Linlor v. Five9, Inc. et al

Filing 37

ORDER granting 29 Defendant's Motion to Dismiss Plaintiff's Second Amended Complaint. The Court GRANTS Five9's Motion to Dismiss Plaintiff's Second Amended Complaint and DISMISSES Plaintiff's claims against Defendant Five9 , Inc. See Knappenberger, 566 F.3d at 942 (stating that leave to amend should be granted unless amendment would be futile). The Clerk of Court is instructed to terminate the action as to Defendant Five9, Inc. Signed by Judge Michael M. Anello on 11/29/2017. (All non-registered users served via U.S. Mail Service)(acc)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 JAMES LINLOR, Case No.: 17cv218-MMA (BLM) Plaintiff, 12 13 v. 14 ORDER GRANTING DEFENDANT'S MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED COMPLAINT FIVE9, INC., et al., 15 Defendants. 16 [Doc. No. 29] 17 18 On February 3, 2017, Defendant Five9, Inc. (“Five9”) removed this action from 19 the Superior Court of California, County of San Diego. See Doc. No. 1. In the Second 20 Amended Complaint (“SAC”), Plaintiff James Linlor, proceeding pro se, alleges 21 Defendants Five9, Futero, Inc. (“Futero”), and other unnamed defendants violated the 22 Telephone Consumer Protection Act, 47 U.S.C. § 227 et seq. (“TCPA”). See Doc. No. 23 27 (“SAC”). Five9 moves to dismiss Plaintiff’s SAC under Federal Rule of Civil 24 Procedure 12(b)(6). See Doc. No. 29-1 (“MTD”). Plaintiff filed an opposition [Doc. No. 25 31 (“Oppo.”)] and Five9 filed a reply [Doc. No. 32 (“Reply”)]. The Court found the 26 matter suitable for determination on the papers and without oral argument pursuant to 27 Civil Local Rule 7.1.d.1. Doc. No. 35. For the reasons set forth below, the Court 28 GRANTS Defendant’s motion to dismiss. 1 17cv218-MMA (BLM) 1 BACKGROUND1 2 The SAC asserts claims for violations of the TCPA against Defendants Five9, 3 Futero, and other unnamed defendants, whom Plaintiff refers to as “John Does #1-#9.” 4 SAC. Plaintiff alleges Five9 “is in the business of providing customer contact center 5 solutions, including, but not limited to, predictive and autodialers, and inbound call 6 management, including toll-free numbers.” SAC, p. 11. Plaintiff alleges that in approximately October 2016, “Defendants began sending 7 8 texts to Plaintiff’s cellular telephone number.” Id. Specifically, Plaintiff alleges he 9 received “[a]t least sixteen (16) text messages . . . during 2016 and 2017.” SAC, pp. 11- 10 12. Plaintiff alleges that the “repetitive nature of the text messages . . . indicate that 11 Defendants’ messages were made using an ‘automatic telephone dialing system,’ as 12 defined by 47 U.S.C. § 227(a)(1).” SAC, p. 12. The SAC states that Five9 “was 13 identified as the teleco operator/agent responsible for toll-free #s 855-790-6802 and 855- 14 579-9182 identified in SMS messages sent to the Plaintiff’s cell phones.” SAC, p. 11. 15 Plaintiff alleges he does not have a relationship with Defendants, did not provide his 16 cellular telephone number to Defendants, and did not consent to be contacted. SAC, p. 17 12. Plaintiff alleges Futero is directly liable for violating the TCPA because it “is 18 19 identified as the text message sender through its SMS . . . shortcode 61869 . . , which is 20 also listed as owned by Futero . . . .” SAC, p. 7. Plaintiff contends Five9 is vicariously 21 liable for violating the TCPA because Five9 provided Futero with the toll-free numbers 22 that sent the text messages to Plaintiff. SAC, p. 2. Plaintiff alleges that Five9 controls or 23 has the right to control “the manner and means of the text message campaign Futero . . . 24 conducted” because Five9 formatted the toll-free numbers given to Futero to permit them 25 26 27 28 1 Because this matter is before the court on a 12(b)(6) motion to dismiss, the Court must accept as true the allegations set forth in the operative complaint. See Hosp. Bldg. Co. v. Trs. of Rex Hosp., 425 U.S. 738, 740 (1976). 2 17cv218-MMA (BLM) 1 “to receive calls, . . . route, or hold, or process calls during inbound burst volumes, . . . 2 [and] pass back caller-ID information or other metadata from Five9 to Futero.” SAC, pp. 3 2-3. Plaintiff further alleges that Five9 receives payment from Futero for this service. 4 SAC, p. 3. Plaintiff contends that Five9 managed the toll-free number inbound calls and 5 profited “from the toll charges while relaying back caller-ID and other caller metadata to 6 Futero.” SAC, p. 13. 7 LEGAL STANDARD 8 A Rule 12(b)(6) motion to dismiss tests the legal sufficiency of the complaint. 