1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 PAM LAMKIN, an individual, No. 2:18-cv-03071 WBS KJN 13 Plaintiff, 14 v. MEMORANDUM AND ORDER RE:

CROSS-MOTIONS FOR SUMMARY

15 PORTFOLIO RECOVERY ASSOCIATES, JUDGMENT

LLC,

16 Defendant. 17

18 ----oo0oo---- 19 20 Plaintiff Pam Lamkin filed this lawsuit against 21 defendant Portfolio Recovery Associates, LLC (“PRA”) alleging 22 that defendant auto-dialed calls to plaintiff’s cellphone without 23 her express consent, in violation of the Telephone Consumer 24 Protection Act (“TCPA”). 47 U.S.C. § 227. Before the court are 25 the parties’ cross-motions for summary judgment, and defendant’s 26 motion to strike the testimony of plaintiff’s expert witness. 27 I. Factual and Procedural Background 28 1 Defendant PRA purchases consumer debt and then attempts 2 to collect the debt from the debtor. (Pl’s Mem. in Supp. Summ. J. 3 at 2 (Docket No. 15).) Prior to August 1991, plaintiff applied 4 for and received a credit card from Wells Fargo Bank. (Def.’s 5 Resp. to Pl.’s Statement of Undisputed Facts (“SUF”) at 4-5, ¶ 17 6 (Docket No. 19).) Later that year, after plaintiff failed to 7 make all the payments on the account, Wells Fargo charged off the 8 account. (Id. at 5, ¶ 18.) In December of 2007, PRA purchased 9 Lamkin’s credit card debt. (Id. at 5, ¶ 19). 10 After the purchase, PRA began a process known as “skip 11 tracing,” where a debt buyer contacts third-party credit 12 reporting agencies to solicit contact information those agencies 13 may have on the debtors. (Def.’s Resp. to Pl.’s SUF at 8, ¶ 31.) 14 PRA ultimately obtained plaintiff’s cell phone number from a 15 Credit Bureau report in March 2008. (Id.) PRA did not receive 16 Lamkin’s cell phone number from any other source. (Id. at 4, ¶ 17 15.) PRA then made 199 calls to plaintiff’s cell number between 18 February 19, 2008 and August 16, 2010 to collect the debt.1 19 (Stip. at 2, ¶ 3 (Docket No. 12).) PRA never determined if 20 plaintiff had expressly consented to be contacted. (Id. at 4, ¶ 21 9). On August 16, 2010, plaintiff requested that PRA cease all 22 contact with plaintiff. (Def.’s SUF at 6, ¶ 30, 31 (Docket No. 23 17-2).) PRA did not contact plaintiff thereafter. (Id. at 6, ¶ 24 32.) 25 In making the calls, PRA used the Avaya Proactive 26

27 1 The parties agree that all the calls at issue were made during the applicable statute of limitations. (Def.’s Resp. 28 to Pl.’s SUF at 6-7, ¶ 25 (Docket No. 19).) 1 Contact Technology (“Avaya”). When the calls were made, Avaya 2 had the ability to store telephone numbers and did in fact store 3 telephone numbers. (Def.’s Resp. to Pl.’s SUF at 3, ¶ 9.) Avaya 4 could also dial these stored telephone numbers without human 5 intervention. (Id. at 3, ¶ 10.) Indeed, the calls were made in 6 the predictive dialing mode (id. at 2, ¶ 5), under which the 7 dialing system calls the stored numbers “automatically and 8 directly.”2 (Pl.’s Mem. in Supp. of Mot. Summ. J. at 11-12 9 (Docket No. 15).) 10 Plaintiffs rely on the testimony of Randall Snyder to 11 further describe the functionality of Avaya. According to 12 Snyder, Avaya has the “capacity to store or produce telephone 13 numbers to be called, using a random or sequential number 14 generator and to dial telephone numbers without human 15 intervention.” (Decl. Randall Snyder, at ¶ 33, 44, Ex. A (Docket 16 No. 18-1). Avaya, Snyder continues, can also call numbers “using 17 a random or sequential number generator” (id. at ¶ 35), can make 18 “automatic calls from stored lists of telephone [numbers] and has 19 the capacity to dial stored numbers automatically” (id.). 20 In 2018, plaintiff filed this lawsuit against PRA,3

21 2 Predictive dialing allows the call center to “predict” 22 the availability of call center agents that can respond to the calls that have been dialed by the predictive dialing system and 23 answered by the called party. (Pl.’s Mem. in Supp. of Mot. Summ. J. at 11 (Docket No. 15); see also Stip. at 3, ¶ 10 (Docket No. 24 12).)

