission. And the majority also acknowledges that PHI “strongly opposes” the finding that Dr. Martinez gave Cephalon express permission to send him the faxed advertisements. See id. at 17 n.9.
In any event, there is no concession. PHI‘s brief merely allows that ”at best” Cephalon showed “an established business relationship and the voluntary communication of its fax number.” Appellant‘s Br. 24 (emphasis added) (internal quotation marks omitted). Although the summary-judgment standard prohibits us from viewing the evidence in Cephalon‘s favor, the majority draws this inference against the nonmoving party. See Anderson, 477 U.S. at 255.
Nothing in the record shows that Dr. Martinez expressly permitted Cephalon to send him fax advertisements or even other, unidentified “things.” JA 194. Because a genuine dispute of material fact exists on this issue, I believe that summary judgment is inappropriate.
II
Aside from the material factual disputes, the majority‘s legal standard incorrectly allows implied permission to satisfy the TCPA‘s requirement of express permission.
I agree with the majority that the TCPA‘s terms “express consent” and “express permission” have interchangeable meanings. See Maj. Op. 14. “The ordinary meaning of express consent is consent ‘clearly and unmistakably stated.‘” Id. (quoting Express consent, Black‘s Law Dictionary 346 (9th ed. 2011)). By contrast, the ordinary meaning of implied consent is “consent inferred from one‘s conduct rather than one‘s direct expression.” Implied consent, Black‘s Law Dictionary (11th ed. 2019) (emphasis added).
Here, the majority concludes that PHI‘s conduct—passively leaving business cards on a receptionist‘s desk—expressly permitted Cephalon representatives to send fax advertisements to Dr. Martinez. See Maj. Op. 17 n.9 (“[T]he voluntary provision of the fax number by PHI constituted express invitation and permission in and of itself.“); id. at 16–17 (“PHI provided business cards with its fax number to drug company representatives [by leaving them on a desk], thereby giving express consent, invitation, and permission to receive related information[.]“). But PHI did not “clearly and unmistakably” give its permission to receive fax advertisements by leaving business cards on a receptionist‘s desk.
The majority‘s reliance on our decision in Daubert v. NRA Group, LLC does not save its misinterpretation of the TCPA‘s unambiguous text. In Daubert, we noted that an FCC regulation on prior express consent provided that “persons who knowingly release their phone numbers have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary.” 861 F.3d 382, 389 (3d Cir. 2017) (emphasis added) (quoting In re Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 7 F.C.C. Rcd. 8752, 8769 (1992)).
The FCC regulation‘s use of the phrase “in effect” shows that knowingly releasing a contact number is merely implied consent through conduct. One can give consent “expressly” or he can do so “in effect,” but those words are not synonymous. The regulation thus appears to violate the TCPA‘s requirement of express consent.
But in Daubert we recognized that the FCC adopted the regulation under its authority to exempt from the TCPA‘s express-consent requirement certain calls to cell phones. 861 F.3d at 389–90; see also
The majority implicitly places the burden on PHI and Dr. Martinez to opt out of unsolicited fax advertisements. See Maj. Op. 5 (“Dr. Martinez never told Cephalon or its representatives to stop sending [the fax advertisements].“); id. at 17 n.9 (“[A]bsent a definitive expression to not be sent any information . . . the fax number provided is sufficient to establish express invitation and permission.“). This conclusion flips the well-established burden that a party seeking to prove consent—and thus express permission—must carry the burden of proof. See Daubert, 861 F.3d at 390; True Health Chiropractic, Inc. v. McKesson Corp., 896 F.3d 923, 931–32 (9th Cir. 2018).
III
Finally, the established-business-relationship (“EBR“) exception does not save Cephalon‘s fax advertisements from violating the TCPA. The majority notes that the TCPA “explicitly permits unsolicited fax advertisements so long as there is, in part, ‘an established business relationship’ between the sender and the recipient.” Maj. Op. at 17 n.9. The majority then asserts, “Why these two faxes should be curbed, when there was an established practice of drug representatives meeting with, following up with, and providing more information and samples to Dr. Martinez and PHI, defies logic.” Id. at 18 n.9.
The reason why the two fax advertisements should be curbed is simple: They do not satisfy the TCPA‘s requirements for unsolicited faxes under the EBR
Cephalon‘s fax advertisements to Dr. Martinez did not contain any opt-out notice, let alone one in compliance with
* * *
For these reasons, I respectfully dissent.