Case Information

‐ ‐ cv Automotive Fin. Servs. In the

United States Court of Appeals

For the Second Circuit

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A UGUST T ERM , A RGUED : A PRIL D ECIDED : J UNE No.

A LBERTO R EYES , J R .,

Plaintiff Appellant, L INCOLN A UTOMOTIVE F INANCIAL S ERVICES ,

Defendant Appellee.* ________

Appeal United States District Court Eastern District New York. Civ. – Leonard D. Wexler, Judge . ________

Before: W ALKER J ACOBS P ARKER , Circuit Judges

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* Clerk Court directed amend caption shown above. No. ‐ ‐

Plaintiff appellant Alberto Reyes, Jr., appeals judgment of United States District Court for Eastern District New York (Leonard D. Wexler, J .). Judgment was entered following grant summary judgment defendant appellee, Lincoln Automotive Financial Services (“Lincoln”), on claim for damages stemming from Lincoln’s alleged violation Telephone Consumer Protection Act (“TCPA”), Pub. L. Stat. (1991) codified U.S.C. § Reyes leased automobile from Lincoln and, condition lease agreement, consented receive manual automated calls Lincoln. called Reyes regularly after he defaulted his lease obligations, continued do so after allegedly revoked consent called. sued for damages TCPA. district granted summary judgment for Lincoln, basis (1) evidence consent revocation insufficient, (2) event TCPA does permit when provided consideration binding contract. We hold (1) introduce sufficient evidence jury conclude consent, but consumer forms part bargained exchange. We therefore AFFIRM judgment court.

________ No. ‐ ‐

Y ITZCHAK Z ELMAN Marcus & Zelman, LLC, Ocean, NJ, for Plaintiffs ‐ Appellees J ESSICA L. E LLSWORTH (Morgan L. Goodspeed, on brief ), Hogan Lovells US LLP, Washington, DC, for Defendants Appellants.

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J OHN M. W ALKER J R ., Circuit Judge :

Plaintiff appellant Alberto Reyes, Jr., appeals judgment United States District Court for Eastern District New York (Leonard D. Wexler, J .). Judgment was entered following grant summary judgment defendant appellee, Lincoln Automotive Financial Services (“Lincoln”), on claim for damages stemming from Lincoln’s alleged violation Telephone Consumer Protection Act (“TCPA”), Pub. L. Stat. (1991) codified U.S.C. § Reyes leased automobile Lincoln and, condition lease agreement, consented receive manual automated calls Lincoln. regularly after defaulted lease obligations, continued do so after allegedly called. sued for damages TCPA. granted summary judgment Lincoln, basis (1) evidence revocation insufficient, event consent provided consideration a binding contract. We hold (1) Reyes introduce sufficient evidence which a jury conclude his consent, but not consumer consent when forms part bargained exchange. We therefore AFFIRM judgment court.

BACKGROUND

In leased new Lincoln MKZ luxury sedan Ford dealership. Lincoln financed lease. In lease application, provided several personal details, including cellular phone number. lease itself contained number provisions assented finalizing agreement. One provision permitted contact Reyes, and read follows:

You [Reyes] expressly and agree Lessor [Ford], Finance Company, Holder and their affiliates, agents service providers may use written, electronic or verbal means contact you. This includes, but limited to, contact manual calling methods, prerecorded or artificial voice messages, text messages, emails and/or automatic telephone dialing systems. You agree Lessor, Finance Company, Holder their affiliates, agents service providers may use any email address number you provide, now or in future, including a number a cellular phone or other wireless device, regardless whether you incur charges result.

At some point after lease finalized, Reyes stopped making his required payments. As result, on multiple occasions, Lincoln called Reyes in an attempt cure his default.

