Freeman et al v. Wilshire Commercial Capital L.L.C.

Filing 100

ORDER signed by Senior Judge William B. Shubb on 3/6/18, ORDERING that plaintiffs' 73 Motion for Summary Judgment is DENIED, and defendant's 72 Motion to Deny Class Certification is DENIED. (Kastilahn, A)

Download PDF
1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 12 13 VERINA FREEMAN and VALECEA DIGGS, individually and on behalf of all others similarly situated, Plaintiffs, 14 v. 15 16 17 CIV. NO. 2:15-1428 WBS AC MEMORANDUM AND ORDER RE: DEFENDANT’S MOTION TO DENY CLASS AND PLAINTIFFS’ MOTION FOR SUMMARY JUDGMENT WILSHIRE COMMERCIAL CAPITAL L.L.C., a California limited liability company, dba WILSHIRE CONSUMER CREDIT, 18 Defendant. 19 Verina Freeman (“Freeman”) and Velecea Diggs (“Diggs”) 20 21 (collectively “plaintiffs”) initiated this class action against 22 defendant Wilshire Commercial Capital, L.L.C. (“WCC”) alleging 23 violations of the Telephonic Consumer Protection Act (“TCPA”), 47 24 U.S.C. § 227. 25 to Deny Class Certification (Docket No. 72) and plaintiffs’ 26 Motion for Partial Summary Judgment (Docket No. 73.) 27 I. 28 Presently before the court is defendant’s Motion Factual and Procedural Background Non-party Shanell White (“White”) procured an 1 1 automobile title loan from defendant on January 13, 2009. 2 of Ana Vela (“Vela Decl.”) (Docket No. 72-4) ¶ 5.) 3 application required that White list references, for which she 4 provided the names and cell phone numbers of Freeman and Diggs. 5 (Id.) 6 throughout the putative class period. 7 (“FAC”) (Docket No. 40) ¶ 23.) 8 White became delinquent. 9 Decl.”) (Docket No. 72-2) ¶ 16.) (Decl. The loan Freeman and Diggs had no relationship with defendant (First Amended Compl. During the course of her loan, (Decl. of Bryan McGuire (“McGuire In the course of collection 10 efforts, between December 17, 2010 and November 29, 2011, 11 defendant allegedly called Freeman nine times and Diggs five 12 times in an effort to locate and collect money from White. 13 Plaintiffs initiated this case on July 6, 2015. (Id.) In 14 November 2015, the court stayed the case pending the resolution 15 of defendant’s motion in a separate, but similar, matter. 16 (Docket No. 19.) 17 “to conduct limited discovery on the issue of the dialing system 18 that defendant used to call plaintiffs and the putative class 19 members in this action.” 20 lifted the stay. 21 ordered that prior to class discovery and any motion for class 22 certification, the parties would first brief the threshold issues 23 of (1) “plaintiffs’ Article III Standing” and (2) “the alleged 24 capacity of defendant’s Automatic Telephone Dialing System to 25 make autodialed calls to plaintiffs and proposed class members.” 26 (Docket No. 38.) 27 for Summary Judgment due to Lack of Article III Standing of 28 Plaintiffs (Docket No. 42), which the court denied. In the meantime, the court allowed the parties (Id.) On April 11, 2016, the court (Docket No. 28.) In September 2016, the court On January 19, 2017, defendant filed a Motion 2 (Docket No. 1 58.) 2 II. Defendant’s Motion to Deny Class Certification 3 “At an early practicable time after a person sues or is 4 sued as a class representative, the court must determine by order 5 whether to certify the action as a class action.” 6 P. 23(c)(1)(A). 7 plaintiffs with the exclusive right to put the class 8 certification issue before the district court or prohibits a 9 defendant from seeking early resolution of the class Fed. R. Civ. Nothing in the federal rules “either vests 10 certification question.” 11 571 F.3d 935, 939-40 (9th Cir. 2009). 12 “per se rule that precludes defense motions to deny 13 certification, and Plaintiffs have produced no authority to the 14 contrary.” 15 Vinole v. Countrywide Home Loans, Inc., Accordingly, there is no Id. at 940. However, the Vinole court also determined that these 16 types of “preemptive” motions should not be brought or ruled upon 17 until the plaintiff has had a reasonable opportunity to conduct 18 class discovery. 19 Circuit allowed defendant to bring a motion to deny class 20 certification prior to plaintiff filing a motion to certify a 21 class, it did so in light of the fact that “[p]laintiffs were 22 provided with adequate time in which to conduct discovery related 23 to the question of class certification.” 