Whiteamire Clinic P.A., Inc. v. Cartridge World North America, LLC et al
Filing
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Opinion and Order. Plaintiff's Motion for Summary Judgment (Related doc # 60 ) is denied. Defendant's Motion for Summary Judgment (Related doc # 65 ) is denied. Judge Christopher A. Boyko on 1/26/2018. (H,CM)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION
WHITEAMIRE CLINIC, P.A. INC.,
Plaintiff,
Vs.
CARTRIDGE WORLD NORTH
AMERICA, LLC., AND JOHN DOES
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Defendant.
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CASE NO.1:16CV226
JUDGE CHRISTOPHER A. BOYKO
OPINION AND ORDER
CHRISTOPHER A. BOYKO, J:
This matter is before the Court on Plaintiff Whiteamire Clinic, P.A.’s Motion for
Summary Judgement on it’s Individual Claim (ECF # 60) and Defendant Cartridge World North
America, LLC.’s Motion for Summary Judgment (ECF # 65). For the following reasons, the
Court denies both Motions.
Plaintiff’s First Amended Complaint (“FAC”) alleges a single claim for violation of the
Telephone Consumer Protection Act of 2005, 47 U.S.C. § 227 (“TCPA”), on behalf of itself and
a putative class. According to Plaintiff, on July 3, 2012, Defendant transmitted via facsimile
machine an unsolicited facsimile advertisement to Plaintiff.
Plaintiff did not give Defendant
consent to send the fax.
The TCPA as amended by the Junk Fax Prevention Act of 2005 (“JFPA”), 47 USC § 227
prohibits the use of any “telephone facsimile machine, computer, or other device to send, to a
telephone facsimile machine, an unsolicited advertisement...” 47 U.S.C. § 227(b)(1)(C). “The
JFPA provides a private right of action and provides statutory damages of $500 per violation.”
(FAC pg 1). Although the FAC alleges Plaintiff received only one unsolicited fax, its Motion
for Summary Judgment asserts Defendant sent Plaintiff two unsolicited faxes on July 3 and July
12, 2012, respectively. Plaintiff argues the faxes were unsolicited and failed to contain the
statutorily required opt-out notice. Although Plaintiff concedes the parties had an existing
business relationship, the lack of consent and failure to include opt-out language in the faxes
entitles him to the statutory remedies.
Defendant alleges it did not violate the JFPA because Plaintiff consented to the receipt of
the advertisements via fax and because the parties had a long standing business relationship
wherein Plaintiff made monthly purchases of ink from Defendant. Furthermore, as a result of a
recent court decision, faxes that have been consented to no longer are required to contain the optout notices. Lastly, Defendants contend Plaintiff cannot show standing as it has failed to offer
any evidence of injury.
LAW AND ANALYSIS
Summary judgment shall be granted “if the movant shows that 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). The burden is on the moving party to show that no genuine issue of material fact
exists, which may be demonstrated by “portions of the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any.” Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). Inferences drawn “from the underlying facts contained in
such materials must be viewed in the light most favorable to the party opposing the motion.”
U.S. v. Diebold, Inc., 369 U.S. 654, 655 (1962). The court does not have the duty to search the
entire record to establish that no genuine dispute as to any material fact exists. Street v. J.C.
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Bradford & Co., 886 F.2d 1472, 1479 (1989). The non-moving party must present affirmative
evidence supporting a genuine dispute of fact in order to defeat a motion for summary judgment.
Id. at 1479. If the non-moving party fails to establish the existence of an essential element of
which it has the burden of proof at trial, the moving party is entitled to judgment as a matter of
law. Celotex, 477 U.S. at 322-23. “[T]he inquiry is whether the evidence presents a sufficient
disagreement to require submission to a jury or whether it is so one-sided that one party must
prevail as a matter of law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 243 (1986).
