Mejia v. Time Warner Cable Inc.
OPINION AND ORDER: re: (82 in 1:15-cv-06445-JPO) MOTION for Judgment on the Pleadings filed by Time Warner Cable Inc., (63 in 1:15-cv-06445-JPO, 63 in 1:15-cv-06445-JPO) MOTION to Intervene. MOTION to Stay filed by John Fontes, Gregory Monteg na, Damon Byrd, (105 in 1:15-cv-06445-JPO) MOTION for Summary Judgment filed by Time Warner Cable Inc., (75 in 1:15-cv-06445-JPO) MOTION for Summary Judgment filed by Anne Marie Villa, Leona Hunter, (52 in 1:15-cv-06518-JPO) MOTION for Judgment on the Pleadings filed by Time Warner Cable, Inc. For the foregoing reasons, it is hereby ORDERED: In the Mejia action, Plaintiffs' motion for summary judgment is DENIED, Defendant's motion for summary judgment is GRANTED IN PART and DENIED I N PART, Defendant's motion for judgment on the pleadings is DENIED, and the Fontes plaintiffs' motion to intervene and stay is DENIED; In the Johnson action, Defendant's motion for judgment on the pleadings is DENIED. Within 21 days of the date of this Opinion and Order, the parties are directed to file a letter with the Court proposing a timeline for further discovery. The Clerk of Court is directed to close the following motions in 15-CV-6445: Docket Numbers 63, 75, 82, and 105. The Clerk is directed to close the motion at Docket Number 52 in 15-CV-6518. SO ORDERED. (Signed by Judge J. Paul Oetken on 8/01/2017) (ama)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
RAQUEL S. MEJIA, LEONA HUNTER, and
ANNE MARIE VILLA, on behalf of themselves
and all others similarly situated,
-vTIME WARNER CABLE INC.,
OPINION AND ORDER
-vTIME WARNER CABLE INC.,
J. PAUL OETKEN, District Judge:
Raquel Mejia filed the initial complaint in this action (No. 15 Civ. 6445) (the “Mejia
action”) alleging a violation of the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C.
§ 227, against Defendant Time Warner Cable Inc. (“Time Warner”) on August 14, 2015. (Dkt.
No. 1.) An amended complaint was filed on March 28, 2016, removing Mejia and adding as
Plaintiffs Leona Hunter and Anne Marie Villa. (Dkt. No. 45 (“Compl.”).)
There are several motions currently before the Court: a motion to intervene and a motion
to stay filed by Plaintiffs-Intervenors John Fontes, Daymon Byrd, and Gregory Montegna (Dkt.
No. 63); Plaintiffs’ motion for partial summary judgment (Dkt. No. 75); Time Warner’s motion
for judgment on the pleadings (Dkt. No. 82); and Time Warner’s motion for summary judgment
(Dkt. No. 105).
This Opinion and Order also addresses a fifth motion, a motion for judgment on the
pleadings filed by Time Warner in Johnson v. Time Warner Cable Inc., No. 15 Civ. 6518
(S.D.N.Y.) (Dkt. No. 52) (the “Johnson action”). This motion raises substantially the same
issues raised in Time Warner’s other motion for judgment on the pleadings.
For the reasons that follow, all of these motions are denied, except for Time Warner’s
motion for summary judgment, which is granted in part and denied in part.
The Telephone Consumer Protection Act of 1991, 47 U.S.C. § 227, was passed by
Congress in response to “[v]oluminous consumer complaints about abuses of telephone
technology.” Mims v. Arrow Fin. Servs., LLC, 565 U.S. 368, 370-71 (2012). The TCPA bans
various privacy-invading practices and directs the Federal Communications Commission
(“FCC”) to prescribe regulations. Id. Relevant here, the TCPA prohibits individuals from
“mak[ing] any call (other than a call 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)(A)(iii).
The TCPA defines “automatic telephone dialing system” (“ATDS”) as “equipment which has the
capacity—(A) to store or produce telephone numbers to be called, using a random or sequential
number generator; and (B) to dial such numbers.” Id. § 227(a)(1). The TCPA allows consumers
who receive such calls to recover the greater of their actual monetary loss or $500 per violation,
and allows for treble damages where a violation is willful or knowing. Id. § 227(b)(3).
Time Warner is a national cable network provider. (Compl. ¶ 1.) Plaintiffs in the Mejia
action allege that Time Warner conducted “wide scale telemarketing campaigns and repeatedly
made unsolicited calls to consumers’ telephones without consent” in violation of the TCPA. (Id.
¶ 2.) In particular, Plaintiffs allege that Time Warner made one or more unauthorized calls to
their cell phones using an ATDS or pre-recorded voice. The individual calls are detailed below.
(Id.) Plaintiffs also claim that Time Warner failed to maintain adequate do-not-call policies
under the TCPA’s implementing regulations. (Id. ¶ 19.)
Plaintiffs bring this action pursuant to Federal Rule of Civil Procedure 23 on behalf of
themselves and four classes of consumers who received calls from Time Warner. (Id. ¶ 62.)
They seek damages, statutory penalties, and injunctive relief for recovery of economic injury on
behalf of the putative classes. (Id. ¶ 64.)
Plaintiffs Hunter and Villa bring their claims on the basis of several dozen phone calls
made to them by Time Warner. The following facts, describing these calls, are based on
undisputed facts in the parties’ Rule 56.1 statements of material facts, unless otherwise noted.
(See Dkt. No. 138.)
Calls to Plaintiff Villa
Plaintiff Villa’s claim involves a phone number ending in 5900, which was assigned to
her on November 23, 2015, and for which she had an unlimited phone plan. (Id. ¶¶ 1, 3, 22.) A
Time Warner customer, “A.S.”, established an account listing the 5900 number as the primary
contact number. (Id.) A.S.’s account subsequently became delinquent. (Id. ¶ 5.)
As a result of A.S.’s delinquency, Time Warner placed calls to Villa’s number in order to
collect payments from A.S. (Id. ¶¶ 6, 8.) A total of seven calls were made to Villa’s number.
The first six calls to Villa’s number were made two each on November 27, December 2, and
December 8 of 2015. (Id. ¶ 7.) These calls were made using an “interactive voice response”
(“IVR”) calling system. (Id.) The seventh call to Villa’s number was placed by Time Warner’s
vendor, Meridian, on December 9, 2015. (Id. ¶ 15.)
The following table shows the calls made by Time Warner to Villa’s number:
Time Warner has not called Villa’s number since December 9, 2015. (Id. ¶¶ 19, 20.)
Time Warner claims that it disconnected A.S.’s account on December 24, 2015, and removed
Villa’s number from its billing system. (Id. ¶¶ 28-29.)
Calls to Plaintiff Hunter
Plaintiff Hunter’s claim involves a phone number ending in 1089, which was assigned to
her on May 18, 2015, and for which she had an unlimited phone plan. (Id. ¶¶ 33, 64.) Before
Hunter was assigned this number, it belonged to a Time Warner customer, “A.F.” (Id. ¶ 31.)
A.F.’s account subsequently became delinquent multiple times from around May 2015 to
February 2016. (Id. ¶ 35.)
Due to several issues relating to A.F.’s service, Time Warner placed calls to Hunter’s
number. (Id. ¶ 36.) A total of forty-four calls were made to Hunter’s number. (Id. ¶ 37.) The
first twenty calls were made between May 28, 2015, and August 18, 2015, using an IVR calling
system. (Id. ¶¶ 36, 38-48.) On June 15, 2015, Hunter blocked the phone number used by Time
Warner’s IVR platform using the “Metro Block-It” application, and Time Warner claims that
calls fourteen to twenty were blocked by the application. (Id. ¶¶ 49-50.) The twenty-first call
was placed by Time Warner’s vendor, eClerx, on August 22, 2015, and was not blocked. (Id.
¶ 51-52.) The twenty-second through thirty-eighth calls were made between August 23, 2015,
and February 1, 2016, using an IVR calling system. (Id. ¶¶ 36, 54.) Time Warner claims that
calls twenty-four through thirty-eight were also blocked. (Id. ¶ 54.) On January 31, 2016, A.F.
called Time Warner and confirmed that the 1089 number (Hunter’s number) was associated with
his account. (Id. ¶ 55.) In early February of 2016, A.F. moved out of his old home and
established Time Warner service at his new home. (Id. ¶ 56.) On February 5, 2016, A.F. again
informed Time Warner that the 1089 number was associated with his account. (Id. ¶ 58.) The
thirty-ninth through forty-fourth calls were made between February 6, 2016, and February 10,
2016. (Id. ¶¶ 36, 57.) The thirty-ninth through forty-second calls were placed by Time Warner’s
external vendors, InfoCision and NobelBiz. (Id. ¶¶ 36, 59.) The forty-third and forty-fourth
calls were made using Time Warner’s IVR system. (Id. ¶ 36.)
