Shelton v. Fast Advance Funding, LLCShelton v. Fast Advance Funding, LLC
Plaintiff James Shelton brought this action for damages based on alleged violations of the Telephone Consumer Protection Act ("TCPA"),
I. INTRODUCTION
Throughout this litigation, Defendant Fast Advance has failed to participate in discovery. Significantly, Defendant never responded Plaintiff's Requests for Admission, which Plaintiff propounded on Defendant on February 11, 2019. ECF No. 40-4 ; ECF No. 43. Three weeks prior to the date set for trial, Plaintiff filed a Motion in Limine to prevent Defendant from Offering Testimony or Evidence Contrary to the Admitted Requests for Admission, requesting that the Court confirm that the Requests for Admission are admitted, pursuant to Federal Rule of Civil Procedure ("FRCP") 36(a)(3). ECF No. 40. In its opposition, Defendant argued that the discovery deadline was March 1, 2019, only 18 days after Plaintiff sent Defendant the Requests for Admission, and that Defendant is entitled to 30 days to respond under F.R.C.P 36(a)(3). ECF No. 43. Therefore, Defendant argued, as "Defendant's response date would have been March 13, 2019," which "is after the close of discovery,
Plaintiff was obliged to serve his Requests for Admissions early enough for Defendant to respond before the completion of the discovery period or move the Court for an extension of the discovery completion date. Plaintiff did neither, and his Request for Admissions were untimely. No response was required.
Id. at 1-2 .
Defendant cited no law nor pointed to any statute stating that a defendant does not have to respond to Requests for Admission with a due date 12 days after the discovery deadline, nor did Defendant explain why it did not request that the discovery period be extended. This Court, therefore, granted Plaintiff's Motion in Limine, confirming the Requests for Admission were admitted and requiring that Defendant not seek to admit any evidence at trial to refute or rebut the admissions.
II. REQUESTS FOR ADMISSION
In completely failing to participate in discovery and in ignoring Plaintiff's requests for information despite FRCP 36(a)(3)'s requirement that a "matter is admitted unless ... the party ... serves ... a written answer or objection," Defendant compelled the Court to find for the Plaintiff. FRCP 36 provides the parties an opportunity to "reduce the area of dispute at the trial," and allows the parties to provide a "studied response" made by the party with the "direction and supervision of counsel." Airco Indus. Gases, Inc. Div. of the BOC Grp., Inc. v. Teamsters Health & Welfare Pension Fund of Philadelphia & Vicinity ,
If Defendant had responded to these Requests for Admission, or participated in discovery in any way, the Court would have been able to structure the case for trial. Instead, Defendant was disengaged. In the weeks leading up to trial, this Court was required to email Defendant's counsel multiple times, including sending a letter via mail directly to Defendant Fast Advance, to ensure that it had representation present for trial. A responsive counsel for Defendant finally entered his appearance on April 8, 2019, ECF No. 41, and although Defendant timely filed its pretrial memorandum, it failed to include a proposed verdict slip, proposed Points for Charge, and proposed voir dire, as required by the scheduling order. ECF No. 42 ; ECF No. 43.
On the morning of what was intended to be a jury trial, on May 1, 2019, this Court met with the parties to discuss the remaining issues, if any, for a jury to decide in this matter. At the time of this meeting, this case had been called for a jury trial, ECF No. 38, and a jury was waiting to be empaneled. Defendant argued that it should be allowed to take the testimony of Plaintiff James Shelton to establish that his phone was used for business purposes, which it claimed would act as a bar to standing under the TCPA,
This Court determined that, because the Requests for Admission were deemed admitted, Defendant had admitted that Plaintiff's cell phone was a "personal cellular telephone," and a "private mobile telephone ... used for personal purposes." ECF No. 1 at ¶¶ 20, 50.
III. FINDINGS OF FACT
1. The phone calls made in this case were claimed to be violative of the regulations,
2. Plaintiff James Shelton is the subscriber of a cellphone number (the "Phone Number"), which he uses as his personal cellular telephone number for "personal purposes," and which has been registered on the National Do Not Call Registry since June 2015. ECF No. 1 at ¶¶ 19-20, 50.
3. Defendant has no established business relationship with Plaintiff, and Defendant lacks express prior written consent to contact Plaintiff on his cellular telephone for solicitation purposes. ECF No. 40-1 at ¶¶ 9-10.
4. On March 16, 2018, Plaintiff received a call from a representative of Fast Advance, which Plaintiff answered, regarding a sales pitch about business funding. ECF No. 1 at ¶¶ 21-22. Plaintiff told the caller that if he was interested or had any questions, he would call Defendant back.
