Eric J. Troutman

Partner, Squire Patton Boggs LLP

Email: eric.troutman@squirepb.com

UCLA SOL; Los Angeles CA

Eric is the czar of TCPAWorld.com and has served as lead counsel in nearly a hundred putative nationwide TCPA class actions, in addition to defending over a thousand individual TCPA suits in his role as national strategic litigation counsel for major banks and finance companies. He now leads one of the nation's most powerful TCPA defense teams in the firm's Los Angeles office.

Shutterstock

As putative Telephone Consumer Privacy Act class counsel become more sophisticated and define "wrong number" classes that are untethered to a defendant's available data sets, it is critical that TCPA defendants not fall into the trap of relying on ascertainability arguments to save them at the certification stage. Although demonstrating to a court why class members cannot be identified is often tempting, these arguments rarely thwart certification and will detract from stronger arguments on predominance. Indeed, by cleverly drafting their class definitions, sophisticated class counsel hope to obscure predominance issues at the certification stage and trap less experienced defense counsel into taking the ascertainability bait.

Don't fall for it.

Even if predominance issues are not apparent on the face of a wrong number TCPA complaint, they always lurk just below the surface -- a fact that can be demonstrated to the court easily enough through the proper use of expert witness reports.

Let's start with a few basics. In TCPA class actions, the issue of consent is the crucial merits issue likely to drive the outcome of a case. TCPA certification orders typically turn on the issue of whether consent can be demonstrated on a class-wide basis. And since consent can be obtained in myriad different ways -- and consent is presumed to be given anytime a called party supplies their number directly to a caller absent limiting instructions -- TCPA class certification is usually only possible where numbers all derive from the same source. Otherwise individualized issues of consent will swarm common issues of proof and certification will not be proper under Rule 23(b)(3). (TCPA cases are all about recovery of statutory damages of $500 to $1,500 per call.)

A recent decision from the Northern District of Indiana denying certification in a TCPA class action summarizes the standard quite nicely:

"Whether a [call] was sent without express permission is a necessary element to recovery under the TCPA. It is a question common to the class only if similar evidence and methodology will suffice to answer the question for each member or the issue is susceptible to generalized, class-wide proof. It is an individual question if members of the proposed class will need to present evidence that varies from member to member. [If] all the [] numbers [had] been obtained through th[e] same method, answering whether that method constitutes express invitation or permission would not require a case by case determination. However, the [call list] also contained recipients who were past or present customers with contact information housed in [Defendant']s accounting systems, or who attended trade conventions as hotel representatives and permitted [Defendant] to scan their identification badges with their contact information. Determining which of the hundreds of customers in [Defendant's] accounting system provided permission for [Defendant] to [call], and the status of any permission, would require an individualized inquiry." Gorss Motels v. Brigadoon Fitness, 1:16-CV-330-HAB,(N.D. Ind. May 20, 2019).

For many years, certification of putative TCPA class actions occurred almost exclusively in telemarketing cases. In the most common scenario, a telemarketer would purchase a lead list and make calls to every number on the list using the same technology and for the same purpose. And although courts occasionally denied certification in these cases on ascertainability grounds, for the most part, courts had little problem certifying these cases (since whether or not consent existed to call all numbers on the list was plainly a common issue). On the other hand, certification of TCPA cases involving informational callers was almost never considered appropriate because such callers made calls regarding specific accounts to phone numbers that had been provided directly by the customer under varying circumstances.

Eventually, consumer lawyers began developing theories for proving an absence of consent on a class-wide basis in the informational calling context. Their primary approach was to leverage data within a defendant's phone records purportedly demonstrating an absence of consent. The most commonly leveraged data involved wrong number dispositions entered by agents -- companies hoping to avoid calling errant phone numbers commonly tracked reported wrong numbers to avoid re-calling those numbers. Even though the defendant possessed this data solely to help avoid wrong number phone calls, courts allowed consumer lawyers to use these compliance efforts to their detriment. A string of wrong number data TCPA class actions of this sort have now been certified. See, e.g., Lavigne v. First Cmty. Bancshares, 1:15-cv-00934-WJ/LF, (D. N.M. June 5, 2018); Reyes v. BCA Fin. Servs., 116-24077-CIV (S.D. Fla. June 26, 2018).

On the other hand, some defendants successfully defeated certification in these cases by pointing out that the presence of such disposition codes does not prove any TCPA element and the defendant is free to introduce countervailing evidence to raise triable (individualized) issues on the question of consent, even where a phone number was noted (perhaps inaccurately) as a "wrong number" by an agent.

In response, TCPA class action attorneys have refined their approach yet again. Now, rather than tether their certification chances to the reliability of data elements within the defendant's records, the latest trend is to define classes broadly to include all non-customers who were called -- usually by way of a reference to the call recipient not matching the "intended recipient" as reflected in a defendant's records. This is a rather clever trick because all individuals in that class seem to be in a common position -- making certification feasible. And if a defendant counters that its records demonstrate consent for some portion of the population, the plaintiff will surely retort that those individuals -- by definition -- were never in the class to begin with.