9 Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). A pleading must contain “a short 10 and plain statement of the claim showing that the pleader is entitled to relief . . . .” Fed. 11 R. Civ. P. 8(a)(2). However, plaintiffs must also plead “enough facts to state a claim to 12 relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007); 13 Fed. R. Civ. P. 12(b)(6). That is, the pleadings must contain factual allegations 14 “plausibly suggesting (not merely consistent with)” a right to relief. Twombly, 550 U.S. 15 at 557. The plausibility standard thus demands more than a formulaic recitation of the 16 elements of a cause of action, or naked assertions devoid of further factual enhancement. 17 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Instead, the complaint “must contain 18 sufficient allegations of underlying facts to give fair notice and to enable the opposing 19 party to defend itself effectively.” Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011). 20 In reviewing a motion to dismiss under Rule 12(b)(6), courts must assume the truth 21 of all factual allegations and must construe them in the light most favorable to the 22 nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). 23 The court need not take legal conclusions as true merely because they are cast in the form 24 of factual allegations. Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir. 1987). 25 Similarly, “conclusory allegations of law and unwarranted inferences are not sufficient to 26 defeat a motion to dismiss.” Pareto v. FDIC, 139 F.3d 696, 699 (9th Cir. 1998). 27 However, a pro se plaintiff’s complaint, “however inartfully pleaded, must be held to less 28 3 17cv218-MMA (BLM) 1 stringent standards than formal pleadings drafted by lawyers.” Erickson v. Pardus, 551 2 U.S. 89, 94 (2007). Courts must construe such pleadings liberally. Id. 3 Where dismissal is appropriate, a court should grant leave to amend unless the 4 plaintiff could not possibly cure the defects in the pleading. See Knappenberger v. City 5 of Phoenix, 566 F.3d 936, 942 (9th Cir. 2009). 6 DISCUSSION 7 In the SAC, Plaintiff does not allege Five9 is directly liable for violating the 8 TCPA, as Plaintiff admits Five9 did not send the text messages at issue. See SAC, p. 12- 9 13 (stating that Futero sent all of the text messages). Rather, Plaintiff asserts Five9 is 10 vicariously liable for TCPA violations. SAC, p. 1. The Ninth Circuit has assumed that “Congress intended to apply” “ordinary tort- 11 12 related vicarious liability rules” to TCPA claims. See Gomez v. Campbell-Ewald Co., 13 768 F.3d 871, 877 (9th Cir. 2014), aff’d, 136 S.Ct. 663, 674 (2016), as revised (Feb. 9, 14 2016) (deferring also to the Federal Communications Commission’s ruling that there may 15 be vicarious liability for TCPA violations under federal common law agency principles). 16 In other words, a defendant may be vicariously liable for a third-party caller’s TCPA 17 violations where the plaintiff demonstrates an agency relationship between the defendant 18 and the third-party caller. Id. The FCC has instructed that vicarious liability under the 19 TCPA could be established “under a broad range of agency principles, including not only 20 formal agency, but also principles of apparent authority and ratification.” In re DISH 21 Network, LLC, 28 F.C.C. Rcd. 6574, 6584 (2013); see also Gomez, 768 F.3d at 877-78. 22 Plaintiff argues that Five9 may be vicariously liable under three theories: (1) actual 23 authority; (2) apparent authority; and (3) ratification. See Oppo. at 8-10. Five9 moves to 24 dismiss the SAC with prejudice on the grounds that it is not vicariously liable for 25 Futero’s and the other unnamed defendants’ alleged TCPA violations. MTD at 11. 26 1. Actual Authority 27 Under traditional agency principles, “[a]n entity may be liable for actions it did not 28 itself take when the unlawful acts were performed by an agent of the entity.” Henderson 4 17cv218-MMA (BLM) 1 v. United Student Aid Funds, Inc., No. 13CV1845 JLS (BLM), 2017 WL 766548, at *6 2 (S.D. Cal. Feb. 28, 2017) (citing Restatement (Third) of Agency (2006)). “An agency 3 relationship forms ‘when one person (a ‘principal’) manifests assent to another person (an 4 ‘agent’) that the agent shall act on the principal’s behalf and subject to the principal’s 5 control, and the agent manifests assent or otherwise consents so to act.” Trenz v. Sirius 6 Xm Radio, Inc., No. 15CV0044 AJB (NLS), 2015 WL 11658715, at *2 (S.D. Cal. July 7 13, 2015) (quoting France Telecom S.A. v. Marvell Semiconductor Inc., No. 12-cv- 8 04967-WHO, 2015 WL 925892, at *4 (N.D. Cal. Mar. 2, 2015) (citing Restatement 9 (Third) of Agency § 1.01 (2006)). 