24 Id. at 942. In that case, although the Ninth Id. Here, the court has repeatedly made it clear in 25 numerous status orders that the issues of Article III standing 26 and phone capacity are to be resolved prior to class 27 certification. 28 and 69 at 3-6.) (See Docket Nos. 52 at 3-5, 72 at 3-6, 67 at 3-6, At this point, defendant has not produced 3 1 discovery beyond these two threshold issues. 2 1, 2017, defendant objected to plaintiffs’ document requests, 3 arguing that the “request is overly broad in that it extends 4 beyond the discovery permitted at this stage of litigation as it 5 seeks information beyond telephone calls made to the PLAINTIFFS.” 6 (Decl. of Elliot Conn (“Conn Decl.”), Ex. 3 (Docket No. 87-3).) 7 Notably, on March Prior to a Rule 23 Motion seeking class certification, 8 the parties are entitled to conduct discovery in order to provide 9 the court with evidence to either support or refute the requested 10 certification. 11 on the information above, the court concludes that plaintiffs 12 have not been given the opportunity to engage in the necessary 13 class discovery. 14 210 (9th Cir. 1975) (“The propriety of a class action cannot be 15 determined in some cases without discovery.”) 16 court concludes that defendant’s motion is premature and should 17 be denied.1 18 III. Plaintiffs’ Motion for Partial Summary Judgment 19 A. See Vinole, 571 F.3d 935 at 942. However, based See Kamm v. Cal. City Dev. Co., 509 F.2d 205, Therefore, the Legal Standard 20 21 22 23 24 25 26 27 28 1 The court also notes that defendant seeks denial of class certification because plaintiffs “cannot demonstrate that an auto-dialer was ever utilized to call them.” (Def.’s P. & A. in Supp. of Mot. to Deny Class Cert. (Docket No. 72-1) at 19.) However, “neither the possibility that a plaintiff will be unable to prove his allegations, nor the possibility that the later course of the suit might unforeseeably prove the original decision to certify the class wrong, is a basis for declining to certify a class.” Blackie v. Barrack, 542 F.2d 891, 901 (9th Cir. 1975). Accordingly, by asking the court to determine whether or not an auto-dialer was in fact used to call plaintiffs, defendant is seeking to obtain a ruling on the merits, which is inappropriate at this stage. 4 1 Summary judgment is proper “if the movant shows that 2 there is no genuine dispute as to any material fact and the 3 movant is entitled to judgment as a matter of law.” 4 P. 56(a). 5 of the suit, and a genuine issue is one that could permit a 6 reasonable jury to enter a verdict in the non-moving party’s 7 favor. 8 (1986). Fed. R. Civ. A material fact is one that could affect the outcome Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 9 The party moving for summary judgment bears the initial 10 burden of establishing the absence of a genuine issue of material 11 fact and can satisfy this burden by presenting evidence that 12 negates an essential element of the non-moving party’s case. 13 Celotex Corp. v. Catrett, 477 U.S. 317, 322–23 (1986). 14 Alternatively, the movant can demonstrate that the non-moving 15 party cannot provide evidence to support an essential element 16 upon which it will bear the burden of proof at trial. 17 inferences drawn from the underlying facts must, however, be 18 viewed in the light most favorable to the party opposing the 19 motion. 20 U.S. 574, 587 (1986). 21 B. 22 Id. Any Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 Discussion In order to prove that defendant violated the TCPA, 23 there are three elements plaintiffs need to prove: “(1) the 24 defendant called a cellular telephone number; (2) using an 25 automatic telephone dialing system; (3) without the recipient’s 26 prior express consent.” 27 LLC, 707 F.3d 1036, 1043 (9th Cir. 2012). 28 issue is whether defendant used an “automatic telephone dialing Meyer v. Portfolio Recovery Assocs., 5 Here, the element at 1 system” to call plaintiffs. 2 that, as a matter of law, defendant did in fact use this type of 3 phone system, and thereby violated the TCPA. 4 Plaintiffs ask the court to find It is undisputed that defendant used two different 5 dialing systems to place its phone calls--an Aspect Unified IP 6 6.6 Predictive Dialer (“Aspect”) and an Avaya PBX (“Avaya”). 