5. Plaintiff did not consent at that time to receiving any additional telemarketing calls.
6. On May 1, 2018, Plaintiff wrote an email to Fast Advance, copying Fast Advance's legal counsel, requesting that Fast Advance put his number on their internal do-not-call list and requested to receive a copy of Fast Advance's internal do-not-call policy.
7. From May 1-3, 2018, Plaintiff received another five calls from Defendant.
8. In total, Plaintiff received 22 calls from Fast Advance while his number was on the National Do-Not-Call registry, five of which Plaintiff received after requesting to have his number on Defendant's internal do-not-call list.
9. Defendant has admitted that it "does not scrub against the [N]ational Do
10. Defendant further admitted that it "has neither policies nor procedures in place to honor 'do not call' requests," "does not maintain an internal 'Do Not Call' list," "never recorded any Do Not Call request made from" Plaintiff, and "did not honor Plaintiff Shelton's Do Not Call requests." ECF No. 40-1 at ¶ 23-26.
11. Finally, Defendant admitted that it does not have "TCPA compliance policies available for production upon request," that it "failed to provide Plaintiff with a copy of their Do Not Call [and TCPA] compliance policies upon Plaintiff's request," and that "the 22 calls Defendant placed to Plaintiff all violated the TCP[A], [§] 227(c)."
IV. CONCLUSIONS OF LAW
12. Plaintiff has alleged the following violations of the TCPA: making a telephone solicitation to Plaintiff's cellular phone number which was included in the National Do Not Call Registry,
13. Plaintiff is entitled to bring a private right of action for violation of the regulations prescribed under § 227(c) pursuant to § 227(c)(5) if he has "received more than one telephone call within any 12-month period by or on behalf of the same entity."
15. The TCPA prohibits sales calls to residential telephone subscribers
The regulations required by paragraph (2) may require the establishment andoperation of a single national database to compile a list of telephone numbers of residential subscribers who object to receiving telephone solicitations, and to make that compiled list and parts thereof available for purchase. If the Commission determines to require such a database, such regulations shall- ...
(F) prohibit any person from making or transmitting a telephone solicitation to the telephone number of any subscriber included in such database47 U.S.C. § 227 (c)(3)
16. The resulting regulations establish a National Do Not Call Registry and state:
No person or entity shall initiate any telephone solicitation to ... [a] residential telephone subscriber who has registered his or her telephone number on the national do-not-call registry of persons who do not wish to receive telephone solicitations that is maintained by the Federal Government.
47 C.F.R. § 64.1200 (c)(2)
17. The Court concludes that Plaintiff is entitled to judgment on Count I. Defendant has admitted that Plaintiff's personal telephone number "has been successfully registered on the National Do Not Call Registry since June 26, 2015." ECF No. 1 at ¶ 20. Defendant has further admitted that Defendant placed 22 telephone solicitations to Plaintiff's telephone while it was registered on the National Do Not Call Registry. ECF No. 1 at ¶¶ 21-22, 28, 29, 39, 42, 43, 44, 45, 46 ; ECF No. 40-1 at ¶¶ 32, 33. Because Plaintiff has received more than one telephone call from Defendant in a 12-month period, he has a private right of action to recover actual damages or receive up to $ 500 for each violation, whichever is greater.
18. Therefore, the Court concludes that Plaintiffs are entitled to $ 500 for each phone call made to Plaintiff's phone in violation of § 227(c)(3) and § 64.1200(c)(2).
19. The Court further concludes, pursuant to § 227(c)(5), that Defendant's violations were knowing and willful. Defendant has admitted that it "lacks any sort of express prior consent, written, verbal, or otherwise, to contact Plaintiff on his cellular phone for commercial purposes," that "Defendant does not scrub against the [N]ational Do Not Call Registry," and "does not purchase the [N]ational Do Not Call list from the FTC." ECF No. 40-1 at ¶ 11, 20, 22. Defendant further admitted that "Defendant has no established business relationship with Plaintiff," nor does Plaintiff have an "account with Defendant."
20. The regulations the FCC ("Federal Communications Commission")promulgated concerning the TCPA prohibit a person or entity from initiating a call for telemarketing purposes to a residential telephone subscriber unless they have instituted minimum procedures for maintaining an internal do-not-call list. Title
21. Defendant has admitted that "Defendant has neither policies nor procedures in place to honor 'do not call' requests." ECF No 40-1 at ¶ 23. Defendant further admits that "Defendant does not have TCPA compliance policies available for production upon request," and that "Defendant failed to provide Plaintiff with a copy of their Do Not Call compliance policies upon Plaintiff's request." ECF No. 40-1 at ¶ 29.
