Cunningham v. Enagic USA, Inc. et al

Filing 239

REPORT AND RECOMMENDATION: For the foregoing reasons, the undersigned Magistrate Judge respectfully RECOMMENDS that: Plaintiff's motion for summary judgment (Docket Entry No. 194) be DENIED; and Plaintiff's claim for relief under 47 U.S.C. § 227(c)(5) (Count II) be DISMISSED as to all Defendants. Signed by Magistrate Judge Barbara D. Holmes on 6/23/2017. (xc:Pro se party by regular mail. ) (DOCKET TEXT SUMMARY ONLY-ATTORNEYS MUST OPEN THE PDF AND READ THE ORDER.)(jw)

IN THE UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF TENNESSEE
NASHVILLE DIVISION
CRAIG CUNNINGHAM
v.
ENAGIC USA, INC. , et al.

)
)
)
)
)

NO. 3:15-0847

TO: Honorable David M. Lawson, District Judge

REPORT AND RECOMENDATION
By Order entered November 10, 2015 (Docket Entry No. 39), this pro se action was referred
to the Magistrate Judge for pretrial proceedings under 28 U.S.C. §§ 636(b)(1)(A) and (B), Rule 72(b)
of the Federal Rules of Civil Procedure, and the Local Rules of Court.
Presently pending before the Court is Plaintiff’s motion for summary judgment (Docket Entry
No. 194), to which responses in opposition have been filed. See Docket Entry No. 196, 200-202,
204, and 206. For the reasons set out below, the undersigned Magistrate Judge respectfully
recommends that the motion be denied.

I. FACTUAL AND PROCEDURAL BACKGROUND
Craig Cunningham (“Plaintiff”) is a resident of Nashville, Tennessee. On July 31, 2015, he
filed this pro se lawsuit against seven defendants seeking damages under the Telephone Consumer
Protection Act, 47 U.S.C. §§ 227 et seq. (“TCPA”). See Complaint (Docket Entry No. 1). Plaintiff
subsequently filed three amended complaints, see Docket Entry Nos. 5, 8, and 41, expanding to 20
the number of defendants sued under the TCPA and increasing the length of his pleadings from 10
pages to 45 pages.

Plaintiff’s lawsuit pertains to a lengthy series of interactions in 2014 and 2015 between
himself and the defendants, who are individuals and businesses involved in the telemarketing and
sales of services and products, including, 1) informational products and a “wealth building” system
called the “Secret Success Machine,” and, 2) Enagic water purification machines. See Third
Amended Complaint (Docket Entry No. 41) at ¶¶ 26-134. Plaintiff contends that these services and
products were nothing more than “get rich quick” schemes and pyramid schemes. Id. at ¶¶ 23-24.
He further alleges that many of the Defendants knew each other and worked in concert together
regarding the schemes and/or were agents or principals for corporate entities involved in either the
schemes themselves or the process used to telemarket the schemes. Id. at ¶¶ 40 and 116-118.
Plaintiff alleges that he was solicited to join these schemes through multiple telephone calls that were
made to his cell phone with an auto dialer and that contained prerecorded messages. He also alleges
that he received multiple text messages to his cell phone. He asserts that the calls and texts were not
consented to by him and were not for emergency purposes.
Based on these allegations, Plaintiff brings two specific counts for relief under the TCPA.
In Count I, he alleges that Defendants’ calls and texts constitute multiple violations of 47 U.S.C.
§ 227(b) because Defendants used an automated telephone dialing system to place calls to his cell
phone that contained pre-recorded or automated messages. See Third Amended Complaint at ¶ 136.
In Count II, he alleges that Defendants’ actions constitute multiple violations of 47 U.S.C.
§ 227(c)(5), as codified under 47 C.F.R. § 64.1200,1 because the calls had a pre-recorded message
that did not state the name, address, or phone number of the calling party and because Defendants
failed to have a do-not-call policy and failed to train their agents on the use of a do-not-call policy.
Id. at ¶ 138. Because a violation of each TCPA provision permits a statutory damage award of up