7 Avaya is a manual dialer system whereas the Aspect is, 8 undeniably, an automatic telephone dialing system, also known as 9 an auto-dialer system. The (Decl. of Jose Hernandez (“Hernandez 10 Decl.”) (Docket No. 72-3) ¶¶ 7, 8.) Thus, the question for the 11 court is whether defendant used the Aspect to call plaintiffs. 12 A. Defendant’s Phone Records 13 Defendant uses a system known as Daybreak to record all 14 account activity, including all phone calls made as part of 15 collection efforts. 16 automatically generated and instead are inputted manually by 17 defendant’s employees. 18 error, defendant also relies upon automatically generated call 19 records to maintain a more accurate log of all calls placed. 20 (Hernandez Decl. ¶ 18.) 21 automatically recorded in a database system called “ECAS.” 22 ¶ 14.) 23 calls as well, but those records are only maintained for fifteen 24 days. 25 the invoice records of defendant’s phone carrier, 26 Paetec/Windstream (“Windstream records”). 27 records only include phone calls that are picked up either by a 28 person, an answering machine, or a voicemail. (McGuire Decl. ¶ 3.) (Id. ¶ 8.) Daybreak notes are not To catch any potential human Calls made through the Avaya system are (Id. The Aspect system generates an automatic record of phone (Id.) All calls made on either system are reflected in 6 (Id.) However, these (Id. ¶¶ 12, 13.) 1 If the phone call is not picked up on the receiving end, there 2 will not be a corresponding charge reflected in the Windstream 3 records. (Id. ¶ 13.) 4 B. Calls to Freeman 5 Plaintiffs allege that defendant placed at least nine 6 calls to Freeman. 7 (Docket No. 42-3) ¶ 5.) 8 Daybreak. 9 calls were placed with the Avaya system, and the other four were (Id.) (Decl. of James Eyraud (“Eyraud Decl.”) All of these calls are recorded in Plaintiff further alleges that five of those 10 placed with the Aspect. Plaintiff argues that there are four 11 calls recorded in Daybreak for which there are no corresponding 12 entries in ECAS, the database that records all calls placed using 13 Avaya. 14 have been made using the Aspect system. 15 of Mot. for Summ. J. (Docket No. 73) at 7.)2 Based on this fact, plaintiff avers that these calls must 16 (Pls.’ P. & A. in Supp. However, defendant raises several doubts as to whether 17 this is true. Specifically, defendant points out that the 18 Daybreak notes are recorded manually and are consequently subject 19 to error. 20 but does not appear in the Avaya record, it is possible that the 21 call was not in fact placed using the Aspect system but in fact Therefore, if a call is listed in the Daybreak records 22 23 24 25 26 27 28 2 Defendant points out that plaintiffs base most of these conclusions on the expert report of Jeffrey Hansen, which defendant claims is inadmissible because it is based on “simple logic.” However, defendant does not dispute the underlying records that Hansen’s report is based on, and thus the court need not determine whether or not the report itself is admissible because the court can analyze the admissible records themselves. Accordingly, even if the report were stricken, it would have no impact on the court’s analysis or decision. 7 1 was not placed at all, and the call was only listed in Daybreak 2 because of human error.3 3 appears in Daybreak but was not in the Avaya records, plaintiffs 4 conclude that the call must have been placed using Aspect, but, 5 alternatively, the call could simply not have been placed at all. 6 Plaintiffs argue that defendant previously provided the In other words, for each call that 7 court with a declaration in which defendant’s vice president 8 admitted that the Daybreak notes demonstrate that defendant 9 called Freeman nine times. (Eyraud Decl. ¶ 5.) Based on this, 10 plaintiffs argue that defendant cannot now claim that these calls 11 were never made. 12 present this argument would contradict defendant’s earlier 13 declaration, and therefore would violate Daubert v. NRA Group, 14 LLC, 861 F.3d 382, 391 (3d Cir. 2017)(“When a nonmovant’s 15 affidavit contradicts earlier deposition testimony without a 16 satisfactory or plausible explanation, a district court may 17 disregard it at summary judgment in deciding if a genuine, 18 material factual dispute exists.”). 