The following table shows the calls made by Time Warner to Hunter’s number:
On February 9, 2016, Hunter told Time Warner that it had called the wrong number and
asked Time Warner to stop calling. (Id. ¶ 61.) Since February 10, 2016, Time Warner has
placed no further calls to Hunter’s number, and Time Warner claims that on March 21, 2016, it
removed Hunter’s number from its billing system. (Id. ¶ 71.)
Given the procedural and substantive complexity of this action and several related
actions, a bit of background—some of which was already covered in the Court’s previous
opinion (Dkt. No. 110)—is essential.
Raquel Mejia filed the initial complaint in the Mejia action on August 14, 2015. An
amended complaint was filed on March 28, 2016, removing Mejia and adding Plaintiffs Leona
Hunter and Anne Marie Villa. (Dkt. No. 1; Dkt. No. 45.) In an Opinion and Order dated
December 15, 2016, this Court appointed interim class counsel in the Mejia action and denied
Plaintiffs’ request for class-wide discovery pending the disposition of the potentially casedispositive motions. (Dkt. No. 110.)
The Mejia action is not the only relevant TCPA action against Time Warner currently
pending in this Court. This Court is also presiding over a related case, the Johnson action,
brought by Plaintiff Allan Johnson against Time Warner alleging violations of the TCPA,
stemming from calls made to Johnson’s phone by Time Warner using an IVR calling system.
Johnson v. Time Warner Cable Inc., No. 15 Civ. 6518 (S.D.N.Y. Aug. 18, 2015) (Dkt. No. 1).
There is yet another TCPA class action pending against Time Warner in the Central
District of California, Fontes v. Time Warner Cable Inc., 14 Civ. 02060 (C.D. Cal.) (the “Fontes
action”). The Fontes action is currently stayed, and the plaintiffs in the Fontes action seek to
intervene here and stay the actions currently pending in this Court. (Dkt. No. 63.) The Fontes
Plaintiffs also attempted to centralize these actions—along with four additional TCPA actions
also pending in the Central District of California (Dkt. No. 26 at 3)—under 28 U.S.C. § 1407,
but their motion was denied by the United States Panel on Multidistrict Litigation on October 3,
2016. (Dkt. No. 60; Dkt. No. 61.)
Two appellate actions are also relevant to the current case. First, King v. Time Warner
Cable Inc., No. 15-2474 (2d Cir.), is currently pending in the Court of Appeals for the Second
Circuit, which held oral argument on January 25, 2017. In King, Time Warner is challenging a
district court decision holding, inter alia, that Time Warner’s IVR system is an ATDS under the
TCPA. King v. Time Warner Cable, 113 F. Supp. 3d 718, 725 (S.D.N.Y. 2015). This holding
forms the basis for Plaintiffs’ motion for summary judgment in this action. As of the date of this
Opinion and Order, the Second Circuit has not issued a decision in King.
Second, ACA International v. FCC, No. 15-1211 (D.C. Cir.), is currently pending in the
Court of Appeals for the District of Columbia Circuit, which held oral argument on October 19,
2016. (Dkt. No. 72 at 11.) In ACA International, the court is reviewing a final order of the FCC
regarding its interpretation of ATDS under the TCPA. (Dkt. No. 37.) The D.C. Circuit has not
issued a decision in ACA International as of the date of this Opinion and Order.
This Opinion addresses the five pending motions in three groups. First, the Court
addresses the motions for summary judgment filed by Plaintiffs and by Time Warner in the
Mejia action. Second, the Court addresses the motions for judgment on the pleadings filed by
Time Warner in the Mejia action and the Johnson action. And third, the Court addresses the
motion to intervene and stay by the Fontes plaintiffs.
Motions for Summary Judgment
There are two motions for summary judgment pending in the Mejia action. First,
Plaintiffs, relying on the district court decision in King, move for partial summary judgment on
the issue of whether Time Warner’s IVR phone system is an ATDS. (Dkt. No. 76 at 1-2.)
Second, Time Warner moves for summary judgment on Plaintiffs’ individual claims, arguing
that they have various defects meriting summary judgment. (Dkt. No. 113 at 1-2.) The Court
addresses these motions in turn.
Summary judgment is appropriate where “there is no genuine dispute as to any material
fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). A fact is
material if it “might affect the outcome of the suit under the governing law.” Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute is genuine if, considering the record as
a whole, a rational jury could find in favor of the non-moving party. Ricci v. DeStefano, 557
U.S. 557, 586 (2009) (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574,
“On summary judgment, the party bearing the burden of proof at trial must provide
evidence on each element of its claim or defense.” Cohen Lans LLP v. Naseman, No. 14 Civ.
4045, 2017 WL 477775, at *3 (S.D.N.Y. Feb. 3, 2017) (citing Celotex Corp. v. Catrett, 477 U.S.
317, 322-23 (1986)). “If the party with the burden of proof makes the requisite initial showing,
the burden shifts to the opposing party to identify specific facts demonstrating a genuine issue
for trial, i.e., that reasonable jurors could differ about the evidence.” Clopay Plastic Prods. Co.
v. Excelsior Packaging Grp., Inc., No. 12 Civ. 5262, 2014 WL 4652548, at *3 (S.D.N.Y. Sept.
18, 2014). The court views all evidence “in the light most favorable to the non-moving party”
and summary judgment may be granted only if “no reasonable trier of fact could find in favor of
the nonmoving party.” Allen v. Coughlin, 64 F.3d 77, 79 (2d Cir. 1995) (quoting Lunds, Inc. v.
Chemical Bank, 870 F.2d 840, 844 (2d Cir. 1989)).
Though a party may move for summary judgment before the completion of full
discovery, summary judgment “should be denied ‘where the nonmoving party has not had the
opportunity to discover information that is essential to his opposition.’” Delphi-Delco Elecs.
Sys. v. M/V NEDLLOYD EUROPA, 324 F. Supp. 2d 403, 417 (S.D.N.Y. 2004) (quoting
Anderson, 477 U.S. at 250). Where a nonmoving party shows that it cannot present facts
essential to its opposition, the court may defer or deny the motion. See Fed R. Civ. P. 56(d).
Plaintiffs’ Motion for Summary Judgment
Plaintiffs move for partial summary judgment, arguing that the ruling by the district court
in King collaterally estops Time Warner from litigating whether the IVR calling system used to
make several of the calls to Plaintiffs is an ATDS under the TCPA. (Dkt. No. 76 at 1.) Time
Warner argues that Plaintiffs have failed to show that the IVR system used to call them is
identical to the one at issue in King, preventing the application of collateral estoppel (also known
as issue preclusion). (Dkt. No. 87 at 1.) Time Warner also argues that the Court should exercise
its discretion and decline to find preclusive effect here because its application would be unfair
and would not promote judicial economy. (Id.)
In King, Judge Hellerstein granted partial summary judgment to the plaintiff on the basis
that Time Warner’s IVR system qualified as an ATDS. King, 113 F. Supp. 3d at 725. In making
this determination, Judge Hellerstein focused on Time Warner’s failure to “identif[y] any human
involvement at all in any stage of the customer selection, list compilation, or dialing processes.”
Id. Accordingly, he concluded that the ATDS generation of customer lists was “fully automated
from start to finish.” Id. Judge Hellerstein also cited the FCC’s ruling that an ATDS is “any
technology with the capacity to dial random or sequential numbers.” Id. (quoting Press Release,
Federal Communications Commission, FCC Strengthens Consumer Protections against
Unwanted Calls and Texts (June 18, 2015), https://www.fcc.gov/document/fcc-strengthensconsumer-protections-against-unwanted-calls-and-texts). He concluded that “[p]laintiff has
alleged, and Defendant has not credibly refuted, that the IVR has the requisite capacity. Whether
it actually dialed King’s number randomly or from a list is irrelevant. The IVR was an ATDS
under § 227(a)(1).” Id. Time Warner has challenged this portion of Judge Hellerstein’s ruling
and the issue is currently on appeal in the Second Circuit. King v. Time Warner Cable Inc., No.
15-2474. Argument was held on January 25, 2017; the Second Circuit has not released a
decision as of the date of this Opinion and Order.
