Sullivan v. All Web Leads, Inc.
Filing
24
MEMORANDUM OPINION AND ORDER Signed by the Honorable Harry D. Leinenweber on 6/1/2017:Mailed notice(wp, )
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
WILLIAM SULLIVAN,
Individually and on Behalf of
All Others Similarly
Situated,
Case No. 17 C 1307
Plaintiff,
Judge Harry D. Leinenweber
v.
ALL WEB LEADS, INC., a
Delaware Corporation,
Defendant.
MEMORANDUM OPINION AND ORDER
Before
Plaintiff’s
the
Court
Complaint
is
or,
in
Defendant’s
the
Proposed Class [ECF Nos. 7, 12].
Motion
Alternative,
to
to
Dismiss
Strike
the
For the reasons stated herein,
the Motion is denied.
I.
FACTUAL BACKGROUND
Plaintiff William Sullivan (“Sullivan”) filed this lawsuit
under the Telephone Consumer Protection Act, 47 U.S.C. § 227 et
seq.
(the
“TCPA”),
to
address
allegedly
deceptive
marketing
practices of Defendant All Web Leads, Inc. (“All Web”).
The
following facts are drawn from Sullivan’s Complaint and are, for
purposes of this Motion, accepted as true, with all inferences
drawn in his favor.
See, e.g., Adams v. City of Indianapolis,
742 F.3d 720, 728 (7th Cir. 2015).
All Web offers services to insurance industry customers,
typically
insurance
agents,
by
generating
“leads.”
Specifically, All Web places calls to potential purchasers of
insurance
coverage
and
then
customers. (Compl. ¶ 16.)
transfers
those
calls
to
its
To identify “leads,” All Web owns and
operates various websites claiming to offer insurance quotes.
(Id. ¶ 18.)
Upon visiting one of these websites, a consumer is
directed to fill out a quote request form specific to the type
of
insurance
consumer.
of
On
interest.
January
13,
(Ibid.)
2017,
Sullivan
he
visited
was
one
such
www.affordable-
health-insurance-plans.org to obtain quotes on health insurance
plans
that
would
comply
with
the
Patient
Protection
and
Affordable Care Act, 52 U.S.C. § 18001 et seq. (“Obamacare”).
(Id. ¶¶ 31, 37-38.)
When prompted (see figure below), Sullivan
entered his zip code and clicked “Start Now.”
- 2 -
(Compl. ¶¶ 19, 32.)
Once directed to the next page, Sullivan
filled
(reproduced
out
the
form
below)
by
entering
personal
information, including a “Day phone” number, and then clicked
the “Submit” button.
- 3 -
(Id. ¶ 20.)
Because it appeared in small print at the bottom of
the page, Sullivan did not see All Web’s consent language before
he clicked “Submit”:
- 4 -
(Id. ¶ 23.)
He therefore had no reason to suspect that he was
agreeing to be contacted via autodialed calls.
(Id. ¶ 26.)
Soon after completing the quote form, Sullivan received an
autodialed call from a representative at All Web. (Compl. ¶ 34.)
Upon answering, Sullivan heard “an immediate pause on the other
end,
followed
by
a
distinct
‘clicking’
noise
before
the
connection with the representative was made.” (Id. ¶ 35.)
The
representative asked Sullivan a series of questions, confirmed
that he was seeking information about health insurance, and then
transferred
Sullivan
him
informed
to
a
the
health
agent
insurance
that
he
agent.
was
(Id.
seeking
¶
a
36.)
health
insurance plan that would comply with the Obamacare individual
mandate; yet the agent attempted to persuade Sullivan “to enroll
in a limited benefit non-major medical plan, and suggested that
it was a better option than an ‘Obamacare-compliant’ plan.” (Id.
¶ 38.)
When it became clear that the agent was not offering the
opportunity to review and compare “Obamacare-compliant” health
insurance quotes, Sullivan ended the call. (Ibid.)
He continued
to receive additional similar phone calls over the next several
days. (Id. ¶ 40.)
Sullivan filed this lawsuit seeking injunctive relief and
money damages on behalf of himself and a nationwide class of
individuals who utilized the same website, clicked “Submit” on
- 5 -
the associated quote form, and then received autodialed calls.
(Compl. ¶ 42.)
II.
The
TCPA
THE TELEPHONE CONSUMER PROTECTION ACT
makes
it
unlawful
for
any
“person
within
the
United States” to, inter alia, “make any call (other than a call
made
for
consent
emergency
of
the
purposes
called
or
party)
made
with
using
any
the
prior
automatic
express
telephone
dialing system or . . . artificial or prerecorded voice . . . to
any
telephone
service.”
number
assigned
to
a . . . cellular
telephone
47 U.S.C. § 227(b)(A)(iii). (The exception to this
prohibition - calls “made solely to collect a debt owed to or
guaranteed by the United States” - is a non-issue here.)
