Hamza v. Dunhams Athleisure Corporation
ORDER Granting in Part and Denying in Part 11 Defendant's Motion to Dismiss. Signed by District Judge Denise Page Hood. (LSau)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
Case No. 16-11641
HON. DENISE PAGE HOOD
ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANT’S MOTION TO DISMISS [#11]
On May 6, 2016, Plaintiff filed a two-count Class Action Complaint against
Defendant, and Defendant filed an initial motion to dismiss on July 20, 2016. After
Plaintiff filed a First Amended Class Action Complaint on August 10, 2016 (Doc. No.
10), Defendant filed a Motion to Dismiss First Amended Class Action Complaint on
August 24, 2016 (“Motion to Dismiss”) (Doc. No. 11), which has been fully briefed,
and each party has filed several notices of supplemental authority. A hearing on
Defendant’s Motion to Dismiss was held on November 9, 2016, at 3:00 p.m.
For the reasons that follow, the Court denies Defendant’s Motion to Dismiss
with respect to Count I and grants Defendant’s Motion to Dismiss with respect to
STATEMENT OF FACTS
Plaintiff is an adult consumer who resides in Saint Clair Shores, Michigan, and
Defendant is a Delaware corporation headquartered in Troy, Michigan. On February
29, 2016, Defendant began placing automated text messages to Plaintiff’s cellular
telephone number, 734-xxx-3421 (the “Number”), from SMS short code number
55678. The first text message from Defendant set forth: “Thank you 4 opting-in to
the Dunhams mobile program.” Plaintiff alleges that he had not: (1) opted in or
text-messaged Defendant to effect an opt-in; (2) provided his cellular telephone
number to Defendant; or (3) provided Defendant prior express written consent to send
automated text messages to his cellular telephone. Plaintiff alleges that he does not
know how Defendant obtained Plaintiff’s cellular telephone number. (First Amended
Class Action Complaint ¶ 22).
On February 23, 2016, an entrant named “Aisha Hamza” completed an internet
form to enter a Detroit Red Wings sweepstakes program (the “Form”), a program was
sponsored by Defendant. The Form completed by Aisha Hamza included the
opportunity to receive promotional text messages from Defendant, as follows:
G By checking this box and providing your mobile number, you are
subscribing to receive text message promotions from Dunham’s Sports.
Message & data rates may apply. Maximum seven messages per month,
per subscription. You can cancel at any time. Dunham’s respects your
Links & coupons within Dunham’s text messages are best viewed via
smart phone & may not be accessible from all mobile phones.
Opting-in to receive text messages from Defendant required the entrant to
affirmatively check the box, as the default setting was an unchecked box. When
completing the Form, Aisha Hamza opted-in to receive messages from Defendant by
checking the box, provided the Number as the mobile phone number to receive
messages, and entered the same address where Plaintiff allegedly resides.
After the sweepstakes closed, the Detroit Red Wings sent a file to Defendant
that included the telephone numbers that had opted-in, including the Number.
According to Plaintiff, he began receiving text messages from Defendant on the
Number on February 29, 2016. Plaintiff received numerous messages that marketed
Defendant products, and each message appeared to be template-based and not personal
to Plaintiff. (¶¶ 23-24). Each text sent by Defendant and received by Plaintiff
included instructions on how to stop receiving subsequent text messages from
Defendant. Plaintiff does not allege that he ever sent Defendant a response message
asking Defendant to stop sending text messages to the Number.
Plaintiff alleges that he was injured by Defendant unauthorized text messages
in a number of ways: (a) the messages invaded Plaintiff’s privacy and annoyed,
frustrated, distracted, and inconvenienced Plaintiff while he was working on school
assignments and during work hours (¶ 26); (b) he was disrupted by text messages from
Defendant during dinner (¶ 26); (c) he was distracted while driving by incoming text
messages from Defendant (¶ 26); (d) Defendant’s text messages took over Plaintiff’s
cellular telephone, his personal property, during the time that the messages were
incoming and while Plaintiff retrieved them, such that Plaintiff’s time was wasted by
text messages he neither asked for nor wanted (¶ 27); and (e) Defendant’s text
messages drained his cell phone battery, which he then had to recharge, requiring him
to incur costs for electricity (¶ 28). Plaintiff also claims that the telephone number to
which Defendant sent the text messages was assigned to a cellular telephone service
for which Plaintiff incurred charges (¶ 28).
APPLICABLE LAW & ANALYSIS
Fed.R.Civ.P. 12(b)(1) provides for the dismissal of an action for
lack of subject matter jurisdiction. A Rule 12(b)(1) motion for lack of
subject matter jurisdiction can challenge the sufficiency of the pleading
itself (facial attack) or the factual existence of subject matter jurisdiction
(factual attack). United States v. Ritchie, 15 F.3d 592, 598 (6th Cir.
