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Peralta v. Rack Room Shoes, Inc.

United States District Court, E.D. Louisiana

November 30, 2018


         SECTION: M (2)

          ORDER & REASONS


         Before the Court is a Motion to Stay filed by defendant Rack Room Shoes, Inc. (“RRS”), [1] to which plaintiff Cesar Peralta (“Peralta”) responds in opposition, [2] and in support of which RRS replies, [3] and to which both Peralta and RRS filed notices of supplemental authority.[4] Having considered the parties' memoranda and the applicable law, the Court issues this Order & Reasons.

         I. BACKGROUND

         This case is a putative class action alleging claims arising under the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227. Peralta filed this action in the Civil District Court, Parish of Orleans, State of Louisiana, against RRS alleging that, on November 22, 2017, RRS sent an unauthorized text message advertisement to Peralta's cellular telephone using an automated telephone dialing system (“ATDS”) in violation of the TCPA.[5] Peralta also alleges that RRS's actions violated the Louisiana Unfair Trade Practices Act, (“LUTPA”), La. R.S. 51:1401, et seq.[6]Peralta asserts his claims on behalf of himself and all similarly situated consumers who have received RRS's text message advertisements.[7] RRS removed the action to the United States District Court for the Eastern District of Louisiana alleging federal question and diversity subject-matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1332, respectively.[8]


         A. Statutory, Regulatory, and Jurisprudential Backdrop

         RRS filed a motion to stay this matter pending guidance from the Federal Communication Commission (“FCC”) on the definition of ATDS.[9] Thus, RRS's motion to stay is predicated on the evolving history of the FCC's definition of ATDS. In Gorgan v. Aaron's Inc., 2018 WL 6040195 (N.D.Ga. Oct. 26, 2018), the court considered the exact same question raised by RRS herein - whether to stay a putative class action brought under the TCPA pending guidance from the FCC regarding the definition of ATDS - and explained the statutory, regulatory, and jurisprudential landscape as follows:

         1. The TCPA

Automated telephone calls, colloquially referred to as “robocalls, ” have ravaged both the landlines and mobile telephone lines of millions of American households throughout the years. See generally 47 U.S.C. § 227, Note, Pub. L. No. 102-243, § 2(1-4), 105 Stat. 2394, 2394. In response to rising consumer discontent with the seemingly endless proliferation of automated telephone calls, Congress, in 1991, enacted the TCPA with the primary aim of restricting automated telephone calls to both residential telephone lines as well as to telephone numbers assigned to a cellular telephone service. 47 U.S.C. § 227(b)(1)(A)(iii), (B); see also 47 U.S.C. § 227, Note, Pub. L. No. 102-243, § 2(5-6), 105 Stat. 2394, 2394 (finding, in relevant part, that “[u]nrestricted telemarketing ... can be an intrusive invasion of privacy and, when an emergency or medical assistance telephone line is seized, a risk to public safety” and that “[m]any consumers are outraged over the proliferation of intrusive, nuisance calls to their homes from telemarketers”).

         As is relevant to the instant case, the TCPA provides that

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 -
(iii) to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call, unless such call is made solely to collect a debt owed to or guaranteed by the United States[.]
47 U.S.C. § 227(b)(1)(A)(iii). The term “automatic telephone dialing system [‘ATDS']” is likewise defined 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. § 227(a)(1).
Consonant with its remedial purpose, the TCPA provides for a private right of action which allows a party to seek both statutory damages in the amount of $500 per violation as well as injunctive relief against the offending conduct. Id. § 227(b)(3). Moreover, if a defendant is found to have “willfully or knowingly violated” the statute or the “regulations prescribed” by the FCC, the courts are vested with the inherent discretion to award treble damages. Id. § 227(b)(3)(C).
Given the broad sweep of the prohibitions set forth in the TCPA, Congress explicitly vested the Federal Communications Commission (the “FCC”) with the sole authority to promulgate regulations implementing the TCPA's requirements. Id. § 227(b)(2) (mandating that the FCC “shall prescribe regulations to implement the requirements of this subsection....”).
2. FCC's Regulatory Orders 1
The FCC, in accordance with its statutory mandate has, over the intervening years, issued several regulations delineating the TCPA's reach and scope. The first of these was promulgated in 1992, shortly after the statute's enactment and, as is relevant here, predominantly adopted, without elaboration, the statutory definition of what constitutes an ATDS. In re Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 7 FCC Rcd. 8752, 8792 App'x B (1992) (amending 47 C.F.R. § 64.1200).
In 2003, the FCC, based upon the ever-changing technological landscape, revisited the types of equipment which would constitute an ATDS as defined by the statute. In Re Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 18 F.C.C. Rcd. 14014, 14091 (2003). Specifically, the FCC determined whether predictive dialers - “equipment that dials numbers and, when certain computer software is attached, also assists telemarketers in predicting when a sales agent will be available to take calls” - constitute an ATDS. Id. at 14091. After setting forth how predictive dialers functioned and reviewing the legislative history and statutory definition of an ATDS, the FCC determined that “to exclude from these restrictions equipment that use predictive dialing software from the definition of ‘automated telephone dialing equipment' simply because it relies on a given set of numbers would lead to an unintended result ... [and] [t]herefore, the Commission finds that a predictive dialer falls within the meaning and statutory definition of ‘automatic telephone dialing equipment' and the intent of Congress.” Id. at 14092-93.
In 2008, the FCC revisited whether a predictive dialer constitutes an ATDS. In the Matter of Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 23 F.C.C. Rcd. 559, 566 (2008). Specifically, the FCC was asked to determine whether a predictive dialer meets the definition of an autodialer “only when it randomly or sequentially generates telephone numbers, not when it dials numbers from customer telephone lists.” Id. After considering the issue and referencing its earlier 2003 decision on the matter, the FCC noted that the petitioner did not raise any “new information about predictive dialers that warrants reconsideration of these findings” and, on that basis, affirmed its earlier 2003 ruling in this regard. Id. at 566-67.
In 2015, the FCC reaffirmed its position as to whether predictive dialers fall within the ambit of the statutory definition of an ATDS. In the Matter of Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 30 F.C.C. Rcd. 7961, 7971-72 (2015). Specifically, the FCC explicitly endorsed the continuing vitality of its position that
dialing equipment generally has the capacity to store or produce, and dial random or sequential numbers (and thus meets the TCPA's definition of “autodialer”) even if it is not presently used for that purpose, including when the caller is calling a set list of consumers. We also reiterate that predictive dialers, as previously described by the ...

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