Levine Hat Co. v. Innate Intelligence, LLC et al
MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that plaintiff's motion for class certification is GRANTED. Signed by District Judge Stephen N. Limbaugh, Jr on 2/9/2018. (JMC)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
LEVINE HAT CO., on behalf of itself
and all other similarly situated,
INNATE INTELLIGENCE, LLC, et al.,
No. 4:16-cv-01132 SNLJ
MEMORANDUM AND ORDER
Plaintiff Levine Hat Co. filed this putative class action lawsuit against defendants
Innate Intelligence LLC d/b/a Innate Wellness Centers (“Innate”), Nepute Enterprises
LLC (“Nepute”), and ProFax, Inc.1 alleging violations of the Telephone Consumer
Protection Act, 47 U.S.C. § 227 (“TCPA”). Plaintiff has moved for class certification
(#93). Only defendant ProFax has responded in opposition to the motion.
Defendant Innate is an umbrella organizations for advertising and managing
chiropractic clinics, operating 12 chiropractic offices in four markets across the United
States. Plaintiff contends that Innate contracted with defendant ProFax to send tens of
thousands of unsolicited fax advertisements to persons with whom Innate had no
preexisting relationship of any kind. On July 5, 2016, defendant Innate, through
facsimile broadcaster ProFax, sent plaintiff a fax advertising “a FREE Lunch ‘n Learn on
Plaintiff also named several other entities and individuals as defendants, but those defendants have been dismissed.
Stress Management for your employees.” The following notice appears at the bottom of
To opt out from future faxes go to www.removemyfax
number and enter PIN# 17204, or call 800-321-4433. The
recipient may make a request to the sender not to send any
future faxes and failure to comply with the request within
30 days is unlawful.
(Doc. # 27-1). Plaintiff alleges that the opt-out notice does not comply with the
minimum requirements of 47 C.F.R. § 64.1200.
On July 12, 2016, plaintiff
initiated this action, under the TCPA, on behalf of itself and a purported nationwide
class. Plaintiff alleges it was annoyed and disturbed by receiving the fax from Innate,
that it lost employee time in reviewing and disposing of the funk fax, and that it wasted
the use of its fax machine and ink and paper used to print the junk fax. Through
discovery, plaintiff has obtained documents that purportedly shows all the broadcast
transmissions Innate hired ProFax to make. The transmission logs show that 9,553 fax
transmissions were sent by ProFax to 8,542 persons in Illinois, Indiana, Missouri,
Washington, and Wisconsin. Profax also produced a list of 1,693 recipients who opted
out of receiving Innate’s faxes, which means those recipients certainly received a fax
with Innate’s unique PIN. Of those 1,693 recipients, 1,489 have fax numbers that do not
appear among the successful transmissions listed in the five transmission logs produced
by Innate. Thus the total number of Innate fax recipients is 10,031 according to plaintiff.
Plaintiff has moved for class certification under Federal Rule of Civil Procedure
23 of the following class:
All persons who received a facsimile transmission sent by ProFax, Inc., on
behalf of Innate Intelligence LLC or its chiropractic clinics between
January 27, 2016 and July 13, 2016, as confirmed by either:
(1) presence on a facsimile transmission log produced by Innate
Intelligence LLC in this case showing one or more transmissions “sent” and
(2) presence on a list of those who opted out from receiving future
faxes from Innate Intelligence LLC, produced by ProFax, Inc. in this case.
(See #93 at ¶ 5.)
“The class action is an exception to the usual rule that litigation is conducted by
and on behalf of the individual named parties only. To come within the exception, a party
seeking to maintain a class action must affirmatively demonstrate his compliance with
[Federal Rule of Civil Procedure] 23.” Comcast Corp. v. Behrend, 133 S.Ct. 1426, 1432
(2013) (citations omitted). Rule 23(a) establishes four prerequisites for class
certification: (1) the class is so numerous that joinder of all members is impracticable; (2)
there are questions of law and fact common to the class; (3) the claims or defenses of the
representative parties are typical of the claims or defenses of the class; and (4) the
representative parties will fairly and adequately protect the interests of the class. Fed. R.
Civ. P. 23(a).
“The preliminary inquiry of the class certification stage may require the court to
resolve disputes going to the factual setting of the case, and such disputes may overlap
the merits of the case.” Luiken v. Domino's Pizza, LLC, 705 F.3d 370, 372 (8th Cir. 2013)
(internal quotation marks and citation omitted). “[C]ertification is proper only if the trial
court is satisfied, after a rigorous analysis, that the prerequisites of Rule 23(a) have been
satisfied.” Comcast, 133 S.Ct. at 1432 (internal quotation marks and citation omitted). A
plaintiff seeking to maintain a class action must satisfy the Rule 23(a) prerequisites along
with at least one provision of Rule 23(b). Comcast, 133 S.Ct. at 1432.
None of the parties contests that plaintiffs have met the standards of Rule 23.
