St. Louis Heart Center, Inc. v. Vein Centers for Excellence, Inc.
MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that defendant's motion to dismiss or in the alternative to strike allegations in Count I directed to the faxes at exhibit 1-3 of the Complaint [# 10 ] is granted in part and denied in part. The claims related to the faxes at exhibits 1-3 are dismissed and exhibits 1-3 themselves are hereby striken from the record. Count I of the plaintiff's Complaint shall proceed only as to the alleged violations occurring on or after December 23, 2007. IT I S FURTHER ORDERED that defendant's motion to dismiss the request for class certification in Count I of the plaintiff's Complaint [# 8 ] is denied. IT IS FINALLY ORDERED that defendant shall file its answer within fourteen (14) days of the date of this order. Signed by Honorable Catherine D. Perry on March 14, 2012. (BRP)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
ST. LOUIS HEART CENTER, INC.,
VEIN CENTERS FOR EXCELLENCE, )
Case No. 4:12CV174 CDP
MEMORANDUM AND ORDER
On December 23, 2011, plaintiff St. Louis Heart Center, Inc. filed a three
count complaint in the Circuit Court of St. Louis County against Vein Centers for
Excellence, Inc. The complaint alleged that Vein Centers violated the Telephone
Consumer Protection Act (TCPA), 47 U.S.C. § 227, committed conversion, and
violated the Missouri Merchandising Practices Act (MPA), Mo. Rev. Stat. §
407.010 et seq., in conjunction with several faxes the Heart Center allegedly
received from Vein Centers. On January 31, 2012, Vein Centers removed the case
to this Court.
On February 7, 2012, Vein Centers filed three motions to dismiss. The first
motion sought to dismiss Count III which alleged an MPA violation. On February
16, 2012, Heart Center filed its own motion to dismiss Count III without prejudice.
I granted Heart Center’s motion to dismiss Count III by docket text order, which
mooted Vein Centers’ motion to dismiss Count III.
The second and third motions both relate to Count I. Vein Centers argues
that the request for class certification under TCPA should be dismissed because
TCPA does not provide for private class actions. Additionally, Vein Centers
argues that the allegations related to the faxes at exhibits 1-3 of the Complaint
should be dismissed, or in the alternative, stricken from the record because the
statute of limitations has lapsed on those claims. At this stage, I will deny the
motion to dismiss the request for class certification, but I will grant the motion to
the extent the allegation are outside the statute of limitations. As such, the
allegations regarding the faxes at exhibits 1-3 will be dismissed and exhibits 1-3
themselves will be striken from the record.
Motion to Dismiss Standard
A defendant may move to dismiss a claim “for failure to state a claim upon
which relief can be granted” under Fed. R. Civ. P. 12(b)(6). The purpose of such a
motion is to test the legal sufficiency of the complaint. A complaint is only
required to contain “a short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed. R. Civ. P. 8(a). When considering a 12(b)(6)
motion, the court should assume all factual allegations of a complaint are true and
construe them in favor of the plaintiff. Neitzke v. Williams, 490 U.S. 319, 326
(1989). The court, however, is not required to accept as true a legal conclusion
couched as a factual allegation. Bell Atlantic v. Twombly, 550 U.S. 544, 555
(2007). While the complaint need not contain detailed factual allegations, the
plaintiff must set forth “more than labels and conclusions, and a formulaic
recitation of the elements of a cause of action will not do.” Id.