Did Plaintiff consent to receipt of the fax
The JFPA, 47 U.S.C. § 227 prohibits the use of “any telephone facsimile machine,
computer, or other device to send, to a telephone facsimile machine, an unsolicited
advertisement, unless”-(i) the unsolicited advertisement is from a sender with an established business
relationship with the recipient;
(ii) the sender obtained the number of the telephone facsimile machine through-(I) the voluntary communication of such number, within the
context of such established business relationship, from the
recipient of the unsolicited advertisement, or
(II) a directory, advertisement, or site on the Internet to which the
recipient voluntarily agreed to make available its facsimile number
for public distribution,
(iii) the unsolicited advertisement contains a notice meeting the requirements under
paragraph (2)(D),
47 U.S.C.A. § 227(b)(1)(C) (West).
The JFPA further “provides for a private right of action, permitting plaintiffs to seek (1)
to enjoin a violation of the Act; (2) to recover for actual monetary loss from such a violation or
to receive $500, whichever is greater; or (3) both (1) and (2).” Imhoff Inv., L.L.C. v. Alfoccino,
Inc., 792 F.3d 627, 631 (6th Cir. 2015) citing 47 U.S.C. § 227(b)(3). “A fax is ‘unsolicited’ if it
is sent to persons who have not given their ‘prior express invitation or permission’ to receive it.”
Sandusky Wellness Ctr., LLC v. ASD Specialty Healthcare, Inc., 863 F.3d 460, 463 (6th Cir.
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2017), as corrected on denial of reh'g en banc (Sept. 1, 2017) quoting § 227(a)(5). “The statute
carves out a narrow exception to this general ban by permitting the sending of unsolicited faxes
if a sender can show three things: (1) the sender and recipient have ‘an established business
relationship’; (2) the recipient voluntarily made his fax number available either to the sender
directly or via ‘a directory, advertisement, or site on the Internet’; and (3) the fax contained an
opt-out notice meeting detailed statutory requirements.” Id. quoting § 227(b)(1)(C)(i)-(iii).
“The upshot of this exception is that if an unsolicited fax does not contain a properly worded
opt-out notice, the sender will be liable under the statute, regardless of whether the other two
criteria are met.” Id.
The parties do not dispute that the faxes received by Plaintiff from Defendant were
indeed advertisements, however, the parties dispute whether Plaintiff consented to the receipt of
faxes from Defendant. It is Defendant’s burden to show Plaintiff consented to receipt of the fax
or gave its fax number willingly in order to receive the fax. See Spine & Sports Chiropractic,
Inc. v. ZirMed, Inc., No. 3:13-CV-00489-TBR, 2014 WL 2946421, at *19 (W.D. Ky. June 30,
2014) quoting Rules and Regulations Implementing the Telephone Consumer Protection Act of
1991; Junk Fax Prevention Act of 2005, 71 FR 25967, at 25972 :
Commenters that discussed this issue agree that a sender should have the
obligation to demonstrate that it complied with the rules, including that it had the
recipient's prior express invitation or permission. Senders who choose to obtain
permission orally are expected to take reasonable steps to ensure that such
permission can be verified. In the event a complaint is filed, the burden of proof
rests on the sender to demonstrate that permission was given. The Commission
strongly suggests that senders take steps to promptly document that they received
such permission. (An example of such documentation could be the recording of
the oral authorization. Other methods might include established business practices
or contact forms used by the sender's personnel.) Express permission need only be
secured once from the consumer in order to send facsimile advertisements to that
recipient until the consumer revokes such permission by sending an opt-out
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request to the sender.
According to the deposition testimony of Rusty V. Whiteamire, he did not give
permission to Defendant to send him faxes. (Whiteamire Depo. Pg 83). Defendant’s evidence is
more circumstantial but still presents issues of fact whether express permission was given
Plaintiff by Defendant. According to Defendant, in 2012 it implemented a marketing plan to
send electronic advertisements to potential customers using data obtained from USAData, Inc.
The data included business names, addresses, phone numbers, SIC codes (codes used to identify
particular industries) and descriptions of each business along with contact names and titles.
Defendant then hired a third party call center, Timlin, Industries, Inc., to call the businesses and
obtain consent to send emails. Defendant developed a script for Timlin to use that requested
consent to receive email advertisements. The USAData, Inc. data received by Defendant for
Plaintiff did not include an email or fax number. During the course of the call campaign Timlin
discovered many contacts did not want the ads sent to their email but preferred to receive them
by fax. Timlin uses inmates of correctional facilities as telemarketers.
They called the numbers
of businesses provided Defendant by USAData and followed a script prepared by Defendant.
(Kloos depo.pgs 10-18). The script used by Timlin telemarketers reads as follows:
“Hi, I’m _____________, and I’m calling from your local Cartridge World store.
How are you today?
