True Health Chiropractic, Inc.; McLaughlin Chiropractic Associates, Inc., individually and as representatives of a class of similarly situated persons, Plaintiffs-Appellants,
McKesson Corporation; McKesson Technologies, Inc., Defendants-Appellees.
and Submitted October 17, 2017 San Francisco, California
from the United States District Court for the Northern
District of California D.C. No. 4:13-cv-02219-HSG Haywood S.
Gilliam, Jr., District Judge, Presiding
L. Hara (argued), Anderson and Wanca, Rolling Meadows,
Illinois; Willem F. Jonckheer, Schubert Jonckheer & Kolbe
LLP, San Francisco, California; for Plaintiffs-Appellants.
R. Palmore (argued) and Seth W. Lloyd, Morrison &
Foerster LLP, Washington, D.C.; Ben Patterson and Tiffany
Cheung, Morrison & Foerster LLP, San Francisco,
California; for Defendants-Appellees.
Before: Michael Daly Hawkins, William A. Fletcher, and
Richard C. Tallman, Circuit Judges.
Consumer Protection Act / Class Certification
panel affirmed in part and reversed in part the district
court's denial of class certification in an action under
the Telephone Consumer Protection Act.
sought to represent a class of plaintiffs who allegedly
received unsolicited faxed advertisements from defendants in
violation of the TCPA. The district court denied class
certification on the ground that under Fed.R.Civ.P. 23(b)(3),
individual issues related to affirmative defenses would
predominate over issues common to the class. These
"consent defenses" alleged that putative class
members in various ways gave defendants "prior express
invitation or permission" to send the faxes.
panel concluded that the district court did not impose an
"ascertainability" or administrative feasibility
requirement for class certification. Agreeing with the Sixth
Circuit, the panel held that there is no requirement that all
faxes, whether consented or not, must contain an
"opt-out" notice because the FCC's Solicited
Fax Rule has been held invalid by the D.C. Circuit.
panel nonetheless concluded that the district court erred in
part in holding that appellants' proposed class or
subclasses failed to satisfy the predominance requirement of
Rule 23(b)(3). The panel held that in light of Van Patten
v. Vertical Fitness Grp., LLC, 847 F.3d 1037 (9th Cir.
2017) (holding that "express consent" is an
affirmative defense to a claim brought under 47 U.S.C. §
227(b)(1)(A), a provision of the TCPA dealing with
unsolicited telephone calls), "prior express invitation
or permission" under § 227(b)(1)(C) is an
affirmative defense on which the defendant bears the burden
of proof. The panel affirmed the district court's denial
of class certification with respect to one possible subclass
and reversed the district court's holding that other
possible subclasses could not satisfy the predominance
requirement. The panel held that one subclass would satisfy
predominance, and it remanded for a determination whether
another subclass would also satisfy the requirement. The
panel also remanded to allow the district court to address
the requirements of Rule 23(a).
FLETCHER, CIRCUIT JUDGE
True Health Chiropractic and McLaughlin Chiropractic
("True Health") seek to represent a class of
plaintiffs who allegedly received unsolicited faxed
advertisements from appellees McKesson Corporation and
McKesson Technologies, Inc. ("McKesson") between
September 2009 and May 2010, in violation of the Telephone
Consumer Protection Act of 1991 ("TCPA"). The
district court denied class certification on the ground that
individual issues related to McKesson's affirmative
defenses would predominate over issues common to the class.
See Fed. R. Civ. P. 23(b)(3). We granted True
Health's request for permission to appeal the order
pursuant to Federal Rule of Civil Procedure 23(f). We affirm
in part, reverse in part, and remand.
Health's TCPA Claim
TCPA forbids certain unsolicited advertisements sent via
phone or facsimile ("fax"). 47 U.S.C. §
227(b)(1). In enacting the TCPA, "Congress intended to
remedy a number of problems associated with junk faxes,
including the cost of paper and ink, the difficulty of the
recipient's telephone line being tied up, and the stress
on switchboard systems." Imhoff Inv., L.L.C. v.
Alfoccino, Inc., 792 F.3d 627, 633 (6th Cir. 2015). The
TCPA makes it unlawful to send "unsolicited
advertisement[s]" via fax machine. 47 U.S.C. §
227(b)(1)(C). An advertisement is unsolicited if it includes
"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." Id. § 227(a)(5). But
unsolicited advertisements may be sent if (1) the sender and
recipient have "an established business
relationship," (2) the recipient voluntarily provided
his or her contact information to the sender either directly
or indirectly through "a directory, advertisement, or
site on the Internet," and (3) the "unsolicited
advertisement contains" an opt-out notice meeting
certain statutory requirements. Id. §
227(b)(1)(C)(i)-(iii). In 2006, the Federal Communications
Commission ("FCC") promulgated a regulation
requiring that companies include opt-out notices in solicited
as well as unsolicited advertisements (the "Solicited
Fax Rule"). 47 C.F.R. § 64.1200(a)(4)(iv). Eleven
years later, the D.C. Circuit held the Solicited Fax Rule
invalid. See Bais Yaakov of Spring Valley v. FCC,
852 F.3d 1078, 1083 (D.C. Cir. 2017).
Health's Second Amended Complaint ("SAC")
alleges that McKesson sent to named plaintiffs and other
putative class members unsolicited fax advertisements without
their prior express permission or invitation, and without
opt-out notices, in violation of 47 U.S.C. §
227(b)(1)(C) and 47 C.F.R. § 64.1200(a)(4)(iv).
According to the SAC, McKesson sent the faxes at issue after
having received a May 9, 2008, citation from the FCC warning
it against sending unsolicited advertising by fax. The
citation stated, "It has come to our attention that your
company . . . apparently sent one or more unsolicited
advertisements to telephone facsimile machines in violation
of Section 227(b)(1)(C) of the [TCPA]." In its answer to
the SAC, McKesson alleged that True Health and other putative
class members in various ways gave McKesson "prior
express invitation or permission" to send the faxes. 47
U.S.C. § 227(a)(5). For ease of reference, we will refer
to this as McKesson's "consent defenses."
discovery, True Health requested that McKesson produce
"[a]ll Documents indicating that any person gave prior
express invitation or permission to receive facsimile
transmissions of any [McKesson advertisements]." True
Health also asked McKesson to identify "each type of act
that Defendants believe demonstrates a recipient's
express permission to receive faxes" and to list which
class members consented in each of the ways identified.
responded by listing three groups of consent defenses that it
claimed relieved it of TCPA liability. McKesson attached to
its response three exhibits, which corresponded to the three
groups of asserted consent defenses, listing putative class
members who purportedly consented in the specified manners.
According to McKesson, each exhibit contains the "name
and contact information (where available)" of faxes for
each asserted consent defense. The exhibits are not in the
record, but McKesson described the consent defenses it
asserted against the putative class members in each exhibit.
A lists putative class members that, according to McKesson,
(1) provided their fax numbers when registering a product
purchased from Physician Practice Solutions
("PPS"), a business unit of McKesson Technologies,
and/or (2) entered into software-licensing agreements, called
End User License Agreements ("EULAs"). Exhibit A,
which contains 11, 979 unique fax ...