Collateral estoppel precludes relitigation of issues actually litigated and decided in a prior
action, so long as the determination of those issues was essential to the judgment in the prior
action. Cent. Hudson Gas & Elec. Corp. v. Empresa Naviera Santa S.A., 56 F.3d 359, 368 (2d
Cir. 1995). “Four elements must be met for collateral estoppel to apply: (1) the issues of both
proceedings must be identical, (2) the relevant issues were actually litigated and decided in the
prior proceeding, (3) there must have been ‘full and fair opportunity’ for the litigation of the
issues in the prior proceeding, and (4) the issues were necessary to support a valid and final
judgment on the merits.” Id. (quoting Gelb v. Royal Globe Ins. Co., 798 F.2d 38, 44 (2d Cir.
1986)). However, “[t]he Supreme Court has afforded district courts ‘broad discretion’ in
determining whether to deny collateral estoppel,” and “‘the general rule should be that in cases
where . . . the application of offensive estoppel would be unfair to a defendant, a trial judge
should not allow the use of offensive collateral estoppel.’” S.E.C. v. Mattera, No. 11 Civ. 8323,
2013 WL 6485949, at *7 (S.D.N.Y. Dec. 9, 2013) (quoting Parklane Hosiery Co. v. Shore, 439
U.S. 322, 331 (1979)).
Time Warner disputes the first prong of this analysis: whether the issue raised in this
action is identical to that raised in King. It argues that Plaintiffs have failed to show that “the
IVR platform that called King is identical in all material respects to the one that called Hunter
and Villa (and, to the extent they seek class-wide relief, the members of the putative class).”
(Dkt. No. 87 at 10-11.) Time Warner contends that “IVR” is a “generic term” and “a label used
to describe a complex system of interconnected servers and software applications that perform a
variety of different functions relevant to managing customer call experiences.” (Id. at 11.)
And indeed, especially in light of the limited discovery in this action, Plaintiffs have not
carried their burden to justify summary judgment on this issue at this juncture. In support of
their argument that the King IVR system is identical to that at issue here, Plaintiffs point
primarily to Time Warner’s statement in response to Plaintiffs’ Request for Admission No. 37:
“Time Warner further admitted on numerous occasions that the ‘IVR SYSTEM that is at issue in
this case was also at issue in’ King.” (Dkt. No. 98 at 3 (quoting Dkt. No. 89, Ex. E at 22-23).)
However, in the very statement upon which Plaintiffs rely, Time Warner made clear that it was
not admitting that the IVR system was identical: “TWC further objects to this Request on the
grounds that it is vague and ambiguous to the extent it uses the phrase ‘the same IVR SYSTEM,’
which suggests that the IVR SYSTEM is currently identical to the IVR SYSTEM at any point in
the past.” (Dkt. No. 89, Ex. E at 22.) Indeed, in the very portion of the statement that Plaintiffs
quote in their brief, they omit a key qualification made by Time Warner: “TWC states that the
general IVR SYSTEM that is at issue in this case was also at issue in” King. (Id. (emphasis
added).) Time Warner, contrary to Plaintiffs’ claim, has thus not admitted that the IVR at issue
here is the same as that at issue in King. They merely conceded that it is the same general type
Plaintiffs also point to statements by Time Warner’s counsel purporting to concede that
the IVR systems are identical. (Dkt. No. 98 at 3 (citing Dkt. No. 76 Ex. 2).) However, as Time
Warner makes clear in its counter-statement to Plaintiffs’ Rule 56.1 statement: “The statements
made during the pretrial conference . . . are taken out of context, and were not testimonial factual
assertions that the IVR platform used here is identical in all material respects to the IVR platform
used in King, or that the IVR platform is a static technology.” (Dkt. No. 88 at 4.) Construing
such statements in the light most favorable to Time Warner—the non-moving party here—a
reasonable jury could conclude that those statements referred to the general IVR system and
were not admissions that the systems were identical. Accordingly, summary judgment is not
Further discovery into the IVR system may reveal that there are no relevant differences
between the system used here and the system at issue in King. If Plaintiffs are able to adduce
Because the Court concludes that Plaintiffs have not carried their burden to prove
the elements of collateral estoppel, it need not address Time Warner’s argument that it should
exercise discretion to not apply collateral estoppel even where its requirements have been
satisfied. (Dkt. No. 87 at 5-10.)
evidence to this effect, they may again move for summary judgment on this issue. At this
juncture, however, they have not carried their burden.
Time Warner’s Motion for Summary Judgment
Time Warner moves for summary judgment on a variety of grounds. First, Time Warner
argues that Plaintiffs lack standing due to their failure to establish a cognizable injury in fact.
Second, Time Warner argues that some of the calls to Plaintiffs fall within a regulatory safe
harbor for calls to re-assigned numbers. Third, Time Warner argues that Plaintiffs cannot carry
their burden to show that Time Warner used an ATDS or played an artificial or prerecorded
voice in their calls to Plaintiffs. Fourth, Time Warner argues that even if the TCPA does apply,
Time Warner had consent to make the calls and made them in good faith, which bars Plaintiffs’
claims. Fifth, Time Warner disputes Plaintiffs’ claim that Time Warner failed to maintain
adequate do-not-call policies. Lastly, Time Warner challenges Plaintiffs’ request for injunctive
relief. The Court addresses these arguments in turn.
In considering Time Warner’s motion for summary judgment, the Court is mindful that
Plaintiffs have not yet had the benefit of class discovery, as the Court has stayed such discovery
pending resolution of the pending motions. (Dkt. No. 110.) Accordingly, where Plaintiffs can
show that the failure of their opposition is the result of their inability to discover essential facts,
the Court will decline to grant summary judgment in Time Warner’s favor. See Fed. R. Civ. P.
56(d); Delphi-Delco Elec. Sys., 324 F. Supp. 2d at 417-18.
Time Warner argues that Hunter and Villa lack standing because they are unable to prove
injury in fact. (Dkt. No. 113 at 27.) Time Warner argues that Plaintiffs have suffered no
financial loss as a result of the calls because they had unlimited phone plans that did not incur
costs by the minute. (Id.) And Time Warner argues that Plaintiffs have not suffered any non13
financial injuries because they cannot prove harm for each call for which they seek to recover.
(Id. at 28-29.)
The “irreducible constitutional minimum” of standing in federal court requires: (1)
“injury in fact;” (2) that is “fairly traceable” to a defendant's challenged conduct; and (3) that is
“likely to be redressed” by a favorable decision. Lujan v. Defenders of Wildlife, 504 U.S. 555,
560-61, 589-90 (1992). To support standing, an injury must be both “concrete and
particularized.” Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1548 (2016) (quoting Lujan, 504 U.S.,
at 560). A “bare” statutory violation is insufficient to confer constitutional standing absent some
“concrete” harm. Id. at 1549.
In a recent case, Leyse v. Lifetime Entertainment Services, LLC, Nos. 16-1133-cv, 161425-cv, 2017 WL 659894 (2d Cir. Feb. 15, 2017) (summary order), the Second Circuit held that
a plaintiff had standing to assert a claim under the TCPA where the defendant “left a prerecorded
voicemail message, to which [plaintiff] later listened, on an answering device in the place where
[plaintiff] resided and to which he had legitimate access.” Id. at *1. The court added that
“[i]nsofar as the TCPA protects consumers from certain telephonic contacts, . . . receipt of such
an alleged contact in the way described demonstrates more than a bare violation and satisfies the
concrete-injury requirement for standing.” Id. The Second Circuit cited decisions of several
sister circuits finding minor, non-financial injuries sufficient to confer standing for a claim under
the TCPA. See Golan v. Veritas Entm’t, LLC, 788 F.3d 814, 819-21 (8th Cir. 2015) (receipt of
two brief unsolicited robocalls as voicemail messages); Palm Beach Golf Ctr.–Boca, Inc. v. John
G. Sarris, D.D.S., P.A., 781 F.3d 1245, 1251-52 (11th Cir. 2015) (one-minute occupation of fax
Here, Plaintiffs have adequately alleged precisely the sort of injury that the TCPA was
designed to target. “The intent of Congress, when it established the TCPA in 1991, was to
protect consumers from the nuisance, invasion of privacy, cost, and inconvenience that
autodialed and prerecorded calls generate.” In re Rules & Regs Implementing the Tel. Consumer
Prot. Act of 1991, 30 FCC Rcd. 7961, 7979-80 (2015) (“2015 FCC Order”) (citing S. Rep. No.
