Michael v. Charter Communications, Inc.

Filing 73

MEMORANDUM AND ORDER... IT IS HEREBY ORDERED that plaintiff's claims under the Cable Act, 47 U.S.C. § 551, asserted in Counts I through V, are dismissed as time-barred. IT IS FURTHER ORDERED that plaintiffs state-law claims, asserted in Counts VI through VIII, are dismissed without prejudice. Signed by Magistrate Judge John M. Bodenhausen on 3/27/2019. (NEP)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
ALEX MICHAEL,
Plaintiff,
vs.
CHARTER COMMUNICATIONS, INC.,
Defendant.

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Case No. 4:17 CV 1242 (JMB)

MEMORANDUM AND ORDER

This matter is before the Court for determination of whether plaintiff’s claims are timebarred and whether he has standing to proceed. The parties appeared for oral argument and have
submitted extensive briefs on these issues. All matters are pending before the undersigned United
States Magistrate Judge with the consent of the parties, pursuant to 28 U.S.C. § 636(c).
I.

Background

Plaintiff Alex Michael alleges that he was a subscriber of defendant Charter
Communications, Inc., from July 2007 through May 2009. Plaintiff states that defendant advertised
and marketed that its services were provided for monthly itemized rates on a no-contract basis. He
alleges that, contrary to its representations, defendant failed to disclose that, in addition to collecting
subscribers’ fees, it would sell to third parties subscribers’ personally identifiable information (PII),
including names, addresses, and subscription information.

In his second amended complaint,

plaintiff alleges that defendant sold his PII “numerous times to numerous parties” both while he was
a subscriber and after he terminated his service relationship with defendant. Second Amended
Complaint at ¶ 17 [Doc. # 33].

He alleges that defendant’s actions violated the Cable

Communications Act of 1984 (the Cable Act), 47 U.S.C. §§ 551 et seq., and the Missouri
Merchandising Practices Act (MMPA), Mo. Rev. Stat. §§ 407.010 et seq. In addition, plaintiff

asserts common-law claims for conversion and unjust enrichment. He seeks to certify a nationwide
class of individuals who subscribed to receive Charter services between January 2005 and
September 2014.
II.

Discussion

Plaintiff asserts that defendant committed five violations of the Cable Act. First, Charter
failed to deliver privacy notifications, in violation of § 551(a)(1), both when the parties entered into
a service agreement (Count I), and at least once a year thereafter during his subscription (Count II).
In addition, he alleges that, even if defendant had provided him with its privacy notifications, they
were not clearly and conspicuously worded and thus violated § 551(a)(1)(A)-(E) (Count III). He
also alleges that defendant failed to obtain his prior written or electronic consent before disclosing
his PII, in violation of § 551(c)(1) (Count IV). Finally, he alleges that defendant failed to provide
its subscribers an opportunity to prohibit or limit disclosures, in violation of § 551(c)(2)(C) (Count
V). In Count VI, plaintiff asserts that defendant violated the MMPA by offering its services without
disclosing that his PII would be sold. He also asserts claims for conversion (Count VII) and unjust
enrichment (Count VIII) arising from defendant’s alleged sale of his PII.
A.

Preliminary Matters

Plaintiff asserts in his statute-of-limitations brief that his claims are brought pursuant to this
Court’s diversity jurisdiction under 28 U.S.C. § 1332. This assertion is at odds with plaintiff’s
jurisdictional statement in his complaint [Doc. # 1 at ¶ 6]; first amended complaint [Doc. # 23 at ¶
5]; and second amended complaint [Doc. # 33 at ¶ 6], in which he asserts that he has “statutory
standing” under 47 U.S.C. § 551(f). Nowhere in his pleadings does plaintiff cite diversity of
citizenship as the basis of this Court’s subject matter jurisdiction nor has he made the required
factual allegations regarding the citizenship of all parties and the amount in controversy. Thus, to
the extent that plaintiff now insists that his action arises under diversity jurisdiction, it is subject to
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dismissal without prejudice. Even if the Court assumes that plaintiff has properly pleaded diversity
jurisdiction, however, the analysis of the limitations period that applies to plaintiff’s Cable Act
claims remains the same. Furthermore, even if a state statute of limitations applies to plaintiff’s
Cable Act claims, federal common law dictates when his federal causes of action accrued and
whether the statute of limitations was tolled.1 Johnson v. Precythe, 901 F.3d 973, 980–81 (8th Cir.
2018) (discussing § 1983 claim); see Powell v. Tordoff, 911 F. Supp. 1184, 1193–94 (N.D. Iowa
1995) (citing cases); Harris v. Ford Motor Co., 635 F. Supp. 1472, 1473 (E.D. Mo. 1986)
(“Questions of when a federal cause of action accrues and whether it is tolled by subsequent
conduct are federal questions to be determined by federal law.”); see also 19 Charles Alan Wright,
et al., Fed. Pract. & Procedure § 4519 (3d ed.) (“[F]ederal law usually has been held to govern the
time of a claim’s accrual, regardless of the source of the limitations period being applied by the
court or the basis of the court’s subject matter jurisdiction.”).
Plaintiff also objects to the Court addressing the statute of limitations issue in the absence of
a motion from defendant. The Court notes, however, that defendant asserted in its affirmative
defenses that plaintiff’s claims were barred by statutes of limitations. Furthermore, a named
plaintiff whose claims are time-barred lacks standing to bring an action on behalf of a class. City of
Hialeah, Fla. v. Rojas, 311 F.3d 1096, 1102-04 (11th Cir. 2002).

