Bouton v. Ocean Properties, Ltd.

Filing 358

ORDER granting in part and denying in part 298 Motion to Exclude;granting in part and denying in part 300 Motion to Strike ; granting in part and denying in part 324 Motion for Summary Judgment; granting in part and denying in part 325 Motion for Summary Judgment; granting 326 Motion for Summary Judgment. Signed by Judge Beth Bloom on 10/23/2017. (men)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 16-cv-80502–BLOOM/Valle

JUSTIN BOUTON,
Plaintiff,
vs.
OCEAN PROPERTIES, LTD, et al.,
Defendants.
_________________________________/
OMNIBUS ORDER ON MOTIONS FOR SUMMARY JUDGMENT
AND DAUBERT MOTIONS TO EXCLUDE EXPERT TESTIMONY
THIS CAUSE is before the Court upon Plaintiff Justin Bouton’s Daubert Motion to
Exclude Defendant’s Proposed Expert Testimony, ECF No. [298] (“Plaintiff’s Daubert
Motion”), Defendants’ Motion to Strike Plaintiff’s Expert Witness Don Coker, ECF No. [300]
(“Defendants’ Daubert Motion”), Oprock Jupiter Fee, LLC and Oprock Jupiter TRS, LLC’s
(collectively “Oprock Defendants”) Motion for Summary Judgment, ECF No. [324] (“Oprock
Defendants’ Motion”), Defendant GHM Jupiter, LLC’s Motion for Summary Judgment, ECF
No. [325] (“GHM’s Motion”), and Defendant Ocean Properties, Ltd.’s Motion for Summary
Judgment, ECF No. [326] (“OPL’s Motion”). The Court has carefully reviewed the Motions, the
record, all supporting and opposing filings, the exhibits attached thereto, and is otherwise fully
advised. For the reasons that follow, both Plaintiff’s Daubert Motion and Defendants’ Daubert
Motion are granted in part and denied in part. As to the issues on summary judgment, GHM’s
Motion is granted in part and denied in part, OPL’s Motion is granted, and the Oprock
Defendants’ Motion is granted in part and denied in part.

Case No. 16-cv-80502–BLOOM/Valle

I.

BACKGROUND 1
A. Plaintiff’s Claims
Plaintiff Justin Bouton (“Plaintiff”) brings a lawsuit against Defendants for their alleged

violation of the Fair and Accurate Credit Transactions Act (“FACTA”) amendment to the Fair
Credit Reporting Act, 15 U.S.C. § 1681 et seq., as amended (“FCRA”). See ECF No. [47] at ¶ 1
(“Second Amended Complaint”). In the Second Amended Complaint, Plaintiff claims that
Defendant Ocean Properties, Ltd (“OPL”) represents that it develops, owns and operates hotels
in several states, including Florida. Id. at ¶ 5. Defendant Oprock Jupiter Fee, LLC (“Oprock
Fee”) owns the property Jupiter Beach Resort & Spa (“Jupiter Beach Resort”), the hotel at which
Plaintiff allegedly received a FACTA non-compliant receipt. Id. at ¶ 6. Defendant Oprock
Jupiter TRS, LLC (“Oprock TRS”) leases the Jupiter Beach Resort property from Oprock Fee.
Id. at ¶ 7. Defendant GHM Jupiter, LLC (“GHM”) manages the Jupiter Beach Resort. Id. at ¶ 8.
Plaintiff claims that all Defendants are “privately-owned companies, which are directly and
indirectly owned and operated by Tom Walsh and his children,” and that “[t]hrough a byzantine
ownership and management structure, Defendants operate their hotel businesses as a unitary
enterprise.” Id. at ¶¶ 9-10. Specifically, Plaintiff alleges that “Defendants share common
owners, managers, addresses, and resources, and use the OPL legal name when describing its
business operations in a singular fashion.” Id. at ¶ 10. According to Plaintiff, “Defendants were
acting jointly as a unitary enterprise utilizing the resources and legal name of [OPL], and by and
1

In their Reply memoranda, Defendants ask the Court to deem all facts within their respective Statements of
Undisputed Facts admitted because Plaintiff did not follow Local Rule 56.1 in that he failed to respond to
each individually numbered paragraph. The Court agrees that Plaintiff did not follow the requirements of
the Local Rules. Instead, Plaintiff filed a competing Statement of Undisputed Facts. While this format is
not helpful when analyzing whether any material issues of fact exist, Plaintiff’s actions are not tantamount
to a complete failure to respond. Plaintiff has still challenged multiple facts by preparing his own
competing statement. For this reason, the Court will not deem Defendants’ facts admitted. Plaintiff,
however, is reminded that he must follow all Local Rules and any failure to do so in the future will result
in sanctions.

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though their agents, servants and/or employees, each of which were acting within the course and
scope of their agency or employment, and under the direct supervision and control of the
Defendants.” Id. at ¶ 43.
B. OPL
The Walsh family and Walsh family interests own more than 100 hotel-owning
companies, including OPL. See ECF No. [193] at ¶ 14. For the past 25 years, the Walsh family
has formed numerous corporations and limited liability companies to own and hold property for
the purpose of banking lending requirements, including formation of single-purpose and specialpurpose entities (“SPE”) for bankruptcy remoteness and limiting liability. Id. at ¶¶ 56, 58. As
the multi-tiered SPE structure became a common requirement in acquisition financing or refinancing, OPL divested itself of multiple hotels, and the Walsh family formed and owns
Portsmouth Corporate Financial Services, Inc. (“PCFSI”) in 1995. Id. at ¶¶ 56-57.
OPL is a privately-held company owned by Walsh siblings Michael, Mark, William,
Suzanne and Patrick. See ECF No. [125-3]. OPL’s directors are Michael, Mark, and William
Walsh.

Id.

Its officers are Michael Walsh (President), Mark and William Walsh (Vice

Presidents), Patrick Walsh (Secretary) and Richard Ade (“Ade”) (Executive Vice President). Id.
OPL maintains two corporate offices with one located at 1001 East Atlantic Avenue in Delray
Beach, Florida and the other at 1000 Market Street in Portsmouth, New Hampshire. See ECF
No. [47-5]; ECF No. [290-6] at 14-16.
For the last several years, OPL, through its President Mike Walsh and its employees, has
assisted in local marketing of the Marriott Delray Beach and has provided clerical support
services for this hotel. See ECF No. [193] at ¶¶ 27, 29. The only two hotels owned and operated
by OPL during the relevant timeframe were the Marriott Delray Beach and the Holiday Inn

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Lakeside, and neither of them had any FACTA violations during this period. See ECF No. [29013] at 133, 140, and 142. OPL does not have and has not had contracts to operate or manage any
hotels other than the Marriott Delray Beach between March 1, 2015 and the present. See ECF
No. [130-05] at ¶13.

In OPL’s Motion, it contends that its employees have no duties or

employment obligation to, and do not perform any work or services at, any other hotel or
property including the Jupiter Beach Resort. Id. at ¶30. However, as explained below, this is a
disputed issue of fact.
OPL does not directly or indirectly own Oprock Fee, Oprock TRS, or GHM. See ECF
No. [130-5] at ¶ 4; ECF No. [193] at ¶ 16; and ECF No. [24-3] (Recitals A and B). There are no
contracts between Oprock Fee, GHM and OPL, and OPL has no contract to operate or manage
the Jupiter Beach Resort. See ECF Nos. [130-1]; [130-3]; [130-5]; and [193]. The $295,000,000
mortgage on Jupiter Beach Resort and properties of other Oprock entities appearing in the public
records of Palm Beach County do not refer to OPL and are not signed by any Walsh family
member. See ECF No. [66-4]. OPL does not carry the hotel or any loan related to it on its
financial statements. See ECF No. [83-7], [4-30].
OPL states that it did not have any direct or indirect involvement in the FACTA violation at
the Jupiter Beach Resort as its employees never worked there, but Plaintiff submitted evidence
suggesting that OPL has been involved with the resort in some capacity. Starting in 2005, OPL
acquired the Jupiter Beach Resort, renovated it and reopened the resort, obtaining building permits in
2005, 2006, and 2007. See ECF No. [47-4]; 2 ECF Nos. [80-2], [80-3], and [80-4]. Although Oprock

2

Michael Walsh disputes the accuracy of the content on the “About Us” page on www.oplhotels.com;
however, OPL’s corporate representative, Ade, testified that OPL owned the website and, even though it
had the right to control the website, it delegated that responsibility to non-party PCFSI. See ECF No.
[290-6] at 108-113. OPL’s statements on its websites are admissions by a party opponent regardless of
whether OPL had its own employees post that content onto the internet, whether it authorized PCFSI to
create the content for its website, or it had an agency relationship with PCFSI through which it delegated

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Fee has been the owner of the resort since 2007, during the relevant timeframe, OPL publicly
represented on its website www.oplhotels.com that the Jupiter Beach Resort was one of its
properties. See ECF No. [47-13]. More specifically, the website states that “Ocean Properties’
resort and hotels on Florida’s popular East Coast attract both business travelers and leisure seekers
from the United States, Europe and Latin America. Sophisticated and multicultural, they range from
the elegant Jupiter Beach Resort and Spa, immediately north of Palm Beach and easily accessible to
Palm Beach International Airport, and the Marriott Delray Beach . . .” Id. (emphasis added). Thus,
OPL’s website represents that the Jupiter Beach Resort is part of its collection of hotels. 3 Other
marketing materials bearing the OPL logo and name also suggest the same. See ECF No. [47-19]
(bearing the OPL and OPAL collection logos, stating “Ocean Properties has your travel story
covered,” identifying Jupiter Beach Resort as part of the hotel collection, and listing Kerry Morrisey
from “Ocean Properties, Ltd.” at “[e-mail]” as the media contact). 4 OPL’s
website, www.oplhotels.com, also contains a Terms of Use page, which states OPL is “committed to
protecting” customer privacy including customer “financial information (such as credit card number

all website management responsibility to PCFSI. See Fed. R. Evid. 801(d)(2) (“A statement that meets
the following conditions is not hearsay: [t]he statement is offered against an opposing party and (A) was
made by the party in an individual or representative capacity . . . (C) was made by a person whom the
party authorized to make a statement on the subject; (D) was made by the party’s agent or employee on a
matter within the scope of that relationship and while it existed . . .”). While Michael Walsh may dispute
the accuracy of the admission, that goes to the weight of the evidence – an issue to be determined by a
jury, not the Court on summary judgment.
3
OPL’s website does not say the Jupiter Beach Resort is owned by an affiliated entity. The website is
written in the possessive – “Ocean Properties’ resorts and hotels,” representing to the public that Jupiter
Beach Resort belongs to OPL. While it may be coincidental, the only other hotel referenced here is the
Marriott Delray Beach – a hotel that OPL admits to owning and managing.
4
OPL argues that it assigned its rights to the OPAL trademark to PCFSI and that only PCFSI has the right
to use it. However, at his deposition, Ade did not dispute the authenticity of this brochure. See ECF No.
[290-06] at 152-154. And, although Michael Walsh disputes that OPL ever marketed the OPAL
collection of hotels, the terms and conditions for the OPAL collection website do not allow its content to
be modified, reproduced, transmitted, distributed, disseminated, sold, published, broadcast or circulated
“without the written consent of Ocean Properties, Ltd.” See ECF No. [47-20]. A genuine issue of fact
exists as to OPL’s involvement in the OPAL collection of hotels, including the Jupiter Beach Resort.

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and expiration date, etc.” and that OPL “is committed to the security of the data collected.” See ECF
No. [47-12].

C. PCFSI
PCFSI is a consulting and services provider in the areas of accounting, financial,
information technology, human resources, administrative, advertising and other services to hotel
and property management companies and sometimes directly to hotel and property owners. See
ECF No. [193] at ¶60. GHM is one of PCFSI’s clients. Id. PCFSI provides its services to
entities both associated with the Walsh family and to persons and entities not associated with the
Walsh family. Id. at ¶60. It does not own or operate hotels or real estate. Id. at ¶60. OPL does
not direct the operations of PCFSI and it is not a subsidiary of OPL. Id. at ¶62; ECF No. [1253]; ECF No. [193] at ¶25.
D. Oprock Fee and Oprock TRS
Oprock Fee owns the Jupiter Beach Resort and, in turn, leases the hotel to Oprock TRS.
See ECF No. [324] at 3; ECF No. [335] at 2. 5 The Oprock Defendants, formed on May 13,
2007, are single-purpose entities with a sole purpose of real estate investment. See ECF No.
[324-1] at ¶ 5; ECF Nos. [47-1], [47-2]. The corporate structure of the Oprock Defendants is as
follows: Rockwood Ocean, LLC owns 100% of Oceanrock Master Mezz, LLC; Oceanrock
Master Mezz LLC owns 100% of Oprock Jupiter Master Mezz LLC; Oprock Jupiter Master
Mezz LLC owns 100% of Oprock Fee; and Oprock Fee owns 100% of Oprock TRS. See ECF
No. [335] at 3; ECF No. [324-1]. The Walsh family interests own 8% of Rockwood Ocean
5

In his Response, Plaintiff refers the Court to language within the lease agreement between Oprock Fee
and Oprock TRS and purports to attach a copy of the lease agreement as Exhibit 3. See ECF No. [335] at
2-3. However, Exhibit 3 is not the lease agreement between Oprock Fee and Oprock TRS. See ECF No.
[335-3]. Rather, it is the management agreement between Oprock TRS and GHM. Id. The Court’s
review of the exhibit failed to locate a § 7.1.1 within the document or the language quoted by Plaintiff. It
appears that Plaintiff did not provide the Court with any evidence of the lease agreement to support his
statement.

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LLC. ECF No. [324]. The remaining 92% is owned by unrelated Rockwood interests that are
not directly or indirectly owned, managed, or controlled by any member of the Walsh family.
ECF No. [324-1] at ¶ 6. Mark Walsh is the Vice President of Oprock Fee while Oprock Jupiter
Master Mezz is its managing member. See ECF No. [290-20]. Similarly, Mark Walsh is the
Vice President of Oprock TRS while Oprock Fee is its managing member. See ECF No. [29021]. Both Oprock Fee and Oprock TRS have the same principal place of business located at 50
California Street, Suite 3000, San Francisco, California. See ECF Nos. [290-20], [290-21]. Both
entities also have the same mailing address as GHM: 1000 Market Street, Portsmouth, New
Hampshire. Id. The Oprock Defendants have the same mailing address as GHM because
GHM runs the day-to-day operations of the Jupiter Beach Resort under the management
agreement, as explained below. See ECF No. [324-1] at ¶ 8. Their Vice President, Mark
Walsh, works out of OPL’s office located at 1001 East Atlantic Avenue in Delray Beach,
Florida. Id. The Oprock Defendants have never used OPL’s name or otherwise made any
representations that OPL or GHM are their agents. See ECF No. [324-1] at ¶ 9. They also do
not have any contracts with OPL. Id. at ¶ 8. Following the incorporation of the Oprock
Defendants, in September of 2007, Oprock TRS obtained ownership over the fictitious name
“Jupiter Beach Resort.” 6 See ECF No. [335-5]. Plaintiff’s hotel folio, as further discussed
below, contained the “Jupiter Beach Resort” name. See ECF No. [251-2].
E. The GHM Management Agreement

6

Plaintiff’s Statement of Undisputed Facts states that both Oprock Defendants obtained ownership of the
fictitious name in September of 2007. Based on the Court’s review of the attached exhibit, it appears that
only Oprock TRS was identified as the owner. See ECF No. [335-5]. To the extent that both entities may
have acquired ownership over the fictitious name in 2017 while this lawsuit was underway, such evidence
is not probative of the facts as they existed during the alleged FACTA violation.

