UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
October 17, 2005
WILLIAM ADLER, ET AL., PLAINTIFFS,
VISION LAB TELECOMMUNICATIONS, INC., ET AL., DEFENDANTS.
The opinion of the court was delivered by: Ellen Segal Huvelle United States District Judge
William Adler and five other plaintiffs allege that they received unsolicited and improperly identified faxes from Vision Lab Telecommunications, Inc. and eight other defendants in violation of the Telephone Consumer Protection Act ("TCPA"), 47 U.S.C. § 227 (Counts I and II), and the District of Columbia Consumer Protection and Procedures Act ("DCCPPA"), D.C. Code § 28-3904 (Count III). Plaintiffs also claim that defendants are liable for the common law torts of negligence (Count IV) and invasion of privacy (Count V). Defendants have moved for judgment on the pleadings pursuant to Fed. R. Civ. P. 12(c), arguing that plaintiffs have failed to state a claim for each of the five counts.
I. Standard of Review
The standard of review under Rule 12(c) is essentially the same as that for a motion to dismiss under Rule 12(b)(6). Jung v. Assoc. of Am. Med. Colleges, 339 F. Supp. 2d 26, 35-36 (D.D.C. 2004). Thus, dismissal is appropriate only where a defendant has shown "'beyond doubt that the plaintiff can prove no set of facts in support of [their] claim which would entitle [them] to relief.'" In re Swine Flu Immunization Prods. Liab. Litig., 880 F.2d 1439, 1442 (D.C. Cir. 1989) (quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1955)). The allegations in plaintiffs' complaint are presumed true and all reasonable factual inferences should be construed in their favor. Maljack Prods., Inc. v. Motion Picture Ass'n of Am., Inc., 52 F.3d 373, 375 (D.C. Cir. 1995); Phillips v. Bureau of Prisons, 591 F.2d 966, 968 (D.C. Cir. 1979).
II. TCPA Claims
The TCPA prohibits the transmission of unsolicited fax advertisements and of faxes that do not contain certain identifying information.*fn1 47 U.S.C. §§ 227(b)(1)(C), (d)(2). Count I alleges that defendants violated the TCPA by sending faxes to plaintiffs "without prior express invitation or permission" (Am. Compl. ¶ 55), while Count II alleges that defendants violated the TCPA by failing to provide proper identification. (Id. ¶ 58.) Defendants argue that these counts must fail because no private right of action exists for either of these violations.
A. Count I: Unsolicited Faxes
Under the TCPA, a recipient of an unsolicited fax may assert a private right of action in state court*fn2 if "otherwise permitted by the laws of a State." 47 U.S.C. § 227(b)(3).*fn3 Courts interpreting this ambiguous phrase have differed, with most concluding that the term simply "acknowledges the principle that states have the right to structure their own court systems and that state courts are not obligated to change their procedural rules to accommodate TCPA claims" or that a private right of action exists as long as a state has not "opted out" of the federal scheme, although others have found that no right exists unless a state has affirmatively "opted in." Schulman v. Chase Manhattan Bank, 268 A.D. 2d 174, 179 (N.Y. App. Div. 2000).