TCPA
authorizes
“FCC”)
to
promulgate
requirements.
Fin.
the
Servs.,
Federal
Communications
regulations
Commission
implementing
the
The
(the
statute’s
47 U.S.C. § 227(b)(2); see also, Mims v. Arrow
LLC,
565
U.S.
368,
370
(2012)
(“The
Act . . . directs the Federal Communications Commission (FCC or
Commission)
Ira
to
Holtzman,
prescribe
C.P.A.
v.
implementing
Turza,
728
regulations.”);
F.3d
682,
687
accord,
(7th
Cir.
2013).
Under the express language of the TCPA, an automated call
may be lawfully made to a cell phone in certain circumstances,
only one of which is relevant to this case.
- 6 -
Specifically, a
call is not unlawful if it is made “with the prior express
consent of the called party.”
47 U.S.C. § 227(b)(A)(iii).
The
FCC recognizes that the statute itself is mute on what form of
express consent – oral, written, or some other kind – suffices
“for calls that use an automatic telephone dialing system or
prerecorded voice to deliver a telemarketing message.”
In the
Matter of Rules & Regs. Implementing the Tel. Cons. Prot. Act of
1991,
27
F.C.C.
Rcd.
1830,
1838
¶
21
(Feb.
15,
2012)
(hereinafter, the “2012 Order”).
At
“prior
one
time,
express
FCC
consent”
implementing
for
regulations
automated
calls
to
required
cell
only
phones,
meaning that a person had only to “knowingly release their phone
number
[to
contrary.”
the
caller] . . . absent
instructions
to
the
2012 Order at 1833 ¶ 7 n.20 (citation omitted).
In
2012, however, the FCC announced a new rule to take effect on
October 16, 2013, that modified the consent requirements for
automated telemarketing calls under the TCPA.
at 1831 ¶ 1; 47 C.F.R. § 64.1200.
See, 2012 Order
The new rule for automated
telemarketing calls to cell phones requires the “prior express
written consent of the called party.” 47 C.F.R. § 64.1200(a)(2).
The
FCC
defines
“telemarketing”
as
“the
initiation
of
a
telephone call or message for the purpose of encouraging the
purchase or rental of, or investment in, property, goods, or
- 7 -
services,
which
§ 64.1200(f)(12).
is
transmitted
to
any
person.”
47
C.F.R.
Prior express written consent means:
an agreement, in writing, bearing the signature of the
person called that clearly authorizes the seller to
deliver or cause to be delivered to the person called
advertisements or telemarketing messages using an
automatic telephone dialing system or an artificial or
prerecorded voice, and the telephone number to which
the
signatory
authorizes
such
advertisements
or
marketing messages to be delivered.
47 C.F.R. § 64.1200(f)(8).
To be effective, such consent also
must satisfy further requirements:
(i) The written agreement shall include a clear and
conspicuous disclosure informing the person signing
that:
(A) By executing the agreement, such person
authorizes the seller to deliver or cause to be
delivered to the signatory telemarketing calls using
an automatic telephone dialing system or an artificial
or prerecorded voice; and (B) The person is not
required
to
sign
the
agreement
(directly
or
indirectly), or agree to enter into such an agreement
as a condition of purchasing any property goods, or
services.
(ii) The term “signature” shall include an electronic
or digital form signature, to the extent that such
form of signature is recognized as a valid signature
under applicable federal law or state contract law.
Ibid.
FCC
In tandem with elevating these consent requirements, the
also
created
an
promulgated
exemption
certain
from
the
exceptions.
prior
express
As
relevant,
written
it
consent
requirement for health care messages made to cellular lines.
That exception states that no person or entity may:
(2) Initiate, or cause to be initiated, any telephone
call that includes or introduces an advertisement or
- 8 -
constitutes
telemarketing,
using
an
automatic
telephone
dialing
system
or
an
artificial
or
prerecorded voice, to any of the lines or telephone
numbers described in paragraphs (a)(1)(i) through
(iii) of this section, other than . . . a call that
delivers a “health care” message made by, or on behalf
of a “covered entity” or its “business associate,” as
those terms are defined in the HIPAA Privacy Rule, 45
CFR 160.103[.]
47
C.F.R.
ambiguity
§
64.1200(a)(2)
in
the
(emphasis
wording
of
this
added).
“health
Despite
some
rule”
(the
care
parties’ shorthand), the FCC has clarified that such calls are
exempted
only
from
the
written
consent
requirement.
See,
Consumer & Governmental Aff. Bureau Seeks Comment on Petition
for Expedited Declaratory Ruling & Exemption from Am. Ass’n of
Healthcare
Admin.
Mgmt.,
29
F.C.C.
Rcd.
15267,
15267
n.7
(Dec. 17, 2014); cf. Jackson v. Safeway, Inc., No. 15 C 4419,
2016 WL 5907917, at *7 n.10 (N.D. Cal. Oct. 11, 2016) (“[B]oth
parties
assume
that
there
is
a
‘prior
express
consent’
requirement for such ‘health care’ calls.”).
