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In re Collecto, Inc., Telephone Consumer Protection Act Litigation

United States District Court, D. Massachusetts

February 10, 2016

IN RE COLLECTO, INC., TELEPHONE CONSUMER PROTECTION ACT LITIGATION

MEMORANDUM AND ORDER ON DEFENDANT COLLECTO'S MOTION FOR SUMMARY JUDGMENT

RICHARD G. STEARNS, District Judge.

Defendant Collecto, Inc., pursues debts on behalf of third-party providers of goods and services. Plaintiffs John Lofton, Robert Pegg, Richard Davenport, and Ralph Davenport brought separate causes of action against Collecto under the Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227 et seq., on behalf of themselves and putative classes of similarly situated plaintiffs. Plaintiffs allege that Collecto repeatedly dialed their cellular telephones using an automated telephone dialing system (ATDS) without their prior express consent. Collecto now seeks summary judgment against all plaintiffs, arguing that its telephone dialers do not meet the legal definition of an ATDS.

BACKGROUND

The TCPA, enacted in 1991, provides in relevant part:

It shall be unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States-
(A) 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.

47 U.S.C. § 227(b). The statute defines an ATDS as "equipment which has the capacity- (A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers." Id. at § 227(a)(1).

The FCC determined in 2003, 2008, and most recently in 2015, that a so-called "predictive dialer"[1] fits the definition of an ATDS. See In re Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 18 FCC Rcd. 14014, 14091-93 (July 3, 2003) ("[T]he Commission finds that a predictive dialer falls within the meaning and statutory definition of automatic telephone dialing equipment' and the intent of Congress."); see also In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 23 FCC Rcd. 559, 566 (Jan. 4, 2008) ("[W]e affirm that a predictive dialer constitutes an automatic telephone dialing system and is subject to the TCPA's restrictions on the use of autodialers."); In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 30 FCC Rcd. 7961, 7974 (July 10, 2015) ("We... reiterate that predictive dialers, as previously described by the Commission, satisfy the TCPA's definition of autodialer' for the same reason.").

On August 26 and 27, 2009, Collecto placed calls using a "Maestro Dialer" manufactured by Noble Systems, Inc. (Noble Dialer), to a cellular telephone owned by plaintiffs Richard and Ralph Davenport, seeking to collect a debt. From May 31, 2012, through June 7, 2012, Collecto used the Noble Dialer to place multiple calls to plaintiff John Lofton's cellular telephone, also seeking to recover an outstanding debt. Between June 11 and June 20, 2013, Collecto made a series of calls using a "Guaranteed Contacts" dialer to call plaintiff Robert Pegg's telephone in a similar dunning effort.[2] It is undisputed that Collecto did not have plaintiffs' prior express consent for the calls.

The three plaintiffs filed separate class action Complaints against Collecto: Lofton in the Northern District of California; Pegg in the District of Massachusetts; and the Davenports in the Eastern District of Michigan. (The TCPA expressly authorizes a private right of action. 47 U.S.C. § 227(b)(3)). Plaintiffs allege that Collecto's Noble and Guaranteed Contact Dialers are ATDS's, the use of which violates the TCPA. Collecto's Director of Telephony, Peter Cappola, acknowledges that Collecto's dialers have predictive dialing capabilities. The Noble Dialer, for example, is configured to interface with Collecto's Flexible Automated Collection Software (FACS) database. This database contains information on debtors' accounts, including telephone numbers supplied by Collecto's clients. Collecto employees enter the account information into FACS, then import the telephone numbers into the Noble Dialer to create call lists. When a Collecto employee logs onto the Noble Dialer, he or she selects a "group" of call lists to initiate calls. The Noble Dialer then automatically calls the numbers on the list. Based on the employee's predicted availability, the dialer will connect the recipient of the call with the employee logged onto that "group."[3] The parties disagree whether Collecto's dialers have the capacity to store or generate random or sequential numbers.

On February 19, 2014, the Judicial Panel on Multidistrict Litigation transferred the Davenport and Lofton actions to this district to be consolidated with the Pegg action for pretrial proceedings. A hearing on Collecto's motion for summary judgment was held on January 26, 2016.

DISCUSSION

Summary judgment is appropriate when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). Summary judgment shall not be granted if the evidence is "such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The moving party bears the initial burden of establishing that no genuine issue of material fact exists. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).

Collecto's summary judgment argument begins with the contention that the court should give no weight whatsoever to the FCC's determination that a predictive dialer is an ATDS for TCPA purposes. According to Collecto, the FCC lacks the statutory authority to "modify" Congress' definition of an ATDS, and, in any event, relied on "false hearsay" in doing so.[4] Def.'s Mem. at 14; Reply at 5-6. Collecto's opening argument does not survive the Administrative Orders Review Act (Hobbs Act), 28 U.S.C. § 2342(1), under which this court lacks jurisdiction to set aside, suspend, or adjudicate the validity of an FCC ruling and final order. See Fed. Commc'ns Comm'n v. ITT World ...


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