1

Although Count II states that it is for violations of 47 U.S.C. § 227(c)(5) “as codified under
47 CFR 227(d),” this appears to be an error by Plaintiff. The Court presumes that Plaintiff intends
to refer to 47 C.F.R. § 64.1200, as this regulatory provision is referenced at numerous other places
in his pleading. See Third Amended Complaint at ¶¶ 25, 127-128, and 132.
2

to $1,500.00, Plaintiff seeks statutory damages of $3,000.00 for each telephone call and text he
received.
Because of the number of Defendants Plaintiff attempted to bring into the lawsuit through
his amended complaints, problems with service of process, improper answers that were filed by
corporate defendants, and issues related to the pro se status of some Defendants, the case became
a quagmire. Accordingly the Court entered a series of orders in August and September 2016 dealing
with outstanding motions and issues. Of specific note were: 1) an order denying Plaintiff’s motion
for leave to file a fourth amended complaint, which would have added 37 new defendants via a 64
page amended complaint, see Order entered August 22, 2016 (Docket Entry No. 150); 2) the entry
of scheduling order, see Order entered August 22, 2016; and 3) an order dismissing Defendant
Enagic USA, Inc., from the case with prejudice, see Order entered September 28, 2016 (Docket
Entry No. 156). Subsequently, Defendants 800 Link, Inc., and Scott Biel were dismissed, see Order
entered February 23, 2017 (Docket Entry No. 208), as well as Defendants Jerry Maurer, Brian
Kaplan, Terry Collins, Angela Linder, and Peter Wolfing. See Order entered June 14, 2017 (Docket
Entry No. 237).
As the case currently stands, there are twelve remaining Defendants. Seven of these
Defendants have been defaulted,2 and a hearing is set for August 15, 2017, on Plaintiff’s pending
motion that seeks an award of damages against them via a default judgment. See Order entered
June 14, 2017 (Docket Entry No. 238). The remaining five Defendants are Peter Polselli, Jeffrey
Howard, Dave Hill, Rick Freeman, and Walter Peterson, each of whom is alleged to have been
involved in making phone calls and texts to Plaintiff. These Defendants, who all reside in different

2

My Mind’s Eye, LLC, Multiplex Systems, Inc., Oscar “Christian” Kinney, The 7 Figure
Wealth Corporation, Susie Tremblay-Brown, Corazon Management Group, Inc., and JL Net Bargain,
Inc. See Docket Entry Nos. 90 and 173
3

states,3 have appeared and defended the lawsuit. Like Plaintiff, they are each currently proceeding
pro se.

II. MOTION FOR SUMMARY JUDGMENT AND RESPONSES
By his motion, Plaintiff seeks summary judgment against the remaining Defendants. He
contends that each Defendant directly made calls and/or sent text messages to his cell phone in
violation of the TCPA. Specifically, he alleges that Defendant Polselli sent 46 texts, Defendant
Howard made 10 calls and sent 3 texts, Defendant Hill made 4 calls and sent 14 texts, Defendant
Freeman made 13 calls and sent 2 texts, and Defendant Peterson made 4 calls. See Motion for
Summary Judgment (Docket Entry No. 194) at 1, ¶ 3.4 He contends that each call and text message
to him constitutes a separate violation of each of the two TCPA counts that he is pursuing and that
the violations were willful, thus permitting trebled damages under the TCPA. Id. at 2-3, ¶¶ 15-17.
Plaintiff argues that the facts establishing the TCPA violations are undisputed and because the
statutory damages are fixed and simple to calculate, he is entitled to summary judgment in his favor.
He requests damages of $3,000.00 for each call and text message, resulting in a total damage award
of $288,000.00. Id. at 3, ¶ 18.5 He further contends that the five Defendants should be deemed
jointly and severally liable “due to the network marketing nature of the calls, products, and services
as each of the defendants stood to gain had the Plaintiff purchased the products or services and the
defendants were working in concern to sell the products and services using robocalls.” Id. at 1, ¶ 4.