102-178, at 2, 4-5 (1991)). Plaintiff Villa testified that Time Warner’s calls—at least one of
which she answered—were disruptive and invaded her privacy, even causing her to miss
important calls. (Dkt. No. 137-1 at 103-104, 144.) Plaintiff Hunter similarly testified that Time
Warner’s calls—which she also answered—were unwanted, disruptive, diminished her usage and
enjoyment of her cellular telephone, and caused her irritation. (Dkt. No. 137-2 at 7; Dkt No.
115-14 at 109, 127.) Based on the Second Circuit’s recent decision in Leyse, these allegations
are sufficient to support standing under the TCPA. 2 See, e.g., Zani v. Rite Aid Headquarters
Corp., No. 14 Civ. 9701, 2017 WL 1383969, at *7 (S.D.N.Y. Mar. 30, 2017).
TCPA Safe Harbor
In a 2015 order, the FCC established a safe harbor from TCPA liability for calls made to
reassigned numbers, due to the difficulty for callers in knowing when numbers have been
reassigned. 3 See 2015 FCC Order at 7999-8000, 8004-09. This safe harbor “giv[es] callers an
opportunity to avoid liability for the first call to a wireless number following reassignment,” and
presumes constructive knowledge of the reassignment after that point. Id. at 8009 (emphasis
Because the Court finds that Plaintiffs have adequately alleged a non-financial
injury in fact sufficient to support standing, it need not address whether calls made to an
unlimited phone plan may amount to a financial injury sufficient for standing.
The viability and scope of the FCC safe harbor is on review in ACA International
before the D.C. Circuit. See ACA Int’l, No. 15-1211 (D.C. Cir.). A decision from that court
impacting the safe harbor may provide grounds for reconsidering the Court’s conclusions here.
Time Warner argues that it is entitled to summary judgment with respect to the first calls
made to each of Hunter and Villa, whose phone numbers were reassigned to them after having
previously been assigned to Time Warner customers A.F. and A.S. (Dkt. No. 113 at 23.)
Plaintiffs do not appear to dispute this application of the safe harbor. (Dkt. No. 139 at 13.)
Accordingly, Time Warner is entitled to summary judgment on call one to Villa and call one to
Hunter under the FCC’s TCPA safe harbor.
Time Warner also argues that the safe harbor entitles it to summary judgment on calls 38
and 39 to Plaintiff Hunter, which were made on February 1, 2016, and February 6, 2016,
respectively. (Dkt. No. 113 at 23-24.) This is because those calls were made after Time Warner
subscriber A.F. called Time Warner on January 31, 2016, and February 5, 2016, and provided
Time Warner with Hunter’s number, thereby renewing consent for Time Warner to call that
number. (Id.) Plaintiffs dispute this contention, arguing that the safe harbor protects a caller
from liability only after reassignment, and does not address consent. (Dkt. No. 139 at 13.)
Plaintiffs’ interpretation of the safe harbor is the correct one here. The language of the
safe harbor is expressly keyed to the fact of reassignment, foreclosing liability only for the “first
call . . . following reassignment.” 2015 FCC Order at 8009. It neither mentions nor implies that
consent functions to renew the safe harbor. Accordingly, summary judgment is denied on this
ground as to calls 38 and 39 to Hunter.
ATDS/Artificial or Prerecorded Voice
Time Warner next argues that Plaintiffs cannot show that the TCPA applies to the calls at
issue here because they have not carried their burden of establishing that Time Warner used an
ATDS or played an artificial or prerecorded voice on the calls at issue. (Dkt. No. 113 at 8.) See
47 U.S.C. § 227(b)(1) (“It shall be unlawful . . . to make any call . . . using any automatic
telephone dialing system or an artificial or prerecorded voice . . . .”).
The TCPA defines ATDS as “equipment which has the capacity—(A) to store or produce
telephone numbers to be called, using a random or sequential number generator; and (B) to dial
such numbers.” 47 U.S.C. § 227(a)(1). The 2015 FCC Order further clarified that even where a
system is not “presently used” as an ATDS, it nonetheless counts as an ATDS so long as it has
the potential ability to be used in that manner. 4 2015 FCC Order at 7971-72. However, the FCC
made clear that it was not “address[ing] the exact . . . contours of the ‘autodialer’ definition or
seek[ing] to determine comprehensively each type of equipment that falls within that definition
that would be administrable industry-wide.” Id. at 7974-75 (internal quotation marks omitted).
Whether a particular system is an ATDS, and in particular, the role of human intervention in its
functioning, “is specific to each individual piece of equipment, based on how the equipment
functions and depends on human intervention, and is therefore a case-by-case determination.”
Id. at 7975.
Time Warner argues that none of the calling systems at issue in this case—the IVR
platform, the NobelBiz platform, the eClerx platform, the Meridian platform, and the InfoCision
platform—has the requisite capacity to be deemed an ATDS. (Dkt. No. 113 at 11-18.)
As to the non-IVR calling systems, Plaintiffs explain that they are “presently unable to
provide a rebuttal to [Time Warner]’s summary judgment allegations . . . because of the lack of
opportunity for class-wide discovery.” (Dkt. No. 139 at 11.) The four non-IVR systems involve
a total of six calls—one to Villa and five to Hunter. Three of the systems made one call each,
As discussed above, a decision from the D.C. Circuit in ACA International
modifying this definition risks disrupting the Court’s conclusion on this issue. Under the
statutory standard applied prior to the FCC Order, courts generally held that a system must have
the present ability to store or produce numbers to be called using a random or sequential number
generator in order to be deemed an ATDS. See, e.g., Marks v. Crunch San Diego, LLC, 55 F.
Supp. 3d 1288, 1292 (S.D. Cal. 2014); Gragg v. Orange Cab Co., 995 F. Supp. 2d 1189, 119293 (W.D. Wash. 2014).
and the remaining system made three calls. (See Dkt. No. 138 ¶¶ 15, 36.) Given that the TCPA
provides $500 per violation, 47 U.S.C. § 227(b)(3), Plaintiffs would be entitled to an award of
between $500 and $1500 as to each of these phone systems (or three times that, if they can prove
that the violations were willful or knowing, id.). The systems are, Plaintiffs claim, managed by
third parties, in some cases abroad. Accordingly, Plaintiffs have been unable to adequately
defend against Time Warner’s summary judgment allegations as to these systems relying only on
the limited individual discovery the Court has permitted. Summary judgment on this ground is
thus denied as to the non-IVR calling systems, that is, as to call seven to Villa and calls twentyone, thirty-nine, forty, forty-one, and forty-two to Hunter.
As to the IVR platform, Plaintiffs point to enough evidence to justify denying summary
judgment to Time Warner on this question, especially in light of the limited discovery taken in
this action. Time Warner claims that none of the platform’s software can be “readily modified”
to enable random or sequential number generation, citing the absence of an “off-the-shelf plugin” that could be installed. (Dkt. No. 113 at 13.) However, Plaintiffs identify evidence
suggesting that the IVR system has the necessary capacity, including a document describing
“automated calling” (Dkt. No. 136-2), and expert testimony describing the capacity of the IVR
system (Dkt. No. 136 ¶¶ 45-46).
Moreover, as discussed above, a version of Time Warner’s IVR system was deemed to be
an ATDS by Judge Hellerstein in King. 113 F. Supp. 3d at 725. The Court has denied Plaintiffs’
motion for partial summary judgment on the basis that they had not adduced sufficient evidence
to show that the IVR system at issue in King was sufficiently similar to that at issue here.
Accordingly, more discovery on the specifics of the IVR system at issue here is called for.
Indeed, in connection with their opposition to Time Warner’s motion for summary judgment,
Plaintiffs submit an affidavit describing the additional categories of discovery that would be
required to assess whether the IVR system is an ATDS. In particular, Plaintiffs seek to depose a
Time Warner representative on “(1) the differences, if any, between the IVR platform in this case
and the IVR system described in King . . . ; (2) whether the IVR platform has the capacity to
store telephone numbers to be called as any type of electronic list or database; (3) Defendant’s
methodology for initiating and invoking the IVR platform to make outgoing calls,” and more.
(Dkt. No. 137 ¶ 9.)
Plaintiffs have identified genuine issues of fact as to whether the IVR system here is an
ATDS under the TCPA, and have further identified categories of discovery that would better
allow them to address the issue. See Trebor Sportswear Co. v. The Limited Stores, Inc., 865 F.2d
506, 511 (2d Cir. 1989) (“The nonmoving party should not be ‘railroaded’ into his offer of proof
in opposition to summary judgment.”). Accordingly, Time Warner’s motion for summary
judgment on this issue is denied.