25 3 Plaintiff was a member of the class in the class action lawsuit in In re Portfolio Recovery Associates, LLC. Telephone 26 Consumer Protection Act Litigation, No. 11-MD-2295-JAH-BGS, filed 27 in the United States District Court for the Southern District of California. Plaintiff opted out of the settlement in the class 28 action and can therefore sue individually. (Def.’s Resp. to 1 alleging that, because Avaya qualifies as an automatic telephone 2 dialing system under the Telephone Consumer Protection Act 3 (“TCPA”) (Compl. at 4, ¶ 17 (Docket No. 1)), and because PRA 4 failed to obtain plaintiff’s express consent prior to calling her 5 cell phone (id. at 6, ¶ 31), each call constituted a violation of 6 the TCPA. Plaintiff requests treble damages for PRA’s alleged 7 “willful or knowing” violation of the statute. (Id. at 7, ¶ 8 35(a).) Both parties now seek summary judgment under Federal 9 Rule of Civil Procedure 56 on plaintiff’s sole claim under the 10 TCPA. Defendant also seeks to strike Snyder’s testimony. 11 II. Discussion 12 Summary judgment is appropriate when the movant shows that 13 no genuine dispute as to any material fact remains and the movant 14 is entitled to prevail as a matter of law. Fed. R. Civ. P. 56. 15 A. The Telephone Consumer Protection Act (TCPA) 16 Congress enacted the TCPA to “protect the privacy 17 interests of residential telephone subscribers by placing 18 restrictions on unsolicited, automated telephone calls.” S. Rep. 19 No. 102-178. Under the Act, it is “unlawful for any person . . . 20 (A) to make a call (other than a call made . . . with the prior 21 express consent of the called party) using any automatic 22 telephone dialing system . . . (iii) to any telephone number 23 assigned to a . . . cellular telephone service.” 47 U.S.C. § 24 227(b)(1). Thus, “the three elements of a TCPA claim are: (1) 25 the defendant called a cellular telephone number; (2) using an 26 automatic telephone dialing system; (3) without the recipient’s 27