For example, in Portuguese-American Leadership Council of the U.S., Inc. v. Investors' Alert, Inc., Case No. 01-CA-3479 (D.C. Super. Ct., July 22, 2003), a D.C. Superior Court judge held that D.C. must "opt in" to allow its citizens a private right of action under the TCPA. Defendants argue that D.C. is therefore an opt-in state and, since it has not "pass[ed] legislation or promulgate[d] court rules consenting to state court actions based on the TCPA," plaintiffs' claim must fail. (See Defs.' Rule 12(c) Mot. for J. on the Pleadings ["Mot."] at 4 (quoting Autoflex Leasing, Inc. v. Mfrs. Auto Leasing, Inc., 16 S.W.3d 815, 817 (Tex. App. 2000)).) However, more recent cases have disagreed with Portuguese-American and have rejected the opt-in approach. See Adler v. Advanced Wireless Cellular Comm., Inc., No. 01-SC-12944 (D.C. Super. Ct. July 6, 2005) (rejecting the opt-in approach and finding that the D.C. Superior Court has jurisdiction over claims brought under the TCPA); Morris v. Fax.com, Inc., No. 03-CA-1109 (D.C. Super. Ct. Dec. 19, 2003) (same); City Lights Sch., Inc. v. T-Mobile USA, Inc., No. 03-CA-2780 (D.C. Super. Ct. Nov. 18, 2003) (same). The Portuguese-American decision also runs counter to state court decisions in California, Florida, Pennsylvania, New Jersey, New York, Missouri, Maryland, Georgia, and Texas, all of which have rejected the opt-in approach. See Kaufmann v. ACS Sys. Inc., 110 Cal. App. 4th 886 (Cal. App. 2d. Dist. 2003); Condon v. Office Depot, Inc., 855 So. 2d 644 (Fla. Dist. Ct. App. 2003); Aronson v. Fax.com, Inc., 51 Pa. D.&C. 4th 421 (Pa. Ct. Com. Pl. 2001); Zelma v. Market USA, 778 A.2d 591 (N.J. Super. Ct. App. Div. 2001); Schulman, 268 A.D. 2d 174; Reynolds v. Diamond Foods & Poultry, Inc., 79 S.W.3d 907 (Mo. 2002); R.A. Ponte Architects v. Investors' Alert, Inc., 857 A.2d 1 (Md. 2004); Hooters of Augusta, Inc. v. Nicholson, 537 S.E.2d 468 (Ga. Ct. App. 2000); Chair King, Inc. v. GTE Mobilnet of Houston, Inc., 135 S.W.3d 365 (Tex. App. 2004). Nor has any federal appellate court ever adopted the opt-in approach. See Robert R. Biggerstaff, State Courts and the Telephone Consumer Protection Act of 1991: Must States Opt-In? Can States Opt-Out?, 33 Conn. L. Rev. 407, 415 (2001).
Given the persuasive reasoning of the many cases cited above that have rejected the notion that states must take affirmative action to provide their citizens with a forum for TCPA claims, the Court concludes that plaintiffs may bring an action against defendants for a violation of § 227(b).*fn4 Defendants' motion to dismiss Count I will therefore be denied.
B. Count II: Improperly Identified Faxes
Count II asserts a cause of action based on regulations promulgated by the Federal Communications Commission ("FCC") pursuant to the TCPA, which require that faxes properly identify the individual or entity sending the faxed message and the number of the sender. 47 C.F.R. § 68.318(d). Defendants contend the TCPA does not provide a private right of action for such a claim. Based on the plain language of the statute, the Court agrees. The private right of action established by § 227(b)(3) limits the right to "an action based on a violation of this subsection [i.e., subsection (b)] or the regulations prescribed under this subsection." 47 U.S.C. § 227(b)(3) (emphasis added). The regulations cited by plaintiffs, however, were issued pursuant to a directive in § 227(d).*fn5 See Rules and Regulations Implementing the Telephone Consumer Protection Act (TCPA) of 1991, 68 Fed. Reg. 44144, 44170 (July 25, 2003) (citing § 227(d) as authority for 47 U.S.C. § 68.318(d)).*fn6 Section 227(b) deals with unsolicited faxes, not improperly identified faxes. A private right of action exists only with respect to the former. See 47 U.S.C. § 227(d) (omitting any mention of a private right of action). Thus, Count II must be dismissed for lack of subject matter jurisdiction.*fn7
III. Count III: D.C. Consumer Protection Procedures Act
Defendants argue that the Court should dismiss Count III because plaintiffs are not consumers of defendants' services (Mot. at 9) or, in the alternative, because plaintiffs have failed to allege any substantive violation of the DCCPPA. (Id. at 10.)