And because the Court concludes that each of the phone systems at issue may be an
ATDS, Plaintiffs have satisfied a prerequisite for coverage under the TCPA, and it is
unnecessary to address Time Warner’s argument on whether Plaintiffs have shown that Time
Warner used an artificial or prerecorded voice, which is an alternative predicate for TCPA
Consent and Good Faith
Time Warner next argues that that it is immune from liability because the TCPA does not
prohibit calls that the “called party” consents to receive, 47 U.S.C. § 227(b)(1)(A)(iii), and that
the relevant “called party” is the intended recipient of the call. (Dkt. No. 113 at 24.) See
generally Reyes v. Lincoln Auto. Fin. Servs., No. 16-2104-cv, 2017 WL 2675363 (2d Cir. June
22, 2017). Because Time Warner had the prior consent of its customers—the intended recipients
of its calls—to call Villa’s and Hunter’s numbers, Time Warner argues that it is immune from
TCPA liability. (Id.)
However, Time Warner acknowledges that this argument is foreclosed by the FCC 2015
Order, which expressly defines “called party” as “the subscriber and customary users” of the
phone number at issue, not the intended recipient of the call. FCC 2015 Order at 8001. Time
Warner raises this issue here only in order to preserve it in the event that the FCC’s interpretation
is vacated by the D.C. Circuit in ACA International. Accordingly, summary judgment is denied
on this issue.
Time Warner also argues that its good faith belief that it had consent should preclude
liability. The FCC 2015 Order does not address this issue and it is unclear whether good faith
operates as a defense to liability under section 227(b) of the TCPA, though Time Warner has
identified two district court cases concluding as much. See, Danehy v. Time Warner Cable
Enters., No. 14 Civ. 133, 2015 WL 5534094, at *7 (E.D.N.C. Aug. 6, 2015); Chyba v. First Fin.
Asset Mgmt., Inc., No. 12 Civ. 1721, 2014 WL 1744136, at *12 (S.D. Cal. Apr. 30, 2014).
In any event, even assuming the existence of a good faith defense, the only evidence of
good faith that Time Warner identifies is that they eventually stopped calling Villa and Hunter.
(Dkt. No. 113 at 25.) However, Time Warner stopped calling only after seven calls to Villa and
forty-four calls to Hunter. It has not carried its burden of proving good faith beyond genuine
dispute over the duration of its calls. Moreover, the post-reassignment safe harbor created by the
FCC 2015 Order, and discussed above, presumes that a caller has constructive notice of the
reassignment after just a single call, and may, as a result, foreclose a good faith defense beyond
the first call. FCC 2015 Order at 8009. Given this legal and factual uncertainty, the Court
denies summary judgment as to Time Warner’s good faith defense.
Time Warner also seeks summary judgment on Plaintiffs’ do-not-call list claims. The
TCPA also allows claims for internal do-not-call list violations. The relevant regulation provides
that “[n]o person or entity shall initiate any call for telemarketing purposes to a residential
telephone subscriber unless such person or entity has instituted procedures for maintaining a list
of persons who request not to receive telemarketing calls made by or on behalf of that person or
entity.” 47 C.F.R. § 64.1200(d). The regulation goes on to describe the “minimum standards” a
caller must satisfy before placing telemarketing calls. Id. § 64.1200(d)(1)-(6). The term
“telemarketing” is defined as “the initiation of a telephone call or message for the purpose of
encouraging the purchase or rental of, or investment in, property, goods, or services, which is
transmitted to any person.” Id. § 64.1200(f)(12). By the terms of the regulation, nontelemarketing calls do not give rise to liability under this provision.
Here, Plaintiffs have failed to carry their burden to show that calls to them made by Time
Warner were made for “telemarketing purposes. Id. § 64.1200(d). The complaint speaks about
telemarketing only in general terms. It alleges that “Defendant conducted (and continues to
conduct) wide scale telemarketing campaigns and repeatedly made unsolicited calls to
consumers’ telephones without consent” (Compl. ¶ 2 (emphasis added)), and that “Plaintiffs’
overriding interest is ensuring Defendant ceases all illegal telemarketing practices” (id. ¶ 59
(emphasis added)). So too in Plaintiffs’ motion for partial summary judgment, in which they
contend that “Plaintiffs and the putative class allege that Time Warner made unsolicited calls to
their telephones . . . as part of a wide ranging telemarketing campaign.” (Dkt. No. 76 at 2.)
Nowhere do Plaintiffs allege that any of the calls made to them were made for telemarketing
In their opposition to Time Warner’s motion for summary judgment, the only evidence
that Plaintiffs point to in support of their allegation that Time Warner’s calls were made for
telemarketing purposes is Hunter’s claim in her deposition that she believed Time Warner was
calling her for telemarketing purposes based on her experience with cable companies. (Dkt. No.
139 at 20.) However, in her deposition, Hunter was then asked: “[D]id Time Warner Cable ever,
in fact, try to convince you to sign up for services?” (Dkt. No. 115-14 at 127.) She responded:
“We didn’t get that far in the conversation. But it’s a possibility if we would have continued
talking, they would have tried to convince me.” (Id. (emphasis added).) This mere possibility
that the calls at issue were being made for telemarketing purposes is insufficient to carry
Plaintiffs’ burden on their do-not-call list claims. Accordingly, Time Warner is entitled to
summary judgment on this claim.
Plaintiffs also argue that they lacked sufficient opportunity to conduct discovery into
Time Warner’s do-not-call list procedures to determine whether they satisfy the required
minimum standards. (Dkt. No. 139 at 20.) See 47 C.F.R. § 64.1200(d)(1)-(6). However,
Plaintiffs have had the opportunity to conduct discovery as to the individual Plaintiffs and the
calls at issue; their failure to adduce evidence that these calls were made for telemarketing
purposes, an essential element of their do-not-call-list claim, renders irrelevant their inability to
take discovery on another element of that claim.
In the complaint, in addition to seeking damages, Plaintiffs also seek “[p]reliminary and
permanent injunctive relief enjoining Defendant . . . from engaging in, and continuing to engage
in, the unlawful calls made with automated dialing systems to cellular phones without prior
express consent, placing calls to the wrong number, and placing calls to members of Defendant’s
IDNC . . . .” (Compl. at 18.)
Time Warner moves for summary judgment as to Plaintiffs’ request for injunctive relief,
arguing that because Plaintiffs have an adequate remedy at law, injunctive relief should not be
available. (Dkt. No. 113 at 33.) Time Warner further claims that because it has taken adequate
precautions to ensure that further calls will not be made to Plaintiffs, the request for injunctive
relief is now moot. (Id. at 34-35.)
The TCPA expressly provides that a plaintiff may seek either monetary relief, injunctive
relief, or both. 47 U.S.C. § 227(b)(3). The TCPA’s provision of statutory damages is designed
to compensate victims for past infractions, whereas its provision of injunctive relief is designed
to protect against future violations. Permitting a plaintiff to seek both forms of relief confirms
these dual aims. See id. Accordingly, the mere availability of damages should not preclude a
plaintiff from also seeking injunctive relief.
Moreover, because Plaintiffs have not yet been able to take discovery into Time Warner’s
systems and procedures, it would be premature for the Court to determine that Time Warner has
adequately foreclosed the possibility of future violations. (Dkt. No. 137 ¶ 25 (“Plaintiffs have
not yet had the opportunity to discover relevant information regarding Defendant’s claim that
Plaintiffs will not be called again in the future . . . .”).) Further discovery may reveal that Time
Warner has, in fact, taken steps to ensure that future violations will not occur, rendering
injunctive relief unnecessary, but the Court cannot grant summary judgment concluding so at this
Motions for Judgment on the Pleadings
Time Warner moves for judgment on the pleadings in both the Mejia action and the
Johnson action. In both actions, Time Warner challenges the constitutionality of Section
227(b)(1)(A)(iii) of the TCPA under the First Amendment to the United States Constitution,
arguing that it draws distinctions that are content based and fails strict scrutiny. (Dkt. No. 83.)
The Court certified the constitutional question in each case pursuant to Federal Rule of Civil
Procedure 5.1(b) and 28 U.S.C. § 2403, and the United States has intervened to defend the
constitutionality of the TCPA. (Dkt. No. 90; Dkt. No. 146; Johnson, Dkt. No. 56; Johnson, Dkt.
Time Warner focuses on the Supreme Court’s recent decision in Reed v. Town of Gilbert,
135 S. Ct. 2218 (2015), to argue that the TCPA is content-based. In Reed, the Supreme Court
deemed unconstitutional the sign code of the Town of Gilbert, Arizona, which prescribed
different regulations for different types of signs on the basis of their content. Id. at 2224-25.