The “health care rule” speaks in HIPAA-defined terms and,
as
with
most
explication.
administrative
Under
the
alphabet
Health
soup,
Insurance
requires
further
Portability
and
Accountability Act (“HIPAA”), “health care” is defined as “care,
services, or supplies related to the health of an individual,”
including, but not limited to, “(1) [p]reventive, diagnostic,
therapeutic,
rehabilitative,
maintenance,
- 9 -
or
palliative
care,
and counseling, service, assessment, or procedure with respect
to the physical or mental condition, or functional status, of an
individual
or
that
affects
the
structure
or
function
of
the
body; and (2) [s]ale or dispensing of a drug, device, equipment,
or
other
item
in
accordance
with
a
prescription.”
45
C.F.R.
§ 160.103.
Last to mention is this lawsuit’s bedrock.
Section 227 of
the TCPA “authorizes private litigation”; aggrieved parties need
not depend on the FCC.
565 U.S. at 370.
Holtzman, 728 F.3d at 688; accord, Mims,
In general, a district court presiding over
such litigation gives controlling weight to final decisions of
the FCC implementing and interpreting the TCPA.
See, e.g., CE
Design, Ltd. v. Prism Bus. Media, Inc., 606 F.3d 443, 449-50
(7th
Cir.
2010)
(noting
that
“Congress
vested
the
power
of
agency review of final FCC orders exclusively in the courts of
appeals”); Jamison v. First Credit Servs., Inc., 290 F.R.D. 92,
97 (N.D. Ill. 2013) (stating in a TCPA case that the court is
“bound by the FCC’s orders, which are final and controlling”).
III.
ANALYSIS
All Web seeks to dismiss Sullivan’s Complaint under FED. R.
CIV. P. 12(b)(6) for failure to state a claim on which relief can
be granted.
In the alternative, All Web moves to strike the
- 10 -
class allegations in the Complaint for failure to satisfy the
strictures of FED. R. CIV. P. 23.
A.
Motion to Dismiss
Based on a mélange of arguments, All Web moves to dismiss.
The gravamen of its Motion is that Sullivan has pled himself out
of court because the Complaint establishes his prior express
consent or, alternatively, his prior express written consent to
receive the call(s).
Sullivan responds that All Web’s Motion is
bankrupt because its website, as alleged, does not procure valid
express written consent.
1.
Legal Standard
To survive a Rule 12(b)(6) motion to dismiss, a complaint
“must state a claim that is plausible on its face.”
Adams, 742
F.3d at 728 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
570
(2007)).
plaintiff
A
pleads
claim
enjoys
sufficient
“facial
factual
plausibility
content
the
allows
that
when
the
court to draw the reasonable inference that the defendant is
liable for the alleged misconduct.”
(quoting
plaintiff
Ashcroft
must
v.
allege
Adams, 742 F.3d at 728
Iqbal,
556
U.S.
662,
that
all
elements
678
of
(2009)).
his
claim
A
are
satisfied, but cannot survive a Rule 12(b)(6) motion to dismiss
by alleging only legal conclusions.
Reynolds v. CB Sports Bar,
Inc., 623 F.3d 1143, 1147 (7th Cir. 2010).
- 11 -
“Threadbare recitals
of
the
elements
of
a
cause
of
action,
conclusory statements, do not suffice.”
supported
by
mere
Iqbal, 556 U.S. at 678.
To state a claim under the TCPA, Sullivan must allege that:
(1) a call was made (2) using an automatic telephone dialing
system or artificial or prerecorded voice; (3) the number called
was assigned to cellular telephone service; and (4) the party
making
the
call
lacked
the
requisite
consent.
See,
e.g.,
Thrasher-Lyon v. Illinois Farmers Ins. Co., 861 F.Supp.2d 898,
904-05 (N.D. Ill. 2012).
2.
Discussion
At the outset, Sullivan objects to treating the issue of
consent
at
the
pleading
Response”) at 6-7.)
stage.
(See,
ECF
No.
10
(“Pl.’s
The prevailing view in this district is
that “prior express consent” under the TCPA “is an affirmative
defense on which the defendant bears the burden of proof; it is
not a required element of the plaintiff’s claim.”
Kolinek v.
Walgreen Co., No. 13 C 4806, 2014 WL 518174, at *2 (N.D. Ill.
Feb. 10, 2014) (collecting cases).
anticipate
and
defeat
Because complaints need not
affirmative
defenses,
dismissal
is
typically only appropriate if the affirmative defense “is set
out
entirely
reason,
in
courts
Rule 12(b)(6)
the
plaintiff’s
reject
motion
to
a
complaint.”
TCPA
argue
defendant’s
consent
- 12 -
Ibid.