Request for Class Certification
Vein Centers argues that the TCPA does not authorize private class actions
for two reasons. First, it argues that Congress could not have intended to
authorize private class actions because the statutory damages available to
individual plaintiffs, $500 to $1500 for each violation, are sufficient to punish
offenders and incentivize plaintiffs to bring lawsuits on their own. Second, it
argues that Congress only intended class actions to be brought by a state official
because the TCPA authorizes a private right of action in two different subsections,
then authorizes a state official to bring a suit on behalf of state citizens when a
pattern or practice of violations is present in another subsection. Specifically, §
227(b)(3) sets out a private right of action for violations allowing an injunction,
$500 per violation, or $1500 for willful or knowing violations. Section 277(b)(5)
sets out a private right of action for a “person who receives more than one
telephone call within any 12-month period by or on behalf of the same entity in
violation” of the statute. § 277(f)(1), entitled “Actions by States,” provides that
“[w]henever the attorney general of a State, or an official or agency designated by
the state, has reason to believe that any person has engaged or is engaging in a
pattern or practice of telephone calls or other transmissions to residents of that
State in violation of this section or the regulations prescribed under this
subsection, the state may bring a civil action on behalf of its residents . . ..” Vein
Centers argues that the inclusion of right of action by state officials on behalf of
state citizens necessarily excludes such a right for private citizens and entities.
Heart Center argues that a ruling on this class certification issue is
premature because class determinations require a rigorous analysis including
discovery and briefing. It also points the Court to several state and federal courts
that have certified class actions by private individuals or entities based on TCPA
The United States Court of Appeals for the Third Circuit has addressed
whether a class action is the superior method of handling claims under TCPA.
Landsman & Funk PC, v. Skinder-Strauss Ass., 640 F.3d 72, 91-95 (3d. Cir.
2011). It concluded that whether “individual statutory damages of $500 to $1500
are enough to both punish offenders and spur victims” is a question for Congress,
and a trial court’s determination that such damages are adequate would be an
inappropriate substitution of judicial judgment for that of Congress. Id. at p. 94.
It noted that “[h]ad Congress wanted to preclude aggregation of individual TCPA
claims, it could have so provided in the TCPA itself or in CAFA, which
specifically lists certain types of statutory claims that could not be brought as class
actions.” Id. at 95 (citing 28 U.S.C. § 1332(d)). The Landsman court also held
that a class determination on a motion to dismiss would be premature because it is
well settled that exploring whether a case meets the requirements of Federal Rule
of Civil Procedure 23 requires a “rigorous analysis.” Id. at 94. I agree.
Although state and federal courts are split on this private class action
certification issue, see Local Banking Prod., Inc. v. Kosher Bagel Munch, Inc., 23
A3d 469, 476 (N.J. Super. A.D. 2011) (collecting cases), many decisions not to
certify classes were based on the suggested class’s inability to meet the
requirements of state rules or Federal Rule of Civil Procedure 23, rather than a ban
on private rights. Further, the Landsman decision is supported by the rationale in
Califano v. Yamasaki, 442 U.S. 682 (1979) (holding that “[t]he fact that the statute
speaks in terms of an action brought by ‘any individual’ . . . does not indicate that
the usual Rule providing for class actions is not controlling” and “a wide variety
of federal jurisdictional provisions speak in terms of individual plaintiffs, but class
relief has never been thought to be unavailable under them.”) and Karen S. Little,
L.L.C. v. Drury Inns, Inc., 306 S.W.3d 577 (Mo. Ct. App. 2010) (holding that
“[n]othing in the text of the statute, regulations or legislative history of the TCPA
indicates that Congress intended to preclude class actions.”). Just because the
TCPA authorizes state officials to bring class actions does not clearly demonstrate
that Congress intended to deprive the private individual or entity from its usual
right to bring a class action case. I find nothing in the legislative history
suggesting that Congress intended to exclude private class actions.
The legislative history does reveal that the private right of action was
incorporated in a late amendment to Senate Bill S. 1462, which allows plaintiffs to
appear in small claims courts to recover more than their actual damages, i.e.,
between $500 and $1500 per TCPA violation. See Levine v. 9 Net Ave., Inc., No.
A-1107-00T1, 2001 WL 34013297, at *1 (N.J. Super. A.D. 2001) (citing Int’l Sci.
& Tech. Inst. v. Inacom Comm’ns, Inc., 106 F.3d 1146, 1152–53 (4th Cir. 1997)).1
It is fair to say “[t]he drafters recognized that damages from a single violation
would ordinarily amount to only a few pennies worth of ink and paper usage.” Id.