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On July 2, 2017, Oprock TRS granted GHM the exclusive right to manage and operate
the Jupiter Beach Resort pursuant to a management agreement. See ECF No. [324-1] at 6-80.
Specifically, the management agreement gives GHM the exclusive authority and control over the
daily management of the hotel as follows: “Lessee [TRS] hereby engages Management Company
[GHM] as an independent contractor to supervise, direct and control the management and
operation of the Hotel and the Management Company shall have the exclusive authority and
responsibility for the day-to-day management of the Hotel for and during the Term. . .” Id. at §
2.01. It further provides:
The Management Company shall have complete discretion and control and
exclusive authority and responsibility for the day-to-day management of the
Hotel, free from interference, interruption or disturbance, in all matters relating to
management and operation of the Hotel, including without limitation, charges for
rooms and commercial space, credit policies, food and beverage services,
employment policies, receipt, holding and disbursement of funds, maintenance of
bank accounts, procurement of Inventories, supplies and services, promotion and
publicity and, generally, all activities necessary for operation of the Hotel . . .
Id. at § 2.03(A).
Within the management agreement, TRS agreed that GHM would “have the right to
manage and operate the Hotel during the Term free from hindrance, ejection or molestation by
Lessee or other party claiming under, through or right of” TRS. Id. at § 11.01. The agreement
also identifies GHM as an independent contractor and disclaims the creation of “any form of
agency, a partnership, or joint venture or any other relationship between [TRS and GHM] or
their successors in interest.” Id. at § 20.03.
As to the personnel employed at the Jupiter Beach Resort, TRS and GHM agreed as
follows:
All personnel employed at the Hotel shall at all times be the employees of the
Management Company and/or the employees or one or more third parties
designated by the Management Company and approved by Lessee . . .
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Management Company shall have absolute discretion to hire, promote, supervise,
direct and train all employees at the Hotel, to fix their compensation, benefits,
and, generally establish and maintain all policies relating to employment . . .
Id. at § 14.01.
Oprock TRS also retained the right to terminate the management agreement in the event
of direct or indirect transfer or assignment of the agreement by GHM that “would result in
fewer than four (4) of the following seven individuals: William Walsh, Patrick Walsh, Michael
Walsh, Mark Walsh, Rich Ade, Tom Varley, Andy Berger continuing to have full time senior
management positions with” GHM. ECF No. [92-3] at § 18.01(A). The lease agreement
between the Oprock Defendants is subordinated to the management agreement. See ECF No.
[324] at 83 (“The Operating Lease is and shall be subject and subordinate in all respects to the
operation and effect of the Management Agreement and to all renewals, modifications,
consolidations, replacements and extensions thereof.”).
F. FACTA Knowledge
This lawsuit contains one count alleging a FACTA violation by all Defendants. GHM
admits it had “industry knowledge of FACTA through its LLC manager Rich Ade.” ECF No.
[251-6] at 8. GHM further “admits the requirements of FACTA are well known” and it “does
not dispute that it had knowledge of FACTA.” Id.; ECF No. [348] at 7. OPL likewise knew
about FACTA’s requirements prior to December 22, 2015. See ECF No. [298-2]. By 2006, OPL
converted and updated its credit and debit card platforms to FACTA compliant settings. See
ECF No. [125-2] at ¶ 15. OPL was also previously sued for a FACTA violation in 2008. See
ECF No. [290-6] at 116-118. Neither of the Oprock Defendants were aware of FACTA’s
requirements prior to this lawsuit. See ECF No. [324-1] at ¶ 12.
G. The Software Upgrade

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On November 5, 2015, Oprock TRS contracted with non-party Oracle to upgrade the
software for Jupiter Beach’s Property Management System (“PMS”). See ECF No. [290-19] at
23-25; ECF No. [290-8] at 224-225. Cliff Lazenby (“Lazenby”) signed the contract with Oracle
as “IT Director” on behalf of Oprock TRS. 7 See ECF No. [290-19] at 23-25. Lazenby, 8 at
Oracle’s urging, decided to allow the installation of the software upgrade to eliminate a potential
credit card security vulnerability that Oracle recently identified in their Opera software. See ECF
No. [193] at ¶ 70. Oracle assured Lazenby that certain credit card and debit card information
would not be secured unless this update was immediately installed at the Jupiter Beach Resort. 9
Id. Based on Oracle’s marketing materials, Lazenby understood Oracle would safeguard the
security of the credit card data. See ECF No. [290-8] at 280. At Jupiter Beach Resort, they
relied upon Oracle’s sophisticated software, which was “advertised as the software that would
protect the identities of individuals by complying with various regulations.” ECF No. [290-10]
at 126. On the other hand, Oracle’s limited warranty only warrants that “[s]ervices will be
provided in a professional manner consistent with industry standards.” ECF No. [290-19] at 25.
Oracle’s contract does not provide any other specific warranties, such as compliance with
7

The Oprock Defendants claim in their Statement of Undisputed Facts that they “did not know about the
Oracle Upgrade” and “did not have any involvement in the decision to upgrade the software or in the
implementation of the Oracle Upgrade.” Despite this assertion, the contract for the Oracle software
upgrade was entered into by Oprock TRS. See ECF No. [290-19] at 23-25. The Oprock Defendants also
state that Cliff Lazenby has never been an employee of theirs, but he signed this contract on behalf of
Oprock TRS as its “IT Director.” This creates an issue of fact as to Lazenby’s relationship to Oprock
TRS Id.
8
Although GHM and OPL characterize Lazenby as an employee of non-party PCFSI, Plaintiff raises an
issue of fact involving Lazenby’s relationship to multiple Defendants as he signed the Oracle contract as
the “IT Director” of Oprock TRS and he repeatedly held himself out as the “IT Director” of OPL. See n.
4; ECF No. [290-16]; [290-8] at 41-42, 46-48, 60.
9
GHM directs the Court to the Declaration of Ade for the proposition that: “Cliff Lazenby believed [the
failure to allow the software upgrade] would have created the unnecessary risk to the security of certain
guest’s credit card transactions . . . .” See ECF No. [325] at 7. Similarly, GHM relies upon Ade’s
declaration as evidence of Lazenby’s lack of knowledge of a potential software defect. See ECF No.
[325] at 8. However, it is questionable that Ade can testify about what Lazenby did or did not believe or
know.

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FACTA. 10 Id. There is no evidence that Oprock Fee knew about the Oracle upgrade or that it
was otherwise involved in the decision to upgrade the software. 11 See ECF No. [324-1] at ¶¶ 1011.
The upgrade eventually occurred on December 22, 2015 at which time the Jupiter Beach
Resort began printing folios with unmasked expiration dates in violation of FACTA. See ECF
Nos. [335-2]; [251-2]; [251-8]; [290-6] at 44, 47. Oracle caused the defect by upgrading and
installing the Opera system to version 5.04.02. See ECF No. [130-05] at ¶ 10. The software
issue continued through April 6, 2016. Id. However, it did not impact seven to ten other point of
sale locations within the Jupiter Beach, which remained FACTA compliant. See ECF No. [29013] at 149.
Following the upgrade, hotel staff reported problems. On December 22, 2015, an email
was sent to Oracle informing it that “the [f]ront [d]esk users can now access the guest folios
within Billing, however, apparently they are now receiving the following message when
attempting to perform an express checkout/post charges.” ECF No. [290-18]. 12 The error
message, which did not pop up prior to the upgrade, references the need to set up a “GST FOLIO

10

GHM disputes this fact within Plaintiff’s Statement of Additional Undisputed Facts, but GHM does not
direct the Court to anything within the contract demonstrating that the Oracle warranty is broader than
Plaintiff represents. See ECF No. [348] at 10-11.
11
Plaintiff cites to Ade’s deposition for the proposition that the Oprock Defendants approved the upgrade
prior to its implementation. See ECF No. [335] at 6. However, the Court’s review of the cited testimony
is that the “Rockwood asset manager” approved the subject Oracle upgrade at the Jupiter Beach Resort.
See ECF No. [290-4] at 24, 112. Plaintiff does not direct the Court to any testimony that would define
“Rockwood asset manager.”
12
Plaintiff incorrectly cited the docket entry pertaining to this email string. Although GHM argues that
this email string is not in the record and cannot be considered, see ECF No. [348] at 8, the email is indeed
in the record located at ECF No. [290-18]. Consistent with Plaintiff’s description, this email dated
December 22, 2015 discusses an issue about printing problems after the upgrade and the screenshot
reveals a credit card expiration date. Id. In fact, Lazenby acknowledged at his deposition that there is
enough information on the screenshot to understand that the expiration date is exposed. Moreover, he
admits he was copied on the email. See ECF No. [290-8] at 152-153.

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printer task.” Id. Within this series of emails is a screenshot revealing a truncated credit card
number with an exposed credit card expiration date. Id.
During the December 22, 2015 to April 6, 2016 time period, management estimated that
twenty percent of guests who stayed at the Jupiter Beach Resort would have requested a final
folio at the front desk. See ECF No. [298-5] at 23. 13 According to Defendants’ expert Laykin,
“this amounts to approximately 1,083 folios that potentially could have been printed with an
unmasked expiration date.” Id. In addition, there were more than 200 pages of folios generated
at the Jupiter Beach Resort during this timeframe that revealed credit card expiration dates and
were placed into the audit packs that were later reviewed by the hotel’s general manager. See
ECF No. [251-8]; ECF No. [290-6] at 127-129. GHM’s general managers and hotel desk staff at
the Jupiter Beach Resort were trained to make sure the folios did not show unmasked credit card
expiration dates and were FACTA compliant. See ECF No. [290-6] at 131-133; ECF No. [29010] at 133-135. According to GHM’s corporate representative, the unmasked expiration date
would not have been “obvious,” but it can be easily identified “if you are looking for it” because
it is the same size as all other print on the folio. See ECF No. [290-4] at 70-72, 131.
Once GHM learned about the defective software upgrade and the unmasking of
expiration dates, it immediately contacted PCFSI to cure the defect and it was resolved within 24
hours of GHM receiving a copy of the lawsuit and approximately 72 hours after OPL was
served. See ECF No. [193] at ¶ 67; ECF No. [130-05] at ¶ 11. The Oprock Defendants did not
have any involvement in implementing a fix to the Oracle upgrade. See ECF No. [324-1] at ¶ 13.

13

Here, Plaintiff relied upon and quoted from Laykin’s report in his Statement of Undisputed Facts.
Laykin is Defendants’ expert witness; therefore, Plaintiff, as the party proffering the evidence on
summary judgment, has waived any argument that this portion of Laykin’s report is inadmissible hearsay.
In any event, Laykin’s report can be considered on summary judgment.

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They learned about the issue involving the exposed credit card expiration dates after it was
already corrected. Id.
OPL claims it did not have any involvement in the resolution of the software defect,
stating that PCFSI resolved the issue. However, this fact is hotly disputed. OPL claims that
Lazenby and Dan Rich (“Rich”), who were tasked with fixing the issue, were employees of
PCFSI assisting its client, GHM. 14 See ECF No. [326] at 10-11. On the other hand, Plaintiff
presented evidence suggesting that Lazenby had some sort of relationship to OPL as his
signature line in multiple emails identifies him as the “IT Director” of OPL. See ECF No. [29016]. Further, Lazenby identified himself professionally in other fora as the “IT Director” for
OPL, such as in his Linked In profile, the Harvard alumni directory, and an interview with the
Portsmouth Herald. See ECF No. [290-8] at 41-42, 46-48, 60. OPL’s corporate representative
admitted that Lazenby identified himself as its “IT Director” and stated that OPL was “probably
lax” about this because “people latch onto the name Ocean Properties” and PCFSI uses OPL’s
name “to gain immediate name recognition to whomever [they] are dealing with.” See ECF No.
[290-6] at 87-88, 96. Similarly, Rich, who handled information technology matters at the Jupiter
Beach Resort, also held himself out as the “IT Director” of OPL. See ECF No. [290-9] at 16-17,
20, 110-111 (stating that he identified himself as the “IT Director” of OPL in his email signature
line and business cards). Others working in information technology for the hotel, such as
Gregory Dunham and Greg O’Keefe, likewise represented that they worked for OPL. See ECF
No. [290-18] (December 22, 2015 emails identifying Greg O’Keefe as the Regional IT Manager
for OPL, with an OPL mailing address and email address); ECF No. [290-16] (April 6, 2016

14

PCFSI was not registered to do business in Florida during the time the Oracle software upgrade was
unmasking expiration dates. See ECF No. [290-6] at 98-99. PCFSI did not register to do business in
Florida until months later in October of 2016. Id.

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emails identifying Gregory Dunham as the regional controller with an OPL signature line and
email address).
H. Plaintiff’s Stay at the Jupiter Beach Resort
Plaintiff stayed at the Jupiter Beach Resort from March 8 to March 9, 2017. See ECF No.
[335-1]. During his stay, he paid with his credit card and received a folio at the front desk of the
hotel that unmasked his credit card’s expiration date.

Id.

The folio also contained other

identifying information, such as his name and residential zip code. See ECF No. [47-29].
Prior to the filing of this lawsuit, Plaintiff had never heard of the Oprock Defendants. See
ECF No. [166-1] at 67-68. He did not visit the hotel in reliance upon who managed it and did
not believe that the individuals who worked at the front desk were agents of the Oprock
Defendants. Id. at 66, 75. As of the date of his deposition, Plaintiff did not know who the
Oprock Defendants were. Id. at 63-65, and 69.
In the pending Motions, Plaintiff seeks to exclude the expert witness testimony of
Defendants’ expert witness, Eric Laykin (“Laykin”), while Defendants likewise seek to exclude
the testimony of Plaintiff’s expert, Don Coker (“Coker”). In addition, all four Defendants seek
summary judgment, 15 raising both overlapping and individualized issues. Because the parties’
summary judgment briefing, in part, relies upon expert witness testimony, the Court will first
address the two Daubert Motions to determine which expert witness opinions are admissible.
Thereafter, the Court will undertake its review of the three pending Motions for Summary
Judgment.
II.

LEGAL STANDARD
A. Expert Testimony

15

The Oprock Defendants filed a combined Motion for Summary Judgment.

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Federal Rule of Evidence 702 governs the admissibility of expert testimony. When a
party proffers the testimony of an expert under Rule 702, the party offering the expert testimony
bears the burden of laying the proper foundation, and that party must demonstrate admissibility
by a preponderance of the evidence. See Rink v. Cheminova, Inc., 400 F.3d 1286, 1291-92 (11th
Cir. 2005); Allison v. McGhan Med. Corp., 184 F.3d 1300, 1306 (11th Cir. 1999). To determine
whether expert testimony or any report prepared by an expert may be admitted, the Court
engages in a three-part inquiry, which includes whether: (1) the expert is qualified to testify
competently regarding the matters he intends to address; (2) the methodology by which the
expert reaches his conclusions is sufficiently reliable; and (3) the testimony assists the trier of
fact, through the application of scientific, technical, or specialized expertise, to understand the
evidence or to determine a fact in issue. See City of Tuscaloosa v. Harcros Chems., Inc., 158
F.3d 548, 562 (11th Cir. 1998) (citing Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 590
(1993)). The Eleventh Circuit refers to each of these requirements as the “qualifications,”
“reliability,” and “helpfulness” prongs. United States v. Frazier, 387 F.3d 1244, 1260 (11th Cir.
2004).

While some overlap exists among these requirements, the Court must individually

analyze each concept. See id.
An expert in this Circuit may be qualified “by knowledge, skill, experience, training, or
education.” J.G. v. Carnival Corp., No. 12–21089–CIV, 2013 WL 752697, at *3 (S.D. Fla. Feb.
27, 2013) (citing Furmanite Am., Inc. v. T.D. Williamson, 506 F. Supp. 2d 1126, 1129 (M.D. Fla.
2007); Fed. R. Evid. 702. “An expert is not necessarily unqualified simply because [his]
experience does not precisely match the matter at hand.” Id. (citing Maiz v. Virani, 253 F.3d
641, 665 (11th Cir. 2001)). “[S]o long as the expert is minimally qualified, objections to the
level of the expert’s expertise go to credibility and weight, not admissibility.” See Clena

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Investments, Inc. v. XL Specialty Ins. Co., 280 F.R.D. 653, 661 (S.D. Fla. 2012) (citing Kilpatrick
v. Breg, Inc., No. 08–10052–CIV, 2009 WL 2058384 (S.D. Fla. June 25, 2009)). “After the
district court undertakes a review of all of the relevant issues and of an expert’s qualifications,
the determination regarding qualification to testify rests within the district court’s discretion.”
J.G., 2013 WL 752697, at *3 (citing Berdeaux v. Gamble Alden Life Ins. Co., 528 F.2d 987, 990
(5th Cir. 1976)).
When determining whether an expert’s testimony is reliable, “the trial judge must assess
whether the reasoning or methodology underlying the testimony is scientifically valid and
whether that reasoning or methodology properly can be applied to the facts in issue.” Frazier,
387 F.3d at 1261-62 (internal formatting, quotation, and citation omitted).

To make this

determination, the district court examines: “(1) whether the expert’s theory can be and has been
tested; (2) whether the theory has been subjected to peer review and publication; (3) the known
or potential rate of error of the particular scientific technique; and (4) whether the technique is
generally accepted in the scientific community.”

Id. (citing Quiet Tech. DC-8, Inc. v.

Hurel-Dubois, UK Ltd., 326 F.3d 1333, 1341 (11th Cir. 2003)). “The same criteria that are used
to assess the reliability of a scientific opinion may be used to evaluate the reliability of
non-scientific, experience-based testimony.” Id. at 1262 (citing Kumho Tire Co. v. Carmichael,
526 U.S. 137, 152 (1999)).

Thus, the aforementioned factors are non-exhaustive, and the

Eleventh Circuit has emphasized that alternative questions may be more probative in the context
of determining reliability. See id. Consequently, trial judges are afforded “considerable leeway”
in ascertaining whether a particular expert’s testimony is reliable. Id. at 1258 (citing Kumho, 526
U.S. at 152)).

