(Teaser: Because There’s no Reliable Way to Ascertain Class Members, Consent will Always Predominate, and it Probably Violates Due Process Anyway)

Just a few days ago, Judge William F. Jung of the Middle District of Florida denied certification in a wrong-number TCPA class action, and tore to shreds the most common methodologies proposed by plaintiffs to ascertain wrong number class members, drove a stake through the heart of the case by finding individualized inquiries of consent will predominate where a Defendant only intends to call actual known consenting customers, then tied it all up in a nice little bow of due process considerations.  Wilson v. Badcock Home Furniture, No. 8:17-cv-02739-T-02AAS, 2018 WL 6660029 (M.D. Fla. Dec. 19, 2018).

The Wilson ruling is truly a holiday treat filled with so many delightful little presents.  So let’s start unwrapping those presents like my frenzied, Santa-crazed kids will soon be doing on Christmas morning!

Ascertainability

There’s a fundamental problem with wrong-number class actions: it’s impossible to accurately track down and identify each person who received a “wrong number” call intended for a consenting customer of the caller.  All the defendant’s records will typically provide is some coding that plaintiffs will claim shows a true “wrong number” call (more on the problem with that below).  But otherwise, since the person who received the call is—according to the class definition—not the actual customer, the defendant’s records won’t get you any further.

So how does the gap between the Defendant’s records and the true identity of a wrong number call recipient get bridged?

Most commonly, plaintiffs will propose using a reverse number lookup (aka “the unobservable, proprietary ‘black box’ techniques of LexisNexis), and subpoenas to cell phone carriers.  Ok.  But the best that will probably net is the name of the subscriber.  This process won’t work, however, to identify true wrong number recipients who are regular users of under a family plan (among other problems).

And this is where the court found that the Plaintiff’s reverse look-up plan “truly f[ell] apart.”  The flaw was glaringly obvious too: this methodology wouldn’t have even identified Plaintiff herself because she was not the subscriber of the number (it was her grandma’s family plan), and she wasn’t identified anywhere in the carrier’s records.  Thus, “[s]hort of relying on a claimant’s assertions,” through individualized inquiries, there was “no way to definitively determine who actually answered the call from Defendant and stated ‘wrong number.’”

There was another problem too.  The Defendant had identified multiple documented instances where more than one customer provided the same phone number.  The Court described the issue with this “multiple hit” scenario thusly:

This “multiple hit” scenario means that a call to an otherwise consenting customer might be designated as “wrong number” simply because Defendant had intended to call—and asked for—the other customer who provided the number.

So how do all these gaps get bridged?

As we saw just a couple of weeks ago, Plaintiff proposed the same “ask a subscriber” approach the Czar covered in the Keim case.  But the court rejected this approach for three powerfully fundamental reasons.

First, the “ask a subscriber” approach “ignores the very purpose of ascertainment and will, in any event, require an individualized inquiry.”  Yes!  This is exactly what the Czar was saying when he covered the Keim case.

Second—and this one just strikes right at the heart of the “ask a subscriber” approach—it will impact the Defendant’s due process protections.

Let’s let that sink in: the “ask a subscriber” approach to ascertaining wrong number class members likely violates due process.  And this makes perfect sense.  As the court explained:

While an affidavit certifying inclusion in a class might be appropriate in some cases where damages for an individual claimant are negligible…here Defendant could face up to $1500 per call.  This amount is relevant both as an incentive for individuals to improperly enter the class and…a danger that impacts due process protections for Defendant.

Third, and even putting these clear dangers aside, the entire plan was nothing but a bunch of inadmissible hearsay held together with band-aids and duct tape:

[A] call recipient’s statement of “wrong number,” as well as the simple act of Defendant listing a number as “wrong number” may not be admissible as a matter of federal evidence as proof of the matter asserted, even if the number is labeled as “wrong” in Defendant’s business records.  The unknown person answering on the phone was under no business duty to make that declaration, which is likely hearsay to prove the number was in fact wrong.

So let’s tie this all together:  the reverse look-up and “ask a subscriber” approach to ascertaining class members is ineffective to definitively determine who actually received a wrong number call, necessitates individualized inquiries, violates due process, and is based on a bunch of inadmissible hearsay.

Predominance of Individualized Inquires of Consent

Notably, the Court found that—even putting aside ascertainability issues—the class couldn’t be certified because individualized issues of consent predominated (and there probably wasn’t even commonality to begin with).

While recognizing that there were some common issues, the overarching issue was one that was a “complex, fact-specific…aspect of each case: how [each telephone] number entered Defendant’s records and, related, the issue of consent.”

And there were multiple scenarios presented by the Defendant that would necessitate individualized inquiries across the class over the issue of consent:

• [A] defaulting [consenting] customer may reply with “wrong number” when the customer answers a call from the creditor collecting a past-due debt;
• Someone in the customer’s household might intentionally mislead the caller on behalf of the defaulting customer;
• The call’s recipient might also be bound by a customer’s consent, like if a household member used the recipient’s number to make a purchase;
• More than one consenting customer provided the same number to the Defendant (i.e. the “multiple hit” scenario).

Critically, while these scenarios weren’t statistically quantified for the court (as we saw in the Tomeo v. City case I covered back in October), the court found that wasn’t necessary given two fundamental problems in the case that are—as it so happens—common in virtually all wrong number class actions.

First, is that Defendant wasn’t just randomly calling people but was specifically intending to call its customers who had provided their consent to be called using an ATDS in the first instance:

Rather than engage in random robocalling, Defendant only calls numbers in its records and its intent was to call actual known customers in arrears…Actualcustomers almost certainly consented.  This means Defendant would likely have a possible defense against many class members, the precise contours of which could vary substantially.  The scope of this sort of inquiry is likely to dwarf the much simpler question of whether Defendant called a given class member with a prohibited system.  This is not a case where a defendant sprayed robocalls across a nonconsenting public.

The Court here really did an elegant job laying out exactly why issues of consent will always predominate when a Defendant’s practice is to call its own customers who provided consent.  But the Court ties everything up in a nice little bow of due process considerations that show why these individualized issues of consent can’t be ignored or minimized as they so often are in cases where wrong number classes have been certified:

 [T]his case does not concern marginal damages for an ineffective, relatively cheap product…the TCPA carries with it damages up to $1,500 per call.  Plaintiff was called at least thirty times, which could total $45,000.  With such a looming threat, due process allows Defendant to inquire whether the alleged wrong number belonged to a customer by consulting each individual file and, if not, how the number entered Defendant’s records, whether the claimant was actually the one called, whether privies or associates might have consented, and whether the call represents a “multiple hit.”

(emphasis added).

And the court then took the opportunity to drive home again why the “ask a subscriber” approach is unworkable given these considerations:

A mail-in affidavit for a $45,000 claim is not going to work in this class setting.  Consent requires an individualized inquiry especially when the source list, by definition, is consented as with credit applications.

To put it plainly, when the stakes are that high it’s unacceptable to “leave[] a defendant at the mercy of prospective class members.”

So there you have it.  In the course of one ruling, Judge Jung forcefully laid out why most wrong number class actions should never be certified.  Aside from the inherent unreliability of trying to find class members in an administratively feasible way, individualized inquiries of consent will almost always eclipse any other common issue when the Defendant’s practice is to call consenting customers, and these issues of consent can’t be given short shrift (as we’ve seen some courts apt to do) given the magnitude of statutory damages at issue.

And with that being said, Merry Christmas to all and to all a good night!