Reyes disputed his balance on lease, also claims that he requested Lincoln cease contacting him. asserts on June 14, 2013, mailed letter Lincoln he wrote: “I would like request writing contact made your office my cell phone.” Lincoln contends never received letter, or other request cease calls. At deposition, testified mailing letter P.O. box listed Lincoln’s invoices produced copy letter bear an address postmark referenced an incorrect account number. Despite alleged consent, Lincoln continued call Reyes. Following close discovery, Lincoln’s attorney confirmed Lincoln had called him times with customer representative line, had him with pre ‐ recorded messages additional times.

On February filed complaint against Eastern District New York, alleging violations seeking $720,000 damages. On June 20, 2016, Judge Wexler granted summary judgment Lincoln, holding (1) had failed produce sufficient evidence reasonable jury conclude had ever contacted by Lincoln, that, any event, TCPA party legally binding contract unilaterally bargained ‐ for contacted telephone. now timely appeals both rulings.

DISCUSSION

A court’s grant summary judgment is reviewed de novo Gallo Prudential Residential Servs., Ltd. P ʹ ship (2d Cir. 1994). On motion summary judgment, must “resolv[e] all ambiguities draw[] all permissible factual inferences favor against whom summary judgment is sought.” Burg Gosselin, 2010). Summary judgment appropriate only “if movant shows there is genuine dispute material fact movant entitled judgment matter law.” Fed. R. Civ. P. 56(a). All legal conclusions by a district court are reviewed de novo United States Livecchi 2013) (per curiam).

On appeal, Reyes contends (1) that he introduced sufficient evidence create a triable issue of fact as to whether he placed Lincoln notice his consent; that TCPA, construed in light broad remedial purpose protect consumers unwanted phone calls, a revoke be called, even if that consent was given as part a contractual agreement.

I. Whether Reyes his contacted was triable issue fact

As preliminary matter, we agree with that district court’s finding he contacted was improper summary judgment. This material issue fact was dispute raised jury question. testified sworn deposition he mailed letter revoking consent; submitted affidavit effect; introduced copy letter evidence defending Lincoln’s motion summary judgment. The district court discounted evidence “insufficient,” because “does recall address mailed Letter to,” because “he record Letter actually sent Defendant.” noted *8 8 16 2104 Lincoln sent a letter on December 1, 2014, stating it had never received of Reyes.

district court’s conclusion not rested on impermissible assessment the court of credibility. Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 255 (“Credibility determinations, weighing of the evidence, drawing legitimate inferences facts are jury functions, those judge . . . [when] he ruling on motion for summary judgment.”). introduced two separate forms sworn testimony asserting had mailed letter revoking called, responded turn had never received letter. Adverse parties commonly advance “conflicting versions events” throughout course litigation. Jeffreys City N.Y. F.3d (2d Cir. 2005) (quoting Rule Brine, Inc., F.3d 1996). In such instances, summary judgment, district required “resolv[e] all ambiguities [draw] all permissible factual inferences favor against whom summary judgment [is] sought.” Burg, at “[T]he judge must ask . . . whether . . evidence unmistakably favors one side other but whether fair minded jury return verdict plaintiff evidence presented.” Jeffreys (quoting Anderson, U.S. 252). Under standard, judge 2104 erred concluding reasonable jury could find consent, introduced sworn testimony the contrary. Whether testimony reliable was question fact jury. id

II. Under TCPA not able revoke term prior contract We next turn district court’s determination TCPA not unilaterally consent. Congress enacted TCPA protect consumers “[u]nrestricted telemarketing,” determined “an intrusive invasion privacy.” Mims Arrow Fin. Servs., LLC U.S. (internal quotation marks citation omitted) accord Gager Dell Fin. Servs., LLC 2013). To mitigate problem, act prohibits, subject narrow exceptions pertinent here, any person within United States “initiat[ing] call any residential telephone line using artificial prerecorded voice deliver message without prior express party.” U.S.C. § 227(b)(1)(B). authorizes Federal Communications Commission (“FCC”) to promulgate rules regulations in order further implement the act’s provisions. U.S.C. § 227(b)(2).