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The final element, helpfulness, turns on whether the proffered testimony “concern[s]
matters that are beyond the understanding of the average lay person.” Edwards v. Shanley, 580
F. App’x 816, 823 (11th Cir. 2014) (quoting Frazier, 387 F.3d at 1262) (formatting omitted).
“[A] trial court may exclude expert testimony that is ‘imprecise and unspecific,’ or whose factual
basis is not adequately explained.” Id. (quoting Cook ex rel. Estate of Tessier v. Sheriff of
Monroe Cnty., Fla., 402 F.3d 1092, 1111 (11th Cir. 2005)). To be appropriate, a “fit” must exist
between the offered opinion and the facts of the case. McDowell v. Brown, 392 F.3d 1283, 1299
(11th Cir. 2004) (citing Daubert, 509 U.S. at 591). “For example, there is no fit where a large
analytical leap must be made between the facts and the opinion.” Id. (citing General Electric
Co. v. Joiner, 522 U.S. 136 (1997)).
Under Daubert, a district court must take on the role of gatekeeper, but this role “is not
intended to supplant the adversary system or the role of the jury.” Quiet Tech., 326 F.3d at 1341
(internal quotations and citations omitted). Through this function, the district court must “ensure
that speculative, unreliable expert testimony does not reach the jury.” McCorvey v. Baxter
Healthcare Corp., 298 F.3d 1253, 1256 (11th Cir. 2002). “[I]t is not the role of the district court
to make ultimate conclusions as to the persuasiveness of the proffered evidence.” Quiet Tech.,
326 F.3d at 1341 (internal quotations and citations omitted). Thus, the district court cannot
exclude an expert based on a belief that the expert lacks personal credibility. Rink, 400 F.3d at
1293, n.7. To the contrary, “vigorous cross-examination, presentation of contrary evidence, and
careful instruction on the burden of proof are the traditional and appropriate means of attacking
shaky but admissible evidence.” Quiet Tech., 326 F.3d at 1341 (quoting Daubert, 509 U.S. at
596); see Vision I Homeowners Ass’n, Inc. v. Aspen Specialty Ins. Co., 674 F. Supp. 2d 1321,
1325 (S.D. Fla. 2009) (quoting Jones v. Otis Elevator Co., 861 F.2d 655, 662 (11th Cir. 1988)

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(“On cross-examination, the opposing counsel is given the opportunity to ferret out the opinion’s
weaknesses to ensure the jury properly evaluates the testimony’s weight and credibility.”)).
B. Summary Judgment
A court may grant a motion for summary judgment “if the movant shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment as a matter of
law.” Fed. R. Civ. P. 56(a). The parties may support their positions by citation to the record,
including, inter alia, depositions, documents, affidavits, or declarations. See Fed. R. Civ. P.
56(c).

An issue is genuine if “a reasonable trier of fact could return judgment for the

non-moving party.” Miccosukee Tribe of Indians of Fla. v. United States, 516 F. 3d 1235, 1243
(11th Cir. 2008) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986)). A fact
is material if it “might affect the outcome of the suit under the governing law.” Id. (quoting
Anderson, 477 U.S. at 247-48). The Court views the facts in the light most favorable to the
non-moving party and draws all reasonable inferences in the party’s favor.

See Davis v.

Williams, 451 F.3d 759, 763 (11th Cir. 2006). “The mere existence of a scintilla of evidence in
support of the [non-moving party’s] position will be insufficient; there must be evidence on
which a jury could reasonably find for the [non-moving party].” Anderson, 477 U.S. at 252. The
Court does not weigh conflicting evidence. See Skop v. City of Atlanta, Ga., 485 F.3d 1130,
1140 (11th Cir. 2007) (quoting Carlin Comm’n, Inc. v. S. Bell Tel. & Tel. Co., 802 F.2d 1352,
1356 (11th Cir. 1986)).
The moving party shoulders the initial burden to demonstrate the absence of a genuine
issue of material fact. See Shiver v. Chertoff, 549 F.3d 1342, 1343 (11th Cir. 2008). If a movant
satisfies this burden, “the nonmoving party ‘must do more than simply show that there is some
metaphysical doubt as to the material facts.’” Ray v. Equifax Info. Servs., L.L.C., 327 F. App’x

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819, 825 (11th Cir. 2009) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475
U.S. 574, 586 (1986)). Instead, “the non-moving party ‘must make a sufficient showing on each
essential element of the case for which he has the burden of proof.’” Id. (quoting Celotex Corp.
v. Catrett, 477 U.S. 317, 322 (1986)). The non-moving party must produce evidence, going
beyond the pleadings, and by its own affidavits, or by depositions, answers to interrogatories,
and admissions on file, designating specific facts to suggest that a reasonable jury could find in
the non-moving party’s favor. Shiver, 549 F.3d at 1343.
III.

DISCUSSION
A. Plaintiff’s Daubert Motion
Defendants have retained and disclosed Erik Laykin as their expert witness in this case.

Following the disclosure of Laykin’s report and his deposition, Plaintiff now seeks to exclude the
following three opinions: (1) cybercrime techniques are more prevalent than criminal techniques
involving paper receipts, (2) certain receipts at the Jupiter Beach Resort were masked, and (3)
Defendants did not act willfully. The Court addresses each opinion to determine its admissibility
on summary judgment and at trial.
1. Prevalence of Cybercrime In Relation to Crime Involving Paper Receipts
Plaintiff first seeks to exclude Laykin’s opinion about the prevalence of cybercrime
activity in today’s world, arguing that such an opinion is not relevant as this case involves a
paper receipt – not cybercriminal activity. See ECF No. [298] at 1. As such, Plaintiff argues that
Laykin’s opinion is not helpful to the trier of fact in understanding the evidence or determining
an issue. Id. at 3. Thus, Plaintiff challenges the “helpfulness” of Laykin’s cybercrime opinion.
His report devotes a significant amount of time to discussing current techniques used in the
cybercrime world to illegally obtain credit card numbers and to commit identity theft, such as the

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internet black market, “key logging,” the “man-in-the-middle” attacks, massive data breaches,
etc. See ECF No. 298-5 at 32-46. The purpose of this analysis, as explained in Laykin’s report,
is “to submit that even if a guest folio showing an expiration date and last four digits was lost,
the risk of harm to the guest would not be significantly increased and the guest would not
plausibly face an imminent risk of being harmed.” Id. at 32. Ultimately, Laykin concludes that
Plaintiff has not suffered any harm as a result of the printing of the expiration date on the folio.
Id.
In response, Defendants argue that Laykin’s opinion is relevant to the issue of standing
under Article III. See ECF No. [309] at 5 n. 10; 10 n. 20. More specifically, they state: “[t]he
threshold issue for Article III standing in a FACTA case such as this is not whether ‘any’ risk of
harm exists, but whether Plaintiff can demonstrate a ‘material risk of harm to the underlying
interest’ of identity theft protection. . . . Laykin opines that the risks Plaintiff identifies are
‘infinitesimally small’ which of course would not subject a cardholder to a ‘material’ risk of
harm.” Id. at 5, n. 10 (emphasis in original, internal citations omitted). Plaintiff’s Article III
standing, however, has already been decided by this Court as a matter of law. The Court is
cognizant that the briefing period on the Daubert Motions overlapped the briefing on Plaintiff’s
Motion for Class Certification. For that reason, when the parties prepared their respective
Daubert memoranda, they did not have the benefit of the Court’s Order on Motion for Class
Certification (“Order”) wherein the issue of standing was decided. See ECF No. [330] at 6-11.
In the Order, the Court reasoned that Defendants’ analysis “ignore[d] that ‘[c]ourts[,
including this one,] have [] considered a FACTA violation to be concrete as soon as a company
prints the offending receipt, as opposed to requiring a plaintiff actually suffer identity theft.’” Id.
at 8-9 (quoting Guarisma v. Microsoft Corp., 209 F. Supp. 3d 1261, 1266 (S.D. Fla. July 26,

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2016)).

Relying upon Wood v. Choo USA, Inc.’s 16 finding that the consumer “suffered a

concrete harm as soon as Jimmy Choo printed the offending receipt,” the Order concluded that
“the concrete harm [here] materialized at the very moment the folio was printed regardless of
whether Plaintiff immediately noticed the violation and safeguarded it.” See ECF No. [330] at 9.
Since the issuance of this Order, another opinion from the Southern District of Florida, also
involving an alleged FACTA violation at a hotel, likewise held that the plaintiff “without
question” established a concrete injury for purposes of Article III standing. See Guarisma v.
Hyatt Equities, LLC, No. 17-cv-20931-UU, ECF No. [50] at 8 (S.D. Fla. Sept. 28, 2017) (“Every
court in this District, including this Court, uniformly holds that FACTA creates a substantive
right for consumers to have their personal credit card information truncated on receipts and
provided to customers at the point of sale.”).
In support of Laykin’s opinion and their standing argument, Defendants bring to the
Court’s attention another recent opinion from this district, which reached an opposite conclusion.
See Gesten v. Burger King, No. 17-cv-22541-RNS, ECF No. [35] (S.D. Fla. Sept. 27, 2017).
The analysis in Burger King is contrary to this Court’s prior analysis on the issue of standing
under FACTA as well as the weight of authority within this District. In fact, Burger King
appears to be the only opinion to date in this District reaching a contrary result on this issue. The
Court declines to reconsider its prior ruling that Plaintiff established a concrete injury and,
therefore, established this element of Article III standing. Because Plaintiff’s standing has been
decided as a matter of law and Defendants concede that Laykin’s opinions on cybercrime are
solely related to the issue of standing, Plaintiff’s Daubert Motion on this specific point has been
rendered moot. Defendants admit that such testimony is solely for the Court and not the jury’s

16

201 F. Supp. 3d 1332, 1340 (S.D. Fla. 2016).

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consideration. See ECF No. [309] at 10 n. 20 (“Winn-Dixie does not limit relevance to issues at
trial. The trier of fact here is the Court, which can make factual findings on certain issues (like
subject matter jurisdiction) before trial.”). As such, this opinion is excluded.
2. The Unmasking of Certain Folios
Plaintiff next seeks to strike Laykin’s opinion that certain folios at the Jupiter Beach
Resort masked the expiration dates because this opinion is the ipse dixit of the expert and is not
helpful to the jury. See ECF No. [298] at 6-9. Plaintiff’s first argument appears to challenge the
reliability of Laykin’s methodology while the second argument relates to the helpfulness prong
of a Daubert analysis. The Court will address each argument in turn.
On the issue of reliability, Plaintiff seeks to exclude Laykin’s conclusion that only certain
credit and debit card transactions resulted in printed receipts with unmasked expiration dates
during the relevant timeframe, arguing the opinion “appear[s] created out of whole cloth or for
which the persons Laykin identified as a source testified that they are not familiar with the area
on which Laykin claims they were the source for.” ECF No. [298] at 6. To analyze Plaintiff’s
argument, the Court must first identify the factual basis for Laykin’s opinion. His report lays out
the following pertinent facts in support of this opinion:
•

“The FACTA violations alleged in this lawsuit in reference to unmasked
expiration dates do not involve any folios delivered under a guest’s door, viewed
on a television screen, or provided to a guest prior to check out, and do not
involve any receipts printed at a point of sale, such as the gift shop.”

•

“If a guest had requested a final folio after checking out, then during the period
from the Oracle Opera upgrade to April 6, 2016, the expiration date is believed to
have appeared on some customers’ final folios.”

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•

“Most guests of Jupiter Beach resort check out of the hotel without requesting a
final folio.”

•

“Management estimates that twenty percent (20%) of Jupiter Beach Resort guests
request a final folio based on the information tracked by Jupiter Beach Resort
information technology support staff and its front desk personnel since the
commencement of this lawsuit.”

•

“When applied to the 5,417 credit card transactions that occurred during this
period, this amounts to approximately 1,083 folios that potentially could have
been printed with an unmasked expiration date.”

See ECF No. [298-5] at 23.
Challenging the reliability of this opinion, Plaintiff points out that Laykin arrived at this
conclusion without observing a single folio during the relevant timeframe that revealed masked
expiration dates. See ECF No. [298]. Further critiquing the opinion’s foundation, Plaintiff
argues that Laykin could not identify any individuals he allegedly spoke with as part of his
investigation and, with regard to those individuals he identified by name, such as Lazenby and
Rich, they did not know any of this information. Id.
Before analyzing the basis for Laykin’s opinion though, the Court is compelled to point
out that Plaintiff relies upon this exact opinion when challenging the Defendants’ Motions for
Summary Judgment. See e.g. ECF No. [335] at 6. Indeed, Plaintiff’s “Statement of Undisputed
Facts” quotes from this portion of Laykin’s report and states: “During that time, Defendants’
expert estimated that Jupiter Beach’s front desk staff handled and gave to customers 1,083
receipts with unmasked expiration dates.” Id. (emphasis added). Plaintiff appears to assert

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inconsistent positions of disclaiming’s Laykin’s methodology yet then relying upon it to create
an issue of fact.
Regardless of the inconsistency, the Court has reviewed Laykin’s report, his testimony,
and the testimony of the witnesses upon whom he relies and finds a sufficient evidentiary
foundation exists, removing it from realm of impermissible ipse dixit opinions. Laykin’s report
states that he relied upon all materials identified in Exhibit B to his report, which in part lists the
following: “Interview of Mr. Cliff Lazenby and Mr. Dan Rich by Erik Laykin, May 25, 2017,”
“Interview of Mr. Bob Garcia,” “Deposition of Justin William Bouton, March 30, 2017” and
“Deposition of Richard C. Ade, February 22, 2017.” See ECF No. [298] at 7, 77-81. In addition,
at his deposition, Laykin testified that he interviewed Michael Walsh; a “gentleman who Mr.
Rich and Mr. Lazenby reported to at PCFSI” identified by Defendants as Bob Garcia; 17 and an
individual who worked at the Jupiter Beach Resort during the relevant timeframe with
“management expertise, and firsthand knowledge of the operations at the front desk and
operations at the Jupiter Beach Resort.” 18 See ECF No. [290-10] at 25-26, 28, and 31.
Starting with the February 22, 2017 deposition of Ade, the Court notes that this witness
testified in his capacity as the corporate representative of OPL and GHM. See ECF No. [298] at
30. In his Reply, Plaintiff argues that Laykin cannot rely on Ade’s testimony because he did not
have personal knowledge of the specific issues. See ECF No. [312] at 5. However, Mr. Ade was
not testifying as an individual based on his personal knowledge but was instead testifying on
behalf of both corporations on the topics listed in the Notices of Taking Deposition. See QBE
Ins. Corp. v. Jorda Enterprises, Inc., 277 F.R.D. 676, 688 (S.D. Fla. 2012) (“The testimony of a
Rule 30(b)(6) witness represents the collective knowledge of the corporation, not of the specific
17
18

This is consistent with Laykin’s report, which identifies an interview with Bob Garcia.
The identity of this individual remains unclear based on the record.

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individual deponents. . . .The corporation appears vicariously through its designees.”). Thus,
Ade was not required to have such personal knowledge because he stepped into the shoes of
GHM and OPL at that deposition.
At his deposition, Ade testified that an investigation was conducted to determine whether
the receipts generated at the Jupiter Beach Resort’s gift shop and bar area were being properly
masked for expiration dates. See ECF No. [298-1] at 63. According to Ade, the investigation
found no issue with those receipts generated from food and beverage sales or at the gift shop
because it used different software, POS, and the issue was with the PMS software. Id. Ade
further testified that, “[a]t check-out in most cases [the folio] is slid under the door” and “[m]ost
people walk off the property” while “very few people go to the front desk and say, can you print
a folio?” Id. at 47. Rich testified at his deposition that, after April of 2016, his supervisor Bob
Garcia (“Garcia”) began tracking data to determine how many guests stop at the front desk to
obtain a printed folio upon check out. See ECF No. [298-10] at 92-93. Although Garcia’s
deposition, if it was taken, does not appear to be in the record, Laykin’s report indicates that he
spoke with Garcia as part of his investigation. See ECF No. [298] at 7, 77-81. Rich also
confirmed that when he spoke with Laykin, Garcia was on the telephone call. See ECF No.
[298-10] at 86. Thus, Laykin spoke with the individual who tracked the data regarding the
number of folios printed at the front desk. Additionally, Laykin spoke with Michael Walsh who
testified that approximately 75 to 80 percent of the receipts generated at the Jupiter Beach Resort
are from the bar, restaurant, spa, gift shop, pool bar and banquet area. See ECF No. [298-11] at
148. Laykin’s opinion relies upon this evidence and Laykin either spoke with these witnesses or
reviewed their deposition in connection with his report. This is not a situation where an expert’s
conclusions are only connected to existing data solely by the ipse dixit of the expert. See Guinn

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v. AstraZeneca Pharm. LP, 602 F.3d 1245, 1255–56 (11th Cir. 2010) (finding that expert
witness’ testimony was unreliable because the “conclusions were not logically supported by the
facts of th[e] case). To the contrary, Laykin’s opinion is supported by the evidence made
available to him.
The Court recognizes that Laykin’s report cites to interviews with Lazenby and Rich to
support the estimated number of printed folios at the front desk during the relevant time period
and that both of these witnesses disclaimed knowledge of such information at their deposition.19
See ECF No. [298] at 6. On the other hand, the case materials that Laykin identified in his report
and deposition demonstrate that he interviewed four witnesses and reviewed two deposition
transcripts, all of which provide him the foundation for the opinion Plaintiff seeks to strike. To
the extent Laykin’s report incorrectly states that he relied upon Lazenby and Rich for such
information, Plaintiff may explore those issues on cross-examination. However, the Court will
not strike Laykin’s opinion on these grounds when he had an adequate foundation.
Plaintiff also argues that Laykin cannot be used as a conduit for inadmissible hearsay
testimony. 20

See ECF No. [312] at 6, n. 7.