The DCCPPA regulates transactions between a consumer and a merchant. D.C. Code § 28-3904. See Indep. Commc'ns Network, Inc. v. MCI Telecomms. Corp., 657 F. Supp. 785, 787 (D.D.C. 1987) (DCCPPA "was intended to apply only to trade practices arising out of the supplier-purchaser relationship")(citing Howard v. Riggs Nat'l Bank, 432 A.2d 701, 709 (D.C. 1981); see also Slaby v. Fairbridge, 3 F. Supp. 2d 22, 27 (D.D.C. 1998). A "consumer" is "a person who does or would purchase, lease (from), or receive consumer goods or services, . . . or a person who does or would provide the economic demand for a trade practice." D.C. Code § 28-3901(a)(2). A "merchant" is "a person who does or would sell, lease (to), or transfer, either directly or indirectly, consumer goods or services, or a person who does or would supply the goods or services which are or would be the subject matter of a trade practice." Id. § 28-3901(a)(3). The Act defines a "trade practice" as "any act which does or would create, . . . make available . . . or effectuate, a sale, lease, or transfer of consumer goods or services." Id. § 28-3901(a)(6). Finally, "goods and services" are defined broadly as "any and all parts of the economic output of society, at any stage or related or necessary point in the economic process . . . ." Id. § 28-3901(a)(7). A merchant need not be the "actual seller of the goods or services" complained of, but must be "connected with the 'supply' side of the consumer transaction." Save Immaculata/Dunblane, Inc. v. Immaculata Prep. Sch., 514 A.2d 1152, 1159 (D.C. 1986). Thus, parties providing recommendations of the goods or services of a particular merchant to the consumer assume liability only when they are involved in supply side of the transaction. See Calvetti v. Antcliff, 346 F. Supp. 2d 92, 104-05 (D.D.C. 2004) (Antcliff's involvement beyond the recommendation of a particular contractor, in which he obtained supplies and contracts with vendors and agreed to oversee and monitor the contractor's work, placed him on the supply side of the transaction and within the scope of the DCCPPA); Howard, 432 A.2d at 710 (Riggs Bank employee's recommendation of a contractor to perform home repair did not fall under DCCPPA because Riggs was not a "merchant").
Defendants argue that because plaintiff did not purchase, lease, or receive any goods or services from defendants, there is no consumer-merchant relationship, for "Defendants' own clients [whose faxes are transmitted by Vision Lab or who use Vision Lab's services to transmit their own faxes] -- not Plaintiffs -- are consumers of Defendants' fax transmission services." (Mot. at 10.) Rather than addressing the issue of whether plaintiffs are indeed "consumers" of defendants' services, plaintiffs argue that Vision Lab has "the most direct contact with consumer," and therefore should fall within the DCCPPA's definition of a "merchant." (Pls.' Resp. in Opp'n to Defs.' Mot. ["Opp'n"] at 12.) They suggest that permitting "intermediaries" to avoid liability will allow "the actual vendors who engage in unfair or deceptive trade practices . . . to insulate themselves from liability." (Id.)
Plaintiffs' argument is misplaced. As long as an entity falls within the definition of a "merchant," the "actual vendor"-- whether it transmits its information through an "intermediary" or directly to the injured consumer-- will remain liable for DCCPPA violations. Moreover, the issue is not whether defendants have had "the most direct contact" with plaintiffs (id.), but rather whether plaintiffs "purchase[d], lease[d] . . . or receive[d] . . . services" from defendants, D.C. Code § 28-3901(a)(2), which they have not.
As discussed above, there is a federal statute which allows plaintiffs to sue defendants for transmitting faxes without express permission. The Court sees no need to extend the already broad reach of the DCCPPA to allow plaintiffs to challenge conduct that is already covered by federal law.*fn8
IV. Count IV: Negligence
To state a claim of negligence, plaintiffs must first identify a duty that defendants have breached. Jarret v. Woodward Bros., Inc., 751 A.2d 972, 977 (D.C. 2000). In Count IV, plaintiffs allege that defendants violated a duty not to send unsolicited faxes to plaintiffs, a duty to check and verify the numbers to which defendants send faxes, and a duty not to call plaintiffs in the early morning hours. (Am. Compl. ¶¶ 21, 63-64.) Defendants contend that this claim duplicates Count I and "is based upon non-existent duties." (Mot. at 13.)