While the act requires that party wishing make live prerecorded calls obtain prior express consent, the statute silent whether party that so consented can subsequently revoke that consent. Two our sister circuit courts ruled that can revoke prior under terms act. In Gager Dell Financial Services Third Circuit held that plaintiff, who consented in an application for line credit she submitted defendant, was permitted later revoke after receiving harassing calls upon her default loan. at 68. The reasoned “consent,” defined under law, traditionally considered revocable. Id . 270. Moreover, permitting consumers revoke would further Congress’s purpose in enacting TCPA, “to protect consumers unwanted automated calls.” Id Eleventh Circuit, in Osorio State Farm Bank F.S.B ., adopted Third Circuit’s reasoning held plaintiff case, who had consented receive calls defendant application auto insurance, her consent. (11th 2014). In FCC relied these two cases ruling “prior express consent” revocable TCPA. 2104 See In the Matter Rules & Regulations Implementing the Tel. Consumer Prot. Act , F.C.C. Rcd. (2015) (hereinafter “2015 FCC Ruling”).

Gager , Osorio , and FCC Ruling considered narrow question: whether TCPA allows consumer who has freely unilaterally given or her informed consent be contacted can later revoke consent. Osorio at 1253; Gager appeal presents different question, which been addressed by FCC or, our knowledge, by any federal circuit appeal: whether permits consumer unilaterally revoke or her contacted by when is given, gratuitously, but bargained consideration bilateral contract. contends same principles FCC

Third Eleventh Circuits relied their previous rulings apply situation well. He argues (1) law definition term, which Congress presumed adopted drafted TCPA, any form “consent” (whether contractual not) revocable by consenting time; permitting parties their consistent with remedial purpose TCPA, designed Congress afford consumers broad protection harassing phone calls.

We agree with the court that the TCPA who agrees contacted as part bargained exchange unilaterally consent, and we decline read such provision into act. As initial matter, is correct when Congress uses term, such “consent,” “accumulated [a] settled meaning under . . . common law, must infer, unless statute otherwise dictates, Congress means incorporate established meaning th[at] term[].” Neder United States, U.S. (citation omitted). text evidences intent deviate common law rules defining “consent,” FCC and other federal appellate courts applied common law definition term interpreting act. Gager 270; FCC Ruling at *7961 (holding permitting “unwanted texts voice calls is counter . . common law notions consent”).

“Consent,” however, is always revocable common law. A distinction regard must drawn between tort contract law. In tort law, “consent” generally defined gratuitous action, or “[a] voluntary yielding what another proposes desires.” Black’s Law Dictionary (10th ed. 2014); see Gager (“Under law understanding consent, basic premise given voluntarily.” (internal quotation marks omitted)). In Gager Osorio plaintiffs provided such voluntary consent be contacted by furnishing their telephone numbers businesses in connection with loan insurance applications, respectively. Gager , at 267; Osorio 1247; see Rules Regulations Implementing F.C.C. Rcd. (ruling “knowing[]” release phone number third party constitutes “express consent” receive calls party TCPA). The courts in those cases found, FCC ruling confirmed, consent kind, which is not given in exchange any consideration, which is not incorporated into binding legal agreement, may by consenting any time. This conclusion is well supported by common law authority, which counsels “[u]pon termination effectiveness is terminated.” R ESTATEMENT (S ECOND ) OF T ORTS § 892A(5) (A M . L AW I NST . 1979). contacted telephone, however, was