However, “[t]he Federal Rules of Evidence

specifically allow an expert to engage in hearsay testimony based on the type of evidence

19

Plaintiff’s Daubert Motion also suggests that Lazenby and Rich did not recall having a discussion with
Laykin. See ECF No. [298] at 6 (“[B]oth Lazenby and Rich testified that they don’t recall that discussion.
. .”). Rich and Lazenby testified that they recalled speaking with Laykin but did not recall the details of
the conversation. See ECF No. [298-9] at 260 (“I don’t recall most of the content of the conversation to
be honest with you, so no, I don’t recall that.”); ECF No. [298-10] at 87 (“I can’t remember what we
talked about.”).
20
Plaintiff’s Reply also argues that Laykin’s inability to “observe what happened retroactively” is a basis
to exclude his testimony. Experts need not have personal knowledge or be an eye witness to testify.
Banta Properties, Inc. v. Arch Specialty Ins. Co., No. 10-61485-CIV, 2011 WL 13096476, at *3 (S.D.
Fla. Dec. 22, 2011). Seldom would be the case that an expert witness could observe the facts of a case
retroactively, absent some video or other contemporaneous recording of the occurrence. Id. (rejecting
Daubert challenge to expert’s lack of personal knowledge of property damage caused by Hurricane
Wilma, even though the expert did not inspect the property until years later, because he relied upon
reports from other contractors, photographs, and witness interviews).

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reasonably relied on by those in his or her field.” See Kirksey v. Schindler Elevator Corp., No.
CV 15-0115-WS-N, 2016 WL 3189242, at *5 (S.D. Ala. June 7, 2016), reconsideration denied,
No. CV 15-0115-WS-N, 2016 WL 6462176 (S.D. Ala. Oct. 28, 2016) (citing United States v.
Floyd, 281 F.3d 1346, 1349 (11th Cir. 2002)); United States v. Steed, 548 F.3d 961, 975–76
(11th Cir. 2008) (“[E]ven assuming that the bases of Gonzalez's expertise as a law enforcement
agent constituted inadmissible hearsay, his testimony in this regard did not violate Rule 703
because those sources are reasonably relied upon by experts in the field.”); Fed. R. Evid. 703
(“An expert may base an opinion on facts or data in the case that the expert has been made aware
of or personally observed. If experts in the particular field would reasonably rely on those kinds
of facts or data in forming an opinion on the subject, they need not be admissible for the opinion
to be admitted.”). Plaintiff does not argue that experts in Laykin’s field do not rely upon witness
interviews. Instead, Plaintiff argues that “Laykin cannot proffer testimony resting on hearsay
statements.” Such an argument ignores that Rule 703 allows experts to rely on hearsay and
creates a procedure through which experts can testify to the contents of the documents upon
which their opinions are based. See Kirksey, 2016 WL 3189242 at * 5 (citing United States v. An
Easement and Right-of-way Over 6.09 Acres of Land, 2015 WL 6444983, *22 (N.D. Ala. Oct.
21, 2015)).
Finally, Plaintiff challenges the helpfulness of this opinion.

The Court finds that

Laykin’s opinion will assist the jury in deciding the issue of willfulness, which is a threshold
issue that Plaintiff must prove at trial to be awarded any damages. Defendant’s theory of the
case is that the number and frequency of guests who received a printed folio with an unmasked
expiration date was so small that management could not have noticed the issue and, therefore,
they could not have knowingly or recklessly violated FACTA. See ECF No. [309] at 12.

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Laykin’s opinion will assist the jury in understanding issues of knowledge, which ties directly
into the issue of willfulness, thereby satisfying the helpfulness prong. However, while Laykin
can provide his opinion in support of Defendants’ knowledge defense, Laykin may not testify to
legal conclusions involving Defendants’ willfulness or recklessness as explained below.
3. Defendants’ Willfulness
Lastly, Plaintiff seeks to strike a series of “wholly uninformed” legal conclusions in
Laykin’s report relating to the lack of a “willful” violation under FACTA. See ECF No. [298] at
9-10. In his report, Laykin devoted multiple pages to the issue of “Lack of Willfulness and
Recklessness.” See ECF No. 298-5 at 29-31. In doing so, Laykin states that Plaintiff “can[not]
demonstrate that Defendants’ actions with respect to printed folios were a willful, knowing,
reckless or intentional violation of FACTA.” See ECF No. 298-5 at 29. The report repeatedly
references the lack of “willful” conduct and the lack of “recklessness,” ultimately opining that
“[t]hese actions taken by Jupiter Beach Resort over a period of years demonstrate a lack of
willfulness and recklessness in this matter despite the reality that there was a failure to catch this
computer glitch earlier.” Id. at 29-31.
For a plaintiff to recover damages in a FACTA lawsuit that does not allege actual harm,
as is the case here, the plaintiff must demonstrate the defendant “willfully failed to comply” with
FACTA’s requirements. See 28 U.S.C. § 1681n(a). The term “willfully” in § 1681n(a) has been
construed as requiring evidence of a knowing or reckless disregard for the law. Harris v.
Mexican Specialty Foods, Inc., 564 F.3d 1301, 1310 (11th Cir. 2009). To prove recklessness, a
plaintiff must establish that the Defendants’ “action[s] are not only a violation under a reasonable
reading of the statute's terms,’ but also “that the company ran a risk of violating the law
substantially greater than the risk associated with a reading [of the law] that was merely

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careless.” Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 55-57 (2007)). At trial, the jury will be
asked to determine whether Defendants’ alleged violation of FACTA was “willful” (i.e. knowing
or reckless). By opining that Defendants did not act willfully or recklessly, Laykin would be
telling the jury the specific result it should reach, which is impermissible. Montgomery v. Aetna
Cas. & Sur. Co., 898 F.2d 1537, 1541 (11th Cir. 1990) (“An expert may not, however, merely
tell the jury what result to reach.”). Expert witness testimony that suggests the ultimate result to
the jury is not helpful. Id. Further, “[a] witness also may not testify to the legal implications of
conduct; the court must be the jury's only source of law.” Id. (citing United States v. Poschwatta,
829 F.2d 1477, 1483 (9th Cir. 1987); United States v. Baskes, 649 F.2d 471, 479 (7th Cir. 1980)).
In their Response, Defendants do not dispute that Laykin’s opinions regarding willfulness
and recklessness are legal conclusions. 21 Instead, Defendants refocus the Daubert issue by
arguing that Laykin’s opinion that “Jupiter Beach Resort responded immediately, responsibly,
and effectively to rectify the software glitch caused by Oracle’s software upgrade” is not a legal
conclusion. ECF No. [309] at 17. While the latter may be true, that is not the opinion Plaintiff
seeks to strike.

Rather, Plaintiff is clearly seeking to strike Laykin’s “unabashed legal

conclusions on whether Defendants were willful or reckless in unmasking expiration dates on
thousands of receipts over a 3 ½ month period.” ECF No. [298] at 9. The Court agrees with
Plaintiff that Laykin may not testify about the legal implications of Defendants’ conduct as such
testimony invades the province of the Court and is not helpful to the jury. This exclusion
includes any opinion that Defendants did not act in a willful or reckless manner, and to this
extent, Plaintiff’s Daubert Motion is granted.
21

Defendants do not dispute that legal conclusions are inadmissible. In fact, Defendants’ own Daubert
Motion contains a section entitled “LEGAL CONCLUSIONS INVADE THE PROVINCE OF THE
JURY” in which Defendants argue that “Mr. Coker cannot opine that Defendants violated FACTA
because such an opinion would be a conclusion of law.” ECF No. [300] at 18.

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B. Defendants’ Daubert Motion
Defendants’ Daubert Motion challenges the opinions of Plaintiff’s expert, Don Coker,
and seeks to preclude him from testifying on three specific subjects: (1) whether exposing a hotel
customer’s credit card expiration date on a folio subjects the customer to a risk of harm under
FACTA, (2) whether the proposed class is ascertainable, and (3) whether the unmasking of
expiration dates at the Jupiter Beach Resort occurred recklessly and due to a “gross deviation
from industry standard practices.” See ECF No. [300] at 2.
1. Risk of Harm
Much like Defendant, Plaintiff disclosed an expert who discusses the risk of harm of
exposing a credit card expiration date on a printed receipt but, predictably, Coker’s analysis
reaches the opposite conclusion. As the parties concede in their memoranda, this opinion is
relevant to the issue of Plaintiff’s Article III standing. In their Motion, Defendants seeks to
exclude the opinion under all three prongs of a Daubert inquiry – qualifications, reliability, and
helpfulness. However, the Court need not decide these matters. The Court’s finding at the class
certification stage that Plaintiff suffered a concrete harm rendered the issue of standing moot.
The Court arrived at this conclusion as a matter of law without reliance upon the expert witness
reports. 22
Nonetheless, Plaintiff’s Response argues that Coker’s opinion will be helpful to the jury.
See ECF No. [307] at 13. In support of this argument, Plaintiff states that exclusion of Coker’s
opinion would prejudice Plaintiff and unfairly benefit Defendants because Laykin provides a
contrary opinion. Id. This argument fails to recognize that standing is a question of subject
matter jurisdiction, not a question for the trier of fact. The jury will not be asked to decide the

22

The Court recognizes the parties did not have the benefit of this ruling at the time they briefed the Daubert issues.

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issue of Plaintiff’s standing, thereby eliminating the need for Laykin or Coker to testify about
this subject. At trial, the jury will be asked to determine whether Defendants violated FACTA,
specifically whether they accepted credit cards or debit cards for the transaction of business and
printed more than the last five digits of the card number or the expiration date upon the receipt
provided to Plaintiff at the point of sale or transaction. See 15 U.S.C. § 1681(c)(g). If the jury
answers this question in the affirmative, it will then be asked to decide whether Defendants
willfully failed to comply with this requirement and if so, to assess damages. See 15 U.S.C. §
1681n. However, the jury will not be asked whether Plaintiff suffered any harm or risk of harm;
therefore, such an opinion would not help the jury decide the issues at trial. See McDowell v.
Brown, 392 F.3d 1283, 1299 (11th Cir. 2004) (citing Daubert, 509 U.S. at 591) (stating that for
an opinion to be helpful, a “fit” must exist between the offered opinion and the facts of the case).
Much like the Court found that Laykin’s opinion on this point is moot, the Court likewise finds
that Coker’s competing opinion on the same subject is moot. As such, this opinion is excluded.
2. Ascertainability
Defendants next seek to exclude Coker’s opinion on another class-certification subject
that is moot in light of the Court’s Order. Specifically, Defendants seek to preclude Coker from
opining that the class is ascertainable. See ECF No. [300] at 8. Once again, the Court need not
decide whether Coker is qualified to render this opinion, whether his methodology was reliable
or whether this opinion is helpful. The Court already determined that the members of the
proposed class and subclass are not ascertainable in that certification of the class would require
individualized inquiries to determine whether each individual “received any receipts or folios
during their stay at the Jupiter Beach Resort, and if so, whether the receipt or folio was obtained
from the front desk.” ECF No. [330] at 19. The Court reached this conclusion based on the

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factual evidence in the record without any reliance upon expert witness reports. Id. at 20 n. 8.
Thus, any expert opinions on the subject of ascertainability of the class are moot in light of the
Court’s prior order denying class certification. As such, this opinion is excluded.
3. Hotel Industry Practices
The third opinion Defendants seek to exclude is Coker’s conclusion that unmasking of
expiration dates occurred recklessly due to a “gross deviation from industry standard practices.”
Defendants challenge Coker’s qualifications, the reliability of his methodology, and the
helpfulness of the opinion. For the reasons explained below, the Court finds that Coker is not
qualified to provide opinions on hotel industry practices and that the methodology he used to
reach those opinions lacks a factual foundation, rendering the opinion unreliable.
Starting with the qualifications prong, Defendants argue that Coker cannot comment
upon the industry practices at the Jupiter Beach Resort and Defendants’ compliance or lack of
compliance with such practices when he has no hotel employment experience, no hospitality
education, no knowledge of the hotel industry, no understanding of the hotel check-out process,
no understanding of the Opera software used at the hotel, no knowledge about Oracle’s
relationship to the hotel, and no history of publications on the subject. See ECF No. [300] at 16.
Rather than address Coker’s qualifications to provide this specific opinion, Plaintiff argues that
(1) Coker need not have experience in cybersecurity or the prevalent forms of identity theft, (2)
Coker has years of professional experience as a high-level banker, mortgage banker, lender, and
independent consultant, (3) Coker has been published in these fields, and (4) Coker has testified
extensively as an expert witness, including serving as an expert in more than 50 FACTA cases.
See ECF No. [307] at 2-6.

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While the Court agrees that Coker has significant experience, training, and education in
areas of finance, lending, and banking, Coker’s opinion extends far beyond the scope of his
expertise. By testifying about Jupiter Beach Resort’s gross deviation from “industry practices,”
he necessarily implicates the standard practices of the hospitality industry. In order to opine on
Defendants’ hotel practices, it is necessary that Coker have at least some minimal training,
education, experience, knowledge, or skill in this particular industry. See J.G., 2013 WL 752697
at *3 (citing Furmanite, 506 F. Supp. 2d at 1129; Fed. R. Evid. 702. Although “[a]n expert is not
necessarily unqualified simply because [his] experience does not precisely match the matter at
hand,” Coker’s background has no relationship or connection to the very industry about which he
seeks to opine. Id. (citing Maiz v. Virani, 253 F.3d 641, 665 (11th Cir. 2001)). Not only is it
undisputed that he has no such background, but Coker admits he has not previously been an
expert in a case involving a hotel. See ECF No. [300-2] at 9 (“[A]lthough this case may be the
first involving a hotel company, the FACTA violation is substantially the same as those that I
have previously been involved in.”).

While Coker’s report is arguably unclear on which

“industry practices” he is opining on, Plaintiff’s Response does not dispute that this opinion
pertains to the hotel industry. Instead, the focus of Plaintiff’s Response is on Coker’s banking
credentials and his extensive experience as an expert in other FACTA cases. See ECF No. [307]
at 2-8. Coker’s report, rebuttal report, and curriculum vitae reflects the complete absence of any
background that would qualify him as an expert on hotel industry practices.
Even if the Court interpreted Coker’s report to opine upon “industry practices” within the
credit card industry, Coker’s opinion is still subject to exclusion given the unreliability of
Coker’s methodology. When determining whether an expert’s testimony is reliable, “the trial
judge must assess whether the reasoning or methodology underlying the testimony is

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scientifically valid and whether that reasoning or methodology properly can be applied to the
facts in issue.”

Frazier, 387 F.3d at 1261-62 (internal formatting, quotation, and citation

omitted). The Court’s review of Coker’s report reveals that he prepared a 25-page report
outlining his opinions having reviewed only three documents specific to this case: (1) the Class
Action Complaint, (2) Defendant’s Responses to First Set of Discovery Requests, and (3) a
receipt dated June 3, 2016. See ECF No. [300-1] at 6, 25 (stating that he reviewed “the subject
receipt” and “the case materials listed in the ‘Materials Reviewed’ section of th[e] Report.”).
Based on the description of materials, it appears that Coker did not even review the operative
complaint in this case or the subject receipt. The original complaint filed against OPL on April
1, 2016 was entitled “Class Action Complaint for Violations of the Fair and Accurate Credit
Transactions Act (FACTA)” while the current complaint against all Defendants is entitled
“Plaintiff’s Second Amended Class Action Complaint for Violations of the Fair Accurate Credit
Transactions Act (FACTA).” Compare ECF No. [1] (emphasis added) with [47] (emphasis
added). As to the folio or receipt, the subject folio was dated March 9, 2016, but Coker states
that the receipt he reviewed was dated June 3, 2016. Compare ECF No. [47-29] with [300-1] at
25. Id. Therefore, it is doubtful that Coker reviewed Plaintiff’s receipt from the Jupiter Beach
Resort and even more doubtful that he reviewed a receipt that unmasked the expiration date as it
is undisputed that the Oracle software issue was corrected by April 6, 2016 – two months before
the date on the folio Coker reviewed. 23

23

Coker also states he reviewed “Defendant’s Responses to First Set of Discovery Requests.” See ECF
No. [300-1] at 25. Although it is unclear which Defendant’s discovery responses he reviewed and
whether those responses pertained to a request for production, request for admissions, or interrogatories, it
is clear that he only reviewed discovery responses pertaining to one of the four Defendants in this case.
Despite this, he provided opinions pertaining to all four Defendants.