For
attempt
contrary
to
this
on
a
express
allegations
in
a
complaint
pleading lack of consent.
or
attack
a
complaint
for
not
See, e.g., Charvat v. Allstate Corp.,
29 F.Supp.3d 1147, 1149 (N.D. Ill. 2014); Thrasher-Lyon, 861
F.Supp.2d at 905; Greene v. DirecTV, Inc., No. 10 C 117, 2010 WL
1506730, at *2 (N.D. Ill. Apr. 14, 2010).
In more garden-
variety circumstances, the Court would end the inquiry without
engaging in a detailed consent analysis, because it is clear
enough that Sullivan has alleged sufficient facts to alert All
Web of the substance of his TCPA claim.
See, e.g., Bakov v.
Consolidated Travel Holdings Grp., Inc., No. 15 C 2980, 2016 WL
4146471,
at
(finding
that
*3
(N.D.
the
Ill.
Aug.
plaintiffs
4,
2016)
sufficiently
(Leinenweber,
alleged
that
J.)
“they
received unsolicited phone calls on their cell phones that were
prerecorded,”
which
“is
all
that
is
necessary”
for
a
TCPA
claim).
However, All Web’s Motion is at least formally premised on
the allegations of (illegitimate) consent contained within the
four corners of the Complaint.
All Web does not attack the
Complaint for failure to plead lack of consent.
speculate
arguing
contrary
only
their
to
the
legal
facts
of
the
significance.
Nor does it
Complaint,
See,
e.g.,
instead
U.S.
v.
Lewis, 411 F.3d 838, 842 (7th Cir. 2005) (“The exception occurs
where,
as
here,
the
allegations
- 13 -
of
the
complaint
itself
set
forth
everything
necessary
defense. . . .”).
Alas,
to
satisfy
because
the
the
argument
affirmative
here
is
that
Plaintiff’s own consent allegations plead him out of court, the
Court
excavates
the
consent
issue
before
denying
All
Web’s
Motion.
a.
The Calls at Issue Fall outside the “Health Care” Rule
If the “health care rule” applies in this case, then All
Web needed only Sullivan’s prior express consent to autodial his
cell
phone.
To
qualify
for
the
less
demanding
consent
requirements of the “health care rule,” an automated call must
deliver a “health care message.”
All Web contends that the
autodialed
as
calls
at
issue
qualify
“health
care
messages”
because Sullivan was seeking “more affordable health insurance”
and the calls were part of securing “supplies related to the
health of an individual.”
(ECF No. 12 (“Def.’s Mot.”) at 10.)
Although it abjures comprehensively defining “health care
message,” the FCC describes such calls as those placed by or on
behalf
of
“the
consumer’s
health
care
provider
consumer . . . concern[ing] the consumer’s health.”
at
1855
¶
63.
Archetypical
messages
include
to
the
2012 Order
“immunization
reminders,” ibid., “prescription notifications,” In the Matter
of Rules & Regs. Implementing the Tel. Consumer Prot. Act of
1991,
30
F.C.C.
Rcd.
7961,
8031
- 14 -
¶
146
(July
18,
2015)
(hereinafter
the
“2015
Order”),
and
flu
shot
notices.
See,
e.g., Zani v. Rite Aid Headquarters Corp., No. 14 C 9701, 2017
WL
1383969,
at
*9-12
(S.D.N.Y.
Mar.
30,
2017);
Jackson
v.
Safeway, Inc., No. 15 C 4419, 2016 WL 5907917, at *8-9 (N.D.
Cal. Oct. 11, 2016).
Guidance from the FCC and the limited case
law on point establish the relevance of three factors to whether
a call conveys a “health care message”:
First, if such a call concerns a product or service
that is inarguably health-related, . . . it likely
conveys a health care message.
Such category would
include the administration of medication “prescribed
by a doctor or other healthcare provider,” but would
not include any product simply because it may be
construed to benefit a consumer's health.
Second, if
such a call is made by or on behalf of a health care
provider to a patient with whom she has an established
health care treatment relationship, that too is
material to application of the rule. Finally, if the
call concerns the individual health care needs of the
patient
recipient,
that
too
is
material.
The
operative question as to this last factor would be
whether a nexus exists between the subject matter of
the call and the established health care needs of its
recipient.
Zani,
2017
WL
1383969,
at
*11
(emphasis
added)
(internal
citations omitted).
Applying these factors to this case leads inescapably to
the
conclusion
that
All
Web’s
lead-generating
calls
are
not
“health care messages.”
First, such calls are not “inarguably
health-related”;
they
rather,
smack
of
messages
designed
to
promote a “product simply because it may be construed to benefit
- 15 -
a consumer’s health.”
As the Zani court indicated, such subject
matter is not as a matter of law “inarguably health-related.”