1. Numerosity is undeniably present because there are 10,031 putative class
2. Commonality is also present. For example, a “common contention, capable of
classwide resolution, is whether class members received an unsolicited fax advertisement
violating the TCPA.” Sandusky Wellness Ctr., LLC v. Medtox Sci., Inc., 821 F.3d 992,
998 (8th Cir. 2016). Plaintiff states that each of the class members was treated exactly
the same, so common factual issues include the content of the faxes, how many were
sent, and when they were sent. Common legal questions include, for example, whether
the faxes constituted an “advertisement” under the TCPA; whether ProFax had a high
degree of involvement in sending the faxes, subjecting it to fax broadcaster liability; and
whether Innate’s practices precluded the possibility that it had an established business
relationship with any recipient of the faxes.
3. Typicality requires that a plaintiff must possess the same interest and have
suffered the same injury as the other class members. Alpern v. UtiliCorp United, Inc., 84
F.3d 1525, 1539 (8th Cir. 1996). Here, typicality is met because the other class members
have claims similar to the named plaintiff.
See DeBoer v. Mellon Mortg. Co., 64 F.3d
1171, 1174 (8th Cir. 1995).
4. The adequacy of representation factor requires that the class representative
must “fairly and adequately protect the interests of the class.” Fed. R. Civ. P. 23(a)(4).
In making this determination, Court must consider “(1) whether the representatives and
their attorneys are able and willing to prosecute the action completely and vigorously,
and (2) whether each representative's interests are sufficiently similar to those of the class
that it is unlikely that their goals and viewpoints will diverge.” Moore v. The Boeing Co.,
4:02CV80 CDP, 2004 WL 3202777, at *13 (E.D. Mo. Mar. 31, 2004). The Court find
that these requirements are met and that the plaintiff can adequately represent the class.
Further, plaintiff’s counsel is qualified to serve as class counsel under Rule 23(g).
5. Finally, the requirements of Rule 23(b)(3) are satisfied. Rule 23(b)(3) requires
a court to find that “the questions of law or fact common to class members predominate
over any questions affecting only individual members, and that a class action is superior
to other available methods for fairly and efficiently adjudicating the controversy.” Fed. R.
Civ. P. 23(b) (emphasis added). Rule 23(b)(3) is satisfied because questions of law here
(such as whether the faxes are advertisements) predominate, as do the questions of fact
(such as whether a class member received the unsolicited fax). There are no relevant
individualized factual questions that would vary class member by class member. In
addition, the class satisfies the Rule 23(b)(3) requirement that a class action be the
superior method for adjudicating the claims. The many recipients of the allegedly
unlawful faxes may, through the class action device, achieve economies of time, effort,
and expense and promote uniformity of decision as to persons similarly situated. See
Amchem Prods. v. Windsor, 521 U.S. 591, 615 (1997).
Notably, none of the defendants argues that the factors of Rule 23 are not met.
Innate and Nepute did not oppose class certification at all. Only ProFax filed a brief in
opposition to plaintiff’s motion, but ProFax contends that, as a policy matter, the TCPA
should not be used in a class action context. The TCPA, ProFax argues, “was designed to
provide adequate incentive for an individual plaintiff to bring suit on his or her own
behalf (a small claims court matter), and many courts found a class action inconsistent
with the specific and personal remedy provided by Congress to address the minor
nuisance of unsolicited facsimile advertisements.” (#101 at 1 (citing Forman v. Data
Transfer, Inc., 164 F.R.D. 400 (E.D. Pa. 1995).) Thus, ProFax opposes the motion to
certify class on the basis that the class action device is improper and that, moreover,
ProFax is not a proper defendant in this case anyway.
As to ProFax’s public policy argument that TCPA claims should be brought by
individuals and not as a class, ProFax stops short of arguing that individual plaintiff
actions are the superior method of adjudication. Plaintiff’s reliance to Forman for the
proposition that the TCPA was intended for use by individual plaintiffs is not persuasive
because, there, plaintiff sought to certify a class of people who had received any
“unsolicited advertisements” from a particular fax sender. 164 F.R.D. at 404. A minihearing would be required regarding the matter of “unsolicited” to determine membership
in the class. Id. at 403. Thus, the class definition was held untenable, and the plaintiff
failed to show he met the other requirements of Rule 23, as well. As a general matter of
policy, the Eighth Circuit has noted that “[c]lass certification is normal in litigation under
§ 227, because the main questions, such as whether a given fax is an advertisement, are
common to all recipients.” Sandusky Wellness Ctr., 821 F.3d at 998 (quoting Holtzman v.
Turza, 728 F.3d 682, 684 (7th Cir. 2013)).
As for defendant ProFax’s contention that it is not a proper defendant in this case,
its arguments regarding its indemnification agreement with defendant Innate are
misplaced in the context of class certification. Although discussion of the merits is
sometimes necessary in establishing whether the Rule 23 requirements are met, ProFax’s
arguments do not go to whether any of the Rule 23 factors --- numerosity, commonality,
typicality, adequacy, and superiority --- are met here. Ultimately, no party contests that
the plaintiff has met the Rule 23 class certification requirement. The Court finds that the
proposed class meets those requirements, and the motion will be granted.
IT IS HEREBY ORDERED that plaintiff’s motion for class certification is
Dated this 9th day of February, 2018.
STEPHEN N. LIMBAUGH, JR.
UNITED STATES DISTRICT JUDGE
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