not provided gratuitously; it included an express provision contract lease automobile Lincoln. Under such circumstances, “consent,” term is used TCPA, is revocable. law clear another’s actions can “become irrevocable” provided legally binding agreement, R ESTATEMENT (S ECOND ) OF T ORTS § 892A(5) (A M . L AW I NST 1979), case “attempted termination 2104 ‐ effective,” id. at cmt. i. See C ORBIN ON C ONTRACTS § 67.1 (noting “a party who a legal duty [to perform a contractual obligation] by virtue of its assent” burden to prove duty discharged by some subsequent event, such recission by “mutual agreement” by exercise of a contractual right to terminate). This rule derives requirement every provision of a contract—including any proposed modification—receive “mutual assent” every contracting party order legal effect. Dallas Aerospace, Inc. CIS Air Corp. 2003) (“[F]undamental establishment a contract modification proof each element requisite formulation a contract, including mutual assent terms.” (internal quotation marks citation omitted)). It black letter law one may alter bilateral contract by revoking term without counterparty. See R ESTATEMENT (S ECOND ) OF C ONTRACTS § cmt. (A M L AW I NST . 1981) (requiring “assent other party” before proposed alteration contract becomes valid). Yet reading TCPA’s definition “consent” permit unilateral time, suggests, would him do just that. Absent express statutory language contrary, we cannot conclude Congress intended alter law contracts way. Neder, U.S. argues that to be contacted revocable because an “essential term” of lease agreement with Lincoln. This argument meritless. In contract law, “essential terms” are those terms are necessary in order to lend an agreement sufficient detail to be enforceable a court. Brookhaven Hous. Coal. Solomon (2d Cir. 1978) (“If essential terms of agreement are omitted or are phrased too indefinite a manner, no legally enforceable contract will result.”). For example, a contract sale goods must contain terms such as quantity goods be sold price they will be purchased. But contractual term need be “essential” order enforced as part binding agreement. It fundamental rule contracts parties may bind themselves terms, so long basic conditions contract formation (e.g., consideration mutual assent) are met. Chesapeake Energy Corp. Bank N.Y. Mellon Trust Co. 2014) (noting law rule “contract should construed so give full meaning effect all provisions”(alterations, internal quotation marks citation omitted) (emphasis added)). A who agreed particular term valid contract cannot later renege term unilaterally declare longer apply simply because contract been formed without it. Contracting parties are bound perform terms they agree to, what they might agreed to different circumstances. counters that because TCPA remedial statute

enacted protect consumers unwanted calls, ambiguities in its text must construed further purpose. See Atchison, Topeka & Santa Fe Ry. Co. Buell, U.S. (holding when interpreting broad remedial statutes, courts should apply “standard liberal construction in order accomplish [Congress’s] objects” (citation omitted)); E.E.O.C. Staten Island Sav. Bank, 2000) (“[I]t our duty interpret remedial statutes broadly.”). A liberal reading an ambiguous term might favor right contractual consent. But remedial rule statutory interpretation apply, statute must contain actual ambiguity construe in consumer’s favor, we find no lack clarity TCPA’s use term “consent.” It well established time Congress drafted TCPA becomes irrevocable integrated into binding contract, we find indication statute’s text Congress intended deviate ‐ law principle use word “consent.” Neder U.S. We are sensitive argument businesses may undermine effectiveness inserting “consent” No. ‐ ‐ clauses type signed by into standard sales contracts, thereby making impossible many instances. See, e.g., Skinner Bluestem Brands, Inc. 3:14 CV CWR FKB, WL *3 (S.D. Miss. July 8, 2015). But hypothetical concern, if valid, grounded public policy considerations rather than legal ones; if abuse came pass, would therefore “for Congress resolve—not courts.” Atl. City Elec. Co. Gen. Elec. Co. 1962) (en banc). We are free substitute our own policy preferences those legislature reading right contractual into where Congress provided none.

CONCLUSION

We considered remaining arguments, we find them meritless. We therefore AFFIRM judgment court.

[1] “Lincoln Automotive Financial Services” registered trade name Ford Motor Credit Company LLC, independent company.

[2] initially sought damages Fair Debt Collection Practices Act (“FDCPA”), but abandoned those claims prior summary judgment because “debt collection agency” within meaning FDCPA. Only claims remain.

[3] Whatever impact use wrong account number may reasonably assumed attempt revocation, rely fact.