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Moreover, even if Coker had the operative pleading and the subject receipt, Coker
reaches conclusions regarding Defendants’ alleged failure to adhere to industry practices without
reviewing any testimony or otherwise conducting any investigation into the practices or software
used at the Jupiter Beach Resort. Specifically, Coker’s report concludes as follows:
The Defendants clearly were at fault for not obtaining and maintaining systems
that would comply with FACTA’s requirements that were passed into law by
Congress in 2003 and went into effect in 2006. The Defendants could have
adjusted its [sic] IT systems to comply with FACTA, hired an outside firm to do
the task or purchase a module or new system that would achieve compliance with
FACTA, but they did not.
See ECF No. [300-1] at 23-24 (emphasis added).
Rather than address how Coker arrived at his opinions in his original report, Plaintiff’s
Response focuses almost exclusively on the evidence he considered in support of his rebuttal
report issued six months later in direct response to Laykin’s report. 24 Yet, Defendants’ Daubert
Motion seeks to strike only those opinions within Coker’s original report, see ECF No. [300] at
16-18, and Coker cannot rely upon evidence he reviewed six months after he issued his original
report to support those earlier opinions. Focusing the Court’s analysis on Coker’s original
report, Plaintiff’s states he based his opinion that Defendants failed to adhere to industry
standards on: (1) Defendants’ receipt of notices discussing the requirements of FACTA sent by
Visa and Mastercard to all merchants, (2) OPL’s status as a defendant in a 2008 lawsuit alleging
a FACTA violation, and (3) Coker’s “experience and observations [that] ‘a business in the same
position as Defendants would choose to take the legally required actions to bring its IT system
24

For example, Plaintiff argues that “Coker read several transcripts including Defendants’ corporate
representative Richard Ade, and Mr. Lazenby’s, as his reports indicate.” See ECF No. [307] at 19.
However, Coker’s original report does not cite to a single deposition transcript among the materials
reviewed. See ECF No. [300-1] at 25. It was not until the rebuttal report issued six months later that
Coker listed any deposition transcripts. See ECF No. 300-2 at 9. It would have been impossible for
Coker to rely upon either deposition transcript when he issued his January 30, 2017 report as Ade’s
deposition was taken on February 22, 2017 and Lazenby’s deposition was taken on May 11, 2017.
Compare ECF No. [300-1] at 1 with [300-2] at 9.

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into compliance with FACTA.” See ECF No. [300-1] at 16; ECF No. [307] at 15-16. Plaintiff’s
Response does not direct the Court to any other basis for the opinions in Coker’s original report.
Significantly, Coker’s report does not cite to any documents, testimony or other evidence he
relied upon when determining that all four Defendants failed to adjust their IT systems to comply
with FACTA, that all four Defendants failed to hire an outside company to assist them with
FACTA compliance, or that none of the Defendants purchased a module or new system to
achieve such compliance. Id.
Thus, the Court finds that Coker’s conclusions are unreliable in that they are not logically
supported by any facts. See Guinn, 602 F.3d at 1255–56 (affirming district court’s decision to
exclude testimony as unreliable when the “conclusions were not logically supported by the facts
of th[e] case). Neither Daubert nor the Federal Rules of Evidence require this Court to “admit
opinion evidence which is connected to existing data only by [Coker’s] ipse dixit.” Id. (quoting
Gen. Elec. Co. v. Joiner, 522 U.S. 136, 146 (1997)). This Court finds that “there is simply too
great an analytical gap between the data [Coker relied upon] and the opinion proffered.” Id.; see
also McDowell, 392 F.3d at 1301–02 (“[A]n expert opinion is inadmissible when the only
connection between the conclusion and the existing data is the expert's own assertions....”).
Coker’s methodology is simply unreliable. As such, his opinions in this area are inadmissible.
4. Legal Conclusions
Finally, Defendants seek to preclude Coker from opining that they violated FACTA,
arguing this is an impermissible legal conclusion. See ECF No. [300] at 18. Coker’s report
states that Defendants’ “widespread violation of FACTA was not an accident but rather was
simply a failure or refusal to act when it should have.” ECF No. [300-1] at 16. It also references
instances of Defendants’ “reckless” conduct. Id. Consistent with this Court’s ruling that Laykin

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may not opine in the form of legal conclusions at trial, see Section III(A)(3), Coker likewise may
not testify that Defendants violated FACTA or that they acted willfully or recklessly as those
legal conclusions invade the province of the Court and are not helpful to the jury.
5. Coker’s Testimonial List
Lastly, Defendants seek to strike Coker as an expert because the testimonial lists attached
to his original report and rebuttal report do not provide any case numbers, jurisdictions, citations
or otherwise specify whether the testimony was at trial or in the form of deposition. 25
Defendants argue that the failure to provide such information is “per se ‘prejudicial to
Defendants.’” ECF No. [300] at 4 (citing Medina v. United Christian Evangelistic Ass’n, 2009
WL 4030454 (S.D. Fla. Nov. 20, 2009)). While it is true that Coker’s testimonial lists are devoid
of this information, the Court notes that Coker’s original report was dated January 30, 2017 and,
according to Plaintiff, it was delivered to Defendants on February 1, 2017. See ECF No. [307] at
19. Yet, Defendants did not raise this issue until their Daubert Motion was filed on July 31,
2017 – six months later. At no point in time did Defendants move to compel the information in
an effort to cure any prejudice. Similarly, Defendants received Coker’s rebuttal report on June
12, 2017 and then waited six weeks to raise this issue. Defendants cannot claim that this
omission has unfairly prejudiced them and seek to strike Coker when they failed to apprise the
Court of the omission or to otherwise cure the potential prejudice. See Jones v. Royal Caribbean
Cruises, Ltd., No. 12-20322-CIV, 2013 WL 8695361, at *4 (S.D. Fla. Apr. 4, 2013) (“The
problem for Defendant, though, is that it had the ability to compel, and thereby cure any potential
25

Defendants also seek to strike Coker as an expert because other courts in other unrelated cases have
stricken his opinions, affidavit, or report. See ECF No. [300] at 5-6 (“Cases Available to Defendants on
Westlaw Demonstrate Generally Mr. Coker is not Qualified”). In support of this argument, Defendants
direct the Court to a handful of cases where Coker’s report or affidavit were stricken as untimely or cases
where his opinion was deemed unpersuasive. Id. The Court will not judge Coker’s qualifications or the
reliability or helpfulness of his opinions in this case based on the particularities of other unrelated cases
involving unrelated issues.

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surprise, prior to the discovery cutoff, by advising Plaintiff that his disclosures did not comply
with the rules and by requesting more specific disclosures. . . . Defendant could have sought
intervention of the Court. Defendant did not do so, possibly believing that Plaintiff's noncompliance would doom his ability to offer any expert testimony. That is in and of itself a risky
strategy.”). The Motion to strike on this basis is rejected.
C. GHM’s Motion for Summary Judgment
1. Defendants’ Objection to Coker’s Report on Summary Judgment
Before reaching the merits of GHM’s Motion, the Court must address GHM’s objection
to Plaintiff’s use of Coker’s expert witness report and rebuttal report on summary judgment.
GHM argues that Plaintiff did not submit a declaration from Coker stating the reports were made
under penalty of perjury pursuant to 28 U.S.C. § 1746 and neither report contains such a
declaration. See ECF No. [348] at 3. “Only ‘pleadings, depositions, answers to interrogatories,
and admissions on file, together with affidavits’ can be considered by the district court in
reviewing a summary judgment motion.” Carr v. Tatangelo, 338 F.3d 1259, 1273 (11th Cir.
2003), as amended (Sept. 29, 2003) (quoting former Fed. R. Civ. P. 56(e)). “Unsworn statements
‘do[ ] not meet the requirements of Fed. Rule Civ. Proc. 56(e)’ and cannot be considered by a
district court in ruling on a summary judgment motion.” Id. (quoting Adickes v. S.H. Kress &
Co., 398 U.S. 144, 158 n. 17 (1970)). If an expert’s report is submitted without attestation, it has
no probative value and cannot be considered on summary judgment. Id.; see also Beard v.
Green, No. 08-22284-CIV-SEITZ, 2010 WL 411084, at *10 (S.D. Fla. Jan. 29, 2010) (citing
Nissho-Iwai American Corp. v. Kline, 845 F.2d 1300, 1306-07 (5th Cir.1988)) (“Just as is true
for an unsworn affidavit, a document which does not meet the requirements of Fed.R.Civ.P.
56(e) or 28 U.S.C. § 1746, is to be disregarded by a court in conjunction with its review of the

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record in consideration of a defendant's motion for summary judgment.”). This Court has
already stricken some of Coker’s opinions, as explained above, or has otherwise deemed the
opinions moot in light of the Court’s rulings on ascertainability and standing. Even if Coker’s
opinions were intact, this Court cannot consider his report or rebuttal report at the summary
judgment stage as neither of them are in the form of an affidavit or attested to under penalty of
perjury. 26
2. Willfulness
FACTA provides that “no person that accepts credit cards or debit cards for the
transaction of business shall print more than the last 5 digits of the card number or the expiration
date upon any receipt provided to the cardholder at the point of the sale or transaction.” 15
U.S.C. § 1681c(g)(1). Thus, to prove direct liability, Plaintiff must demonstrate that Defendants
are (1) a “person” that (2) accepts credit or debit cards for the transaction of business and (3)
prints and provides the receipt, in this case a folio, to the cardholder at the point of sale. Id. The
word “person” is defined as “any individual, partnership, corporation, trust, estate, cooperative,
association, government or governmental subdivision or agency, or other entity.” 15 U.S.C. §
1681a(b). In order to be entitled to damages, consisting of statutory damages, punitive damages,
and attorneys’ fees, Plaintiff must also prove that Defendants’ violation of FACTA was done
“willfully.” See 28 U.S.C. § 1681n(a). The term “willfully” in § 1681n(a) has been construed as
requiring evidence of a knowing or reckless disregard for the law. Collins v. Experian Info.
Sols., Inc., 775 F.3d 1330, 1336 (11th Cir.), on reh'g sub nom. Collins v. Equable Ascent Fin.,
26

Similarly, GHM objects to Plaintiff’s use of a document that purports to be from the Federal Trade
Commission’s 2012 Consumer Sentinel Network. See ECF No. 336-2. Plaintiff does not proffer or
otherwise explain how this document may be considered on summary judgment. In any event, Plaintiff
proffers facts from this report to support his position that identity theft in Florida is prevalent. Because
these facts are only probative in deciding whether Plaintiff sustained any concrete harm and the Court has
already answered that question in the affirmative, these facts are not material to the issues remaining on
summary judgment.

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LLC, 781 F.3d 1270 (11th Cir. 2015); Harris v. Mexican Specialty Foods, Inc., 564 F.3d 1301,
1310 (11th Cir. 2009); Carlisle v. Nat'l Commercial Servs., Inc., No. 1:14-CV-515-TWT-LTW,
2017 WL 1075088, at *14 (N.D. Ga. Feb. 22, 2017), report and recommendation adopted, No.
1:14-CV-515-TWT, 2017 WL 1049454 (N.D. Ga. Mar. 20, 2017). Thus, at trial, Plaintiff must
prove that Defendants knowingly violated FACTA or were reckless in their violation. Plaintiff’s
Response argues that an issue of fact exists as to whether Defendants’ violation was both
knowing and reckless.
a. Knowing Violation
In its Motion, GHM originally assumed that Plaintiff was not pursuing a willfulness
theory of liability based on a knowing violation of FACTA. See ECF No. [325] at 13. Plaintiff’s
Response, however, argues otherwise. More specifically, Plaintiff states that an issue of fact
exists because GHM was expressly aware of FACTA’s requirements as evidenced by its training
of its hotel general managers and front desk staff on FACTA compliance and its shared officers
and offices with OPL, which was previously sued for a FACTA violation. See ECF No. [336] at
6. Adding to this argument, Plaintiff states that “GHM knew the PM system was programmed to
print credit and debit card transaction receipts that disclosed card expiration dates because the
very same day the PM system upgrade occurred in December 2015 GHM’s staff circulated an
email about receipt printing problems that listed the receipt contents, which included the card
expiration date.” Id. (emphasis in original).
In this case, GHM does not dispute that it knew about FACTA’s requirements during the
relevant timeframe. 27 See ECF No. [348] at 7 (stating it “does not dispute that it had knowledge

27

Given GHM’s admission that it knew about FACTA’s requirements, the Court need not address
Plaintiff’s argument that OPL’s involvement in another FACTA lawsuit is evidence of GHM’s
knowledge. See ECF No. [336] at 6.

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of FACTA.”). However, knowledge of FACTA’s requirements, standing alone, is not enough to
prove willfulness. Plaintiff must demonstrate a knowing disregard for the law. Collins, 775
F.3d at 1336; Carlisle, 2017 WL 1075088 at *14 (dismissing amended complaint because there
were no facts to support the notion that the defendant knew its actions violated the FCRA). This
requires that GHM have actual knowledge that it was violating FACTA – not mere knowledge of
FACTA.

The record is devoid of any evidence demonstrating that GHM knew about the

unmasking of expiration dates during the relevant timeframe. Instead, Plaintiff’s argument is
that GHM had countless opportunities to discover the FACTA violation but failed at every turn.
While such evidence is probative on the issue of recklessness, it is not evidence of GHM’s actual
knowledge. Plaintiff does not direct the Court to a single FACTA decision in which a knowing
violation was proven with anything less than actual knowledge. In fact, the Court’s review of the
law discussing knowing violations leads it to conclude otherwise. See Keller v. Macon Cty.
Greyhound Park, Inc., No. 3:07-CV-1098-WKW, 2011 WL 1559555, at *4 (M.D. Ala. Apr. 25,
2011), aff'd, 464 F. App'x 824 (11th Cir. 2012)(granting summary judgment because “there
[wa]s no argument or any supporting facts that MCGP acquired knowledge that it was printing
FACTA violative receipts prior to December 5, 2007.”); Cowley v. Burger King Corp., No. 0721772-CIV, 2008 WL 8910653, at *5 (S.D. Fla. May 23, 2008) (“Plaintiff does not conclusively
establish that Defendant knowingly issued receipts that contained credit card’s expiration date.
And because Plaintiff does not do so, summary judgment [in his favor] is inappropriate.”).
Because the record contains no evidence of GHM’s actual knowledge of the FACTA violation,
Plaintiff cannot prove this theory of liability as a matter of law. Therefore, GHM’s Motion for
Summary Judgment is granted on this specific theory.

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b. Reckless Violation
The Court must next determine whether an issue of fact exists as to GHM’s alleged
reckless violation of FACTA. “[A] company subject to [the] FCRA does not act in reckless
disregard of it unless the action is not only a violation under a reasonable reading of the statute's
terms, but shows that the company ran a risk of violating the law substantially greater than the
risk associated with a reading that was merely careless.” Safeco, 551 U.S. at 69. In order to
determine if an interpretation is a reasonable reading of the statute's terms, a district court must
determine whether such an interpretation “has a foundation in the statutory text” or whether the
interpreting party “had the benefit of guidance from the courts of appeals,” or federal regulatory
agencies “that might have warned it away from the view it took.” Carlisle, 2017 WL 1075088,
at *14 (quoting Safeco, 551 U.S. at 69-70; Seamans v. Temple Univ., 744 F.3d 853, 867-68 (3d
Cir. 2014)). Here, none of the Defendants have taken the position that the printing of folios with
unmasked expiration dates was permitted under FACTA, making it unnecessary to determine
whether their interpretation of the statute was objectively reasonable. Instead, the Court must
focus its analysis on whether there is evidence that Defendants “engaged in any form of reckless
disregard of FACTA during this period.” Keller, 2011 WL 1559555 at *4. Recklessness under
FACTA is something more than negligence but less than a knowing violation of the law's
requirements. See Rosenthal v. Longchamp Coral Gables LLC, No. 08-21757-CIV, 2009 WL
1854846, at *2 (S.D. Fla. June 29, 2009) (citing Murray v. New Cingular Wireless Servs., Inc.,
523 F.3d 719, 726 (7th Cir.2008); Kubas v. Standard Parking Corp., 2009 WL 211967, *2 (N.D.
Ill. Jan.29, 2009)); Bouton v. Ocean Properties, Ltd., 201 F. Supp. 3d 1341, 1350 (S.D. Fla.
2016) (“Courts applying Safeco have made clear that under FACTA, a plaintiff must allege more
than mere negligence.”).