The Court held that “[g]overnment regulation of speech is content based if a law applies to
particular speech because of the topic discussed or the idea or message expressed.” Reed, 135 S.
Ct. at 2227. Because the sign code regulations that applied to a particular sign “depend[ed]
entirely on the communicative content” of the sign, the Court deemed the sign code to be content
based and thus subject to strict scrutiny, which it failed. Id.
Following Reed, Time Warner focuses on two exceptions in the TCPA to argue that the
statute is content based. First, Time Warner argues that Section 227(b)(1)(A)(iii) of the TCPA,
which exempts from liability “call[s] made solely to collect a debt owed to or guaranteed by the
United States,” is content based on its face, because it “define[s] regulated speech by particular
subject matter,” Reed, 135 S. Ct. at 2227. Time Warner further argues that the TCPA’s
authorization for the FCC to establish additional exemptions exacerbates this problem. See 47
U.S.C. § 227(b)(2)(C). Second, Time Warner argues that because recent judicial and FCC
decisions have made it clear that Section 227(b)(1) of the TCPA exempts governmental speakers,
it contains a speaker-based restriction.
As a threshold matter, Time Warner has standing to challenge the constitutionality of the
TCPA because invalidation of Section 227(b)(1)(A)(iii) would release it from liability and, as a
result, redress its injuries.
Plaintiffs and the Government make several related arguments questioning Time
Warner’s ability to challenge the statute. They argue that Time Warner lacks standing to
challenge the statute on the basis of exceptions—the debt-collection exemption and the
government-speaker exemption—that do not apply to its conduct here. (Dkt. No. 99 at 6-7; Dkt.
No. 147 at 5-8.) They also argue that because the debt-collection exemption is severable from
the statute, finding the exemption unconstitutional would only lead the Court to strike that
portion of the statute and not eliminate Time Warner’s liability. (Dkt. No. 99 at 6-7; Dkt. No.
147 at 5-8.) And they argue that Time Warner has not adequately alleged overbreadth. (Dkt.
No. 147 at 8.)
However, these arguments misapprehend the posture of Time Warner’s challenge. Time
Warner is challenging the statute’s underinclusiveness—that is, imposing liability for its calls but
not for analogous calls placed for the purposes of debt collection. Put another way, Time Warner
is not directly challenging the imposition of liability for its conduct in the first instance—which
on its own would certainly be constitutional. Rather, Time Warner is disputing Congress’s
ability to penalize its conduct while at the same time immunizing others’ conduct, solely on the
basis of the content of the communications at issue.
This sort of “underbreadth” challenge arising from the statute’s failure to maintain
content neutrality frustrates the arguments against standing. Hill v. Colorado, 530 U.S. 703, 724
(2000). Plaintiffs and the Government argue that Time Warner lacks standing to challenge
exceptions that do not directly apply to it. But this argument would suggest that the only viable
plaintiff to challenge such a provision would be one whose calls fall within an exception to
liability—for it is to them that the exceptions apply (or so the argument goes)—but such a
plaintiff would by definition lack a redressable injury, given its exemption from liability, and as
a result would lack standing to challenge the provision. This paradox of underbreadth risks
effectively “insulat[ing] underinclusive statutes from constitutional challenge.” Tex. Monthly,
Inc. v. Bullock, 489 U.S. 1, 7-8 (1989) (quoting Ark. Writers’ Project, Inc. v. Ragland, 481 U.S.
221, 221 (1987)); see also Orr v. Orr, 440 U.S. 268, 272 (1979) (“We have on several occasions
considered this inherent problem of challenges to underinclusive statutes, and have not denied a
plaintiff standing on this ground.” (citations omitted)). Accordingly, Time Warner should not be
denied standing to challenge an exemption, the existence of which renders its liability
So too with the incarnation of this argument in the guise of severability. Severability is a
question of remedy, to be addressed once a constitutional violation has been identified. It is not
a threshold issue implicating a party’s standing to challenge constitutionality in the first instance.
See, e.g., Whole Woman’s Health v. Hellerstedt, 136 S. Ct. 2292, 2318-19 (2016). But see I.N.S.
v. Chadha, 462 U.S. 919, 931 n.7 (1983) (“In this case we deem it appropriate to address
questions of severability first.”). To treat severability as an issue of justiciability would risk
insulating underinclusive statutes from constitutional challenge, as it would foreclose challenges
by parties liable under a rule made unconstitutional by a potentially severable exception. See
Tex. Monthly, Inc., 489 U.S. at 7-8. Moreover, the mere application of a content-discriminatory
rule may itself amount to a redressable injury, even where the remedy would broaden rather than
eliminate liability. See Sessions v. Morales-Santana, 137 S. Ct. 1678, 1698 n.21 (2017).
Plaintiffs and the Government further argue that the Court should address the TCPA only
as applied to Time Warner’s speech, which is exclusively commercial, and so should be
evaluated under less searching intermediate scrutiny. 5 (Dkt. No. 99 at 7-11; Dkt. No. 147 at 1117.) However, because Time Warner challenges the statute’s allegedly content-based linedrawing head-on as rendering all applications of the provision unconstitutional, the Court will
address the facial challenge to the statute. See United States v. Stevens, 559 U.S. 460, 472-73
(2010). Moreover, the TCPA does not distinguish between commercial and non-commercial
speech, so it would be inapposite to treat it as a regulation of only commercial speech. See
Moser v. F.C.C., 46 F.3d 970, 973 (9th Cir. 1995) (“Because nothing in the [TCPA] requires the
Commission to distinguish between commercial and noncommercial speech, we conclude that
the statute should be analyzed as a content-neutral time, place, and manner restriction. It
regulates all automated telemarketing calls without regard to whether they are commercial or
noncommercial.”); see also Solantic, LLC v. City of Neptune Beach, 410 F.3d 1250, 1269 n.15
(11th Cir. 2005) (“Because the sign code does not regulate commercial speech as such, but rather
applies without distinction to signs bearing commercial and noncommercial messages, the
Central Hudson test has no application here.”). In any event, because the Court concludes below
that the provision survives strict scrutiny, it would necessarily also satisfy any less searching
standard of review.
Section 227(b)(1)(A)(iii) Is Content Based
Moving to the merits of Time Warner’s First Amendment challenge, the Court agrees that
the debt-collection exception renders Section 227(b)(1)(A)(iii) content based.
Section 227(b)(1)(A)(iii) provides:
This Court, along with other courts to consider the issue, finds no reason to
conclude that Reed modified the level of scrutiny applied to regulations of commercial speech.
See Matal v. Tam, 137 S. Ct. 1744, 1763-64 (opinion of Alito, J.); see generally Note, Free
Speech Doctrine After Reed v. Town of Gilbert, 129 Harv. L. Rev. 1981, 1990-92 (2016)
“It shall be 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 paging service, cellular telephone service,
specialized mobile radio service, or other radio common carrier
service, or any service for which the called party is charged for the
call, unless such call is made solely to collect a debt owed to or
guaranteed by the United States . . . .”
47 U.S.C. § 227(b)(1)(A)(iii) (emphasis added).
The debt-collection exception was added to the statute in 2015 as part of the Bipartisan
Budget Act of 2015. See Pub. L. No. 114-74, § 301, 129 Stat. 584, 588 (2015) (“Section 227(b)
of the [TCPA] is amended . . . in subparagraph (A)(iii), by inserting ‘, unless such call is made
solely to collect a debt owed to or guaranteed by the United States’ after ‘charged for the call’
. . . .”). Prior to the addition of the debt-collection exception, though the Second Circuit never
considered the issue, the Ninth Circuit twice considered and upheld the constitutionality of
Section 227(b)(1)(A)(iii) as a content-neutral regulation of speech. See Gomez v. CampbellEwald Co., 768 F.3d 871, 876 (9th Cir. 2014), aff’d on other grounds, 136 S. Ct. 663 (2016);
Moser v. FCC, 46 F.3d 970 (9th Cir. 1995).
No appellate court has considered the constitutionality of Section 227(b)(1)(A)(iii) since
the 2015 amendment and the Supreme Court’s decision in Reed. However, at least two recent
district court decisions have addressed the issue, focusing on the debt-collection exemption. See
Holt v. Facebook, Inc., No. 16 Civ. 02266, 2017 WL 1100564 (N.D. Cal. Mar. 9, 2017);
Brickman v. Facebook, Inc., No. 16 Civ. 00751, 2017 WL 386238 (N.D. Cal. Jan. 27, 2017).