Great. I’m calling because we have a special offer for businesses to save money
on ink and toner AND get a free printer–and we want to send it to the right
person.
Use A or B
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A:
Our records show: (First, Last name) is the (title). Is that right?
And his/her email address is … (obtain information).
Perfect, that’s all we need. We’ll send information about saving money with
Cartridge World ink and toner–and the Free Printer Program! Thanks for your
time.
B:
What’s the name of the person who buys your office supplies?
Their title?
And email address?
Perfect, that’s all we need. We’ll send information about saving money with
Cartridge World ink and toner–and the Free Printer Program! Thanks for your
time.”
(Callaway dec. ¶ 2).
According to Defendant, the inmate telemarketers had no access to the internet, therefore,
the only way they could have obtained the fax number of Plaintiff was by the consent of the
Plaintiff given telephonically after receiving the phone call from Timlin on behalf of Defendant.
(Statement of Facts ¶ 17). Given the evidence both for and against consent, the Court finds
there exists a genuine issue of fact whether consent was given. Therefore, summary judgment is
denied both parties on this issue.
Was there an existing business relationship between Plaintiff and Defendant.
While the JFPA bars unsolicited faxes, it provides an exception. The Sixth Circuit
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recently stated that the JFPA “carves out a narrow exception to this general ban by permitting the
sending of unsolicited faxes if a sender can show three things: (1) the sender and recipient have
“an established business relationship”; (2) the recipient voluntarily made his fax number
available either to the sender directly or via “a directory, advertisement, or site on the Internet”;
and (3) the fax contained an opt-out notice meeting detailed statutory requirements.” Sandusky
Wellness Ctr., LLC , 863 F.3d at 463. Plaintiff readily acknowledges it had an existing business
relationship with Defendant. Plaintiff “does not dispute it has an ‘established business
relationship’ with Cartridge World within the meaning of the JFPA.” (Plaintiff Motion for
Summary Judgment pg. 7). However, Defendant offers unrebutted evidence that Plaintiff
published its fax number on its website. (Whiteamire depo pg 86-87). Thus, Defendant can
meet two of the three requirements for the established business relationship defense.
Whether the Fax provided the requisite opt-out notice requirements
47 U.S.C. § 227(b)(1)(C) requires all unsolicited faxes contain opt-out notices with the
following requirements:
i) the notice is clear and conspicuous and on the first page of the unsolicited
advertisement;
(ii) the notice states that the recipient may make a request to the sender of the
unsolicited advertisement not to send any future unsolicited advertisements to a
telephone facsimile machine or machines and that failure to comply, within the
shortest reasonable time, as determined by the Commission, with such a request
meeting the requirements under subparagraph (E) is unlawful;
(iii) the notice sets forth the requirements for a request under subparagraph (E);
There is no dispute that Defendant’s faxes to Plaintiff did not contain the statutorily
required opt-out notices. Defendant argues its faxes allowed for the recipient to click a link to
“Regard Fax as Junk.” However, this does not meet the express notice requirements of the
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JFPA. Thus, any unsolicited faxes sent by Defendant to Plaintiff were not in compliance with
the JFPA and Defendant is not excepted from liability under the established business relationship
defense. However, the Sixth Circuit has recently held that solicited or consented to faxes are
NOT required to contain the requisite opt-out provisions. See Sandusky, 863 F.3d at 466-68.
Because the issue of consent is disputed, the Court cannot resolve this issue and thus, summary
judgment for both Plaintiff and Defendant are precluded.
Plaintiff cannot show injury in fact
According to Defendant, Plaintiff lacks standing to assert its TCPA claim because it
cannot show an injury. The Court has already determined that Plaintiff has standing under
Article III of the Constitution because it alleged sufficient facts to show it suffered a concrete
and particularized injury. Now on summary judgment, Rusty V. Whiteamire testified that
Plaintiff suffered injury in the “waste of time, loss of focus, staff time and supplies” in dealing
with the allegedly unsolicited fax advertisement. (Whiteamire depo pg. 64). This is sufficient
evidence of injury that is concrete and particularized to establish Article III standing.
Therefore, for the foregoing reasons, the Court denies both Plaintiff’s and Defendant’s
Motions for Summary Judgment.
IT IS SO ORDERED.
s/ Christopher A. Boyko
CHRISTOPHER A. BOYKO
United States District Judge
Dated: January 26, 2018
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