Second,
behalf
of
All
“established
does
health
a
Web
care
health
care
not
autodial
provider”
treatment
consumers
in
the
“by
or
of
course
relationship.”
on
an
All
Web’s
calls neither remind patients who had a flu shot last year to
come into the same pharmacy to receive this year’s flu shot, nor
confirm provision of medication to an individual “in accordance
with
a
prescription.”
See,
Zani,
2017
WL
1383969,
at
11;
Jackson, 2016 WL 5907917, at *8-9; 45 C.F.R. § 160.103; 2012
Order at 1855 ¶ 63 (noting that “immunization reminders” and
calls “‘pushing’ flu vaccines” may convey health care messages).
Instead, All Web’s calls represent an effort to inaugurate a new
relationship
between
an
individual
and
a
health
insurance
issuer.
Finally, there is no nexus between the subject matter of an
All Web autodialed call as alleged “and the established health
care needs of its recipient.”
care”
in
non-limiting
diagnostic,
physical
individual
or
or
or
fashion
therapeutic
mental
that
Recall that HIPAA defines “health
services
condition,
affects
to
the
or
include
“with
functional
structure
or
preventative,
respect
status,
function
to
of
of
the
an
the
body” and medications or devices “dispensed in accordance with a
- 16 -
prescription.”
45
C.F.R.
hopelessly
divorced
from
Indeed,
footnote
in
a
§
160.103.
these
the
All
examples
FCC’s
2015
Web’s
of
calls
“health
Order
are
care.”
confirms
that
“insurance-coverage calls” – even where the insurer actually had
a relationship with the insured and was calling to notify a
patient
that
coverage
already rendered
-
was
not
do
available
necessarily
definition of “health care.”
n.473
(“We
note,
for
a
fall
medical
within
service
the
HIPAA
See, 2015 Order at 8028-39 ¶ 141
additionally,
that
insurance-coverage
calls,
which are included in AAHAM’s list of ‘healthcare calls,’ are
not
necessarily
‘health
among
care.’”);
Healthcare
Declaratory
In
the
the
Administrative
Rulings
and
topics
Matter
in
HIPAA’s
of
Petition
Exemption
Regarding
of
Association
American
Management
definition
of
for
Expedited
Non-Telemarketing
Healthcare Calls, CG Dkt. No. 02-278, at 3 (Oct. 21, 2014).
While All Web is correct in the narrow sense that, under
these
cases
and
FCC
guidance,
calls
otherwise
qualifying
as
“health care messages” need not eschew all advertising content,
it
has
not
shown
how
Sullivan’s
Complaint
establishes
antecedent issue of the alleged calls’ health care content.
the
As
such, for purposes of its Motion, All Web cannot rely on the
TCPA’s prior express consent requirement under the “health care
rule.”
- 17 -
b.
All Web Needed, but Did Not as a Matter of
Law Effectively Procure, Sullivan’s
Prior Express Written Consent
All Web argues in the alternative that Sullivan’s complaint
does not adequately allege “telemarketing” calls triggering the
heightened
written
consent
requirement
and
that,
even
if
it
does, Sullivan pleads himself out of court by establishing that
All Web had his prior express written consent.
All Web fails to show how its alleged calls to consumers
like
Sullivan
calls.
constitute
anything
other
than
telemarketing
As set forth in its implementing regulations, the TCPA
defines “telemarketing” as “the initiation of a telephone call
or message for the purpose of encouraging the purchase or rental
of, or investment in, property, goods, or services, which is
transmitted to any person.”
47 C.F.R. § 64.1200(f)(12). That
is, whether a call is a “telemarketing” call depends not on its
content
but
instead
on
its
purpose.
See,
Golan
v.
Veritas
Entertainment, LLC, 788 F.3d 814, 820 (8th Cir. 2015); see also,
Payton v. Kale Realty, LLC, No. 13 C 8002, 164 F.Supp.3d 1050,
1062-63
(N.D.
Ill.
Feb.
22,
2016).
In
this
case,
Sullivan
alleges that All Web’s purpose in placing these calls is to
encourage the purchase of insurance from All Web’s insurance
industry customers.
(Compl. ¶¶ 16-18, 21, 31, 36-38.)
And, as
set forth above, no content of these alleged calls falls within
- 18 -
the ambit of the “health care rule.”
As such, Sullivan has
adequately
pled
him
purposes.
See, e.g., Margulis v. Eagle Health Advisors, LLC,
that
All
Web
called
for
telemarketing
No. 4:15 C 1248, 2016 WL 1258640, at *3 (E.D. Mo. Mar. 31, 2016)
(denying
motion
to
dismiss
the
plaintiff’s
claim,
which
adequately pled that the defendant used a “telemarketing robot”
to
place
calls
insurance).
to
him
for
the
purpose
of
selling
health
All Web therefore needed Sullivan’s prior express
written consent.
The parties vigorously dispute whether Sullivan’s Complaint
establishes
that
he
gave
All
consent to make the calls.
language
on
the
quote
form
Web
his
prior
express
written
All Web claims that the consent
webpage,
coupled
with
the
user’s
choice to click the “Submit” button, constitutes prior express
written consent under the TCPA.
