Andy Pincus of Mayer Brown. (Courtesy photo)
Solidifying a growing circuit split in the wake of Spokeo v. Robins, the U.S. Court of Appeals for the Third Circuit held on Monday that a single unsolicited call to a woman’s cellphone was enough harm for her to sue under the U.S. Telephone Consumer Protection Act.
The ruling joins a competing line of circuit decisions attempting to interpret Spokeo, in which the U.S. Supreme Court found that a plaintiff who wants to sue in federal court must allege an injury that is “particularized” and “concrete,” and not just a procedural violation. The issue is critical in class actions where statutory violations are common and the defense bar has accused plaintiffs lawyers of bringing cases where there are no concrete injuries.
“What you’re starting to see is a more well-developed circuit split on the issue, with certain circuits giving the green light to claims of Article III standing based essentially on violations of the provision and not a whole lot more,” said Timothy St. George, a partner at Troutman Sanders in Richmond, Virginia. Those decisions are primarily coming out of the Third and Ninth circuits, while the U.S. Court of Appeals for the Fourth Circuit provided the most defense-oriented decision in its May 11 ruling in Dreher v. Experion Information Solutions, which vacated an $11.7 million judgment in a class action after finding the lead plaintiff failed to allege a concrete injury.
Despite the split, the U.S. Supreme Court is unlikely to take up the matter anytime soon since the rulings are coming out in different contexts and statutes, St. George said.
As in many other decisions, the Third Circuit focused on a part of the Spokeo decision that held a “concrete” injury could be intangible so long as it relied on harm that Congress has recognized, or it bore a “close relationship” to harm recognized in English or U.S. courts.
When enacting the TCPA, Congress had intended to recognize privacy rights and was “not inventing a new theory of injury when it enacted the TCPA,” Judge Thomas Hardiman wrote for a unanimous panel.
“Where a plaintiff’s intangible injury has been made legally cognizable through the democratic process, and the injury closely relates to a cause of action traditionally recognized in English and American courts, standing to sue exists,” he wrote. Hardiman was a finalist this year to fill the U.S. Supreme Court seat left vacant when Justice Antonin Scalia died. He was joined in Monday’s opinion by Judge Cheryl Ann Krause, appointed by President Barack Obama in 2014, and U.S. District Judge Lawrence Stengel of the Eastern District of Pennsylvania, a George W. Bush appointee sitting by designation.
The decision highlights the difficulties the defense bar has faced in bringing Spokeo challenges in TCPA cases, as opposed to those over other federal statutes such as the Fair Credit Reporting Act.
“There is a general trend toward finding that a call that violates the TCPA will withstand scrutiny under Spokeo,” said Joe Dowdy, a partner at Kilpatrick Townsend & Stockton in Raleigh, North Carolina. “But when you have a case more like TCPA, where Congress recognized a harm, and it looks like something one could have sued over before the statute existed, like invasion of privacy, the courts aren’t going to dismiss it on standing grounds.”
The U.S. Chamber of Commerce, which participated in the Third Circuit case’s oral arguments, attempted to bolster the defense’s arguments by outlining the surge of TCPA cases in its amicus brief.
“The TCPA has become a bludgeon used by the plaintiffs’ bar to extract millions of dollars from businesses that inadvertently send text messages or make phone calls in alleged violation of the TCPA’s technical requirements,” wrote the Chamber’s lawyer, Andrew Pincus, a partner in Mayer Brown’s Washington office. Pincus did not respond to a request for comment, nor did defense attorney Joshua Bauchner, co-chairman of the litigation department at Ansell Grimm & Aaron in Woodland Park, New Jersey.
Timothy Sostrin, an attorney at Chicago’s Keogh Law who argued for the plaintiffs, declined to comment beyond stating “we’re pleased with the ruling.”
The case, brought by Noreen Susinno, alleged that a gym called Work Out World Inc. had violated the TCPA when it called her cellphone without her permission and left a prerecorded promotional offer on her voice mail.
U.S. District Judge Peter Sheridan in New Jersey dismissed the case, finding that a single call was “not the type of case that Congress was trying to protect people against.”
The Third Circuit disagreed. In finding concrete injury, the court relied on its Jan. 20 decision in In re: Horizon Healthcare Services Inc. Data Breach Litigation, in which the panel revived a data breach class action after finding the disclosure of personal information was a “cognizable injury” that gave the plaintiffs standing to sue.
Horizon is one of several circuit court decisions cited in the Spokeo case, now on remand before the U.S. Court of Appeals for the Ninth Circuit for further analysis on whether a “concrete” injury existed.
The Ninth Circuit, which heard oral arguments in Spokeo but hasn’t yet ruled in the case, has come out with two additional rulings in Syed v. M-I and Van Patten v. Vertical Fitness Group that sided with the plaintiffs on standing. On June 19, the defense in Syed petitioned the Supreme Court to take up the matter again.
Contact Amanda Bronstad at email@example.com. On Twitter: @abronstadlaw.