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Gorss Motels Inc. v. AT&T Services, Inc.

United States District Court, D. Connecticut

March 15, 2018

GORSS MOTELS, INC., individually and as the representative of a class of similarly-situated persons, Plaintiff,


          Janet Bond Arterton, U.S.D.J.

         Plaintiff Gorss Motels, Inc., suing individually and as the representative of a class of similarly situated persons, alleges that Defendants AT&T Mobility LLC and AT&T Mobility National Accounts LLC (together "AT&T" or "Defendant") sent unsolicited facsimiles ("faxes") to Gorss Motels and other similarly situated plaintiffs in violation of the Telephone Consumer Protection Act ("TCPA"), as amended by the Junk Fax Prevention Act ("JFPA"). Defendant moves [Doc. # 40] to dismiss the Amended Complaint [Doc. # 39]. For the reasons articulated below, Defendant's Motion is denied.

         I. Facts Alleged in Plaintiff's Amended Complaint

         Defendant sent fax advertisements to Plaintiff and a class of other persons, "including, but not limited to, " an unsolicited advertisement sent "[o]n or about January 13, 2014." (Am. Compl. ¶ 11; see Ex. A (the Fax) to Am. Compl. [Doc. # 39-1].) That fax states, "Learn about AT&T's new Mobile Share Value Plan!" and "For a limited time, switch from T-Mobile and receive up to $450 when you trade in your current smartphone!" (See Ex. A to Am. Compl.) It further states, "All products and services are manufactured and/or provided by AT&T and not Wyndham Worldwide Corporation ("Wyndham") or its affiliates, " and "Neither [Wyndham] nor its affiliates are responsible for the accuracy or completeness of any statements made in this advertisement, the content of this advertisement (including the text, representations and illustrations) or any material on a website to which the advertisement provides a link or a reference." (Id.)

         Defendant "did not obtain Plaintiffs 'prior express invitation or permission' before sending Exhibit A." (Am. Compl. ¶ 19). The fax was sent "on behalf of AT&T "pursuant to an agreement with Wyndham Worldwide Corporation or one of its affiliates." (Id. ¶ 15). The "goods or services" advertised in Exhibit A are AT&T's, and AT&T "receive[s] some or all of the revenues" from the sale of those goods or services. (Id. ¶¶ 16-17).

         In fine print at the bottom of the page, the fax says, "To opt out from future faxes, email or call this tollfree number: (877) 764-4212" (Ex. A to Am. Compl.), which Plaintiff alleges is non-compliant with 47 C.F.R. § 64.1200(a)(4) because it is not "clear and conspicuous; . . . does not state that a sender's failure to comply within 30 days with an opt-out request that complies with the regulations is unlawful" and fails to "contain a fax number to which the recipient can send an opt-out request." (Am. Compl. ¶ 22.)[1]

         Defendant's unsolicited advertisements caused "concrete injury" to Plaintiff because (1) they: "used the Plaintiffs and the other class members' telephone lines and fax machine[s], " (2) "caused Plaintiff and the other recipients to lose paper and toner consumed in the printing of the Defendants' faxes, " (3) "cost the Plaintiff and the other class members time" that "otherwise would have been spent on the Plaintiffs and the other class members' business activities, " and (4) "unlawfully interrupted the Plaintiffs and other class members' privacy interests in being left alone." (Id. ¶ 41).

         II. Discussion[2]

         Plaintiff asserts a single cause of action claiming that AT&T sent unsolicited fax advertisements to Plaintiff and a class of other persons. As part of that claim, it argues that even if AT&T claims to have sent its faxes pursuant to an EBR or with the recipients' "prior express invitation or permission, " the failure of Defendant to comply with the opt-out notice requirements set forth in 47 C.F.R. § 64.1200(a)(4)(iii) & (iv) constitutes the transmission of an unsolicited advertisement. Defendant argues that Plaintiffs claim must be dismissed because it fails to sufficiently allege Plaintiff never gave permission to receive the fax. Defendant further contends that because the faxes were actually solicited, no opt-out notice is required and that, to the extent Plaintiff relies only upon the insufficient opt-out notice to support its claim, it has not alleged a concrete and particularized injury and therefore lacks standing.