1994). A facial attack goes to the question of whether the plaintiff has
alleged a basis for subject matter jurisdiction, and the court takes the
allegations of the complaint as true for purposes of Rule 12(b)(1)
A factual attack challenges the factual existence of subject matter
jurisdiction. In the case of a factual attack, a court has broad discretion
with respect to what evidence to consider in deciding whether subject
matter jurisdiction exists, including evidence outside of the pleadings,
and has the power to weigh the evidence and determine the effect of that
evidence on the court’s authority to hear the case. Id. Plaintiff bears the
burden of establishing that subject matter jurisdiction exists. DLX, Inc.
v. Commonwealth of Kentucky, 381 F.3d 511, 516 (6th Cir. 2004).
Cartwright v. Garner, 751 F.3d 752, 759-60 (6th Cir. 2014).
The TCPA makes it “unlawful for any person . . . to make any call (other than
a call made for emergency purposes or made with the prior express consent of the
called party) using any automatic telephone dialing system or an artificial or
prerecorded voice . . . to any telephone number . . . assigned to a . . . cellular telephone
service.” 47 U.S.C. § 227(b)(1). The TCPA creates a private right of action in which
a person may bring an action for a violation of § 227 and “receive $500 in damages
for each such violation.” Id. at § 227(b)(2)(G)(3)(B). And, “[i]f the court finds that
the defendant willfully or knowingly violated this subsection . . . the court may . . .
increase the amount of the award to an amount equal to not more than 3 times” the
$500. Id. at § 227(b)(2)(G)(3)(C).
In order to state a TCPA claim for calls made to a cellular phone, a plaintiff
must establish that: (1) a call was placed to a cell or wireless phone, (2) by the use
of any automatic dialing system and/or leaving an artificial or pre-recorded message,
and (3) without prior express consent of the “called party.” 47 U.S.C. §
227(b)(1)(A)(iii). An automatic dialing system (“ATDS”), as defined in the TCPA,
is a device with “the capacity to store or produce telephone numbers to be called,
using a random or sequential number generator” and “to dial such numbers.” 47
U.S.C. § 227(a)(1).
Defendant argues that he is making a factual challenge to jurisdiction and that
Plaintiff does not have Article III standing because Plaintiff has not shown that a
concrete injury-in-fact exists. Defendant asserts that, “because it had . . . written
permission to send text messages to the Number, any alleged harm resulting from the
receipt of the automated text messages would not amount to a concrete injury [for
invasion of privacy], [and] Plaintiff has no Article III standing.” Dkt. No. 15, PgID 203
(citing Muslim Cmty. Ass’n v. Ashcroft, 459 F.Supp.2d 592, 596 (E.D. Mich. 2006)
Defendant first asserts that there can be no injury-in-fact due to invasion of
privacy (which includes all the ways Plaintiff has alleged that the texts annoyed,
frustrated, distracted and inconvenienced him) because Aisha Hamza consented to
Defendant sending texts to the Number. Defendant contends that the consent of Aisha
Hamza satisfies the TCPA’s requirement that an ATDS text only be sent to a “called
party” from whom it has consent. 47 U.S.C. § 227(b)(1)(A). As defined by the FCC,
a “called party” includes a subscriber and “any customary users,” which includes “a
close relative on a subscriber’s family calling plan . . . , because the subscriber will
generally have allowed such customary users to control the calling to and from a
particular number under the plan, including granting consent to receive robocalls.” 30
FCC Rcd 7961, 8001 (2015). Defendant relies on its contention that it is “undisputed”
that it had the prior written consent of Aisha Hamza (whom Defendant assumes, but
no evidence has been presented to show, is a close relative of Plaintiff) to send texts
to the Number.1
Plaintiff does not challenge Defendant’s position that Aisha Hamza gave
consent, or had authority to consent, in writing to allow Defendant to send texts to the
Number. Plaintiff instead argues that he is the only person who could consent to
allow texts to the Number – and that he did not do so. Relying on Osorio v. State
Farm Bank, F.S.B., 746 F.3d 1242, 1250-52 (11th Cir. 2014). Defendant counters that
the amendments to the definition of “called party” nullify the ruling in Osorio, and it
is clear that those amendments did follow the Osorio ruling, as they were made in
The viability of Plaintiff’s cause of action appears to turn on whether Aisha
Hamza is considered a “customary user” under the definition of a “called party.” If
the parties have not taken Aisha Hamza’s deposition, the Court directs that the
parties schedule the deposition of Aisha Hamza as soon as possible.
