On October 13, 2016, the United States District Court for the Southern District of Florida denied class certification in a Telephone Consumer Protection Act (“TCPA”) suit. In Newhart v. Quicken Loans Inc., Case No. 9:15-cv-81250, the plaintiff alleged that he received a number of calls on his cell phone from the defendant as part of a program initiated by Fannie Mae to borrowers with loans serviced by Seterus, Inc. He believed these calls were placed using an automatic telephone dialing system, and alleged that each call violated Section 227(b)(1) of the TCPA. He purported to advance his claim on behalf of a nationwide class consisting of others called as part of the same Fannie Mae program. Joining several other courts both within and outside the Southern District, the Court concluded that no class could be certified because the issue of consent would predominate over any common questions.
First, the Court rejected the plaintiff’s attempt to apply the FCC’s “prior express written consent” standard to all calls placed as part of the Fannie Mae program. Under the FCC’s guidance, different levels of consent may apply depending on the type of call at issue. For non-telemarketing calls made after October 2013, current FCC guidance generally provides that the calling party must have prior express consent prior to placing a call. For telemarketing calls made after October 2013, current FCC guidance generally provides that a caller must have prior express written consent prior to placing the call. The plaintiff asked the Court to apply the prior express written consent standard to all calls the defendant placed as part of the challenged program no matter the purpose of the call or its content. The Court disagreed, explaining that “deciding whether the telemarketing consent rules apply will require an examination of individual calls, not the ‘overall campaign.’” The Court’s decision rested, in part, on evidence presented by the defendant that the purpose and consent of the challenged calls differed from call to call. As a result, the Court concluded that either standard of consent could apply to different calls depending on the circumstances of the call.
Second, the Court found that based on the evidence defendant presented, even if the “prior express written consent” standard applied, individualized inquiries into the many different forms (and variations within those forms) of written consent would be required, and would subsume any common questions. The Court concluded that it “would need to examine different forms of written consent for different borrowers to determine whether they comply with the FCC’s regulations.” Moreover, because the Court found that those forms of written consent might be in the possession of the defendant, but might also be in the possession of prior lenders and servicers or the called parties themselves, it rejected Plaintiff’s argument that FCC guidance requires that the defendant maintain records of consent. The Court then concluded that the individual inquiries necessary to uncover and analyze this evidence rendered the case inappropriate for class treatment.
Third, in denying certification on these grounds, the Southern District of Florida added to the growing list of decisions that have denied certification in TCPA cases because consent is an individualized issue. The Court specifically noted that it joined “the chorus of other courts faced with TCPA class actions that have found such individualized inquiries on the consent issue would predominate over any common issues.” Like the Newhart court, these courts have recognized that the individualized nature of the consent inquiry is incompatible with class treatment.
Goodwin partners Brooks Brown and Kyle Tayman represent Quicken Loans in the Newhart case.
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