3

The docket reflects that these Defendants reside in New York (Polselli), California
(Howard), Illinois (Hill), Georgia (Freeman), and Florida (Peterson).
4

Plaintiff’s motion also seeks summary judgment against Defendants Brian Kaplan and Jerry
Maurer. However, these two Defendants were dismissed from the action subsequent to Plaintiff’s
motion being filed.
5

Plaintiff seeks a judgment for $420,000.00 in his motion. However, after the 44 calls and
texts attributed to Defendants Kaplan and Maurer, who have been dismissed, are removed from the
calculation, $288,000.00 would be the amount of the award he seeks that is still remaining.
4

In support of his motion, he submits his own affidavit (Docket Entry No. 194 at 8-9) and a
spreadsheet of the calls and texts at issue. Id. at 10-14.
Four of the five remaining Defendants have responded in opposition to the motion. Despite
repeatedly answering Plaintiff’s Third Amended Complaint with a denial of wrongdoing, see Docket
Entry Nos. 51, 109, and 154, Defendant Hill has not responded to the motion for summary judgment.
Defendant Polselli asserts that Plaintiff provided his contact information and e-mailed
Polselli on May 5 and 6, 2015, and argues that Plaintiff consented to receiving calls and information
from Polselli. See Response (Docket Entry No. 196).
Defendant Freeman denies making any phone calls or sending any text messages to Plaintiff
and essentially denies all the allegations made against him by Plaintiff. See Response (Docket Entry
Nos. 200-202).
Defendant Peterson admits to calling Plaintiff three times, but asserts that the calls were not
made using an auto-dialer, did not involve pre-recorded messages, and did not violate the TCPA.
See Response (Docket Entry No. 204). Defendant Peterson further contends that Plaintiff consented
to being contacted by Peterson, that Plaintiff has registered his phone number as a business number,
and that Plaintiff has taken actions in order to ensnare other individuals and entities in litigation
under the TCPA so that Plaintiff can obtain monetary settlements. Id. Defendant Peterson also
raises arguments that Plaintiff’s motion is untimely, that Plaintiff did not send Peterson the exhibits
attached to the motion for summary judgment, and that Plaintiff has not suffered an actual injury
because of Defendant Peterson’s calls. Id.
Defendant Howard asserts that Plaintiff provided his contact information to Howard,
consented to being contacted by Howard, and actively spoke with Howard about business
opportunities. See Response (Docket Entry No. 205). Defendant Howard further asserts that all of
his calls to Plaintiff were live, voice-to-voice calls and contends that Plaintiff’s phone number is a
business number, not a personal number. Id. Defendant Howard also echoes the untimeliness, lack
of exhibits, and lack of actual injury arguments made by Defendant Peterson, as well as the argument
5

that Plaintiff has opted-in to receiving phone calls and texts, which he then turns around and
proclaims are unwanted and uses as the basis for lawsuits under the TCPA. Id.

III. CONCLUSIONS
A. Plaintiff’s Motion for Summary Judgment
Plaintiff’s summary judgment motion should be denied. Initially, the Court notes that the
motion was not timely filed under the scheduling order entered in this action, which set
December 19, 2016, as the deadline for filing any dispositive motions. See Docket Entry No. 151,
at 1. Plaintiff’s motion was not filed until December 22, 2016, three days after the dispositive
motion deadline.6 For this reason alone, the motion warrants being denied.7
Regardless, even if the untimeliness of the motion is excused, Plaintiff falls woefully short
of showing that genuine issues of material fact do not exist and that he is entitled to judgment in his
favor for $288,000.00 in damages. Summary judgment is appropriate only 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.” Rule 56(a) of the Federal Rules of Civil Procedure. See also Celotex Corp. v.
Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Thus, Plaintiff has the
burden of showing the absence of genuine factual disputes from which a reasonable jury could return
a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106
S.Ct. 2505, 91 L.Ed.2d 202 (1986). In review of the motion, the Court must view the evidence and
all inferences drawn from underlying facts “in the light most favorable to the party opposing the
motion.” See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., Ltd., 475 U.S. 574, 587, 106 S.Ct.