Plaintiff also argues that Defendant’s argument does not go to standing but
instead necessitates a determination of fact not appropriate for consideration at this
stage of the proceedings. Defendant asserts that it is simply a factual challenge to
standing and requests that:
If the Court believes a factual dispute over a jurisdictional issue exists,
limited jurisdiction discovery (subpoena to cell phone provider and
deposition of Aisha Hamza) or an evidentiary hearing would be
appropriate to address that issue. See Madison-Hughes v. Shalala, 80
F.3d 1121, 1130 (6th Cir. 1996) (“[T]he district court is empowered to
resolve factual disputes when necessary to resolve challenges to subject
matter jurisdiction.”); Ohio Nat’l Life Ins. Co. v. United States, 922 F.2d
320, 325 (6th Cir. 1990) (“Such a factual attack on subject matter
jurisdiction commonly has been referred to as a ‘speaking motion.’ . . .
In reviewing these speaking motions, a trial court has wide discretion to
allow affidavits, documents and even a limited evidentiary hearing to
resolve disputed jurisdictional facts.”).
Dkt. No. 15, PgID 208.
Defendant’s argument is at odds with the vast majority of decisions rendered
by courts considering whether a concrete injury-in-fact has occurred when a plaintiff
makes invasion of privacy allegations based on calls or texts received that the plaintiff
has pled violated the TCPA. See, e.g., LaVigne v. First Comm. Bancshares, Inc., No.
1:15-cv-00934, 2016 WL 6305992, at *7 (D.N.M. Oct. 19, 2016) (“The TCPA
codifies the long-recognized common law tort of invasion of privacy . . . for a
particularly intrusive type of unwanted conduct: unauthorized ‘robocalls.’”). As one
of the cases cited by the LaVigne court recognized in the context of invasion of
privacy allegations, “it is the fact of the call (or calls) that creates the injury sufficient
to confer standing.” Ung v. Universal Acceptance Corp., 2016 WL 4132244, at *2
Defendant’s reliance on Kostmayer Constr., LLC v. Port Pipe & Tube, Inc., No.
2:16-cv-01012, Slip Opinion (W.D. La. Oct. 19, 2016), is not persuasive. In
Kostmayer, unlike this case, the plaintiff did not specify what his injuries were. That
plaintiff literally alleged that the defendant’s unsolicited faxes “caus[ed] Plaintiff and
Plaintiff Class to sustain statutory damages, in addition to actual damages, including
but not limited to those contemplated by Congress and the FCC.” Id. at 1. The
absence of specified harm was fatal to a finding of concrete injury, something that is
not present in this case where Plaintiff alleged how his privacy was invaded and costs
(albeit minimal) he incurred.
Defendant asserts that the other injuries Plaintiff alleges (loss of battery power,
incurring charges for his phone) are injuries Plaintiff would have incurred whether the
texts were sent from an ATDS or resulted from manual texting. Relying on Romero
v. Dep’t Stores Nat’l Bank, No. 15-CV-193, 2016 WL 4184099, at *5 (S.D. Cal. Aug.
5, 2016) (a plaintiff who would have been no better off if the defendant made a call
without an ATDS has no standing under Article III to claim a violation of the TCPA).2
Many courts deciding motions to dismiss for lack of Article III standing in TCPA
cases have reached the opposite conclusion. See, e.g., Mey v. Got Warranty, Inc., 2016
WL 3645195, at *3 (N.D. W.Va. 2016) (“all ATDS calls deplete a cell phone’s
battery, and the cost of electricity to recharge the phone is also a tangible harm. While
certainly small, the cost is real, and cumulative effect could be consequential.”);
LaVigne, No. 1:15-cv-00934, Slip Op. at 13 (emphasis in original) (first, rejecting
“Romero [a]s an outlier in holding that a violation of the TCPA is a bare procedural
violation and that some additional harm must be shown to establish standing,” and,
second, finding that an argument such as that made by Defendant – that additional
harm is necessary – “conflates the means through which it (allegedly) violated the
TCPA with the harm resulting from that alleged violation.”).
The majority of cases have recognized a concrete injury-in-fact when a plaintiff
alleges an invasion of privacy (and/or minimal costs), such that Article III standing
Plaintiff relies on McNamara v. City of Chicago, 138 F.3d 1219, 1222 (7th Cir. 1998).
In McNamara, nine white plaintiffs who sued the City of Chicago for promoting AfricanAmericans instead of them, allegedly under an affirmative action program. The court applied the
standing test above (that plaintiff has no Article III standing if he “would have been no better
had the defendant refrained from the unlawful acts of which the plaintiff is complaining”) only to
the six plaintiffs who would not have been promoted even without the affirmative action
program, not to those who might have been promoted but for the affirmative action program. Id.