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GHM asks the Court to apply a standard of recklessness that would also require proof of
“an unjustifiably high risk of harm that is either known or so obvious that it should be known.”
See ECF No. [325] at 19. In support of this argument, Plaintiff cites to a one-page unpublished
Eleventh Circuit decision affirming the entry of summary judgment in favor of the defendant in
which the appellate court quoted from dicta in Safeco. See Keller, 464 F. App’x at 824. The
opinion in Keller, however, affirmed the trial court’s order without any analysis or discussion of
the Supreme Court’s definition of recklessness. Id. Much like GHM here, other defendants
within have relied upon this same dicta to argue that recklessness under FACTA requires proof
of “risk of harm” to later learn that such a characterization of Safeco’s definition is “incorrect.”
Cowley v. Burger King Corp., No. 07-21772-CIV, 2008 WL 8910653, at *6 (S.D. Fla. May 23,
2008). This is because “[t]he Safeco court used the term ‘risk of harm’ only in the context of
explaining why ‘recklessness' under FACTA refers to whether there was a ‘reckless disregard of
statutory duty.” Id. (emphasis in original). See also Ramirez v. Midwest Airlines, Inc., 537 F.
Supp. 2d 1161, 1169 (D. Kan. 2008) (“Thus, it is the reckless disregard of statutory duties (not
harm) that makes a violation willful. . . . Nowhere did the Court in Safeco suggest that the ‘risk
of harm’ standard from tort law is incorporated into the FCRA.”); Soualian v. Int'l Coffee & Tea,
LLC, No. CV 07-0502RGKJCX, 2008 WL 410618, at *3 (C.D. Cal. Feb. 9, 2008) (“The Court
also disagrees with Defendant's characterization of the reckless standard as requiring a risk of
harm. . . . the correct inquiry here is whether Coffee Bean's actions were in reckless disregard of
the FCRA.”). Thus, this Court will limit its inquiry on summary judgment to whether GHM’s
actions constitute a reckless disregard of FACTA’s requirements.
In support of summary judgment, GHM relies upon the district court’s opinion in Keller,
which was later affirmed by the Eleventh Circuit. The theory of recklessness in Keller was

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materially different than the theory Plaintiff advances here, making the analysis in this case
distinguishable from Keller. 2011 WL 1559555 at *3. Much like in this case, Keller involved a
defendant that purchased a credit and debit card point of sale system from a specific vendor that
also installed the software. Id. at *2. At some point later in time, the software crashed. Id. On
the following day, the vendor restored the system, which, unbeknownst to the defendant, caused
the system to print all sixteen credit card numbers on receipts. Id. The office manager of the
food and beverage department would collect the merchant copies of credit card receipts on a
daily basis, sort them, add the totals, and place tape around the stack. Id. at *3. Unlike this case,
however, the office manager was never trained to look for FACTA violations when reviewing
receipts. Id. Approximately six weeks later, the FACTA issue was discovered and corrected on
the same date. Id.
The plaintiff in Keller argued in a conclusory fashion that the defendant “just chose to
recklessly disregard the FACTA violations.” Id. at *5. Although this argument was “unstated,”
the district court bridged the gap between the manager’s review of the receipts and the plaintiff’s
conclusory argument by questioning whether the defendant’s failure to train the manager in
FACTA compliance was reckless. Id. Ultimately, the district court concluded that these failures
may amount to carelessness, but the record was “wholly devoid of any coherent argument that it
amounts to reckless disregard.” Id. In this case, Plaintiff’s theory is materially different than the
one advanced in Keller. There is no dispute that both front desk staff and managers were trained
to ensure there was FACTA compliance at the Jupiter Beach Resort. Unlike Keller, Plaintiff
does not argue that GHM should have implemented measures to detect the violation. Plaintiff’s
theory is that GHM knew about FACTA, had repeated opportunities to detect the violations, and
yet no one noticed the issue until months later when this lawsuit was filed.

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In support of this theory, Plaintiff directs the Court to the 200 folios with unmasked
expiration dates within the nightly audit packs. GHM dismisses this evidence as seemingly
irrelevant because these folios were not handed to the customer at the point of sale and do not,
therefore, represent FACTA violations. See ECF No. [348] at 9. GHM’s argument misses the
point. Plaintiff is not citing to these folios as evidence of other receipts provided to consumers at
the point of sale. Plaintiff is citing to them as evidence of recklessness – evidence that in a threeand-one-half month time span front desk employees printed out folios containing unmasked
credit card expiration dates on more than 200 occasions and then proceeded to place those folios
into the nightly audit pack. These front desk employees were trained on matters of FACTA
compliance. Therefore, they knew what they were looking for and yet they failed to spot the
unmasking of expiration dates on 200 separate occasions. 28 Then, the manager on duty, also
trained on FACTA compliance, was tasked with reviewing those folios within the audit pack, but
did not notice the unmasked expiration dates either. Thus, arguably two sets of trained eyes
looked at those 200 folios showing unmasked expirations dates during the relevant timeframe
and never noticed a problem.
For summary judgment purposes, the Court must draw every inference in the non-moving
party’s favor. Plaintiff has presented sufficient evidence to create an issue of fact as to whether
GHM was reckless in its failure to notice the FACTA violation and rectify it prior to Plaintiff’s
stay. Arguably, GHM, whose employees knew what to look for, had at least 400 opportunities to
28

GHM also argues that there is no evidence these audit pack folios printed in the same format as
customer-facing folios. See ECF No. [348] at 13. On summary judgment, however, the moving party –
GHM - shoulders the initial burden to demonstrate the absence of a genuine issue of material fact. See
Shiver v. Chertoff, 549 F.3d 1342, 1343 (11th Cir. 2008). GHM did not present any evidence to
demonstrate that the audit pack folios indeed printed in a different format than the customer-facing folios
or that the audit pack folios unmasked the expiration dates before and after the Oracle software upgrade,
which would eliminate any argument that the front desk staff and general managers failed to detect a
FACTA violation. On summary judgment, the Court is mindful that it must view all of the facts in the
light most favorable to Plaintiff and draw all reasonable inferences in the record in Plaintiff’s favor.

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discover that the folios printed at the front desk and placed into the audit packs were unmasking
credit card expiration dates. Based on this alone, the Court cannot conclude that no reasonable
jury could find that GHM’s actions were reckless.
The existence of an issue of fact becomes even more apparent when the Court considers
Laykin’s estimate that, during the three-and-a-half month timeframe, approximately 1,083 folios
could have been printed at the front desk with unmasked expiration dates. Thus, in addition to
the 400 missed opportunities to detect the FACTA violation in the audit packs, GHM possibly
had another 1,083 opportunities to detect the issue as its front desk staff handed the folios to the
customers. In addition, Plaintiff presented evidence of an email chain dated December 22, 2015
in which Oracle was informed that “the [f]ront [d]esk users can now access the guest folios
within Billing, however, apparently they are now receiving the following message when
attempting to perform an express checkout/post charges.” ECF No. [290-18]. The error message,
which did not pop up prior to the upgrade, references the need to set up a “GST FOLIO printer
task.” Id. Beneath that pop-up window, the screen reveals an unmasked credit card expiration
date. Id. Taking all inferences in Plaintiff’s favor, this creates an issue of fact as to whether the
front desk employees should have detected a problem with the unmasked expiration dates as
early as December 22, 2015. Ultimately, the jury will be tasked to decide whether this evidence
rises only to the level of “mere human mistake” or to the level of a systematic failure amounting
to recklessness. For these reasons, GHM’s Motion is denied as to recklessness.
3. Standing
In its Motion for Summary Judgment, GHM once again raises the issue of Plaintiff’s
standing, arguing that Plaintiff has not demonstrated a concrete harm. All Defendants join in this
argument and incorporate it by reference into their respective Motions. In its Reply, GHM

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acknowledges this Court’s recent ruling on standing and requests reconsideration. “[T]he courts
have delineated three major grounds justifying reconsideration: (1) an intervening change in
controlling law; (2) the availability of new evidence; and (3) the need to correct clear error or
prevent manifest injustice.” Williams v. Cruise Ships Catering & Serv. Int’l, N.V., 320 F. Supp.
2d 1347, 1357-58 (S.D. Fla. 2004) (citing Sussman v. Salem, Saxon & Nielsen, P.A., 153 F.R.D.
689, 694 (M.D. Fla. 1994)); see Burger King Corp. v. Ashland Equities, Inc., 181 F. Supp. 2d
1366, 1369 (S.D. Fla. 2002).

GHM does not specify the grounds upon which it seeks

reconsideration. Despite this, the Court has independently reviewed all three grounds and none
warrant the relief requested. First, GHM does not cite to any recent precedent from the Eleventh
Circuit or the Supreme Court that would constitute an intervening change in controlling law.
Likewise, it does not argue that new evidence relevant to standing has become available. To the
contrary, GHM relies upon the same arguments and evidence involving Plaintiff’s safeguarding
of the folio previously presented at the class certification stage.

As to the last basis for

reconsideration, GHM does not raise a need to correct clear error or prevent manifest injustice
and the Court concludes that no such need exists.
“[R]econsideration of a previous order is an extraordinary remedy to be employed
sparingly in the interests of finality and conservation of scarce judicial resources.” Wendy’s
Int’l, Inc. v. Nu-Cape Const., Inc., 169 F.R.D. 680, 685 (M.D. Fla. 1996); see also Campero USA
Corp. v. ADS Foodservice, LLC, 916 F. Supp. 2d 1284, 1290 (S.D. Fla. 2012). “A motion for
reconsideration should not be used as a vehicle to present authorities available at the time of the
first decision or to reiterate arguments previously made.” Z.K. Marine Inc. v. M/V Archigetis,
808 F. Supp. 1561, 1563 (S.D. Fla. 1992). The Court finds that GHM is simply reiterating old
arguments that have already been considered and rejected. For these reasons and those discussed

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in Section III(A)(1) above, the Court declines GHM’s invitation to reconsider its ruling on
Article III standing.
D. Oprock Defendants’ Motion for Summary Judgment
The Oprock Defendants seek summary judgment in their favor, arguing there is no
evidence of their direct or vicarious liability for the actions of GHM or OPL. As to Plaintiff’s
theory of direct liability, they argue that Plaintiff cannot prove they accept credit or debit cards
for the transaction of business and print and provide the receipts to cardholders at the point of
sale. 15 U.S.C. § 1681c(g)(1). As to Plaintiff’s theory of vicarious liability, they argue that
Plaintiff cannot satisfy any of the three theories available under the FCRA. Finally, like GHM,
they argue there is no evidence of willfulness.
a. Direct Liability
In support of their Motion, the Oprock Defendants argue that they are merely the owner
and lessee of the Jupiter Beach Resort and, as such, they do not accept credit or debit cards and
they do not print or provide receipts to cardholders. Responding to this argument, Plaintiff
argues in conclusory fashion that as the owner and lessee of the Jupiter Beach Resort, they are
automatically liable and cannot delegate their responsibility under FACTA. Neither Plaintiff nor
the Oprock Defendants take the time to differentiate between the potential liability of Oprock
Fee, as the property owner, and Oprock TRS, as the property lessee. The facts materially vary
from Oprock Fee to Oprock TRS, so the Court will consider each separately.
1. Oprock Fee
The Court agrees with Oprock Fee that there are no grounds to subject it to direct liability
under FACTA simply by virtue of its ownership of the Jupiter Beach Resort. Plaintiff does not
direct the Court to a single decision interpreting FACTA that imposes liability upon the premises

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owner solely because it owns the property where the violation occurred. Instead, Plaintiff cites
to one copyright infringement case discussing the imposition of joint and several liability on a
corporate officer for a corporation’s infringement and another case discussing liability for
contributory copyright infringement on a premises owner. See Broad. Music, Inc. v.
Meadowlake, Ltd., No. 5:12CV1024, 2013 WL 3927793, at *3 (N.D. Ohio July 29, 2013), aff'd,
754 F.3d 353 (6th Cir. 2014) (emphasis added) (“Although the Sixth Circuit has not addressed
the issue, almost every other circuit court in the country has adopted a two-prong test to
determine whether a corporate officer is jointly and severally liable with the corporation for
copyright infringement.”); UMG Recordings, Inc. v. Sinnott, 300 F. Supp. 2d 993, 1001 (E.D.
Cal. 2004) (“Sinnott had knowledge of the vendors' infringing activity, yet continued to provide
the site and facilities to allow the vendors to continue to sell counterfeit CDs and cassettes.”).
Neither of these cases is instructive on the interpretation of FACTA – a statute that makes no
mention of imposing liability on the basis of property ownership. Plaintiff similarly relies on
other cases interpreting other federal statutes that are not remotely similar to FACTA. See
United States v. Bestfoods, 524 U.S. 51, 55 (1998) (emphasis added) (interpreting § 107 of the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980, which
allowed lawsuits against “any person who at the time of disposal of any hazardous
substance owned or operated any facility.”); Scott v. Suncoast Beverage Sales, Ltd., 295 F.3d
1223, 1231 (11th Cir. 2002) (finding that an employer cannot satisfy its statutory obligation to
send an employee a COBRA notice by hiring a third party to send that notice).

Unlike

CERCLA, FACTA does not create a cause of action against the owner or operator of the facility,
and unlike COBRA, FACTA does not impose any affirmative requirements on the owner of a
property, much less requirements that cannot be delegated. The only FACTA decision upon

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which Plaintiff relies does not create liability for Oprock Fee either as the entity sued therein was
the one that accepted credit and debit card payments and printed the violative receipts. See
Edwards v. Toys “R” Us, 527 F. Supp. 2d 1197, 1203-04 (C.D. Cal. 2007).
This Court, therefore, limits its inquiry to determine whether Oprock Fee accepted credit
or debit cards for the transaction of business, printed the folios, and provided them to the
cardholders at the Jupiter Beach Resort. Based on the Court’s review of the record, it finds there
is no evidence to demonstrate that Oprock Fee played such a role. Although Plaintiff states that
Oprock Fee owned the fictitious name, Jupiter Beach Resort, the record evidence cited by
Plaintiff reveals that only Oprock TRS owned the fictitious name during the relevant timeframe.
See ECF No. [335-5]. Plaintiff also cites to the declaration of Ade to prove that Oprock Fee
owns the folios from the Jupiter Beach Resort, but it is unclear how Ade has personal knowledge
of such information or how his declaration can otherwise bind Oprock Fee. 29 Unlike Oprock
TRS, there is no evidence that Oprock Fee entered into any contracts with Oracle for the
software upgrade at issue.

And although Plaintiff cites to Ade’s corporate representative

deposition for the proposition that the Oprock Defendants approved the upgrade prior to its
implementation, see ECF No. [335] at 6, the testimony of the OPL and GHM corporate
representative cannot be used as an admission against Oprock Fee. Even if it could, the Court’s
review of the cited testimony reveals that the “Rockwood asset manager” approved the software
upgrade at the hotel. See ECF No. [290-4] at 24, 112. Plaintiff does not direct the Court to any

29

Plaintiff cites to an August 3, 2017 fictitious name registration form as proof that Ade is currently a
manager of Oprock Fee. However, Ade’s declaration pre-dates this document by many months and the
declaration does not identify Ade’s relationship to Oprock Fee, if any. See ECF No. [193]. The Court,
therefore, cannot determine whether Ade was a manager of Oprock Fee when the declaration was made or
whether this is a new development.

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testimony that would define “Rockwood asset manager” and the Court will not scour through the
voluminous record to search for such a definition.
Based on the record, Oprock Fee’s only relationship to this lawsuit is its status as the
premises owner of the Jupiter Beach Resort. Taking Plaintiff’s liability argument to its natural
conclusion would mean that any individual or entity that owns a building where businesses
accept credit or debit cards and print receipts would be liable for a FACTA violation simply due
to property ownership rights. This would mean that the owner of a shopping center leasing out
retail space to different tenants would be subject to direct liability for any FACTA violations
committed by those tenants simply because the owner derives a financial benefit from its lease.
Plaintiff’s theory of liability expands FACTA far beyond the statute’s intended scope. For these
reasons, the Court finds there is no evidence to hold Oprock Fee directly liability under FACTA.
2. Oprock TRS
As to Oprock TRS, the Court likewise limits its analysis to whether it accepted debit or
credit cards and printed and provided non-FACTA compliant receipts to cardholders. The
evidence here is a closer question that creates an issue of fact for the jury’s determination.
Although Oprock TRS attempts to minimize its role as the lessee that delegated all hotel
management experience to GHM, Oprock TRS was the entity that entered into the contract with
Oracle for the software upgrade that led to the FACTA violations. GHM did not enter into that
contract. Further, as Plaintiff points out, Oprock TRS owns the fictitious name Jupiter Beach
Resort, which is on the folios at issue. Drawing all inferences in Plaintiff’s favor, this evidence
is sufficient to create an issue of fact for the jury to determine whether Oprock TRS accepted
credit and debit cards and printed them. However, as explained below, Oprock TRS cannot be
subject to direct liability as there is no evidence that it willfully violated FACTA.