(citing 137 Cong. Rec. S16205–06 (daily ed. Nov. 7, 1991) (statement of Sen.
Hollings) (“[I]t would defeat the purposes of the bill if the attorneys’ costs to
Vein Centers cite to Levine v. 9 Net Ave., Inc., No. A-1107-00T1, 2001 WL 34013297,
at *1 (N.J. Super. A.D. 2001) as a court who “analyzed the possible effect of subsection (g) of
the statute on private class actions . . . [and] clearly realized the importance of subsection (g) . . .,
because it concluded that the availability of broad remedies to the state attorney general made
state action . . . superior to a private class action for damages.” I do not believe that anything in
the opinion supports that proposition. The Levine court affirmed the denial of class certification
based on the trial judge’s determination that the suggested class did not met the predominance
and superiority factors of the state rule holding that the “only question the court was to decide
was whether a class action should be certified in this case.” While it did consider the potential
for an award beyond actual damages, it did not hold that private class actions were barred by
TCPA because of subsection (g) or that class actions by state officers were the superior method.
consumers of bringing an action were greater than the potential damages.”)). It is
also fair to say that after this consideration Congress provided an avenue for
private plaintiffs to adjudicate matters in small claims court without an attorney. I
do not, however, believe that Congress demonstrated an intent to strip private
individuals and entities of their rights under the Federal Rule of Civil Procedure
23 and the Class Action Fairness Act, 28 U.S.C. § 1332(d) by setting the available
statutory damages above the actual damages.
Finally, the suggestion that Mims v. Arrow Fin. Servs., LLC, 132 S. Ct. 740
(2012) supports Vein Centers’ arguments is misplaced. Mims is a jurisdictional
analysis. Mims simply held that “[t]he TCPA’s permissive grant of jurisdiction to
state courts does not deprive a U.S. district court of federal-question jurisdiction
over private TCPA suits.” Id. Nothing in the opinion supports the Heart Center’s
argument that the statute prohibits private class actions. I will deny Vein Centers’
motion to dismiss the request for class certification. I will reserve my “rigorous
analysis” of the motion for class certification, which Heart Center filed in the state
court, until that motion has been fully briefed.
Statute of Limitations
Vein Centers also filed a motion to dismiss or strike the allegations related
to the faxes at exhibits 1-3 of the Complaint because the statute of limitations has
lapsed on those claims. The statute of limitations issue warrants little discussion.
Claims under the TCPA arise under federal law. Mims, 132 S. Ct. at 749. The
statute of limitations for TCPA violations is four years. Sawyer v. Atlas Heating
and Sheet Metal Works, Inc., 642 F.3d 560, 561 (7th Cir. 2011). Heart Center
filed this case in the Circuit Court of St. Louis County on December 23, 2011. As
a result, any allegations regarding faxes sent before December 23, 2007 are barred.
I will, therefore, dismiss the claims outside the statute of limitations and strike
IT IS HEREBY ORDERED that defendant’s motion to dismiss or in the
alternative to strike allegations in Count I directed to the faxes at exhibit 1-3 of the
Complaint [#10] is granted in part and denied in part. The claims related to the
faxes at exhibits 1-3 are dismissed and exhibits 1-3 themselves are hereby striken
from the record. Count I of the plaintiff’s Complaint shall proceed only as to the
alleged violations occurring on or after December 23, 2007.
IT IS FURTHER ORDERED that defendant’s motion to dismiss the
request for class certification in Count I of the plaintiff’s Complaint [#8] is denied.
IT IS FINALLY ORDERED that defendant shall file its answer within
fourteen (14) days of the date of this order.
This case will be set for a Rule 16 Scheduling Conference by separate order,
and the parties are reminded to include in their Proposed Joint Scheduling Plan all
deadlines needed to resolve the class certification issue.
CATHERINE D. PERRY
UNITED STATES DISTRICT JUDGE
Dated this 14th day of March, 2012.
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