6

The Court notes that Plaintiff’s motion was not mailed to the Court Clerk’s Office, but was
placed in the Clerk’s filing drop box. The Court further notes that Plaintiff’s supporting affidavit
and spreadsheet state that they were executed on December 22, 2016, and Plaintiff’s certificate of
service states that the motion was mailed to Defendants on December 22, 2016.
7

By Order entered May 4, 2017 (Docket Entry No. 228), the Court likewise denied motions
to dismiss filed by Defendants Freeman, Kaplan, and Maurer because they were untimely filed under
the scheduling order.
6

1348, 89 L.Ed.2d 538 (1986); Gribcheck v. Runyon, 245 F.3d 547, 550 (6th Cir.), cert. denied, 534
U.S. 896, 122 S.Ct. 217, 151 L.Ed.2d 155 (2001).
The TCPA regulates the use of telephone technology and seeks to curb abusive telemarketing
practices that threaten the privacy of consumers and businesses. See Mims v. Arrow Fin. Servs.,
LLC, 565 U.S. 368, 132 S. Ct. 740, 745, 181 L. Ed. 2d 881 (2012); Ashland Hosp. Corp. v. Service
Employees Int'l Union, Dist. 1199 WV/KY/OH, 708 F.3d 737, 740 (6th Cir.) cert. denied,

U.S. ,

134 S. Ct. 257, 187 L. Ed. 2d 148 (2013). A text message to a cellular telephone qualifies as a “call”
under the TCPA. Campbell-Ewald Co. v. Gomez,

U.S. , 136 S.Ct. 663, 666-67, 193 L. Ed. 2d

571 (2016). The TCPA contains a number of restrictions on the use of automated telephone
equipment and the use of artificial or prerecorded voices. See Charvat v. NMP, LLC, 656 F.3d 440,
443 (6th Cir. 2011). Among other things, the TCPA places restrictions on the use of automated
telephone equipment and provides that:
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). A private right of action exists under the TCPA allowing a plaintiff
to seek actual damages or statutory damages of $500.00 for a violation of subsection 227(b), and
permits damages, at the court’s discretion, to be trebled upon the finding of a willful or knowing
violation. 47 U.S.C. § 227(b)(3).
After review of the summary judgment filings, it is apparent that factual disputes exist as to,
1) whether the phone calls and text messages Plaintiff attributes to Defendant Freeman were even
made at all, and, 2) whether the phone calls and text messages at issue were made using an automatic
telephone dialing system8 or an artificial or prerecorded voice. These factual disputes are genuine
8

The term “automatic telephone dialing system” means “equipment which has the capacity
... to store or produce telephone numbers to be called, using a random or sequential number
generator; and ... to dial such numbers.” 47 U.S.C. § 227(a)(1).
7

and material because they are germane to the legal merit of the claim that the calls and text messages
violated 47 U.S.C. § 227(b) and to the ultimate issue of whether Defendants are liable under the
TCPA. See Ashland Hosp. Corp. v. Serv. Employees Int'l Union, Dist. 1199 WV/KY/OH, 708 F.3d
737, 743 (6th Cir. 2013) (“the appropriate touchstone under § 227(b)(1) is the actual receipt of an
unwanted automated telephone communication.”).
Additionally, factual disputes clearly exist about whether Plaintiff consented to receiving at
least some, if not all, of the phone calls and text messages attributed to Defendants. While the
Courts are not in unison about whether the lack of “prior express consent” by a TCPA plaintiff is an
element of his Section 227(b) claim, see Meyer v. Portfolio Recovery Assocs., LLC, 707 F.3d 1036,
1043 (9th Cir. 2012), cert. denied, 133 S. Ct. 2361, 185 L. Ed. 2d 1068 (2013), or is an affirmative
defense, see Thrasher-Lyon v. Illinois Farmers Ins. Co., 861 F.Supp.2d 898, 905 (N.D. Ill. 2012),
evidence of consent, or lack thereof, is an issue that weighs into the determination of whether a
TCPA violation has been committed. See Baisden v. Credit Adjustments, Inc., 813 F.3d 338 (6th
Cir. 2016). Based on the record that is before the Court, genuine issues of material fact exist on this
issue.
If Plaintiff was to show undisputed evidence that he received a phone call or text to which
he had not consented and which was in violation of Section 227(b)(1)(A)(ii) of the TCPA, he would
be entitled to seek relief for that violation. However, as noted herein, genuine issues of material fact
exist in this case. Further, it appears to the Court that Plaintiff has lumped together every single
phone call and text he received from Defendants as the basis for an award of several hundred
thousands of dollars, regardless of whether each individual phone call or text meets all the
requirements necessary to conclude that it violated the TCPA. Plaintiff has provided no legal
authority for a theory that every subsequent phone call or text he received in this case, even if
somehow linked to an initial offending phone call or text, is also a violation of the TCPA entitling
him to relief.

