Imhoff Investment, L.L.C. v. Alfoccino of Auburn Hills, Inc. et al

Filing 161

ORDER denying Defendants' Motions 149 to Stay of Proceedings and 157 for Leave to Deposit Funds With the Court. Signed by District Judge Gerald E. Rosen. (JOwe)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION

AVIO, INC., individually and as
the representative of a class of
similarly situated persons,
Plaintiff,

Case No. 10-10221

v.

Hon. Gerald E. Rosen

ALFOCCINO, INC., D. TALIERCIO
INVESTMENTS, INC. and FARSHID
(TONY) SHUSHTARI,
Defendants.
____________________________________/
ORDER DENYING DEFENDANTS’
MOTIONS FOR STAY OF PROCEEDINGS AND
FOR LEAVE TO DEPOSIT FUNDS WITH THE COURT
At a session of said Court, held in
the U.S. Courthouse, Detroit, Michigan
on
September 28, 2016
PRESENT: Honorable Gerald E. Rosen
United States District Judge
In an amended opinion and order dated December 14, 2015, the Court
granted Plaintiff’s motion to certify a class in this case alleging that non-party
Business–to-Business Solutions sent “junk faxes” to thousands of recipients on
Defendants’ behalf in violation of the Telephone Consumer Protection Act

(“TCPA”), 47 U.S.C. § 227. Defendants sought permission under Fed. R. Civ. P.
23(f) to appeal this class certification ruling, but the Sixth Circuit Court of
Appeals denied this request in a May 24, 2016 order.
Two motions presently are pending before the Court. In the first,
Defendants requested a stay of proceedings pending (i) an anticipated Supreme
Court ruling, and (ii) the Sixth Circuit’s decision on Defendants’ Rule 23(f)
petition for leave to appeal this Court’s class certification ruling. Since this
motion was filed, the Supreme Court issued its decision in the case cited in
Defendants’ motion, see Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663 (2016),
and the Sixth Circuit, as noted, acted on Defendants’ Rule 23(f) petition for leave
to appeal. In addition, while Defendants filed a supplemental brief suggesting that
a stay was warranted pending the Supreme Court’s decision in yet another case,
the Supreme Court has now ruled in this case as well. See Spokeo, Inc. v. Robins,
136 S. Ct. 1540 (2016). Accordingly, the Court denies Defendants’ request for a
stay as moot.
In their second pending motion, Defendants request leave to deposit funds
with the Court pursuant to Fed. R. Civ. P. 67, under the premise that these funds, if
disbursed to the named Plaintiff, would provide complete relief to this party and
thereby moot its TCPA claim. In an earlier effort to moot the claim of the named
2

Plaintiff, undertaken prior to this Court’s class certification ruling, Defendants
made an offer of judgment to Plaintiff under Fed. R. Civ. P. 68(a), but Plaintiff did
not accept this offer, and it therefore was deemed withdrawn under Fed. R. Civ. P.
68(b). Moreover, to the extent that Defendants maintained that their offer of
judgment, even if not accepted, operated to moot Plaintiff’s claim, the Supreme
Court squarely addressed and rejected this contention in Campbell-Ewald, 136 S.
Ct. at 672, holding that “an unaccepted . . . offer of judgment does not moot a
plaintiff’s case.”
Undeterred, Defendants have made two additional efforts to moot the named
Plaintiff’s TCPA claim, both undertaken after the Court granted Plaintiff’s motion
for class certification. First, Defendants sent checks to Plaintiff’s counsel
reflecting the amounts offered in Defendants’ Rule 68 offer of judgment, but these
checks were returned uncashed. Next, Defendants have filed the present motion,
seeking leave to deposit with the Court the funds that they have unsuccessfully
offered to Plaintiff on two prior occasions. In support of this motion, Defendants
explain that they “seek to preserve” their argument that through one or more of the
above-cited efforts, whether alone or in combination, they have rendered moot the
TCPA claim of the named Plaintiff. (Defendants’ Motion for Leave to Deposit

3

Funds, Br. in Support at 3.)1
The Court finds that the deposit of funds requested by Defendants would
not have the desired effect, and thus would be futile. It makes all the difference,
under the relevant law, that Defendants are pursuing this effort after the Court
granted Plaintiff’s motion for class certification. The Sixth Circuit has long
recognized, and recently reaffirmed, that “[o]nce a class is certified, the mooting
of the named plaintiff’s claim does not moot the action,” and that “the court
continues to have jurisdiction to hear the merits of the action if a controversy
between any class member and the defendant exists.” Brunet v. City of Columbus,
1 F.3d 390, 399 (6th Cir. 1993) (emphasis in original); see also Wilson v. Gordon,
822 F.3d 934, 942 (6th Cir. 2016). “This is because once a class is certified, the
class of unnamed persons described in the certification acquires a legal status
separate from the interest asserted by the named plaintiff.” Wilson, 822 F.3d at
942 (alteration, internal quotation marks and citation omitted). Thus, even
assuming the deposit of funds proposed by Defendants would moot the TCPA
claim asserted by the named Plaintiff — a difficult question left open by the
Supreme Court in Campbell-Ewald, 136 S. Ct. at 672, and which the Court need

1

The Court notes that Defendant’s motion and accompanying brief lack page
numbers, in violation of Local Rule 5.1(a)(2) of this District.
4

not address here — the members of the Plaintiff class would still be entitled to
pursue their TCPA claims, and the Court would have jurisdiction to hear the
merits of these claims.
The Court recognizes that Defendants continue to disagree with its class
certification ruling. Yet, even assuming they eventually succeed in having this
decision overturned, Defendants would then be able to revisit their request to
deposit funds with the Court in a renewed effort to moot this case. Defendants fail
to suggest why it is necessary to make the requested deposit of funds now, prior to
the forthcoming trial, in order to “preserve” an argument that is presently
unavailable but might hypothetically become available in light of possible posttrial developments. Neither has the Court been able to identify any reason why
Defendants’ request should be granted at the present juncture.
For these reasons,
NOW, THEREFORE, IT IS HEREBY ORDERED that Defendants’ January
19, 2016 motion for stay of proceedings (docket #149) is DENIED AS MOOT. IT
IS FURTHER ORDERED that Defendants’ March 21, 2016 motion for leave to
deposit funds with the Court (docket #157) is DENIED. In light of these rulings,
the Court will issue a notice directing the parties to attend a status conference
addressing notification of the Plaintiff class, preparation for trial, and the
5

possibility of pursuing a class-wide settlement.

s/Gerald E. Rosen
United States District Judge
Dated: September 28, 2016
I hereby certify that a copy of the foregoing document was served upon the parties
and/or counsel of record on September 28, 2016, by electronic and/or ordinary
mail.
s/Julie Owens
Case Manager, [phone]

6