Although a D.C. Superior Court judge refused to dismiss a negligence claim based on unsolicited faxes in Morris v. Fax.com, Inc., No. 03-CA-1109 (D.C. Sup. Ct. June 13, 2003), stating that plaintiff would "have a difficult time proving that the defendants owed her any duty of care," whether a duty exists is a question of law. Hoehn v. United States, 217 F. Supp. 2d 39, 45 (D.D.C. 2002). Other than Morris (which contains no analysis of the issue), plaintiffs have not pointed to any authority that might support the existence of the alleged duties. These duties would arise only from the TCPA's statutory proscriptions and not from any duty recognized in the common law.*fn9 Accordingly, Count IV must be dismissed. Accord Chair King, Inc., 135 S.W.3d at 395-96 (sending unsolicited faxes does not give rise to a common law claim of negligence).
V. Invasion of Privacy (Count V)
Count V alleges that defendants' conduct was "an intentional intrusion into Plaintiff Adler's private place and affairs." (Am. Compl. ¶ 67.) To prove a tort of "intrusion upon seclusion,"*fn10 plaintiffs must show, inter alia, that defendants' conduct would be "highly offensive to an ordinary, reasonable person." Danai v. Canal Square Assocs., 862 A.2d 395, 399-400 (D.C. 2004) ("'One who intentionally intrudes, physically or otherwise, upon the solitude or seclusion of another or his private affairs or concerns, is subject to liability to the other for invasion of his privacy, if the intrusion would be highly offensive to a reasonable person.'") (quoting Restatement (Second) of Torts § 652B (1977)). Plaintiffs claim that "[d]efendants' repeated intrusions and conversion of Plaintiff [Adler]'s paper and toner and used [sic] of his machine, particularly at early morning hours, would be highly offensive to a reasonable person." (Id. ¶ 68.) Defendants challenge this conclusion, claiming that Adler has no privacy interest in his fax machine, paper, or toner, and that he has waived such an interest, if any, by leaving his fax machine on. (Reply at 8.) Plaintiffs maintain that defendants are merely disputing the facts of the case, which have not yet been fully developed and must at this stage be construed in plaintiffs' favor. (Opp'n at 13-14.) See Maljack Prods., Inc., 52 F.3d at 375.
In Danai, the Court of Appeals for the District of Columbia adopted the approach to "intrusion upon seclusion" found in the Restatement (Second) of Torts § 652(B). 862 A.2d at 399. Section 652(B) recognizes that repeated phone calls may in some circumstances constitute an invasion of privacy. While "there is no liability for knocking at the plaintiff's door, or calling him to the telephone on one occasion or even two or three, to demand payment of a debt . . .[,] when the telephone calls are repeated with such persistence and frequency as to amount to a course of hounding the plaintiff, that becomes a substantial burden to his existence, . . . his privacy is invaded." Restatement (Second) of Torts, § 652(B) cmt. d; see also id. cmt. b, illus. 5 (telephone calls made at meal times, late at night, and at other inconvenient times, every day for a month, after a request to desist, would constitute intrusion upon seclusion). Likewise, in extreme circumstances, sending unauthorized fax advertisements may be an intrusion upon seclusion. See generally Int'l Sci. & Tech. Inst. v. Inacom Commc'ns, 106 F.3d 1146, 1150 (4th Cir. 1997) (discussing legislative history of TCPA, which states that TCPA seeks to protect the privacy interests of residential telephone subscribers by restricting unsolicited phone and fax calls); see also Universal Underwriters Ins. Co. v. Lou Fusz Auto. Network, Inc., 401 F.3d 876, 881-82 (8th Cir. 2005) (unsolicited faxes were an "injury" within the meaning of an insurance contract because they invaded insured's privacy); Missouri ex rel. Nixon v. Am. Blast Fax, Inc., 323 F.3d 649, 657 n.5 (8th Cir. 2003) ("Artificial or prerecorded messages, like a faxed advertisement, were believed [by Congress] to have heightened intrusiveness because they are unable to 'interact with the customer except in preprogrammed ways.'") (quoting S. Rep. No. 102-178, at 4-5 (1991)), as reprinted in 1991 U.S.C.C.A.N. 1968, 1972. Although Adler may have difficulty proving that defendants' faxes were a frequent enough intrusion to be highly offensive to a reasonable person, the Court cannot at this stage conclude that his claim must be dismissed.*fn11
For the reasons stated above, the Court will dismiss Counts II, III, and IV, but Counts I and V will remain. A separate Order accompanies this Memorandum Opinion.