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Gorss Motels, Inc. v. Sysco Guest Supply, LLC

United States District Court, D. Connecticut

August 21, 2017

GORSS MOTELS, INC., Plaintiff,
v.
SYSCO GUEST SUPPLY, LLC, JOHN DOES 1-5, Defendants.

          MEMORANDUM OF DECISION DENYING MOTION TO DISMISS [DKT. 23]

          Vanessa L. Bryant United States District Judge

         Plaintiff Gorss Motels, Inc. brings this putative class action against Defendant Sysco Guest Supply, LLC and John Does 1-5 (“Defendants”) for violations of the Telephone Consumer Protection Act of 1991, as amended by the Junk Fax Prevention Act of 2005, 47 U.S.C. §§ 227, et seq. (“TCPA”). Before the Court is Defendants' motion to dismiss for failure to establish subject matter jurisdiction under Fed.R.Civ.P. 12(b)(1). The Court must now determine whether Defendants' three allegedly unsolicited facsimile (fax) advertisements adequately confer upon Plaintiff Article III standing to bring this suit. For the foregoing reasons, the Court finds that they do confer jurisdiction and accordingly DENIES Defendants' Motion to Dismiss.

         I. Background

         Under the TCPA, it is “unlawful for any person within the United States . . . to use 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 TCPA confers a private right of action for persons or entities to enjoin a violation, recover monetary loss or receive $500 in damages, or both. 47 U.S.C. § 227(b)(3).

         According to the Complaint, Defendants have sent unsolicited facsimile advertisements to Plaintiff, including but not limited to three faxes sent in August or September of 2013. [Dkt. 1 ¶ 2]. The faxes “describe the commercial availability or quality of Defendants' products, goods and services.” Id. These “junk faxes” do not contain the required opt-out language. Id. ¶ 3. Plaintiff did not give Defendant prior express invitation or permission to send such faxes to Plaintiff. Id. ¶ 13. Defendants allegedly sent “the same and other unsolicited facsimiles with opt-out language identical or substantially similar to the opt-out language of the fax advertisements” to Plaintiff and at least 40 other recipients or sent the advertisements with the required opt-out language but without permission. Id. ¶ 14. Plaintiff believes Defendant continues to send these junk faxes. Id. ¶¶ 14, 30.

         Plaintiff seeks to certify a class that includes those who received faxes from Defendant during the four years prior to the filing of this case. Id. ¶ 29. Plaintiff believes that the faxes others received “were and are being done in the same or similar manner.” Id. ¶ 5. Plaintiff and others from the putative class do not have a reasonable means to avoid receiving unauthorized faxes as fax machines are left on and operative to receive urgent communications. Id. ¶ 15. Plaintiff and the putative class do not have an established business relationship with Defendant. See Id. ¶ 33.

         As a result of Defendants' actions, “Plaintiff and the other class members” have (1) lost paper and toner due to the printing of the faxes; (2) experienced the use of their telephone lines and fax machines in connection with the unsolicited faxes; and (3) wasted time receiving, reviewing and routing the Defendants' unauthorized faxes, which could otherwise be spent on business activities. Id. ¶ 34.

         II. Legal Standard

         “Federal courts are courts of limited jurisdiction. . . .” Gunn v. Minton, 568 U.S. 251, 256 (2013). Subject matter jurisdiction is not waivable, and a lack of subject matter jurisdiction may be raised at any time, by a party or the court sua sponte. See Gonzalez v. Thaler, 565 U.S. 134, 141 (2012); see also Sebelius v. Auburn Reg'l Med. Ctr., 568 U.S. 145, 153 (2013) (“Objections to a tribunal's jurisdiction can be raised at any time, even by a party that once conceded the tribunal's subject-matter jurisdiction over the controversy.”). In circumstances where a plaintiff lacks Article III standing, a court may not exercise subject matter jurisdiction. Cent. States Se. & Sw. Areas Health & Welfare Fund v. Merck-Medco Managed Care, L.L.C., 433 F.3d 181, 198 (2d Cir. 2005). If a court lacks subject matter jurisdiction, it must dismiss the action. See Fed. R. Civ. P. 12(h)(3).

         A “district court must take all uncontroverted facts in the complaint [ ] as true, and draw all reasonable inferences in favor of the party asserting jurisdiction.” Tandon v. Captain's Cove Marina of Bridgeport, Inc., 752 F.3d 239, 243 (2d Cir. 2014). However, “where jurisdictional facts are placed in dispute, the court has the power and obligation to decide issues of fact by reference to evidence outside the pleadings. . . .” Id. “In that case, the party asserting subject matter jurisdiction has the burden of proving by a preponderance of the evidence that it exists.” Id.

         III. Discussion

         Defendant moves for dismissal solely on the basis that Plaintiff lacks Article III standing to bring suit for a TCPA violation. The Court accordingly shall address this limited issue involving subject matter jurisdiction and will not address the merits of the case.[1]

         Under Article III, section 2 of the Constitution, a federal court is limited to jurisdiction over “Cases” and “Controversies.” Massachusetts v. E.P.A., 549 U.S. 497, 516 (2007). The doctrine of standing is “an essential and unchanging part of the case-or-controversy requirement of Article III.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992). “‘[T]he gist of the question of standing' is whether petitioners have ‘such a personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination.” E.P.A., 549 U.S. at 517 (quoting Baker v. Carr, 369 U.S. 186, 204 (1962)). Proper standing requires a three-part showing: that the plaintiff has “(1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.” Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016) (citing Lujan, 504 U.S. at 560-61). The plaintiff bears the burden of properly alleging facts that establish these elements. Id.

         Defendants' position is that Plaintiff lacks Article III standing for two reasons: (1) it fails to establish a “concrete injury” as required for an “injury-in-fact, ” and (2) it cannot establish a causal connection between the injuries and the ...


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