22. This Court, therefore, concludes that Defendant has violated
23. The FCC regulations further require a person or entity making a call for telemarketing purposes to record any request from a residential telephone subscriber not to receive calls from that person or entity and require that the person or entity honor that request within a reasonable time from the date the request is made, not to exceed thirty days.
24. Defendant has admitted that "Defendant was given repeated 'do not call' requests by Plaintiff or an individual at Plaintiff's number," "Defendant does not maintain an internal 'Do Not Call' list," "never recorded any Do Not Call request made from Plaintiff's telephone number," "did not honor Plaintiff Shelton's Do Not Call requests," and "Defendant called Plaintiff at least five times after being told to stop calling." ECF No. 40-1 at ¶¶ 16, 25, 26, 31.
25. The Court, therefore, concludes that Defendant has violated
26. The Court further concludes that Defendant willfully and knowingly violated
27. The Court concludes, however, that Plaintiff is limited to collecting statutory damages on a per-call basis for multiple claims, specifically Counts III-VI brought pursuant to the regulations requiring certain minimum procedures for maintaining a do-not-call list,
28. Interpreting this introductory language in conjunction with the "minimum standards" indicates that the regulations focus on the phone call itself. Therefore, the "violation of the regulations" anticipated by § 227(c)(5) is the initiation of the phone call without having implemented the minimum procedures and not the failure to have the minimum procedures alone.
29. As there were 22 phone calls made in violation of the TCPA, Plaintiff is able to receive $ 500 per phone call violation. Because the Court has found that these violations were willful and knowing, Plaintiff is entitled to receive $ 1500 per phone call, pursuant to
30. Additionally, Plaintiff's private right of action for all counts arises under § 227(c)(5), which specifically states that a person must "receive[ ] more than one telephone call within any 12-month period... in violation of the regulations" to have a private right of action.
31. This Court concludes that this language of § 227(c)(5) anticipates a plaintiff receiving $ 500 per call that is in violation of § 227(c), and not $ 500 per violation per call.
32. Therefore, the Court concludes that Plaintiff is not entitled to receive more than $ 1500 for each phone call, even if each phone call violates more than one regulation prescribed under § 227(c). Accordingly, even though this Court concludes that Defendant also violated
Notes
Defendant claimed in its Amended Pretrial Memorandum, ECF No. 53, that if Plaintiff had used his phone for business purposes, Plaintiff would lack standing to bring a TCPA action, pursuant to Shelton v. Target Advance LLC , No. CV 18-2070,
In its pretrial memorandum and at the May 1, 2019 hearing, Defendant argued that the holding in Target Advance would preclude any telephone number used for business purposes from bringing any TCPA claim. ECF No. 53. The Court in Target Advance , however, held only that claims under § 227(c) may be barred if "Plaintiff held the Phone Number out to the world as a business phone number, [because] he could not register it on the National Do Not Call Registry for purposes of avoiding business-to-business calls." Target Advance LLC ,
All allegations in Plaintiff's complaint were admitted via Request for Admission No. 15, which states "Admit to all allegations, factual and legal, in Plaintiff's complaint."
"If the court finds that the defendant willfully or knowingly violated this subsection or the regulations prescribed under this subsection, the court may, in its discretion, increase the amount of the award to an amount equal to not more than 3 times the amount available under subparagraph (B) of this paragraph."
Based on the Requests for Admission having been deemed admitted, all allegations in the Complaint have also been deemed admitted, pursuant to Request for Admission No. 15.