Sullivan responds that this
method of procuring consent is legally insufficient.
The Court feels that the legal enforceability of All Web’s
consent
language
is
an
issue
best
left
for
later
in
the
litigation when there is a fully developed factual record.
In
ruling on All Web’s Motion to Dismiss, however, the Court must
determine
whether
Sullivan
states
a
plausible
TCPA
violation
based on lack of (effective) prior express written consent, with
inferences drawn in his favor.
The Court finds it plausible on
- 19 -
the
facts
alleged
that
Sullivan’s consent.
All
Web
did
not
effectively
procure
This is because the Complaint does not as a
matter of law establish reasonable notice of the terms to which
Sullivan
purportedly
gave
prior
express
written
consent,
let
alone a disclosure that was “clear and conspicuous” under the
TCPA.
47 C.F.R. § 64.1200(f)(8)(i); id. 64.1200(f)(3) (“The
term clear and conspicuous means a notice that would be apparent
to the reasonable consumer, separate and distinguishable from
the
advertising
copy
or
other
disclosures.”)
(emphasis
in
original).
Sullivan
unequivocally
alleges
not
only
that
he
lacked
actual notice of All Web’s consent language, but also that these
disclosures were unreasonably camouflaged in the context of the
webpage and below its “Submit” button.
reasonable
notice
to
the
consumer
is
Given that at least
required,
consider
how
courts in contract cases analyze the reasonableness of notice of
terms to online consumers.
“prior
express
“written
written
agreement”
(Also note that the definition of
consent”
and,
incorporates contract law.
relies
on
least
in
at
the
concept
part,
of
a
expressly
See, 47 C.F.R. § 64.1200(f)(8)(ii)
(“to the extent that such form of signature is recognized as a
valid signature under . . . state contract law”).)
Regardless
of whether All Web’s consent agreement is characterized as a
- 20 -
“clickwrap”
or
a
“browsewrap”
agreement,
contract
law
only
permits its enforcement if there was reasonable notice of its
terms plus some action capable of being construed as assent.
The
following
cases
establish
this
proposition
and
provide
salient data points:
•
Nguyen v. Barnes & Noble Inc., 763 F.3d 1171, 1177 (9th
Cir. 2014) (invaliding a browsewrap agreement, i.e., a
“Terms of Use” hyperlink placed directly below or a few
inches away from the button users had to click to proceed
with checkout, because the website did not provide any
notice to users or promote any affirmative action to
demonstrate their assent to the agreement);
•
Hancock v. Am. Tel. & Telegraph Co., Inc., 701 F.3d 1248,
1256 (10th Cir. 2012) (enforcing a clickwrap agreement
whose terms were displayed in a scrollable text box and
underneath it were buttons labeled “Exit Registration,” “I
Reject,” and “I Agree”);
•
Specht v. Netscape Communications Corp., 306 F.3d 17, 32
(2d Cir. 2002) (Sotomayor, J.) (refusing to enforce an
agreement whose terms were placed below the “Accept”
button);
•
Sgouros v. TransUnion Corp., No. 14 C 1850, 2015 WL 507584,
at *6-7 (N.D. Ill. Feb. 5, 2015) (“It is unreasonable to
expect users to scroll down the Window when they are not
aware of a possibility of being bound by the terms in the
Window.”);
•
Van Tassell v. United Marketing Group, LLC,
770, 790 (N.D. Ill. 2011) (invalidating
agreement because the webpage failed to have
to the Conditions of Use and also required
process to locate the Conditions of Use);
•
Burcham v. Expedia, Inc., No. 4:07 C 1963, 2009 WL 586513,
at *1, 3 (E.D. Mo. Mar. 6, 2009) (finding a valid clickwrap
agreement where a “Continue” button led to a page that
stated “By continuing on you agree to the following terms
- 21 -
795 F.Supp.2d
a browsewrap
any reference
a multi-step
and conditions,” provided the terms and conditions, and
included a clickable box stating “I agree to the terms and
conditions”); and
•
Feldman v. Google, Inc., 513 F.Supp.2d 229, 236 (E.D. Pa.
2007) (finding reasonable notice of a clickwrap agreement
where users did not need to scroll down to a submerged
screen to see the terms, and “a prominent admonition in
boldface
to
read the
terms
and
conditions . . . and
indicate assent” made the text of the agreement immediately
visible to users).