Perhaps unsurprisingly, some defendants have responded to these sort of class allegations by focusing on the ascertainability requirement implied by Rule 23(b)(3). Individuals within the class will not be ascertainable -- the argument goes -- either because the defendant's records do not categorically demonstrate wrong number calls or -- more commonly -- because even if wrong number phone numbers can be identified, it is impossible to identify the individuals that received wrong number calls (since the defendant will have no record of who these wrong number call recipients are).

But this is a trap.

Just as was the case with the old telemarketing TCPA class actions from yesteryear, TCPA defendants relying exclusively or primarily on ascertainability to save them from today's sophisticated wrong number class definitions are finding their reliance misplaced. The reason is simple: If a court believes that a defendant has engaged in illegal conduct in a manner that commonly impacts all class members it will find a way to ascertain class members -- even while acknowledging methodological flaws or rough edges.

For instance, in Keim v. ADF MidAtlanatic, LLC, 12-80577 (S.D. Fl. Dec. 4, 2018) the defendant focused heavily on ascertainability in an effort to defeat a class defined as: persons who received text messages on a cellular telephone number provided to the defendant by a third party. Notably, the TCPA allows consent to be provided through an intermediary, so a powerful predominance argument should have been possible here: It is impossible to determine what intermediaries were and were not authorized to supply the phone number to the defendant absent individualized inquiry.

Instead, the defendant principally argued that there was no way to find the users of the telephone numbers that received the text messages so the class was not ascertainable. The court responded by fashioning an extremely unusual ascertainability plan that involved sending class notice to phone number subscribers to ask who uses their phones, in order to find class members. And in order to get there, the plaintiffs had to first subpoena the records of every carrier for the names and users of every subscriber to every phone that received a text from the defendant. Breaking it down further: Any user of a cellphone that received a text from the defendant during the four-year class period will have their phone records searched via subpoena by class counsel to their cellphone carrier. Those text recipients on a family plan will have a notice sent to the subscriber to that plan regarding their use of the phone. And then the subscriber is required to notify those users of the class notice, so they can make an election of whether or not to stay in the class.

On the other hand, the defendant in the comparable case of Revtich v. Citibank, C17-06907, (N.D. Cal. April 28, 2019), stayed laser focused on predominance, and to good effect. There, the class was defined broadly as all individuals receiving calls "where such person was not listed in Defendant's records as the intended recipient of the calls." Rather than argue that individuals falling in that category cannot be found, the defendant argued that there was insufficient common evidence to adjudicate class member claims. This tactic pushed a critical hole in class counsel's case into the light of day: In order to try their case, the plaintiff needed evidence that any individuals actually fell within the class definition.

Although arguably unnecessary at the certification stage, the plaintiff's counsel took the bait and pointed to the defendant's "wrong number" dispositions as evidence of class-wide conduct. Although the plaintiff countered that "false" wrong numbers could be filtered out using a third-party vendor, the court was unconvinced that such third-party data could be leveraged on a class-wide basis, given that numbers are commonly associated with multiple accounts owned by different people. Here, the defendant's experts carried the weight -- demonstrating that of 176 phone numbers the plaintiff's expert identified from within a 20,000-account sample as falling within the class definition, 120 actually were associated with a consenting customer in some form or fashion. For instance, in one circumstance presented to the court, a father's number was provided by a son in connection with one account, and then by the son in connection with a different account. The number was subsequently identified as a "bad" number to reach the father, but remained perfectly valid to reach the son. Nonetheless, the defendant subsequently called the number seeking the son but reached the father-which would place the father within the class definition although the call was consented to be the son. (The court does not specifically address the issue of whether the son could consent for a call answered by the father but it is necessarily implied that the answer is yes.) So just because a number is marked "wrong" on one account does not mean it is "wrong" for calls placed to a different person or on a different account.

Importantly, the Revtich court refused to let the plaintiff shift the consent narrative from an issue of predominance to one of ascertainability (which has no teeth in the 9th Circuit). As the court put it: "The problem here is not identifying the individuals who fall within plaintiff's proposed class. Rather, the problem is that adjudicating the claims of those who do fall within plaintiff's proposed class would devolve into the tedious resolution of individualized issues based on individualized evidence."

That last point is the critical takeaway for those seeking to defeat certification in TCPA wrong number cases -- do not get bogged down on ascertainability. Difficulty finding class members alone is rarely an issue defeating certification. Focus instead on why the claims of class members -- once they are found -- cannot be properly adjudicated using general proof.

Ultimately, a class plaintiff must prove their claims as to each class member. Doing this requires data. Disposition data will not resolve merits issues in one stroke because it can easily be rebutted by other forms of evidence.

While putative TCPA class counsel are now crafting class definitions designed to hide these inherent limitations from the light of day, focusing on predominance at the certification stage exposes these weaknesses to the court and forces an inquiry of what a trial on the merits would actually look like. This, in turn, allows a defendant to put its best foot forward by relying on its policies and procedures and the availability of evidence of consent. On the other hand, focusing on ascertainability at the certification stage may be perceived as an admission of weakness -- highlighting the seeming commonality between class members and an apparent lack of evidence on consent. Relying excessively on ascertainability, therefore, may leave a court thoroughly convinced that a certifiable class exists, and, as Keim demonstrates, some courts will be up to the challenge of fashioning creative means to find them.