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In Missouri, for the purposes of statutes of limitations, a cause of action “shall not be deemed to accrue when the
wrong is done or the technical breach of contract or duty occurs, but when the damage resulting therefrom is sustained
and is capable of ascertainment.” Mo. Ann. Stat. § 516.100. The Missouri Supreme Court has stated that “the statute
of limitations begins to run when the “evidence was such to place a reasonably prudent person on notice of a potentially
actionable injury.” Powel v. Chaminade Coll. Preparatory, Inc., 197 S.W.3d 576, 582 (Mo. 2006), as modified on
denial of reh’g (Aug. 22, 2006) (emphasis removed). Under federal law, accrual occurs “when the plaintiff has a
complete and present cause of action, . . . that is, when the plaintiff can file suit and obtain relief.” Johnson v. Precythe,
901 F.3d 973, 981 (8th Cir. 2018) (quoting Wallace v. Kato, 549 U.S. 384, 388 (2007) and Bay Area Laundry and Dry
Cleaning Pension Trust Fund v. Ferbar Corp. of Cal., 522 U.S. 192, 201 (1997)). “[A] plaintiff's cause of action accrues
when he discovers, or with due diligence should have discovered, the injury that is the basis of the litigation.” Id.
(quoting Union Pac. R.R. Co. v. Beckham, 138 F.3d 325, 330 (8th Cir. 1998)).

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With these preliminary matters addressed, the Court turns to the parties’ arguments on the
appropriate statute of limitations.
B.