8

B. Count II of Plaintiff’s Third Amended Complaint
After review of this action, the Court finds that Count II should be dismissed sua sponte as
to all Defendants because this count fails to provide a basis for legal relief based on Plaintiff’s own
allegations. In Count II, Plaintiff seeks civil damages under the private right of action provided for
in 47 U.S.C. § 227(c)(5)9 based upon Defendants’ alleged violations of the regulations set out at
47 C.F.R. § 64.1200(d). However, the language of the TCPA specifically provides that the
regulations implemented pursuant to Subsection 227(c) concern only “the need to protect residential
telephone subscribers’ privacy rights.” 47 U.S.C. § 227(c)(1). Further, the plain language of the
regulation relied upon by Plaintiff states:
No 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 private right of action created by 47 U.S.C. § 227(c)(5) is accordingly
limited to redress for violations of the regulations that concern residential telephone subscribers. As
clearly stated by the Sixth Circuit in Charvat:
In addition to the restrictions on automated telephone equipment, the TCPA instructs
the FCC to issue regulations “concerning the need to protect residential telephone
subscribers' privacy rights to avoid receiving telephone solicitations to which they
object.” 47 U.S.C. § 227(c)(1). Accordingly, the FCC issued regulations prohibiting
“person[s] or entit[ies] [from] initiat[ing] any call for telemarketing purposes to a
residential telephone subscriber unless [the] person or entity has instituted [certain
listed] procedures for maintaining” a do-not-call list. 47 C.F.R. § 64.1200(d).
656 F.3d at 443-44, and:
Subsection (c) and its accompanying regulations in 47 C.F.R. § 64.1200(d) impose
minimum procedures for maintaining a do-not-call list that apply to all calls—live
or automated—initiated for telemarketing purposes to residential telephone
subscribers.
Id. at 449.

9

Section 227(c)(5) provides that “a person who has received more than one telephone call
within a 12-month period by or on behalf of the same entity in violation of the regulations prescribed
under this subsection” may bring an action for damages.
9

Plaintiff alleges only calls to his cellular phone. Accordingly, he fails to state a claim for
relief under 47 U.S.C. § 227(c)(5), and Count II should be dismissed. See Cunningham v. Rapid
Response Monitoring Servs., Inc., 2017 WL 1489052 at *9 (M.D. Tenn. Apr. 26, 2017) (Crenshaw,
J.) (dismissing claim under Section 227(c)(5) for alleged violations of regulations set out at
47 C.F.R. § 64.1200(d)).

RECOMMENDATION
For the foregoing reasons, the undersigned Magistrate Judge respectfully RECOMMENDS
that:
1.

Plaintiff’s motion for summary judgment (Docket Entry No. 194) be DENIED; and

2.

Plaintiff’s claim for relief under 47 U.S.C. § 227(c)(5) (Count II) be DISMISSED as
to all Defendants.10

ANY OBJECTIONS to this Report and Recommendation must be filed with the Clerk of
Court within fourteen (14) days of service of this Report and Recommendation and must state with
particularity the specific portions of this Report and Recommendation to which objection is made.
Failure to file written objections within the specified time can be deemed a waiver of the right to
appeal the District Court's Order regarding the Report and Recommendation. See Thomas v. Arn,
474 U.S. 140, 106 S.Ct. 466, 88 L.Ed.2d 435 (1985); United States v. Walters, 638 F.2d 947 (6th Cir.
1981).
Respectfully submitted,

BARBARA D. HOLMES
United States Magistrate Judge
10

This Report and Recommendation and the fourteen day period for objections to be filed
by the Plaintiff satisfy the procedural requirements for a sua sponte dismissal of Count II. See
Routman v. Automatic Data Processing, Inc., 873 F.2d 970, 971 (6th Cir. 1989); Morrison v.
Tomano, 755 F.2d 515, 516-17 (6th Cir. 1984); Yashon v. Gregory, 737 F.2d 547, 552 (6th Cir.
1984).
10