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b. Vicarious Liability
With regard to Plaintiff’s theory of vicarious liability, the Oprock Defendants argue that
Plaintiff can prove none of the three theories recognized under the FCRA – authorization,
respondeat superior, or apparent agency. Plaintiff, on the other hand, attempts to establish a
vicarious liability claim against both Oprock Defendants under all three theories. Courts have
found that corporations can be held vicariously liable for the actions committed by their
employees or agents under the FCRA. See Edwards, 527 F. Supp. 2d at 1211; Jones v. Fed. Fin.
Res. Corp., 144 F.3d 961, 966 (6th Cir. 1998). Under the first theory, “a principal may be
vicariously liable for an agent’s tortious conduct if the principal expressly or implicitly
authorized the conduct.” Id. A respondeat superior theory imposes vicarious liability on a
principal “for torts committed by an agent when the agent acts for the benefit of his principal in
the scope of his employment.” Id. And finally, a theory of apparent agency imposes vicarious
liability on the principal for an agent’s tortious conduct “if the principal . . . held the agent out to
third parties as possessing sufficient authority to commit the particular act in question and there
was reliance on the apparent authority.” Id. (omission in original). With this framework in
mind, the Court will address each theory of vicarious liability against each Oprock Defendant.
1. Oprock Fee
With regard to Oprock Fee, the Court finds there is no viable theory of vicarious liability
that can survive summary judgment. Plaintiff’s Response makes no attempt to distinguish
between Oprock Fee and Oprock TRS’ respective alleged statuses as principals. However, each
Defendant is a separate legal entity and must be given separate consideration. It is undisputed
that Oprock Fee does not have any contractual relationships with OPL or GHM. To the extent
Oprock Fee has a contractual relationship with any Defendant in this action, it would be with

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Oprock TRS, as a lessor-lessee, but Plaintiff does not advance such a theory of liability. Further,
Plaintiff did not even file the lease agreement to establish the scope of that relationship. In either
event, the Court will not attempt to analyze a theory of liability that Plaintiff himself does not
attempt to prove.
Thus, Plaintiff’s sole theory is that Oprock Fee is vicariously liable for the actions of
OPL and GHM, but the record does not establish a principal-agent relationship between either
Oprock Fee and OPL or Oprock Fee and GHM under theories of authorization, respondeat
superior or apparent agency. Further, as to apparent agency, it is undisputed that prior to the
filing of this lawsuit, Plaintiff had never heard of Oprock Fee, did not visit the hotel in reliance
upon who owned it, and did not believe that the individuals who worked at the front desk were
agents of Oprock Fee. See ECF No. [166-1] at 66-68, 75. As of the date of his deposition,
Plaintiff still did not know who Oprock Fee was. Id. at 63-65, and 69. See Smith v. Am. Auto.
Ins. Co., 498 So. 2d 448, 449 (Fla. 3d DCA 1986) (finding that the reliance element of an
apparent agency claim could not be established when the plaintiff had never even heard of the
insurance company at issue). Although the Oprock Defendants raise this exact point in their
Motion, see ECF No. [324] at 13-14, Plaintiff makes no attempt to address this element of an
apparent agency claim, much less dispute his own dispositive admissions at deposition. Because
there are no viable theories of vicarious liability against Oprock Fee available to Plaintiff,
summary judgment must be entered in Oprock Fee’s favor.
2. Oprock TRS
Evidence of vicarious liability between Oprock TRS and GHM, however, presents a
closer question. “Under Florida law, ‘[t]he existence of an agency relationship is ordinarily a
question to be determined by a jury in accordance with the evidence adduced at trial.’” Ernani v.

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City of Miami Beach, No. 12-CV-24550, 2014 WL 12514911, at *3 (S.D. Fla. Dec. 4, 2014)
(quoting Orlando Exec. Park Inc. v. Robbins, 433 So. 2d 491, 494 (Fla. 1983)). Summary
judgment may resolve the question of whether an agency relationship existed “only in instances
where ‘the evidence is capable of just one interpretation.’” Id. (quoting Kobel v. Schlosser, 614
So.2d 6, 7 (Fla. 4th DCA 1993)). This is not a case where the evidence is only subject to one
interpretation as it relates to the relationship between Oprock TRS and GHM.
As the lessee of the Jupiter Beach Resort, Oprock TRS entered into a management
agreement with GHM. Plaintiff argues that a principal-agent relationship exists between the two
entities. Oprock TRS, however, points to the provisions within the management agreement that
disclaim any such relationship and instead identify GHM as an independent contractor. See ECF
No. [324] at 11 (“The relationship of Lessee and Management Company shall at all times be that
of Lessee and independent contractor, and nothing contained in this Management Agreement
shall be construed to create any form of agency . . .” ). Language within the contract disclaiming
an agency relationship, however, does not conclusively establish the nature of the relationship.
See Edwards, 527 F. Supp. 2d at 1213 (collecting cases establishing that an independent
contractor status is not dispositive and such a determination will depend upon the circumstances
of the whole activity and not such a singular, isolated factor). To establish actual agency,
Plaintiff must demonstrate: “(1) acknowledgement by the principal that the agent will act for
him, (2) the agent’s acceptance of the undertaking, and (3) control by the principal over the
actions of the agent.” Ernani, 2014 WL 12514911 at *3.
Agency here turns on a question of control. Although the management agreement may
grant GHM exclusive operational control over the Jupiter Beach Resort, the contract for the
Oracle upgrade at issue that led to the FACTA violation was entered into by Oprock TRS – not

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GHM. This evidence creates a question as to whether Oprock TRS still maintained some control
over GHM’s actions, especially its choice of software used to print folios at the hotel, as Oprock
TRS signed and, according to the contract, agreed to be invoiced and pay for the software
upgrade and all other services provided by Oracle. See ECF No. [290-19]. In addition, Oprock
TRS arguably retained some minimal control over GHM in that all folios reflected the name of
Oprock TRS’ fictitious entity – Jupiter Beach Resort – and not any fictitious entity owned by
GHM. Oprock TRS also maintained the right to terminate the management agreement with
GHM in the event of a direct or indirect transfer or assignment by GHM that “would result in
fewer than four (4) of the following seven individuals: William Walsh, Patrick Walsh, Michael
Walsh, Mark Walsh, Rich Ade, Tom Varley, Andy Berger continuing to have full time senior
management positions with” GHM. ECF No. [92-3] at § 18.01(A). One of these individuals is
Michael Walsh, Oprock TRS’ Vice President. This clause presents a question as to whether
Oprock TRS maintained control over GHM’s actions by reserving the right to cancel the
contract in the event that certain individuals of its choosing were no longer within GHM’s
senior management. Thus, while the management agreement may have delegated all rights to
operate the hotel to GHM, the evidence creates a question of fact as to whether Oprock TRS
exercised control over GHM’s actions notwithstanding the language in the agreement. On
these facts, the Court cannot grant summary judgment in favor of Oprock TRS under a theory
of actual agency.
Plaintiff’s theory of apparent agency against Oprock TRS, however, is without any
merit. The record is devoid of any evidence that Oprock TRS held GHM out to Plaintiff as its
agent and that Plaintiff, in turn, relied upon such a representation to his detriment. To the
contrary, Plaintiff candidly admitted that he had never heard of Oprock TRS prior to his stay at

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the Jupiter Beach Resort, that he did not rely upon Oprock TRS’ status as the lessee of the
hotel when staying there, and that, as of the date of his deposition, he still did not know Oprock
TRS’ role. See ECF No. [166-1] at 63-65, 66-69, 75. Even though Plaintiff must prove this
element of an apparent agency claim, his Response completely glosses over this issue, failing
to address any of this evidence or explain how he has otherwise demonstrated any reliance.
His failure to satisfy this element of the apparent agency claim is fatal.
As to OPL, the Court finds that there is no principal-agent relationship between Oprock
TRS and OPL. Plaintiff does not come forward with any evidence whatsoever establishing that
Oprock TRS authorized OPL to act on its behalf, that OPL was its agent acting within the scope
of its employment, or that it represented to Plaintiff that OPL could perform certain acts on its
behalf and that Plaintiff relied upon such a representation to his detriment. Thus, Oprock TRS
cannot be held vicariously liable for any acts of OPL.
c. Willfulness
The Oprock Defendants also argue that Plaintiff cannot demonstrate they acted willfully
under FACTA, a prerequisite to the recovery of any statutory damages. Starting with Oprock
Fee, the Court has already determined that no basis exists to hold it directly liable under FACTA,
much less to find that it either knowingly or recklessly violated FACTA. As to Oprock TRS,
however, because an issue of fact exists as to its direct liability under FACTA, the Court must
consider whether there is any evidence of willfulness.
As explained in section III(c)(2) above, willfulness may be proven with evidence of
either a knowing or a reckless violation of FACTA. Starting with the question of whether
Oprock TRS knowingly violated FACTA, the parties dispute whether Oprock TRS knew about
FACTA’s requirements in the first place. Plaintiff attempts to impute the FACTA knowledge of

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Oprock TRS officers, such as Vice President Michael Walsh, to the entity. Even if the Court
assumed that Oprock TRS knew about FACTA’s requirements through Michael Walsh, the
claim still fails because knowledge of FACTA’s requirements is insufficient to prove willfulness.
Plaintiff must demonstrate that Oprock TRS knew about FACTA’s requirements and that
Oprock TRS knowingly violated its requirements. See Keller, 2011 WL 1559555 at *4 (granting
summary judgment because “there [wa]s no argument or any supporting facts that MCGP
acquired knowledge that it was printing FACTA violative receipts prior to December 5, 2007.”);
Cowley, 2008 WL 8910653 at *5 (“Plaintiff does not conclusively establish that Defendant
knowingly issued receipts that contained credit card’s expiration date. And because Plaintiff does
not do so, summary judgment [in his favor] is inappropriate.”).
There is no evidence in the record to demonstrate that anyone at Oprock TRS ever saw
the non-compliant FACTA folios during the relevant timeframe, much less that they knew about
the unmasking of expiration dates and continued to violate FACTA anyway. In support of his
position, Plaintiff states in a conclusory fashion that Oprock TRS took no action or reasonable
precautions to prevent the FACTA violations, but he does not cite to any evidence. It appears
that Plaintiff’s only evidence of knowledge is a provision within the lease agreement between
Oprock Fee and Oprock TRS in which Oprock TRS agreed to generally comply with federal law.
See ECF No. [335] at 18. Even if such a lease agreement were part of the summary judgment
record, which it is not as explained above, this general agreement to comply with federal law
does not establish that Oprock TRS knew about the ongoing FACTA violation and failed to take
action. Without any evidence of actual knowledge, Plaintiff’s claim against Oprock TRS for a
knowing violation of FACTA necessarily fails.

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Similarly, the Court concludes that Plaintiff failed to establish that Oprock TRS
recklessly violated FACTA. Again, assuming without deciding that Oprock TRS knew about
FACTA’s requirements, Plaintiff does not present any evidence suggesting that Oprock TRS – as
opposed to GHM – systematically failed to discover the FACTA violative receipts during the
three-and-one-half month time span. There is no evidence that any Oprock TRS employees
worked at the front desk of the Jupiter Beach Resort or in management, much less that any such
Oprock TRS employees were trained in FACTA and had an opportunity to scrutinize the folios
for any violations. Here, the evidence as to Oprock TRS does not even rise to the level of
negligence as there is no proof that Oprock TRS should have known of a FACTA issue. Absent
evidence of a knowing or reckless violation of FACTA, Plaintiff’s direct liability claim against
Oprock TRS cannot survive summary judgment.
E.

OPL’s Motion for Summary Judgment

OPL’s Motion seeks summary judgment on numerous theories of liability, including
piercing the corporate veil, the “central operations role” and “central receipt generating
functions,” “unitary business enterprise,” direct liability, joint ownership and management, and
agency. See ECF No. [326]. Plaintiff’s Response, however, does not address many of these
theories of liability. See ECF No. [337]. Instead, Plaintiff is only pursuing three theories of
liability against OPL at the summary judgment stage - direct liability, common enterprise, and
vicarious liability. For that reason, the Court limits its analysis to determine whether Plaintiff
can maintain a claim against OPL under any of these three theories of liability. In addition, OPL
introduces a new variation on its Article III standing argument – whether the purported injury is

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fairly traceable to OPL. 30 Specifically, OPL argues that “there must be a causal connection
between the injury and the conduct complained of” and that Plaintiff cannot prove standing as to
OPL because it “took no action that could have resulted in [Plaintiff’s] harm.” See ECF No.
[326] at 24. This argument is intertwined with OPL’s liability arguments; therefore, the Court
will address this issue concurrently with matters of liability.
Also, in the introductory paragraph of its Motion, OPL “join[ed] all issues raised in GHM
Jupiter LLC’s Motion for Summary Judgment, [ECF No. 325], filed on September 22, 2017. . .”
and, in its Reply, OPL “adopt[ed] GHM’s Reply as to how it could never have been willful or
reckless in the issuance of the folio to Plaintiff.” See ECF No. [326] at 1 (emphasis in original);
ECF No. [349] at 11. OPL’s adoption of and joinder in GHM’s Motion raises two additional
issues for the Court’s consideration – whether Plaintiff demonstrated OPL’s willfulness and
whether Plaintiff demonstrated a concrete harm for purposes of Article III standing. The Court
already addressed the latter argument in Section III(c)(3) above, but it has not addressed the
matter of OPL’s willfulness. For that reason, the Court also addresses whether Plaintiff can
demonstrate that OPL willfully violated FACTA.
a. Direct Liability
Plaintiff first advances a theory of direct liability under FACTA on the basis of OPL’s
admission that it was involved in the operation of the Jupiter Beach Resort and its protection of
customer credit card information at its hotels. See ECF No. [337] at 11. This is not a veil
piercing theory. Instead, Plaintiff’s theory is that an issue of fact exists as to whether, during the
relevant timeframe, OPL was a “person that accept[ed] credit cards or debit cards for the
transaction of business” and “print[ed] more than the last 5 digits of the card number or the
30

OPL previously raised this issue in its Response to Plaintiff’s Motion for Class Certification, but in its
Order, this Court noted that OPL could not seek the affirmative relief requested in a response to a motion.

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expiration date upon any receipt provided to the cardholder at the point of the sale or
transaction.” 15 U.S.C. § 1681c(g)(1).
In support of this claim, Plaintiff relies upon several website statements it attributes to
OPL. 31

Specifically,

it

relies

upon

multiple

statements

located

on

the

website www.oplhotels.com as admissions made by OPL. OPL, in turn, objects to the Court’s
consideration of any statements within this website, characterizing it as a “shared marketing
website” and citing to case law in which courts did not consider statements on a website of a
parent corporation to establish control over the subsidiary. See Dow v. Abercrombie & Kent
Int’l, Inc., 2000 WL 688949 (N.D. Ill. May 24, 2000) (“However, the fact that A & K Kenya lists
a website owned and operated by A & K International as its own is not probative of A & K
International's control over A & K Kenya. Sharing a website is akin to sharing a logo, which is
insufficient to evince control.”); J.L.B. Equities, Inc. v. Ocwen Fin. Corp., 131 F. Supp. 2d 544
(S.D.N.Y. 2001) (“However, the Court is not persuaded that a failure to distinguish between
parent and subsidiary on a web page is sufficient to show that the parent controls the subsidiary's
marketing and operational policies.”); Reers v. Deutsche Bahn AG, 320 F. Supp. 2d 140, 157
(S.D.N.Y. 2004)(“With respect to marketing policies, the fact that subsidiaries share a logo, or
that the parent decides to present several corporations on a website in a unified fashion, is
insufficient to show lack of formal separation between two entities.”). While challenging the
admissibility of the website, OPL does not dispute its authenticity.

31

OPL also objects to Plaintiff’s reliance upon unsworn news articles in his Response. See ECF
No. [349] at 5. The Court agrees with OPL. Unsworn newspaper articles constitute inadmissible
hearsay and cannot be considered as part of the summary judgment record. See Dallas Cty. v.
Commercial Union Assur. Co., 286 F.2d 388, 391–92 (5th Cir. 1961) (“Of course, a newspaper
article is hearsay, and in almost all circumstances is inadmissible.”); Macuba v. Deboer, 193
F.3d 1316, 1322 (11th Cir. 1999) (“The general rule is that inadmissible hearsay ‘cannot be
considered on a motion for summary judgment.”).
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The shortcoming of OPL’s argument is that the website’s terms and conditions page
clearly states: “This website contains information on Ocean Properties, Limited products and
services only.” See ECF No. [290-6] at 109, 112 (emphasis added). To support its objection,
OPL relies upon Ade’s post-deposition declaration in which he states: “Many of the hotels
owned by the Walsh Hotel entities are the ones marketed by PCFSI through the ‘OPL and
Affiliates’ and ‘OPAL’ shared marketing websites referred to in Plaintiff’s Second Amended
Complaint.” See ECF No. [326] at ¶ 8. However, Ade also testified as OPL’s corporate
representative and stated that OPL owns the website, www.oplhotels.com, acknowledged that the
website states it only contains OPL’s products and services, that OPL has the right to control its
content if it chooses to do so, and OPL has instead delegated that task to non-party, PCFSI. Id.
at 109, 112-113.
Courts routinely find that statements on the website of a party to a lawsuit are considered
an admission by a party opponent.

See DePaola v. Nissan Hosp. Am., Inc., No. CIV.A.