28 Pl.’s SUF at 8-9, ¶ 32.) 1 prior express consent.” Meyer v. Portfolio Recovery Assocs., 2 LLC, 707 F.3d 1036, 1043 (9th Cir. 2012). 3 Defendant does not dispute that PRA called plaintiff’s 4 cellular telephone. (Def.’s Resp. to Pl.’s SUF at 2, ¶ 3 (Docket 5 No. 19.) Defendant also does not offer any evidence that PRA had 6 plaintiff’s prior express consent to call her 199 times. On the 7 contrary, defendant admits that it obtained Ms. Lamkin’s number 8 only through a third-party credit report. 9 Therefore, with respect to liability, the issue in this 10 case is only whether PRA’s Avaya constitutes an automatic 11 telephone dialing system (“ATDS”). Defendant argues that, to 12 constitute an ATDS, a system must “generate random or sequential 13 numbers.” (Def.’s Mem. in Supp. of Mot. for Summ. J. at 3 14 (Docket No. 17-1).) Plaintiff, on the other hand, argues that an 15 ATDS is not limited to systems that generate and dial such 16 numbers, but also includes devices with the capacity to dial 17 stored numbers automatically. (Pl.’s Mem. in Supp. of Mot. for 18 Summ. J. at 6 (Docket No. 15). Each party relies on Ninth 19 Circuit decisions. This court now applies the appropriate 20 definition of ATDS under the Act. 21 B. The Definition of ATDS 22 1. FCC Orders 23 Since the enactment of the TCPA in 1991, the definition 24 of ATDS has remained the same: “equipment which has the capacity 25 —-(A) to store or produce telephone numbers to be called, using a 26 random or sequential number generator; and (B) to dial such 27 numbers.” 47 U.S.C. § 227(a)(1); Marks v. Crunch, 904 F.3d 1041, 28 1044-45 (9th Cir. 2018). 1 By the early 2000s, new telemarketing technologies had 2 emerged. The Federal Communications Commission (“FCC”) became 3 particularly concerned about the proliferation of predictive 4 dialers, which do not “dial[] a random or sequential block of 5 numbers,” but rather “automatically dial[] a list of numbers that 6 had been preprogrammed and stored in the dialer.” Rules & 7 Regulations Implementing the Tel. Consumer Prot. Act of 1991, 18 8 FCC Rcd. 14,014, 14,017, 14,022 (2003) (“2003 Order”). As a 9 result, the FCC issued a series of rulings between 2003 and 2015 10 to determine whether the predictive dialer was an ATDS under the 11 statute. Marks, 904 F.3d at 1045. In its 2003 Order, the FCC 12 determined that, to be an ATDS, a predictive dialer need not 13 currently be used to generate random or sequential numbers -- it 14 need only have the capacity to do so. In 2012, the FCC reasoned 15 that the statutory definition of ATDS “covers any equipment that 16 has the specified capacity to generate numbers and dial them 17 without human intervention regardless of whether the numbers 18 called are randomly or sequentially generated or come from 19 calling lists.” Rules & Regulations Implementing the Tel. 20 Consumer Prot. Act of 1991, 27 FCC Rcd. 15,391, 15,392 n.5 21 (2012). In 2015, however, the FCC seemed to adopt the opposite 22 view that a device “would not meet the definition of an ATDS 23 unless it had the capacity to dial random or sequential numbers.” 24 Marks, 904 F.3d at 1046 (citing Rules & Regulations Implementing 25 the Tel. Consumer Prot. Act of 1991, 30 FCC Rcd. 7691, 7971-72 26 (2015) (“2015 Declaratory Ruling”)). 27 2. D.C. Circuit’s Decision in ACA International v. 28 FCC 1 In response to the uncertainty following the FCC’s 2015 2 Declaratory Ruling, “a large number of regulated entities 3 challenged the FCC’s definition of an ATDS.” Marks, 904 F.3d at 4 1046. The petitions were consolidated in the D.C. Circuit. See 5 Consolidated Order, ACA Int’l v. FCC, 885 F.3d 687 (D.C. Cir. 6 2018). The D.C. Circuit court concluded that, while “[i]t might 7 be permissible for the Commission to adopt either interpretation” 8 of the statute -- one that requires that the device generate 9 random or sequential numbers or one that requires only that the 10 device dial automatically from a stored list -- “the Commission 11 cannot, consistent with reasoned decision-making, espouse both 12 competing interpretations in the same order.” Id. at 703. The 13 court thus “set aside the Commission’s treatment of those 14 matters.” Id. 15 3. Ninth Circuit’s Decision in Marks v. Crunch San 16 Diego 17 After the D.C. Circuit issued its opinion in ACA 18 International, the Ninth Circuit addressed the definition of ATDS 19 in Marks v. Crunch San Diego, LLC., 904 F.3d 1041 (9th Cir. 20 2018). The Marks court first concluded that, after the D.C. 21 Circuit’s decision, “the FCC’s prior orders on [the definition of 22 ATDS] are no longer binding” and that “only the statutory 23 definition of ATDS as set forth by Congress in 1991 remains.” 24 Id. at 1049. The court thus “beg[a]n anew to consider the 25 definition of ATDS under the TCPA.” Id. 1049-50. Finding the 26 plain language of the statute ambiguous, and thereafter “reading 27 the definition ‘in [its] context and with a view in [its] place 28 in the overall statutory scheme,’” id. at 1052 (citing FDA v. 1 Brown & Williamson Tobacco Corp., 529 U.S. 120, 133 (2000)), the 2 court concluded that “the statutory definition of ATDS is not 3 limited to devices with the capacity to call numbers produced by 4 a ‘random or sequential number generator,’ but also includes 5 devices with the capacity to dial stored numbers automatically.” 6 Id. 7 Because under Marks a device that has the capacity to 8 “store numbers to be called . . . and to dial such numbers” is an 9 ATDS, id., and because PRA “does not dispute that its Avaya 10 technology calls telephone numbers from a stored list” (Def.’s 11 Opp. to Pl.’s Mot. Summ. J. at 3 (Docket No. 20), Avaya is an 12 ATDS. 13 4. Ninth Circuit’s Decision in Satterfield 14 Defendant asks the court to rely instead on the Ninth 15 Circuit’s decision in Satterfield v. Simon & Schuster, Inc., 569 16 F.3d 946 (9th Cir. 2009). According to defendant, under 17 Satterfield, a device must have the capacity to generate random 18 or sequential numbers to constitute an ATDS. Because Marks 19 conflicts with defendant’s reading of Satterfield, and because 20 one panel cannot overturn the decision of a previous panel, 21 defendant argues that Satterfield is the law. See Von Colln v. 22 Cty. of Ventura, 189 F.R.D. 583, 589 n.2 (C.D. Cal. 1991) 23 (discussing that where two panel decisions conflict, “the 24 ‘earliest case’ rule is the correct one because (1) a decision of 25 a prior panel cannot be overturned by a later panel, and (2) 26 because of the importance of the prior precedent rule”). 27 Satterfield, however, does not conflict with Marks. 28 The Satterfield court discussed only the meaning of the term 1 “capacity.” The scope of that capacity under the TCPA was not at 2 issue.4 569 F.3d at 951 (“We find that the district focused its 3 analysis on the wrong issue . . . A system need not actually 4 store, produce, or call randomly or sequentially generated 5 telephone numbers, it need only have the capacity to do it. 6 Since the district court did not focus its decision on this 7 issue, we must then review the record.”); see also Marks, 904 8 F.3d at 1051 n.6 (“Our statement in Satterfield that ‘the 9 statutory text is clear and unambiguous’ referred to only one 10 aspect of the text: whether a device had the capacity ‘to store 11 or produce telephone numbers . . . .’”) (emphasis in original). 12 The court in Satterfield indeed had no reason to 13 address whether a predictive dialer must generate random or 14 sequential numbers to be an ATDS because in the 2003 Order, “the 15 FCC . . . defined ‘automatic telephone dialing system’ to include 16 predictive dialers.” Meyer, 707 F.3d at 1043. The Ninth Circuit 17 heard Satterfield in 2009. Only after the D.C. Circuit vacated 18 the FCC’s 2003 interpretation of what consists an ATDS in 2018 19 could courts opine on the issue.5 See Marks, 904 F.3d at 1049