In
this
case,
after
Sullivan
input
his
personal
information, he clicked the “Submit” button immediately below
the end of the health insurance quote form without scrolling
down further to the bottom of the webpage to read All Web’s
Lilliputian consent language.
thinks
it
merely
“reasonable
constituted
submitting
their
for
health insurance quote.
clicking
displayed
processed,
“Submit,”
on
an
users
ensuing
especially
speedy quotes.
users
their
personal
in
In these circumstances, the Court
to
assent
assume
to
information
that
[an]
further
their
click
authorization”
to
getting
Sgouros, 2015 WL 507584 at *5.
would
likely
webpage
once
light
of
the
expect
their
quotes
By
to
information
website’s
a
promises
be
was
of
(See, e.g., Compl. ¶¶ 19 (“The Fastest Way to
Get On & Off Exchange Quotes.”), 20 (“The Fastest Way to Get
Free Health Insurance Quotes.”).)
Given the website’s silence
on quotes proceeding by phone and failure to alert users that
legal
disclosures
appear
below
the
- 22 -
“Submit”
box,
the
Court
cannot, while drawing inferences in Sullivan’s favor, find that
All
Web’s
alleged
consent
mechanism
gave
Sullivan
reasonable
notice sufficient for an enforceable written “agreement” - to
say nothing of the TCPA’s heightened “clear and conspicuous”
disclosure requirement governing prior express written consent
agreements.
the
Thus, All Web has not made a legal showing based on
complaint’s
allegations
that
it
effectively
procured
Sullivan’s prior express written consent.
Presented
with
no
other
basis
for
dismissing
Sullivan’s
complaint, the Court denies All Web’s Rule 12(b)(6) Motion to
Dismiss.
B.
In
his
Motion to Strike Proposed Class
Complaint,
Sullivan
proposes
the
following
class
definition:
All persons within the United States who filled out
and submitted an insurance quote form on Defendant’s
website www.affordable-health-insurance-plans.org and
then received a non-emergency telephone call from All
Web Leads, or any party acting on its behalf, to a
cellular telephone through the use of an automated
telephone
dialing
system
or
an
artificial
or
prerecorded voice.
(Compl. ¶¶ 45, 49.)
The Complaint goes on to exclude from the
class
entities
All
Web,
any
in
which
it
has
a
controlling
interest, its agents and employees, the Court and its staff, and
all claims for personal injury, wrongful death, and emotional
distress. (Id. ¶ 46.)
Although he cannot pinpoint the exact
- 23 -
number of putative class members, Sullivan asserts that they
total
in
the
thousands
and
can
be
identified
through
records maintained by All Web. (Id. ¶¶ 47, 52.)
call
Finally, he
identifies several common questions of law and fact, such as
whether All Web uses an automatic telephone dialing system to
make non-emergency calls to class members’ cell phones; whether
All Web gives proper notice to those who fill out a quote form
that it intends to place calls using an automatic dialing system
to the phone numbers provided; whether the website’s requirement
that users consent to receive phone calls via the use of an
autodialer as a condition to provision of services violates FCC
rulings; and whether All Web can meet its burden of showing
prior express written consent to make such calls. (Id. ¶¶ 5355.)
As an alternative to its Motion to Dismiss, All Web argues
that the Court should strike the proposed class for failure to
comply with the requirements of FED. R. CIV. P. 23(a) and FED. R.
CIV. P. 23(b)(3).
(All Web does not claim that the proposed
class is insufficiently ascertainable, which is an independent
class
certification
requirement.)
Courts
generally
address
class certification at the pleading stage “only when the class
allegations are facially and inherently deficient.”
Machowicz
v. Kaspersky Lab, Inc., No. 14 C 1394, 2014 WL 4683258, at *5
- 24 -
(N.D. Ill. Sept. 19, 2014) (internal quotation marks omitted).
The problem for All Web is that Sullivan’s class allegations are
not facially or inherently deficient.
The nub of All Web’s typicality, commonality, adequacy, and
predominance arguments is that Sullivan seeks impermissibly to
represent putative class members regardless of the form of their
consent.
(See,
Reply”) at 8-10.)
Def.’s
Mot.
at
18-20;
ECF
No.
17
(“Def.’s
In a similar vein, All Web contends that the
common issue of “whether Defendant gave proper notice to users”
who filled out the quote form “cannot be resolved without a
series of mini-trials.” (Def.’s Reply at 10.)
All Web grounds
its argument in Cholly v. Uptain Grp., Inc., No. 15 C 5030, 2017
WL 449176 (N.D. Ill. Feb. 1, 2017).
There, the court struck the
plaintiff’s class allegations on typicality grounds because she
sought to “represent a class of persons who received calls from
Uptain where Uptain did not have express consent,” whereas her
individual claim was “based only on telephone calls made to her
cellular phone after she had expressly revoked her consent.” Id.
at *3 (emphasis added).
Thus, the plaintiff’s class in Cholly
was facially deficient under Rule 23(a)(2).
Plainly, this is not the case here.
Sullivan seeks to
represent a class of individuals each of whom engaged in the
same consent procedure that he did – filling out the quote form,
- 25 -
clicking “Submit,” and then receiving an autodialed cell phone
call.