Both held that the debt-collection exemption rendered Section 227(b)(1)(A)(iii) content based
under Reed, and both concluded that the TCPA withstands strict scrutiny. Holt, 2017 WL
1100564, at *7-10; Brickman, 2017 WL 386238, at *4-9.
The Court agrees with these recent district court opinions in concluding that the debtcollection exception renders Section 227(b)(1)(A)(iii) content based on its face under Reed. It is
plain that a court would be required to examine the content of the message at issue to determine
whether it was made for a purpose other than “to collect a debt owed to or guaranteed by the
United States,” and thus subject to liability under the TCPA. 47 U.S.C. § 227(b)(1)(A)(iii). This
is sufficient under Reed to render the provision content based and thus subject to strict scrutiny.
See Reed, 135 S. Ct. at 2227 (“Government regulation of speech is content based if a law applies
to particular speech because of the topic discussed or the idea or message expressed.”).
Indeed, the Government bypasses this argument, instead contending that the TCPA as
originally enacted is not content based and that the 2015 amendment adding the debt-collection
exception “should not be considered here.” 6 (Dkt. No. 147 at 18-19.) However, given the nature
of Time Warner’s facial challenge, the Court must consider the provision in its entirety, as it
currently applies, and cannot simply ignore the problematic exception.
Plaintiffs argue that the provision is nonetheless content neutral, claiming that “[i]n
determining content neutrality, the government’s purpose is the controlling consideration.” (Dkt.
No. 99 at 14.) The Supreme Court’s decision in Reed, however, roundly forecloses this
argument. The Court in Reed made clear that “[a] law that is content based on its face is subject
to strict scrutiny regardless of the government's benign motive, content-neutral justification, or
lack of ‘animus toward the ideas contained’ in the regulated speech.” Reed, 136 S. Ct. at 2228
(quoting Cincinnati v. Discovery Network, Inc., 507 U.S. 410, 429 (1993)). This Court
The Johnson plaintiffs argue that the pre-2015 TCPA applies to them given the
timing of their calls. (Johnson, Dkt. No. 49 at 3.) However, because the Court concludes below
that the TCPA as amended satisfies strict scrutiny, it necessarily follows that the pre-amendment
version, which does not include the content-based distinction Time Warner identifies, would
satisfy any lesser level of scrutiny.
acknowledges that treating facial content discrimination, however narrow or benign, as an
automatic trigger for strict scrutiny risks misaligning the level of First Amendment scrutiny with
the magnitude of infringement on First Amendment interests—but this is what Reed demands.
See id. at 2234-36 (Breyer, J., concurring in the judgment).
The Court rejects, however, Time Warner’s argument that the provision imposes a
speaker-based distinction by exempting government speakers from liability. The Supreme Court
has held that the “United States and its agencies . . . are not subject to the TCPA’s prohibitions
because no statute lifts their immunity.” Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663, 672
(2016). But the mere absence of liability for government speakers does not raise a First
Amendment problem. First, government speech is exempt from First Amendment scrutiny. See
Pleasant Grove City, Utah v. Summum, 555 U.S. 460, 467-68 (2009). And second, the absence
of TCPA liability for government speakers is only a confirmation of the general principle of
sovereign immunity. To find otherwise would force Congress into an untenable Sophie’s Choice
between sovereign immunity and compliance with the First Amendment by requiring Congress
to abrogate sovereign immunity every time it sought to restrict private speech, so as to avoid the
restriction’s being treated as speaker based. See Brickman, 2017 WL 386238, at *8.
Moreover, the Court rejects Time Warner’s argument that because the statute authorizes
the FCC to craft further exceptions, which may themselves be content based, the statute itself is
content based. The delegation of exception-creating authority to the FCC is not content based on
its face, and the FCC could exercise this authority in a content-neutral way. See 47 U.S.C.
§ 227(b)(2)(C) (“The [FCC] . . . may . . . exempt from the requirements of paragraph (1)(A)(iii)
of this subsection calls to a telephone number assigned to a cellular telephone service that are not
charged to the called party . . . .”). The mere fact that the FCC could exercise this authority in a
manner that runs afoul of the First Amendment does not imply that the grant of authority is itself
unconstitutional. 7 The district court considering this argument in Brickman reached the same
conclusion. See Brickman, 2017 WL 386238, at *6.
Application of Strict Scrutiny
Because Section 227(b)(1)(A)(iii) imposes a content-based restriction on speech, it must
be struck down unless it survives strict scrutiny. Strict scrutiny “requires the Government to
prove that the restriction furthers a compelling interest and is narrowly tailored to achieve that
interest.” Reed, 135 S. Ct. at 2231 (quoting Arizona Free Enterprise Club’s Freedom Club PAC
v. Bennett, 564 U.S. 721, 734 (2011)). Though strict scrutiny is, as its name indicates, strict, the
Supreme Court has recently reaffirmed that it is not “strict in theory but fatal in fact.” WilliamsYulee v. Florida Bar, 135 S. Ct. 1656, 1666 (2015) (quoting Adarand Constructors, Inc. v. Pena,
515 U.S. 200, 237 (1995)).
Compelling Government Interest
The TCPA serves a compelling government interest. The TCPA, which was well
supported by extensive congressional findings, was enacted “to protect the privacy interests of
residential telephone subscribers by placing restrictions on unsolicited, automated telephone calls
to the home and to facilitate interstate commerce by restricting certain uses of facsimile (fax)
machines and automatic dialers.” S. Rep. No. 102-178, at 1 (1991).
“The State’s interest in protecting the well-being, tranquility, and privacy of the home is
certainly of the highest order in a free and civilized society.” Carey v. Brown, 447 U.S. 455, 471
(1980). In particular, “[o]ne important aspect of residential privacy is protection of the unwilling
To the extent that Time Warner seeks to challenge any particular FCC order
promulgated under that provision, this Court lacks jurisdiction to consider such a challenge. The
Hobbs Act provides that “[t]he Court of Appeals (other than the United State Court of Appeals
for the Federal Circuit) has exclusive jurisdiction to enjoin, set aside, suspend (in whole or in
part), or to determine the validity of all final orders of the Federal Communications Commission
made reviewable.” 28 U.S.C. § 2342(1).
listener.” Frisby v. Schultz, 487 U.S. 474, 484 (1988). “[I]ndividuals are not required to
welcome unwanted speech into their own homes and . . . the government may protect this
freedom.” Id. at 485. It is true, as Time Warner points out, that the relevant precedents arose in
the context of residential privacy and do not refer to cell phones. But the Court sees no reason
that this compelling interest does not also extend to cell phones. See Patriotic Veterans, Inc. v.
Zoeller, 845 F.3d 303, 305-06 (7th Cir. 2017) (“No one can deny the legitimacy of the state’s
goal: Preventing the phone (at home or in one’s pocket) from frequently ringing with unwanted
calls. Every call uses some of the phone owner’s time and mental energy, both of which are
precious.”); see generally Riley v. California, 134 S. Ct. 2473, 2494-95 (2014) (“Modern cell
phones are not just another technological convenience. With all they contain and all they may
reveal, they hold for many Americans ‘the privacies of life.’” (quoting Boyd v. United States,
116 U.S. 616, 630 (1886))). Moreover, the federal government’s interest in collecting debts
owed to it supports the finding of a particularly compelling interest in exempting calls made for
the purposes of collecting government debts. See Clearfield Trust Co. v. United States, 318 U.S.
363, 366 (1943); see also In the Matter of Rules & Regulations Implementing the Tel. Consumer
Prot. Act of 1991, 31 F.C.C. Rcd. 9074, 9076-77 (2016) (“While no legislative history exists that
lays out the legislative intent, we believe two reasonable interpretations of the [debt-collection
exemption] are to: (1) make it easier for owners of debts owed to or guaranteed by the United
States and their contractors to make calls to collect the debts; and (2) make it easier for
consumers to obtain useful information about debt repayment, which may be conveyed in these
The two recent cases considering the constitutionality of the TCPA similarly concluded
that the TCPA serves a compelling government interest. Brickman, 2017 WL 386238, at *6-7;
Holt, 2017 WL 1100564, at *8.
The Court must next determine whether the TCPA is narrowly tailored. As a general
matter, the provision at issue “restricts a narrow slice of speech.” Williams-Yulee, 135 S. Ct. at
1670. It imposes liability only on a party using an autodialer or artificial voice to make calls
without the recipient’s consent. 47 U.S.C. § 227(b)(1)(A)(iii). It imposes no restrictions on calls
not made using an autodialer or artificial voice, and it allows autodialer or artificial voice calls so
long as consent has been secured. Congress, in crafting this provision, carefully targeted the
calls most directly raising its concerns about invasion of privacy, while also furthering its interest
in collecting federal government debts.