         A. Plaintiff Alleged the Fax was Unsolicited Under the TCPA

         The Junk Fax Provisions of the TCPA make it unlawful for "any person within the United States, or any person outside the United States if the recipient is 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) (emphasis added). The TCPA defines unsolicited advertisement to mean "any material advertising the commercial availability or quality of any property, goods, or services which is transmitted to any person without that person's prior express invitation or permission, in writing or otherwise." 47 U.S.C. § 227(a)(5) (emphasis added). Thus, in order for Plaintiff to make out a valid TCPA claim, the fax at issue must have been sent without its prior express permission, i.e. consent. See e.g. Cochran v. Massey, No. 3:12-CV-765 DRH DGW, 2014 WL 335288, at *2 (S.D. 111. Jan. 30, 2014) ("The question of permission or consent is ... dispositive ... under the TCPA.").

         Defendant argues that Plaintiff failed to allege that it had not given permission to receive the fax from the physical sender, Wyndham, and therefore that it cannot state a claim under the TCPA.[3] Put otherwise, Defendant contends there can be no claim against a company whose products are advertised in a fax if the plaintiff separately provided permission to the entity that actually sent the fax.

         Plaintiff claims it need not allege it never gave Wyndham permission, because the "sender" as defined in 47 C.F.R. § 64.1200(f)(10) was AT&T. There are two ways in which a person or entity may qualify as a sender. First, the term sender "means the person or entity on whose behalf a facsimile unsolicited advertisement is sent." 47 C.F.R. § 64.1200(f)(10). Here, Plaintiff alleges the fax was sent on behalf of Defendant.[4] Second, the fax sender may be defined as the person or entity "whose goods or services are advertised or promoted in the unsolicited advertisement." Id. These regulations and the case law interpreting them make clear that the question is not who physically sent the fax, but which party benefitted from it being sent. See id.; see also Imhoff Inv., L.L.C. v. Alfoccino, Inc., 792 F.3d 627, 637 (6th Cir. 2015) ("The pertinent FCC regulations are explicit that the party whose goods or services are advertised-and not the fax broadcaster-is the sender." (emphasis added)); Senior Care Grp., Inc. v. Red Parrot Distribution, Inc., No. 8:17-CV-760-T-27TGW, 2017 WL 3288288, at *2 (M.D. Fla. Aug. 1, 2017) ("[t]he 2008 Junk Fax Order also explains that the sender does not need to be the individual who actually sent the fax, only that the sender is the benefitting party."); Bee, Denning, Inc. v. Capital All. Grp., 310 F.R.D. 614, 620 n.2 (S.D. Cal. 2015) ("[A] company can 'send' an unsolicited fax advertisement without directly participating in the physical transmission of such a fax."). In other words, while the physical sender may be a covered "sender" for purposes of the TCPA, the mere fact of having physically sent the fax does not make an entity a statutorily identified "sender." Defendant presents no authority supporting its claim that as the party that physically transmitted the fax, Wyndham constitutes a "sender" under the regulation.[5] Instead, it supports its position with two cases in which the plaintiffs had given permission, in some form, to the sender (as defined under the regulations) of the fax. See CE Design Ltd. v. King Architectural Metals, Inc., 637 F.3d 721, 725-27 (7th Cir. 2011); Travel 100 Grp. Inc. v. Mediterranean Shipping Co., 383 Ill.App.3d 149 (2008).

         In CE Design, the Seventh Circuit overturned the district court's grant of class certification because the defendants could assert a unique defense against the named plaintiff based on the fact that it, unlike other members of the class, had provided its fax number to a "Blue Book" service used to facilitate industry-wide marketing, and that subscribers to this "Blue Book" expected and consented to receive ads by fax. 637 F.3d at 725-27 (emphasis added). Similarly, in Travel 100 Group, the court found that the plaintiff travel agency had given express permission and invitation for advertisements to be sent by third parties by agreeing to the inclusion of its contact information in an international travel agency database, with the ...

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