10 Plaintiff alleges that Five9 had “control or . . . the right to control the manner and 11 means of the text message campaign Futero . . . conducted.” See SAC, p. 2. Specifically, 12 he alleges that Five9 controlled the “formatting of the text message to include a reply 13 mechanism,” and “how toll free numbers would be established, managed, routed/queued 14 for operator response, and caller-ID, other caller data, and statistical data relayed back for 15 QoS and data mining for effectiveness of the text message campaign.” Id. Plaintiff 16 explains that “Futero could not control the manner and means itself—if Futero chose the 17 toll-free number without being directed by Five9 as to what Five9 had set up, then the 18 toll-free number would not function to receive calls, nor to route, or hold, or process calls 19 during inbound burst volumes, nor pass back caller-ID information or other metadata 20 from Five9 to Futero.” SAC, p. 3. 21 “Agency means more than mere passive permission; it involves request, 22 instruction, or command.” Klee v. United States, 53 F.2d 58, 61 (9th Cir. 1931). Plaintiff 23 does not allege that Five9 directed or supervised the manner and means of the text 24 message campaign conducted by Futero or unnamed defendants. He does not allege that 25 Five9 created or developed the content of the text messages, nor that Five9 played any 26 role in sending the text messages beyond provisioning the inbound toll-free number used 27 by Futero or unnamed defendants. See SAC. Plaintiff merely alleges that Five9 provided 28 a toll-free number with specifications permitting replies to the text messages and saving 5 17cv218-MMA (BLM) 1 caller and statistical data. See id. In other words, Plaintiff alleges that Five9 controlled 2 the manner and means of the specifications of the toll-free phone number provided to 3 Futero, not the manner and means of the substantive content of the text messages. This is 4 insufficient to allege that Five9 requested, instructed, or commanded that Futero or 5 unnamed defendants send out the text messages alleged to violate the TCPA. See United 6 States v. Bonds, 608 F.3d 495, 506 (9th Cir. 2010) (“To form an agency relationship, both 7 the principal and agent must manifest assent to the principal’s right to control the 8 agent.”). Thus, Plaintiff has not alleged Five9 had any control over Futero or the 9 unnamed defendants for sending the text messages, nor that they acted in any way on 10 Five9’s behalf. Because Plaintiff fails to allege an agency relationship, he also fails to 11 allege that Five9 had express or actual authority over the entity that sent the alleged text 12 messages. 13 2. Apparent Authority Apparent authority “can only ‘be established by proof of something said or done 14 15 by the [alleged principal], on which [the plaintiff] reasonably relied’” to the plaintiff’s 16 detriment. Thomas v. Taco Bell Corp., 582 Fed. App’x 678, 679 (9th Cir. 2014) (quoting 17 NLRB v. Dist. Council of Iron Workers of Cal. & Vicinity, 124 F.3d 1094, 1099 (9th Cir. 18 1997)). Plaintiff argues that apparent authority exists because “[a]fter Futero composed 19 the text message to be sent out via Futero’s shortcode, Five9 still had to ratify and 20 approve the toll-free number as being the correct number that Futero had included per 21 Five9’s direction.” SAC, p. 5; see Oppo. at 9. Plaintiff does not allege that he relied to 22 his detriment on something Five9 did or said with respect to Futero’s or the unnamed 23 defendants’ authority to send the text messages. See Thomas, 582 Fed. App’x at 679-80. 24 As a result, Plaintiff fails to allege that Futero or the unnamed defendants acted with 25 apparent authority. 26 3. 27 28 Ratification “Although a principal is liable when it ratifies an originally unauthorized tort, the principal-agent relationship is still a requisite, and ratification can have no meaning 6 17cv218-MMA (BLM) 1 without it.” Batzel v. Smith, 333 F.3d 1018, 1036 (9th Cir. 2003). As discussed above, 2 Plaintiff fails to sufficiently allege a principal-agent relationship. Therefore, Plaintiff 3 cannot allege ratification. CONCLUSION 4 5 Based on the foregoing, the Court GRANTS Five9’s Motion to Dismiss Plaintiff’s 6 Second Amended Complaint and DISMISSES Plaintiff’s claims against Defendant 7 Five9, Inc. See Knappenberger, 566 F.3d at 942 (stating that leave to amend should be 8 granted unless amendment would be futile). The Clerk of Court is instructed to terminate 9 the action as to Defendant Five9, Inc. 10 IT IS SO ORDERED. 11 Dated: November 29, 2017 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7 17cv218-MMA (BLM)

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