Time Warner argues that by excluding calls made for the purpose of collecting
government debts, the provision is fatally underinclusive. (Dkt. No. 83 at 18.) However, the
Supreme Court has made clear that “the First Amendment imposes no freestanding
‘underinclusiveness limitation.’” Williams-Yulee, 135 S. Ct. at 1668 (quoting R.A.V. v. St. Paul,
505 U.S. 377, 387 (1992)). At most, an underinclusive law may raise a “red flag” by “rais[ing]
‘doubts about whether the government is in fact pursuing the interest it invokes, rather than
disfavoring a particular speaker or viewpoint.’” Id. (quoting Brown v. Entm’t Merchants Assn.,
564 U.S. at 802).
Here, the government debt carve-out is a narrow exception from liability in furtherance of
a compelling interest. The TCPA, in this respect, is entirely unlike the sign code in Reed, which
was full of insufficiently supported exceptions. See Reed, 135 S. Ct. 2224-25. Indeed, the
statute expressly authorizes the FCC to further “restrict or limit the number and duration of calls
made . . . to collect a debt owed to or guaranteed by the United States.” 47 U.S.C.
§ 227(b)(2)(H). And, as the Court in Brickman pointed out in finding the provision to be
narrowly tailored, “[t]he government debt exception would likewise be limited by the fact that
such calls would only be made to those who owe a debt to the federal government.” Brickman,
2017 WL 386238, at *8. This narrow exception, and the provision as a whole, are well-designed
to further the interests that Congress sought to pursue with the TCPA.
Finally, Time Warner’s proposals of “less restrictive alternatives” do not render the
provision fatally overinclusive. Time Warner identifies a variety of alternative restrictions,
including restrictions on the duration of calls or the times of day they can be made, or mandatory
disclosure requirements. (Dkt. No. 83 at 22-23.) However, these alternatives do not fully
foreclose the possibility that autodialier or prerecorded voice calls will be made to nonconsenting consumers (even if they would keep such calls short, in a narrow window of time, or
fully disclosed), and thus may not sufficiently further Congress’s compelling interests in privacy,
while also ensuring the collection of government debts. Particularly in light of Reed’s capacious
understanding of content discrimination, this Court is unwilling to let perfect tailoring be the
enemy of narrow tailoring. See Williams-Yulee, 135 S. Ct at 1671 (“The First Amendment
requires that [the provision] be narrowly tailored, not that it be ‘perfectly tailored.’” (quoting
Burson v. Freeman, 504 U.S. 191, 209 (1992) (plurality opinion))).
Accordingly, Section 227(b)(1)(A)(iii) satisfies strict scrutiny and is thus constitutional.
Motion to Intervene and Stay
The plaintiffs in the Fontes action seek to intervene in the Mejia action for the purposes
of staying it pending the Fontes action, which was first filed. (Dkt. No. 64.)
The Fontes plaintiffs argue that they are entitled to both mandatory and permissive
intervention. Intervention as a matter of right under Federal Rule of Civil Procedure 24(a)
requires a putative intervenor to: “(1) file a timely motion; (2) claim an interest relating to the
property or transaction that is the subject of the action; (3) be so situated that without
intervention the disposition of the action may impair that interest; and (4) show that the interest
is not already adequately represented by existing parties.” Butler, Fitzgerald & Potter v. Sequa
Corp., 250 F.3d 171, 176 (2d Cir. 2001). “Failure to meet any one of these four requirements is
grounds for denial.” Freydl v. Meringolo, No. 09 Civ. 7196, 2012 WL 1883349, at *1 (S.D.N.Y.
May 22, 2012) (citing MasterCard Int’l Inc. v. Visa Int’l Serv. Ass’n, 471 F.3d 377, 389 (2d Cir.
2006)). As for permissive intervention under Federal Rule of Civil Procedure 24(b)(1)(B), “a
Court, in its discretion, may grant permission to intervene if the movant ‘has a claim or defense
that shares with the main action a common question of law or fact.’” Id. at *2 (quoting Fed. R.
Civ. P. 24(b)(1)(B)). “Permissive intervention is appropriate in circumstances in which
intervention would not ‘unduly delay or prejudice the adjudication of the original parties’
rights.’” Id. (quoting Fed. R. Civ. P. 24(b)(3)). “Additional relevant factors include: ‘(1) the
nature and extent of the intervenors’ interests, (2) the degree to which those interests are
adequately represented by other parties, and (3) whether parties seeking intervention will
significantly contribute to full development of the underlying factual issues in the suit and to the
just and equitable adjudication of the legal questions presented.’” Id. (quoting Chevron Corp. v.
Donziger, 11 Civ. 0691, 2011 WL 2150450, at *5 (S.D.N.Y. May 31, 2011)).
Here, intervention is not justified on either mandatory or permissive grounds. At this
early stage of litigation, prior to the certification of a class, any interest the Fontes plaintiffs
claim is too remote to justify intervention. See Bridgeport Guardians, Inc. v. Delmonte, 602
F.3d 469, 473 (2d Cir. 2010) (“For an interest to be cognizable by Rule 24(a)(2), it must be
‘direct, substantial, and legally protectable.’” (quoting Wash. Elec. Coop., Inc. v. Mass. Mun.
Wholesale Elec. Co., 922 F.2d 92, 97 (2d Cir. 1990))). Moreover, as the MDL Panel made clear
in refusing to consolidate the actions, these cases raise different issues, have partially nonoverlapping class definitions, and will require different discovery, thereby limiting the extent of
the Fontes plaintiffs’ interest and the commonalities shared by these actions. See In re Time
Warner Cable, Inc., Tel. Consumer Prot. Act (TCPA) Litig., 2016 WL 5846036, at *1 (J.P.M.L.
Oct 3, 2016). And to the extent that the Fontes plaintiffs do have an interest in the action as
members of the putative class, class certification would necessarily imply adequate
representation. See Fed. R. Civ. P. 23(a)(4). If the Fontes plaintiffs think otherwise, they may
opt out of any class that is eventually certified.
The Court also declines to stay this action in light of the first-filed status of the Fontes
action. “Where two courts have concurrent jurisdiction over an action involving the same parties
and issues, courts will follow a ‘first filed’ rule whereby the court which first has possession of
the action decides it.” 800–Flowers, Inc. v. Intercontinental Florist, Inc., 860 F. Supp. 128, 131
(S.D.N.Y. 1994). However, “[t]he first-filed rule is not to be applied mechanically, but is
intended to aid judicial administration by acting as a presumption that may be rebutted by proof
of the desirability of proceeding in the forum of the second-filed action.” Eternal Asia Supply
Chain Mgmt. (USA) Corp. v. EQD Corp., No. 12 Civ. 0058, 2012 WL 6186504, at *3 (S.D.N.Y.
Dec. 12, 2012) (quoting Reliance Ins. Co. v. Six Star, Inc., 155 F. Supp. 2d 49, 54 (S.D.N.Y.
Given the differences in the actions, the divergent discovery demands, and the current
stay in the Fontes action, the Court sees little reason to delay progress in this action, which has
already been prolonged by the bifurcation of individual and class-wide discovery pending
disposition of Time Warner’s motion for summary judgment and motion for judgment on the
pleadings. As the MDL Panel put it, “[i]n these circumstances, informal cooperation among the
relatively few involved attorneys will be sufficient to minimize any potential for duplicative
discovery or inconsistent pretrial rulings.” In re Time Warner Cable, Inc., 2016 WL 5846036, at
For the foregoing reasons, it is hereby ORDERED:
In the Mejia action, Plaintiffs’ motion for summary judgment is DENIED, Defendant’s
motion for summary judgment is GRANTED IN PART and DENIED IN PART, Defendant’s
motion for judgment on the pleadings is DENIED, and the Fontes plaintiffs’ motion to intervene
and stay is DENIED;
In the Johnson action, Defendant’s motion for judgment on the pleadings is DENIED.
Within 21 days of the date of this Opinion and Order, the parties are directed to file a
letter with the Court proposing a timeline for further discovery.
The Clerk of Court is directed to close the following motions in 15-CV-6445: Docket
Numbers 63, 75, 82, and 105. The Clerk is directed to close the motion at Docket Number 52 in
Dated: August 1, 2017
New York, New York
J. PAUL OETKEN
United States District Judge
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