This Court questions whether Congress intended that a jury determine in the first instance whether there has been a violation of the regulations promulgated by the FCC or whether Congress had anticipated that the FCC or FTC would initially determine if there were a violation, and a plaintiff could then bring a private action for damages on this finding of violation. Clearly both the FTC and FCC have decided it is not in their purview to determine individual violations of the regulations. See How the FCC Handles Your Complaint , FCC.GOV, https://consumercomplaints.fcc.gov/hc/en-us/articles/202752940-Your-Role-in-the-FCC-Consumer-Complaint-Process (last visited May 7, 2019) ("We do not resolve individual complaints on [ ] issues [covered by the TCPA]. However, the collective data we receive helps us keep a pulse on what consumers are experiencing, may lead to investigations and serves as a deterrent to the companies we regulate."); National Do Not Call Registry , FTC.GOV, https://www.consumer.ftc.gov/articles/0108-national-do-not-call-registry (last visited May 7, 2019) ("Will I hear back from the FTC regarding my complaint? Due to the volume of complaints, the FTC cannot respond directly to every complaint. The FTC and other law enforcement agencies analyze complaints to spot trends and to identify and take action against the people responsible for these illegal calls.") Because both the FCC and FTC allow consumers to file a complaint but do not then resolve that complaint, a consumer has no other recourse to recover for TCPA violations outside of paying a $ 400 fee to begin costly federal litigation, and discovery on violation issues, which most consumers are not in a position to do. What is costly in this federal litigation is forcing the consumer to prove the violation in the first instance because the consumer does not come into court with a violation already determined by the FCC or FTC. The FTC acknowledges this epidemic of nuisance calls by stating, "[d]ue to the volume of complaints," yet the FTC and FCC leave the consumer to fend for him or herself thus giving the law and regulations no teeth and allowing the nuisance calls to continue unfettered despite having promulgated the very regulations meant by Congress to control them. This leaves the field not to consumers but to a cottage industry of serial TCPA filers, who are looking simply to make money and who know that the prime offenders of the TCPA actually target members registered on the National Do Not Call Registry, because they know these numbers to be good, viable numbers. This Court does not believe that Congress intended that a jury determine whether there was a violation of the regulations, requiring the jury to wade through FCC rules and regulations, but rather that a consumer first file a complaint with the FCC or FTC, the FCC or FTC determine whether there has been a violation of the regulations, and, finally, a court determine whether this violation, which has already been determined, was willful and knowing, potentially calling for treble damages pursuant to § 227(c)(5)(C) ("If the court finds that the defendant willfully or knowingly violated the regulations prescribed under this subsection, the court may, in its discretion, increase the amount of the award.") (emphasis added). However, as it currently stands, those juries that substantively consider TCPA litigation, of which there are few, are attempting to fill the vacuum left by agencies who are in a much better position to determine a violation. The jury process as it has been evolved essentially eliminates as a practical matter the "private right of action" of the average consumer.
Defendant did not raise the question of whether a cellular telephone number, like Plaintiff's telephone number, would be included in the definition of "residential telephone" or whether Plaintiff is a "residential telephone subscriber" as required by the TCPA. Since the Defendant did not make this argument, this Court will not consider it in its findings. However, this Court questions whether cellular telephone subscribers were intended to be included in the definition of "residential telephone subscriber," as drafted by Congress in 1991 and the regulations promulgated by the FCC shortly after. The definition of residential is "used as a residence or by residents," and "resident" is defined as "living in a place for some length of time," or "one who resides in a place." Residential , Merriam-Webster.com , https://www.merriam-webster.com/dictionary/residential; Resident , Merriam-Webster.com , https://www.merriam-webster.com/dictionary/residents. Therefore, the plain language of "residential telephone" describes a telephone used by individuals in the home, and not a cellular telephone, which can be used anywhere. Furthermore, the TCPA specifically mentions "cellular telephone service" in § 227(b) and § 64.1200(a)(1)(iii), indicating that both Congress and the FCC were aware of the distinction between a cellular telephone and a residential telephone and purposely protected only "residential telephone subscribers" under § 227(c), § 64.1200(c) and (d). "A familiar principle of statutory construction ... is that a negative inference may be drawn from the exclusion of language from one statutory provision that is included in other provisions of the same statute." Hamdan v. Rumsfeld ,
In the Complaint, Plaintiff requested "injunctive relief prohibiting such conduct in the future," for Counts I and II. ECF No. 1 at ¶¶ 56, 58. Despite initially requesting such relief, Plaintiff has failed to pursue injunctive relief and has pursued only monetary relief. The Court therefore will not grant Plaintiff relief that he did not pursue.
Defendant did not raise the issue of whether Defendant calling Plaintiff in the two days following Plaintiff's request to no longer receive calls from Defendant is a "reasonable" amount of time following the request to comply, especially considering that the TCPA regulations anticipate a period of "30 days" as a reasonable time. § 64.1200(d)(3). However, because Defendant did not raise this issue, the Court determines that it waived its opportunity to challenge that these calls were made within the "reasonable" amount of time to honor the do-not-call request. Furthermore, because the Court finds that Plaintiff can receive statutory damages on a per-call basis, and not recover for multiple violations in each call, Plaintiff has already received statutory damages for this phone call based on violations of § 227(c)(3)(F) and § 64.1200(c)(2).
Plaintiff requests damages for multiple violations per phone call, without citing any binding authority requiring such a result. The Third Circuit has not directly discussed the issue of whether a plaintiff may recover for multiple violations of § 227(c) in the same telephone call. The Sixth Circuit, however, has explicitly held that the "language [of § 227(c)(5) ] unambiguously allows for statutory damages on only a per-call basis." Charvat v. GVN Michigan, Inc. ,