19 Plaintiffs aver that allowing defendant to However, the Daubert court explained that it only 20 intended to prohibit subsequent “sham” declarations, and the 21 court here does not find that defendant is presenting a sham 22 declaration, nor even one that is contradictory to a previously 23 made statement. 24 Daybreak records do not list these nine calls, but instead is 25 simply disputing the accuracy of those records. 26 27 28 3 Defendant is not attempting to claim that the It is possible, Defendant admits that it previously had issues with its employees entering false notes or inaccurate entries, and in fact had to discipline multiple employees for “padding” the records to receive certain incentives. (Vela Decl. ¶ 16.) 8 1 and indeed the case here, for defendant to admit both that the 2 Daybreak records reflect that a certain number of calls were 3 made, and also to simultaneously argue that, despite what these 4 records may indicate, these calls were not in fact ever made. 5 Therefore, the court concludes that defendant’s previous 6 declaration does not preclude defendant from now suggesting that 7 the Daybreak notes are not accurate. 8 9 Defendant also points out that there are some Daybreak records indicating that a phone call was made and answered, and 10 yet there is no corresponding entry in Windstream. 11 argue that the fact that these phone calls do not appear in the 12 Windstream records proves that the subject calls were not made. 13 However, Windstream records are only generated for calls that are 14 answered. 15 Windstream records is insufficient to prove that the calls were 16 not placed, although it does add more weight to defendant’s 17 arguments. 18 would appear in the Windstream records, and yet they do not. 19 defendant’s employees could have mistakenly indicated in Daybreak 20 that a call was answered when it was not, then it is plausible 21 that the same employees could have indicated that a call was 22 placed when in reality no such call was made. 23 plaintiff seemingly must concede that at least a portion of the 24 Daybreak records are incorrect, a reasonable trier of fact could 25 find that the Daybreak records are inaccurate and do not 26 correctly reflect whether certain calls were made. 27 28 Defendants Accordingly, the omission of the calls from the Inarguably, if the calls had been answered, they If Therefore, because Plaintiffs argue that the court should not be able to consider the Windstream records because they are inadmissible 9 1 hearsay. 2 (Docket No. 91) at 3.) 3 that telephone records are business records, and that an 4 automatically generated record of a telephone call is admissible 5 evidence. 6 1989), abrogated on other grounds by Fla. V. White, 526 U.S. 559 7 (1999). 8 Administrator, declared that he was able to access and search all 9 Windstream invoices and that these records were kept as part of (Pls.’ Reply P. & A. in Supp. of Mot. for Summ. J. However, the Ninth Circuit has concluded United States v. Linn, 880 F.2d 209, 216 (9th Cir. Further, Hernandez, a WCC Telecommunications 10 WCC’s regular business practices. 11 (Docket No. 90-3) ¶¶ 15-20.) 12 consider the Windstream records, it would nonetheless conclude 13 that defendant has raised sufficient doubts regarding whether the 14 Aspect was used. 15 (Decl. of Jose Hernandez Moreover, even if the court did not Accordingly, the court concludes that a genuine, 16 material factual dispute exists as to whether defendant did in 17 fact use the Aspect system to call Freeman. 18 C. Calls to Diggs 19 Plaintiffs allege that defendant placed at least five 20 calls to Diggs, that only one of those calls was placed with the 21 Avaya system, and that the other four were placed with the 22 Aspect. 23 same reasoning explained above. 24 court again finds that defendant has raised sufficient doubts as 25 to whether defendant in fact used the Aspect system to call 26 Diggs, and thus a dispute of material facts exists. 27 28 In reaching this conclusion, plaintiffs rely upon the As with the Freeman calls, the IT IS THEREFORE ORDERED that plaintiffs’ Motion for Summary Judgment (Docket No. 73) be, and the same hereby is, 10 1 DENIED. 2 IT IS FURTHER ORDERED that defendant’s Motion to Deny 3 Class Certification (Docket No. 72) be, and the same hereby is, 4 DENIED. 5 Dated: March 6, 2018 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 11

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?