Defendant argues that Romero and McNamara apply in this case and dictate a finding that
Plaintiff has not proven a concrete injury-in-fact.
exists. The reasoning of these courts is reasonable and persuasive in light of the
purposes of the TCPA. As stated recently by a district court in the Eastern District of
The Court finds a TCPA violation can cause intangible concrete harm.
As directed by Spokeo [Inc. v. Robins, 136 S.Ct. 1540], the Court should
first consider the history of the intangible harm and Congress’s
judgment. The harm caused by unwanted phone calls is closely related
to an invasion of privacy, which is a widely recognized common law
tort. U.S. Dep’t of Justice v. Reporters Comm. for Freedom of Press, 486
U.S. 749, 763 (1989). “Even if invasion of privacy were not a harm
recognized as redressable through a common law tort claim, it would
meet the requirement of concreteness as interpreted by Spokeo because
Congress so clearly identified it as a legally cognizable harm.” Mey v.
Got Warranty, Inc., No. 5:15-CV-101, 2016 WL 3645195, at *4 (N.D.
W.Va. June 30, 2016). Congress’s judgment in enacting the TCPA was
to protect consumers’ privacy rights. Telephone Consumer Protection
Act of 1991, Pub. L. No. 102-243, § 2, 105 Stat. 2394–95 (codified as a
note to 47 U.S.C. § 227). Congressional findings that accompany the
TCPA illustrate this intent. See id. (“[T]he evidence presented to the
Congress indicates that automated or prerecorded calls are a nuisance
and an invasion of privacy . . . .”). Thus, Congress identified the
intangible harm of invasion of privacy as legally cognizable. Considering
this history and Congress’s judgment, the Court finds an invasion of
privacy within the context of the TCPA constitutes a concrete harm that
meets the injury-in-fact requirements.
Holderread v. Ford Motor Credit Co., LLC, No. 4:16-cv-00222, Slip Op. at 6 (E.D.
Tex. Oct. 26, 2106).
The standard proposed by Defendant, as set forth in Romero, is not reasonable
and should not be adopted. As the LaVigne court stated:
Defendants have also offered Romero, which is hardly convincing.
Under its rather draconian analysis, a plaintiff would find it almost
impossible to allege a harm as a result of these robocalls. Worse, the case
ignores the existence of intangible harms that have been recognized in
the legislative history and in the case law. The Court agrees with
Plaintiff that Romero is an outlier in holding that a violation of the TCPA
is a bare procedural violation and that some additional harm must be
shown to establish standing.
LaVigne, No. 1:15-cv-00934, Slip Op. at 12-13.
The Court denies Defendant’s Motion to Dismiss as to Count I.
Count II of Plaintiff’s First Amended Class Action Complaint alleges a claim
for willfulness under the TCPA. Section 227(b)(3) of the TCPA provides:
If the court finds that the defendant willfully or knowingly violated this
subsection or the regulations prescribed under this subsection, the court
may, in its discretion, increase the amount of the award to an amount
equal to not more than 3 times the amount available under subparagraph
(B) of this paragraph.
47 U.S.C. § 227(b)(3).
Recently, the Court addressed this issue in Duchene v. OnStar, LLC, No. 1513337, 2016 U.S. Dist. LEXIS 97129 (E.D. Mich. July 26, 2016). The Court held
that “a willful or knowing violation of [the] TCPA requires that Plaintiff has to
plead that Defendant was made aware of/notified that Plaintiff did not consent to
calls from Defendant.” Duchene, 2016 U.S. Dist. LEXIS 97129, at *19. See also
Harris v. World Fin. Network Nat’l Bank, 867 F.Supp.2d 888, 895 (E.D. Mich.
2012) (“Plaintiff must also show that Defendant knew that Plaintiff did not consent
to the phone calls”). In Duchene (who was represented by the same legal counsel
as Plaintiff), the plaintiff “did not plead that he notified [d]efendant that he did not
consent to the calls (or that [d]efendant was otherwise aware that Plaintiff did not
consent to the calls),” and the Court granted the defendant’s motion to dismiss.
As Plaintiff, like the plaintiff in Duchene, has not alleged that he notified
Defendant that he did not consent to the text messages sent by Defendant, the
Court grants Defendant’s Motion to Dismiss Count II of Plaintiff’s First Amended
Class Action Complaint.
For the reasons stated above, the Court DENIES Defendant’s Motion to
Dismiss with respect to Count I and GRANTS Defendant’s Motion to Dismiss
with respect to Count II.
IT IS ORDERED.
S/Denise Page Hood
Denise Page Hood
Chief Judge, United States District Court
Dated: March 22, 2017
I hereby certify that a copy of the foregoing document was served upon counsel of
record on March 22, 2017, by electronic and/or ordinary mail.
S/LaShawn R. Saulsberry
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