Statute of Limitations

In a declaration submitted on May 31, 2018, plaintiff states that he was a Charter subscriber
from July 2007 through May 2009. [Doc. # 56-1]. He never received “a separate written statement
informing [him] of [his] privacy rights and how Charter would use [his] personally identifiable
information.” He never received a privacy statement in any form while he was a Charter customersubscriber. Id. at ¶ 8. He declares that he “first became aware of Charter’s illegal business
practices that compromised my privacy rights and personally identifiable information shortly before
filing this lawsuit in December of 2016. Prior to December 2016, I was not aware Charter was
under a legal obligation to provide me a separate, written statement that clearly and conspicuously
informed me of how Charter would use my personally identifiable information or was disclosing
my personally identifiable information to third parties. I have never given Charter consent to
disclose my personally identifiable information to third parties.” Id. at ¶ 10. The declaration does
not state that plaintiff ever became aware that Charter disclosed his PII, let alone provide a date by
which he learned of an improper disclosure. Plaintiff states in his reply memorandum that his
“latest-in-time item of damage . . . occurred in June 2013 or 2014.” [Doc. # 66 at 4].
The Cable Act does not include a statute of limitations for private causes of action. See,
e.g., Joe Hand Promotions, Inc. v. Mooney’s Pub Inc., No. 14-CV-1223, 2014 WL 4748272, at *4
(C.D. Ill. Sept. 24, 2014); J & J Sports Prods., Inc. v. Orellana, No. CIV.A. H-11-0574, 2011 WL
3021861, at *1 (S.D. Tex. July 22, 2011) (“When Congress amended the FCA with the Cable Act in
1984, Congress did not provide a statu[t]e of limitations.”); Kingvision Pay Per View, Ltd. v. Boom
Town Saloon, Inc., 98 F. Supp. 2d 958, 960 (N.D. Ill. 2000) (“We begin with the observation that
the only reason that there is any dispute about the applicable statute of limitations is that when
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enacting . . . the Cable Act, Congress failed to provide a statute of limitations.”) While Congress
has provided a four-year “default” statute of limitations for any federal statutory cause of action for
laws enacted after December 1, 1990, 28 U.S.C. § 1658, the portions of the Cable Act at issue here
were enacted in 1984 and this catchall statute of limitations provision does not apply.
When Congress fails or declines to specify a statute of limitations, “[g]enerally, we presume
that Congress intended courts to apply the most closely analogous state statute of limitations.” Syed
v. Hercules, Inc., 214 F.3d 155, 160 (3d Cir. 2000) (citing DelCostello v. Int’l Bhd. of Teamsters,
462 U.S. 151, 158 (1983)). The Supreme Court has emphasized that state law is the “lender of first
resort” in determining the correct statute of limitations. See North Star Steel Co. v. Thomas, 515
U.S. 29, 34 (1995) (noting that, since 1830, state statutes supplied the periods of limitations for
federal causes of action when the federal legislation made no provision). The rule has “enjoyed
sufficient longevity that we may assume that, in enacting remedial legislation, Congress ordinarily
‘intends by its silence that we borrow state law.’” Lampf, Pleva, Lipkind, Prupis & Petigrow v.
Gilbertson, 501 U.S. 350, 355 (1991) (quoting Agency Holding Corp. v. Malley-Duff & Assoc.,
Inc., 483 U.S. 143, 147 (1987) ). “Rooted as it is in the expectations of Congress, the ‘stateborrowing doctrine’ may not be lightly abandoned.” Id. at 356.
The Supreme Court has recognized a “closely circumscribed exception” to the stateborrowing doctrine “when a rule from elsewhere in federal law clearly provides a closer analogy
than available state statutes, and when the federal policies at stake and the practicalities of litigation
make that rule a significantly more appropriate vehicle for interstitial lawmaking.” Reed v. United
Transp. Union, 488 U.S. 319, 324 (1989) (internal quotation and citation omitted) (quoting
DelCostello, 462 U.S. at 172); see also Lampf, 501 U.S. at 356 (Supreme Court has looked to
federal law “when the operation of a state limitations period would frustrate the policies embraced
by the federal enactment”); Occidental Life Ins. Co. of Cal. v. EEOC, 432 U.S. 355, 367 (1977)
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(“State legislatures do not devise their limitations periods with national interests in mind, and it is
the duty of the federal courts to assure that the importation of state law will not frustrate or interfere
with the implementation of national policies.”); 19 Fed. Pract. & Procedure § 4519 (3d ed.) (“[T]he
preference for forum state limitations periods has been compromised during the past few decades by
a judicial recognition that in certain federal substantive contexts there are persuasive reasons to
consider borrowing the limitations period from another federal statute.”) Thus, “[w]hen a federal
law has no statute of limitations, courts may borrow the most closely analogous state statute of
limitations, unless doing so would frustrate the policy embodied in the federal law.” Dick v.
Dickinson State Univ., 826 F.3d 1054, 1058 (8th Cir. 2016).
The question of what statute of limitations applies to the Cable Act’s privacy provisions has
not been widely litigated. The Court has reviewed a number of cases brought by cable providers
under the Cable Act’s antipiracy provisions, 47 U.S.C. § 553 and § 605. Courts have taken a
number of approaches to determining what statute of limitations applies to these claims.