Thus, absent some other interface with All Web, each
putative class member gave the same consent; the ability of All
Web to invoke consent as an affirmative defense to each class
member is uniform; and determining the legal efficacy of this
consent under the TCPA “will resolve an issue that is central to
the validity of each one of the claims in one stroke.”
Wal-Mart
Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2011); Holtzman, 728
F.3d at 684 (“Class certification is normal in litigation under
§
227,
because
recipients.”).
the
main
questions . . . are
common
to
all
All Web therefore fails to identify any facial
deficiency in Sullivan’s proposed class.
Even if Sullivan’s class definition conceptually includes
those consumers who gave All Web some sort of individualized
consent, it would be premature at this pre-discovery procedural
stage to determine whether this suit can proceed as a class
action.
“Courts
determine
whether
issues
of
individualized
consent defeat commonality and predominance in a TCPA [case] on
a
case-by-case
basis
after
available to prove consent.”
evaluating
the
specific
evidence
Buonomo v. Optimum Outcomes, Inc.,
301 F.R.D. 292, 298 (N.D. Ill. 2014) (“Optimum, however, fails
to
present
speculation
any
—
specific
that
this
evidence
—
purportedly
- 26 -
as
opposed
to
individualized
mere
issue
predominates over common issues.
Nor can it given that Optimum
has refused to provide any class discovery while its motion to
strike is pending.”).
Indeed, many of the cases All Web invokes
were denials of class certification based on evidence obtained
through
discovery.
See,
e.g.,
Jamison,
290
F.R.D.
at
107
(finding that individualized consent issues predominated because
the
defendant
significant
“set[]
percentage
forth
of
specific
the
evidence
putative
showing
class
that
consented
a
to
receiving calls on their cellphone”); Quality Mgmt. and Consult.
Servs., Inc. v. SAR Orland Food, Inc., No. 11 C 6791, 2013 WL
5835915 (N.D. Ill. Oct. 30, 2013) (holding that the plaintiff
failed to meet its burden on class certification to introduce
evidence showing that the defendant’s consent defense as to the
representative plaintiff applied to the class as a whole); Vigus
v. Southern Illinois Riverboat/Casino Cruises, Inc., 274 F.R.D.
229, 235 (S.D. Ill. 2011) (“[T]he Casino has provided evidence
that at least three telephone numbers identified using Vigus’
culling process did not indicate reassigned numbers.”) (emphasis
in original).
These cases furnish no support for All Web’s
motion to strike Sullivan’s proposed class before discovery has
commenced.
Kasalo v. Harris & Harris, Ltd., 656 F.3d 557 (7th Cir.
2011), is not to the contrary.
The authorization granted there
- 27 -
to deny class certification “even before the plaintiff files a
motion requesting certification” rested on the truism that the
court “need not delay a ruling on certification if it thinks
that additional discovery would not be useful in resolving the
class determination.”
omitted).
Id. at 563 (emphasis added) (citations
Here, as mentioned above, this action can on its face
be maintained on a class basis, and discovery – which has not
occurred yet - may assist both parties in arguing the propriety
of certification.
Because All Web’s arguments do not clarify
why the proposed class is conceptually deficient, “discovery is
needed
to
determine
whether
a
class
should
be
certified.”
Santiago v. RadioShack Corp., No. 11 C 3508, 2012 WL 934524, at
*4 (N.D. Ill. Feb. 10, 2012).
Striking the class allegations
would be premature.
In a final gambit, All Web points to language in Sullivan’s
Complaint that he was “tricked” into providing his cell phone
number and clicking “Submit.”
This allegation of “trickery,”
All Web claims, amounts to a fraud claim necessitating minitrials into whether each putative class member was deceived.
Simply put, this argument strains credulity.
Sullivan’s only
claims on behalf of the class are under the TCPA, and his belief
that he was “tricked” seems merely an individual variation on
the Complaint’s objective theme that All Web’s consent procedure
- 28 -
is ineffective and unenforceable.
Even if Sullivan had actually
meant to plead a claim for fraud, this would not necessarily
furnish grounds for striking all the class allegations prior to
discovery.
See,
e.g.,
Volling
v.
Antioch
Rescue
Squad,
999
F.Supp.2d 991, 1006 (N.D. Ill. 2013) (noting that “there is no
penalty
wrong
for
invoking
name
to
the
identify
wrong
a
[legal
theory,”
theory],
and
that
or
it
using
would
the
be
“premature to strike” the legal theories presented in different
counts “before discovery reveals the appropriate theory”).
The Court therefore denies All Web’s Motion to Strike as
premature in light of the absence of any class discovery.
IV.
For
the
reasons
CONCLUSION
stated
herein,
the
Court
denies
Defendant’s Motion to Dismiss Plaintiff’s Complaint or, in the
Alternative, to Strike the Complaint’s Class Allegations [ECF
Nos. 7, 12].
IT IS SO ORDERED.
Harry D. Leinenweber, Judge
United States District Court
Dated: 6/1/2017
- 29 -
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