20 4 Notably, the Ninth Circuit unanimously denied the Marks appellee’s petition for rehearing en banc. Marks v. Crunch San 21 Diego, LLC, 14-56834 (9th Cir. Oct. 30, 2018). In that petition, 22 appellee’s first argument was that Marks conflicts with Satterfield. (Petition for Rehearing En Banc, at 7 (Docket No. 23 113-1).)

24 5 Defendants argue that to apply Marks here would apply the law retroactively. This argument has no traction. The 25 definition of ATDS included predictive dialers from 2003 until the D.C. Circuit vacated the FCC’s 2003 Order in 2018. PRA 26 obtained Lamkin’s number and began calling her in 2008. Because 27 Marks is consistent with the FCC’s 2003 Order, to apply Marks in this instance would merely apply the law as it was at the time of 28 the offense. 1 n.4 (“An appellate court lacks authority to consider a challenge 2 to an FCC order that is brought after sixty days from the date 3 when the FCC releases the final order to the public.”); see also 4 U.S. W. Commc’ns, Inc. v. Jennings, 304 F.3d 950, 958 n.2 (9th 5 Cir. 2002) (stating that “properly promulgated FCC regulations 6 currently in effect must be presumed valid” when not challenged 7 under the Hobbs Act). 8 The Ninth Circuit’s subsequent decision in Duguid v. 9 Facebook, 926 F.3d 1146 (9th Cir. 2019), confirms that Marks is 10 the law. In Duguid, the Ninth Circuit again addressed the 11 definition of an ATDS. According to the court, the Marks court 12 “construed ACA International to wipe the definitional slate 13 clean.” Id. at 1149-50. Marks then “rearticulated the 14 definition of an ATDS.” Id. at 1150. In Duguid, the Marks 15 definition of ATDS “governed [the] appeal” and now also binds 16 this court. Id. 17 Accordingly, because the parties do not dispute that 18 PRA’s Avaya can “store numbers to be called” and “dial such 19 numbers automatically,” Avaya is an ATDS.6 Marks, 904 F.3d at 20 1052. 21 C. Damages 22 Under the TCPA, “if the court finds that the defendant 23 willfully or knowingly violated [Section 227(b)], the court may, 24