As

explained by the court in Joe Hand Promotions, Inc. v. Mooney’s Pub Inc., No. 14-CV-1223, 2014
WL 4748272, at *5–6 (C.D. Ill. Sept. 24, 2014), “[t]he trend . . . has been to apply the [federal]
Copyright Act’s statute of limitations when the closest analogue is the state tort of conversion. . .
However, when state law provides a private right of action for cable piracy, the trend is for courts to
apply the statute of limitations from state law.” See also Comcast of Illinois X, LLC v. MultiVision Elecs., Inc., No. 8:03CV311, 2005 WL 2177070, at *5 (D. Neb. Sept. 8, 2005) (applying the
Copyright Act three-year statute of limitations claims that defendants sold cable descrambling
equipment).
Plaintiff argues that the Court should borrow from Missouri’s five-year statute of limitations
for actions “upon a liability created by a statute” or for “taking . . . any goods or chattels,” codified
at Mo. Rev. Stat. § 516.120, subsections (2) and (4). Alternatively, plaintiff argues that Missouri
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provides a closely analogous statute at § 362.422. This statute authorizes the promulgation of
regulations governing financial institutions’ notice and confidentiality obligations as set forth in the
Gramm-Leach-Bliley Act (GLBA). See Mo. Code Regs. Ann. tit. 20, § 100-6.110. While the
subject matter of § 362.422 is similar to the Cable Act’s notice and privacy provisions, it does not
have a statute of limitations and thus is of little utility for the present task. Plaintiff argues that a
claim under § 362.422 would be governed by the statute of limitations at § 516.120(2), which
applies actions for a “liability created by a statute.” Section 362.422 does not create a private cause
of action, however, and thus cannot give rise to a “liability created by statute.” See Columbian
Bank and Trust Company v. Daniel H. Miller, P.C., et al., No. 07-4123-CV-C-SOW (“The GLBA
does not provide for a private cause of action and neither does Section 362.422 RSMo.”) [Doc. #
65-1]. The Court rejects plaintiff’s assertion that § 362.422 is a closely analogous statute and
concludes that application of Missouri’s general statute of limitations, § 516.120, is appropriate
only if there is not a closely analogous federal statute.
Defendant argues that the Truth in Lending Act (TILA) is a closely analogous statute and
asks the Court to apply its one-year statute of limitations, found at 15 U.S.C. § 1640(e). For
support, defendant cites Scofield v. Telecable of Overland Park, Inc., 751 F. Supp. 1499, 1508 (D.
Kan. 1990), rev’d on other grounds, 973 F.2d 874 (10th Cir. 1992). Similar to the claims asserted
here, the plaintiffs in Scofield alleged that TeleCable failed to provide privacy disclosure statements
in violation of § 551(a)(1), that the privacy notices did not meet statutory requirements in violation
of § 551(a)(1)(A)-(E), and that TeleCable did not destroy PII as required by § 551(e).
In determining what statute of limitations to apply to the Cable Act claims, the Scofield
court noted the general rule: “[W]hen a federal statute upon which a claim is based does not specify
a limitations period, the court will apply the most appropriate state statute of limitations ‘if it is not
inconsistent with federal law or policy to do so.’” Id. (quoting Wilson v. Garcia, 471 U.S. 261,
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266–67 (1985)). The court also noted, however, that the Supreme Court has “endorsed the practice
of applying limitations periods derived from analogous federal statutes when, for example, federal
policies at stake favor application of a federal rule.” Id. (citing Agency Holding Corp. v. Malley–
Duff & Assoc., Inc., 483 U.S. 143, 148 (1987)). “In determining whether a federal limitations
period should be borrowed, two factors are particularly relevant: (1) the availability of a limitations
period in a closely analogous federal statute, and (2) when application of a federal limitations period
is consistent with available indications of Congressional intent.” Id. (citing Wilson, 471 U.S. at
270).
Applying this two-factor test, the Scofield court determined that both factors favored the
application of the one-year statute of limitations from TILA. Id. at 1509-10. With respect to the
first factor, the court noted that TILA and § 551 both “share the same general purpose of requiring
meaningful disclosure of information to consumers,” “provide that such disclosure should be clear
and conspicuous,” and have “somewhat similar” civil enforcement provisions. Id. at 1510. With
respect to the second factor, the Scofield court found “that available indications of Congressional
intent behind the Cable Act favor the application of a uniform federal limitations period. Congress
had several purposes in mind in enacting the Cable Act, including to ‘establish national policy and
guidelines for the rapidly expanding cable television industry,’ and to eliminate any unnecessarily
burdensome state regulation of the industry.” Id. (citations omitted). “[S]ection 551 was intended
to ‘create a nationwide standard for the privacy protection of cable subscribers. . .’” Id. (citing H.R.
Rep. No. 934, 98th Cong., 2d Sess. 76 (1984), reprinted in 1984 U.S. Code Cong. & Admin. News
4655, 4713). The court also found that there was a substantial federal interest in applying a uniform
limitations period to all private actions brought under the Cable Act privacy protections. Id. at
1511. Based on “the federal uniformity concerns expressed in the Cable Act and specifically in
enacting section 551, the court finds that applying the federal TILA limitations period, rather than
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either the state tort or the state version of TILA, would be most consistent with Congressional
purposes.” Id. at 1510.
In this case, plaintiff has not cited an analogue state statute that creates a private cause of
action for violation of privacy and disclosure laws. The Court finds that federal law — that is,
TILA — “clearly provides a closer analogy than available state statutes.” See Reed, 488 U.S. at
324. The Court also agrees with the Scofield court that the federal interest in a nationwide standard
for the privacy protection of cable subscribers is best served by the application of a single statute of
limitations. Accordingly, the Court will adopt the reasoning in Scofield and apply TILA’s one-year
statute of limitations to the claims asserted here.2 See also Wilson v. Am. Cablevision of Kansas
City, Inc., 133 F.R.D. 573, 574 (W.D. Mo. 1990) (analogizing to TILA to address availability of
class action for § 551 claims); Warner v. Am. Cablevision of Kansas City, Inc., 699 F. Supp. 851,
859 (D. Kan. 1988), cause dismissed and remanded (Jan. 4, 1989) (finding “that Congress intended
section 551 of the Cable Act to operate as a ‘private attorney general’ statute, similar to the Truth–
in–Lending Act”).
Plaintiff claims in Counts I, II, and III that Charter failed to provide him with adequatelyworded notice of his privacy rights at the time he subscribed in 2007 and once a year for the next
two years that he maintained his subscription. These claims accrued while plaintiff’s subscription
was in force. Johnson, 901 F.3d at 981 (claim accrues “when the plaintiff has a complete and
present cause of action, . . . that is, when the plaintiff can file suit and obtain relief.”) The fact that
plaintiff did not learn until December 2016 that Charter was legally obligated to provide statutory
notice is not significant. See McDonough v. Anoka Cty., 799 F.3d 931, 943 (8th Cir. 2015)
(holding that claims under the Drivers Privacy Protection Act accrue when personal information is
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Plaintiff argues that Scofield cannot be applied here because it was reversed on appeal. On appeal, however, the Tenth
Circuit reversed the district court’s finding that TeleCable’s privacy notices did not satisfy the requirements of
§ 551(a)(1), without addressing the district court’s analysis of the statute of limitations. Scofield v. TeleCable of
Overland Park, Inc., 973 F.2d 874, 881 (10th Cir. 1992).