1:04CV267-W, 2005 WL 2122265, at *7 (M.D. Ala. Aug. 29, 2005) (“Because these websites
are authenticated by Hewitt's declaration, the statements on the site are admissions by a party
opponent which may be considered by the court.”); Telewizja Polska USA, Inc. v. Echostar
Satellite Corp., No. 02 C 3293, 2004 WL 2367740, at *5 (N.D. Ill. Oct. 15, 2004) (“[T]he
contents of Polska's website may be considered an admission of a party-opponent, and are not
barred by the hearsay rule”); Van Westrienen v. Americontinental Collection Corp., 94 F. Supp.
2d 1087, 1109 (D. Or. 2000) (“[T]he contents of the website are not hearsay for purposes of this
summary judgment motion. . . . the representations made by defendants on the website are
admissible as admissions of the party-opponent under FRE 801(d)(2)(A).”); Aug. v. Boyd
Gaming Corp., 135 F. App'x 731, 733 (5th Cir. 2005) (considering casino's website statement

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that “[t]he Chest is owned and operated by parent company, Boyd Gaming Corporation.”).
Regardless of whether OPL itself prepared the content of the website or PCFSI prepared it on
OPL’s behalf, the Court deems the statements on www.oplhotels.com to be admissions by a
party opponent and admissible for purposes of summary judgment. See Fed. R. Evid. 801(d)(2)
(“A statement that meets the following conditions is not hearsay: [t]he statement is offered
against an opposing party and (A) was made by the party in an individual or representative
capacity . . . (C) was made by a person whom the party authorized to make a statement on the
subject; (D) was made by the party’s agent or employee on a matter within the scope of that
relationship and while it existed . . .”).
Analyzing the contents of OPL’s website, there is evidence that during the relevant
timeframe, OPL publicly represented that the Jupiter Beach Resort was one of its properties. See
ECF No. [47-13]. It states: “Ocean Properties’ resort and hotels on Florida’s popular East Coast
attract both business travelers and leisure seekers from the United States, Europe and Latin
America. Sophisticated and multicultural, they range from the elegant Jupiter Beach Resort and
Spa, . . .” Id. (emphasis added). There is no suggestion on the website that Jupiter Beach Resort
is owned by an affiliated entity. To the contrary, the website is written in the possessive –
“Ocean Properties’ resorts and hotels.” This creates the inference that Jupiter Beach Resort is a
resort operated by OPL. This is consistent with other marketing materials upon which Plaintiff
relies. See ECF No. [47-19] (bearing the OPL and OPAL collection logos, stating “Ocean
Properties has your travel story covered,” identifying Jupiter Beach Resort as part of the hotel
collection,

and

listing

Kerry

Morrisey

from

“[e-mail]” as the media contact).

62

“Ocean

Properties,

Ltd.”

at

Case No. 16-cv-80502–BLOOM/Valle

In addition, OPL’s website contains a page entitled “Terms of Use & Privacy Policy.”
This page states in relevant part:
Ocean Properties, Ltd. respects the privacy of all our guests, and we are
committed to protecting it. To best serve you throughout this website, you will be
asked to provide a variety of information, such as name, mailing address,
telephone number, email address, credit card information, etc. . . . Any personal
information that is requested on our website is necessary in order to perform a
particular service, such as processing your reservation.
We request personal information from you in order to process online
reservations. You must provide contact information (such as name, mailing
address, telephone number and email address) as well as financial information
(such as credit card number and expiration date, etc.) in order for us to process
your reservation. This information is used for billing purposes and to reserve a
room. . . .
Ocean Properties, Ltd. is committed to the security of the data collected on this
Web site, and treats all information you provide us as confidential. We use secure
socket layer (SSL) encryption technology to secure the privacy of credit card
information, name, address, email and other information you provide us.
See ECF No. [47-12] (emphasis added).
To further support its direct liability theory, Plaintiff argues that multiple individuals who
were involved in implementing the subject Oracle upgrade and later resolving the problem were
acting on behalf of OPL. OPL, on the other hand, argues it had no involvement in the resolution
of the software defect, stating that PCFSI resolved the issue. An issue of fact exists as to
whether these individuals were acting on behalf of OPL or non-party PCFSI when implementing
and repairing the upgrade. Although OPL disclaims any relationship with these individuals,
Plaintiff submitted evidence in the form of emails wherein Lazenby and Rich identified
themselves as the IT Directors for OPL. See ECF No. [290-16]. Lazenby’s role as an OPL IT
Director is also documented in his Linked In profile, his submission to the Harvard alumni
directory, and an interview he gave to the Portsmouth Herald. See ECF No. [290-8] at 41-42,
46-48, 60. Similarly, Rich identified himself as OPL’s IT director in emails and his business
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cards. See ECF No. [290-9] at 16-17, 20, 110-111. Additional email evidence reveals that other
employees involved in the software upgrade, such as Gregory Dunham and Greg O’Keefe, also
represented that they worked for OPL. See ECF No. [290-18] (December 22, 2015 emails
identifying Greg O’Keefe as the Regional IT Manager for OPL, with an OPL mailing address
and email address); ECF No. [290-16] (April 6, 2016 emails identifying Gregory Dunham as the
regional controller with an OPL signature line and email address).
This evidence is sufficient to create an issue of fact as to whether OPL is directly liable
for a violation of FACTA. That is, whether OPL qualifies as a person that accepts credit or debit
cards for the transaction of business and was involved in the printing of receipts provided to
cardholders. Liability would not be determined on a veil piercing theory, but premised upon
OPL’s direct violation of FACTA.
b. Common Enterprise
Plaintiff’s next theory of liability against OPL is based on common enterprise. Through
this theory, Plaintiff attempts to hold OPL jointly and severally liable with the other Defendants
because they operated as a common or unitary enterprise. See ECF No. [337] at 13. Such a
theory requires evidence of “common control, the sharing of office space and officers;” business
transacted through “a maze of interrelated companies; the commingling of corporate funds and
failure to maintain separation of companies; unified advertising; and evidence that reveals that
no real distinction exists between the corporate defendants.” See FTC v. Nat’l Urological Group,
Inc., 645 F. Supp. 2d 1167, 1182 (N.D. Ga. 2008). It is, in essence, a form of corporate veil
piercing. Plaintiff relies upon case law applying the common enterprise theory to claims of
unfair and deceptive trade practices under the Federal Trade Commission Act, lawsuits under the
Sherman Anti-Trust Act and the Lanham Act, and actions by the Securities and Exchange

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Commission. Id. (emphasis added, internal citations omitted) (“‘The general rule is that, absent
highly unusual circumstances, the corporate entity will not be disregarded.’ However, ‘where the
public interest is involved, as it is in the enforcement of Section 5 of the Federal Trade
Commission Act, a strict adherence to common law principles is not required ... where strict
adherence would enable the corporate device to be used to circumvent the policy of the
statute.’”); Delaware Watch Co. v. F.T.C., 332 F.2d 745, 746 (2d Cir. 1964) (applying common
enterprise theory to individuals in federal trade commission action alleging unfair and deceptive
trade practices); Greensboro Lumber Co. v. Georgia Power Co., 643 F. Supp. 1345, 1367 (N.D.
Ga. 1986), aff'd, 844 F.2d 1538 (11th Cir. 1988) (applying common enterprise theory to lawsuit
alleging violation of § 1 of the Sherman Act); Jackson v. Grupo Indus. Hotelero, S.A., No. 0722046-CIV, 2009 WL 8634834 (S.D. Fla. Apr. 29, 2009); (applying joint and several liability to
claims made under the Lanham Act); S.E.C. v. BIH Corp., No. 2:10-CV-577-FTM-29, 2014 WL
3416854, at *5 (M.D. Fla. July 14, 2014) (emphasis added) (“Thus, when parties act in concert
to violate securities law, each party is jointly and severally liable for disgorgement of ill-gotten
gains even if a particular party did not receive the proceeds.”).
However, Plaintiff does not direct the Court to any case law supporting the existence of a
common or unitary enterprise theory under Florida corporate law, which would apply to this set
of facts. 32 As OPL points out, Florida law has only applied this theory of liability in the context
32

In lawsuits alleging a violation of the FCRA, other district courts have relied upon state corporate law
to when deciding whether to pierce the corporate veil. DeGraziano v. Verizon Commc'ns, Inc., 325 F.
Supp. 2d 238, 245 (E.D.N.Y. 2004) (applying New York law to determine whether a parent company is
liable for the acts of its wholly-owned subsidiary under the FCRA); Hopkins v. Trans Union, L.L.C., No.
03-5433 ADM/RLE, 2004 WL 1854191, at *4 (D. Minn. Aug. 19, 2004) (applying Minnesota law in
FCRA claim to determine whether the plaintiff may assert an alter ego claim to pierce the corporate veil);
Stich v. BAC Home Loans Servicing, LP, No. 10-CV-01106-CMA-MEH, 2011 WL 1135456, at *3 (D.
Colo. Mar. 29, 2011) (applying Colorado corporate law to analyze reverse veil piercing theory in FCRA
claim).

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of taxation schemes. See Brunner Enterprises, Inc. v. Dep't of Revenue, 452 So. 2d 550, 553
(Fla. 1984) (“[W]e hold that out-of-state investment income earned by a foreign corporation
doing business in Florida is only taxable under the Florida Corporate Income Tax Code if the
Florida enterprise is part of a unitary business.”); Roger Dean Enterprises, Inc. v. State, Dep't of
Revenue, 387 So. 2d 358, 363 (Fla. 1980) (“These regulations are directed primarily at
determining whether a multistate taxpayer operates a ‘unitary’ business entirely subject to tax in
Florida, or separate businesses in several states including Florida, as to which Florida may tax
only the Florida business.”). Absent some indication from Florida’s appellate courts expanding
the scope of the unitary or common business enterprise theory to areas other than taxation, this
Court declines to expand Florida corporate law in this manner.
Under Florida corporate law, veil piercing may only occur “if the plaintiff can prove both
that the corporation is a mere instrumentality or alter ego of the defendant, and that the defendant
engaged in improper conduct in the formation or use of the corporation.” Oginsky v. Paragon
Properties of Costa Rica LLC, 784 F. Supp. 2d 1353, 1373 (S.D. Fla. 2011) (quoting XL Vision,
LLC v. Holloway, 856 So.2d 1063, 1066 (Fla. 5th DCA 2003)) (emphasis added); see also
Garcia v. Kashi Co., 43 F. Supp. 3d 1359, 1394 (S.D. Fla. 2014) (quoting SEB S.A. v. Sunbeam
Corp., 148 F. App’x 774, 800 (11th Cir. 2005)) (“Or, as the Eleventh Circuit has stated: ‘Florida
law allows a party to pierce the corporate veil and hold a parent corporation liable for its
subsidiary's actions if it can demonstrate first, ‘that the subsidiary was a ‘mere instrumentality’
of the parent,' and second, ‘that the parent engaged in ‘improper conduct’ through its
organization or use of the subsidiary.'”).

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Plaintiff has not pled this veil piercing theory of liability in the Second Amended
Complaint. See ECF No. [47]. But even if he did, it is undisputed that OPL is not the parent
corporation of any of the Defendants. In fact, this Court has previously noted that the Walsh
family interests, not OPL, own less than 7% of the parent entity that ultimately owns the Jupiter
Beach Resort. See ECF No. [193] at ¶ 10. Not only is there no evidence of a parent-subsidiary
relationship, but there is also no evidence that OPL engaged in some improper conduct relating
to the creation of the other corporate Defendants. Thus, this theory of liability against OPL
cannot survive summary judgment.
c. Vicarious Liability
Finally, Plaintiff asserts vicarious liability claims against OPL. As explained above,
Plaintiff may pursue his FACTA claim under theories of authorization, respondeat superior, or
apparent agency. In his Response, Plaintiff identifies “Oprock/GHM” as the principals and itself
as the agent. See ECF No. [337] at 15. In support of this position, Plaintiff argues that “OPL
certainly exercised authority for Oprock/GHM, if not itself, to represent that it would protect
sensitive customer card data, and allowed its self-described technology personnel to engage in
implementing the software upgrades that caused the violations. . .” ECF No. [337] at 16. Such a
theory turns the concepts of agency and vicarious liability upside down. In order to impose
vicarious liability on OPL, OPL must be the principal and “Oprock/GHM” must be the agents.
Plaintiff confuses the two concepts. Despite Plaintiff’s initial characterization of the principal
and agent, he then argues that OPL is vicariously liable for Oprock/GHM’s actions if it
authorized the conduct. To the extent that Plaintiff alternatively argues that it is the principal and
GHM/Oprock Defendants are its agents, there is still no evidence of vicarious liability.

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Under a theory of authorization, “a principal may be vicariously liable for an agent’s
tortious conduct if the principal expressly or implicitly authorized the conduct.” See Edwards,
527 F. Supp. 2d at 1211. As evidence of such authorization, Plaintiff argues that OPL “expressly
authorized the implementation of the software update through its shared officers with GHM and
the Oprock Defendants . . . and by benefitting from these transactions.” See ECF No. [337] at
16. However, there is no evidence that OPL authorized Oprock TRS to enter into the Oracle
contract that led to the FACTA violation. The evidence is that Oprock TRS entered into the
contract and that the “Rockwood asset manager” approved it. See ECF No. [290-4] at 24, 112.
Next, Plaintiff’s respondeat superior theory likewise fails to impose vicarious liability on
OPL as there is no evidence that GHM or the Oprock Defendants were acting for the benefit of
OPL “in the scope of [their] employment.”

Id.

There is no contractual or employment

relationship between OPL and GHM, OPL and Oprock Fee, or OPL and Oprock TRS. Absent
such a relationship, OPL cannot be liable for their actions under respondeat superior.
Finally, Plaintiff makes an apparent agency argument stemming from “OPL significantly
advanc[ing] the FACTA violations using the GHM/Oprock Defendants’ facilities and Jupiter
Beach name, as set forth on the FACTA violating receipt that Plaintiff received.” ECF No. [337]
at 17. In order to prove this theory, the focus of the analysis must be on the communications
made by the principal, in this case OPL, to the third party, Justin Bouton.

See Sun Life

Assurance Co. of Canada (U.S.) v. Imperial Holdings, Inc., No. 13-80385, 2014 WL 12452450,
at *3 (S.D. Fla. Jun. 26, 2014). Here, Plaintiff does not identify a single communication that
OPL made to Plaintiff in which it represented that GHM, Oprock Fee or Oprock TRS were its
agents. To the contrary, Plaintiff’s theory of liability under FACTA is that, on its website, OPL
held itself out as the operator of the hotel, not that it held out GHM and the Oprock Defendants

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as its agents. Additionally, Plaintiff does not present any evidence that he relied upon agency
statements from OPL. While he may have seen that the Jupiter Beach Resort is associated with
OPL on its website before he booked his stay, this does not constitute reliance upon OPL’s nonexistent statement that the Oprock Defendants or GHM are its agents. Thus, Plaintiff’s apparent
agency claim also fails.
d. Willfulness
By incorporating GHM’s summary judgment arguments on willfulness into its Motion for
Summary Judgment and Reply, OPL challenges Plaintiff’s ability to demonstrate that it willfully
violated FACTA. Notably, Plaintiff did not respond to or otherwise address any matters of
OPL’s willfulness in its Response. Nonetheless, the Court has independently reviewed the
record to determine whether any issues of fact exist on this element of Plaintiff’s FACTA claim.
Much like all other Defendants in this action, there is no evidence in the record that OPL
knowingly violated FACTA. While OPL undisputedly knew of its requirements, Plaintiff has
not presented any proof that OPL had actual knowledge of the ongoing FACTA violation or that
OPL failed to correct the violation despite such knowledge.
This leaves the Court with the issue of recklessness. Neither party briefed this issue
specifically as to OPL, relying instead upon the positions and evidence presented in conjunction
with GHM’s Motion.

The Court, therefore, considers such evidence as applied to OPL,

consisting of: (1) the 200 folios with unmasked expiration dates within the nightly audit packs,
(2) the 1,083 folios that could have been printed at the front desk containing unmasked
expiration dates, and (3) the December 22, 2015 email reporting an issue after the Oracle
software upgrade. The first two arguments do not apply to OPL. This is because there is no
evidence in the record that OPL’s employees worked at the front desk or in management at the

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Jupiter Beach Resort. Unlike GHM, OPL did not have opportunities to discover that the folios
handed to cardholders were printing credit card expiration dates during a three-and-one-half
month period. However, there is evidence that Lazenby, as OPL’s IT Director, received the
December 22, 2015 email in which a screen shot revealed an unmasked expiration date beneath a
pop-up window. ECF No. [290-18]. Drawing all inferences in Plaintiff’s favor, this email
amounts to nothing more than negligence on Lazenby’s part in that he failed to detect a potential
FACTA violation. This isolated instance is insufficient to establish that OPL was reckless in its
failure to detect the unmasking of credit card expiration dates. This is an instance of “mere
human mistake” that does not allow the recovery of statutory damages under FACTA. Plaintiff’s
inability to prove OPL’s willfulness is dispositive of his claim for statutory damages, requiring
the entry of summary judgment in OPL’s favor.
IV.

CONCLUSION
For the reasons set forth above, it is ORDERED AND ADJUDGED as follows:
1. Plaintiff’s Daubert Motion to Exclude Defendant’s Proposed Expert Testimony,
ECF No. [298], is GRANTED in part and DENIED in part as set forth in this
Opinion;
2. Defendants’ Motion to Strike Plaintiff’s Expert Witness Don Coker, ECF No.
[300], is GRANTED in part and DENIED in part as set forth in this Opinion;
3. Defendant GHM Jupiter, LLC’s Motion for Summary Judgment, ECF. No. [325],
is GRANTED in part and DENIED in part as set forth in this opinion.
4. Defendant Ocean Properties, Ltd.’s Motion for Summary Judgment, ECF No.
[326], is GRANTED. The Court will enter final judgment by separate order.
5. Defendants’ Oprock Jupiter Fee, LLC and Oprock Jupiter TRS, LLC’s Motion for

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Summary Judgment, ECF No. [324], is GRANTED in part and DENIED in
part. As to Oprock Jupiter Fee, LLC, the Court will enter final judgment by
separate order.
DONE AND ORDERED in Miami, Florida this 23rd day of October, 2017.

__________________________________
BETH BLOOM
UNITED STATES DISTRICT COURT
Copies to:
Counsel of Record

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