25 6 Defendant’s motion to strike Snyder’s testimony is moot because it raises objections that are inconsequential given the 26 court’s finding on the definition of an ATDS. Defendant concedes 27 that Avaya calls stored numbers automatically, (Def.’s Resp. to Pl.’s SUF at 3, ¶¶ 9, 10), and, under Marks, plaintiffs need not 28 prove that Avaya generates random or sequential numbers. 1 in its discretion” award treble damages. 47 U.S.C. § 227(b)(3). 2 The Act, the FCC, and the Ninth Circuit are all silent on the 3 definition of the phrase “willful or knowingly.” District court 4 decisions are therefore instructive here. 5 A defendant willfully or knowingly violates the TCPA when 6 the defendant intends or knows “that it was performing each of 7 the elements of a TCPA claim (i.e., [1] that it was making a 8 call, [2] to a person who did not provide prior express consent, 9 [3] using an automated system).” Haysbert v. Navient Solutions, 10 Inc., 15–4144 PSG (Ex), 2016 WL 890297, at *10 (C.D. Cal. March 11 8, 2016) (citing Lary v. Trinity Physician Fin. & Ins. Servs., 12 780 F.3d 1101, 1107 (11th Cir. 2015); Olney v. Progressive Cas. 13 Ins. Co., 993 F. Supp. 2d 1220, 1227 (S.D. Cal. 2014); Harris v. 14 World Fin. Network Nat. Bank, 867 F. Supp. 2d 888, 895 (E.D. 15 Mich. 2012)). Plaintiff need not show that defendant knew his 16 conduct would violate the TCPA. Id. Accordingly, the threshold 17 to assess treble damages is “low.” Roylance v. ALG Real Estate 18 Services, Inc., 5:14–cv–02445–PSG, 2015 WL 1522244, at *11 (N.D. 19 Cal. March 16, 2015) (citing Charvet v. Ryan, 116 Ohio St.3d 394, 20 400 (2007)). 21 1. Making a Call 22 It strains credulity to think that defendant did not intend 23 to call plaintiff. Plaintiff owed defendant money and thus the 24 199 calls were no accident. (See Def.’s Statement of Undisputed 25 Facts at 4, ¶ 15) (“[R]epresentatives . . . contact debtors about 26 paying their debts.”).) 27 2. Lacking Prior Express Consent 28 The undisputed facts establish that defendants knew that 1 plaintiff had not given her prior express consent to be called. 2 The parties agree that (1) plaintiff did not give PRA her 3 cellphone number; (2) PRA instead obtained plaintiff’s number 4 from a third party; (3) PRA called plaintiff 199 times; (4) PRA 5 never investigated whether plaintiff had consented to be called; 6 (5) PRA stopped calling plaintiff at plaintiff’s request. 7 Defendant suggests that the only way to satisfy the willful 8 or knowing standard is to show that defendant called plaintiff 9 after plaintiff asked defendant to cease contact. See, e.g., 10 Roylance, 2015 WL 1522244, at *11; Arbelaez v. Capital Advance 11 Sols., LLC, No. 15-23137-CIV, 2016 WL 2625020, at *2 (S.D. Fla. 12 Jan. 20, 2016); Harris, 867 F. Supp. 2d at 896. This view is 13 incorrect. 14 Here, no reasonable trier of fact could find that PRA 15 thought it had plaintiff’s express consent. PRA never sought an 16 opportunity to obtain consent. PRA acquired plaintiff’s number 17 from a third party and subsequently failed to inquire into 18 whether plaintiff consented to be called. PRA therefore “should 19 have known that they were calling a person who did not provide 20 prior express consent.” N.L. by Lemos v. Credit One Bank, N.A., 21 No. 2:17-CV-01512-JAM-DB, 2019 WL 1428122, at *2 (E.D. Cal. Mar. 22 29, 2019). 23 3. Using an Automated System 24 The undisputed facts also establish that PRA intended to use 25 an automated system to place its calls. Defendant used the Avaya 26 system to “prevent[] PRA from losing man hours dialing debtor 27 phone numbers” by “calling those numbers via electronic means.” 28 (Pl.’s Statement of Undisputed Facts, Ex. 11 at 3 (Docket No. 16- 1 3).) In other words, PRA used Avaya specifically because it 2 intended to automate the process of calling debtors. 3 4. Compliance with Satterfield 4 Defendant insists that its actions were not willful or 5 knowing because it was complying with Satterfield. This court, 6 again, rejects defendant’s flawed interpretation of the law. As 7 discussed above, the law on the definition of ATDS from 2003 to 8 2018 was the FCC’s 2003 Order -- not Satterfield. The 2003 Order 9 | defined predictive dialers to be an ATDS and PRA knew that Avaya 10 | was a predictive dialer. (Def.’s Resp. to Pl.’s SUF at 8, FI 29.) 11 Defendant cannot rely on its misconstruction of the law to avoid 12 liability under the statute. 13 Because the violations are willful and knowing, the court 14 has the discretion to increase damages up to $1,500 per call. 15 The court exercises its discretion and awards treble damages of 16 | $298,500 (199x$500x3). 17 IT IS THEREFORE ORDERED that plaintiff’s Motion for 18 Summary Judgment (Docket No. 14) be, and the same hereby is, 19 GRANTED. 20 IT IS FURTHER ORDERED that defendant’s Motion for 21 Summary Judgment (Docket No. 17) be, and the same hereby is, 22 DENIED. 23 | Dated: September 25, 2019 / td . ak. 2 / 24 WILLIAM B. SHUBB 35 UNITED STATES DISTRICT JUDGE

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