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improperly accessed, even though drivers did not know of alleged access); see also Foudy v.
Miami-Dade Cty., Fla., 823 F.3d 590, 593–94 (11th Cir. 2016) (“[I]n the absence of a clear
Congressional directive or a self-concealing violation, the court should not graft a discovery rule
onto a statute of limitations.”) These claims are plainly time-barred. See Scofield, 751 F. Supp. at
1511 (claims arising from cable company’s failure to provide privacy notices at installation two and
four years before filing suit were time-barred). With respect to plaintiff’s claims in Count IV and V
that defendant did not obtain his consent before disclosing his PII or provide him with the
opportunity to prohibit or limit disclosures of his PII, the Court notes that plaintiff has not identified
what PII defendant disclosed, when it disclosed it, or when plaintiff learned of the disclosure. But,
taking at face value his assertion in his reply memorandum that his “latest-in-time item of damage .
. . occurred in June 2013 or 2014,” plaintiff’s claims in Count IV and V were time-barred when he
filed suit in April 2017.
Although plaintiff asserts that he is entitled to tolling of the statute of limitations, he has
confined his analysis to consideration of when his claims accrued. [Doc. # 62 at 6-7, 10, 12]. A
litigant asserting federal claims is entitled to toll the statute of limitations “only if the litigant
establishes two elements: “(1) that he has been pursuing his rights diligently, and (2) that some
extraordinary circumstance stood in his way and prevented timely filing.” Menominee Indian Tribe
of Wisconsin v. United States, 136 S. Ct. 750, 755, 193 L. Ed. 2d 652 (2016). The circumstances in
this case do not meet the requirements for equitable tolling.
The Court finds that plaintiff’s claims under the Cable Act are time-barred. The Court will
decline to exercise supplemental jurisdiction over plaintiff’s claims arising under state law.
Because all claims will be dismissed, the Court need not address whether plaintiff has established
that he has standing to proceed in this matter.
Accordingly,
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IT IS HEREBY ORDERED that plaintiff’s claims under the Cable Act, 47 U.S.C. § 551,
asserted in Counts I through V, are dismissed as time-barred.
IT IS FURTHER ORDERED that plaintiff’s state-law claims, asserted in Counts VI
through VIII, are dismissed without prejudice.

/s/ John M. Bodenhausen
JOHN M. BODENHAUSEN
UNITED STATES MAGISTRATE JUDGE
Dated this 27th day of March, 2019.

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