Antitrust Law Daily Wrap Up, PRIVACY—7th Cir.: Class certification upheld in Telephone Consumer Protection Act suit, (Apr 2, 2014)

By Linda O’Brien, J.D., LL.M.

In a putative class action against a property management business, a district court properly certified a class of recipients who allegedly received unsolicited fax advertisements in violation of the Telephone Consumer Protection Act, the U.S. Court of Appeals in Chicago has decided (Chapman v. Wagener Equities, Inc., March 31, 2014, Posner, R.).

Wagener Equities is a business that manages commercial real estate properties for the property owners. Recipients of faxed advertisements filed a putative class action suit against Wagener Equities and its owner, Daniel Wagener, alleging that the company paid an entity called Business to Business Solutions to send unsolicited fax advertisements in violation of the Telephone Consumer Protection Act (TCPA). The defendants appealed the district court order certifying the class.

The appellate court found that the district court did not err in certifying the class. A class can be certified without determination of its size as long as it is reasonable to believe the class is large enough to make joinder impracticable and thus justify a class action suit. The number of class members who have a valid claim can be determined after the class is certified. In rejecting the defendants’ argument that they would be forced to settle to avoid risk of a catastrophic judgment unless the class certification order is reversed, the court noted that the defendants presented no evidence of what their assets were in relation to the expected damages.

The defendants also did not demonstrate a significant probability that the class certification order was erroneous, according to the court. In rejecting the defendants’ argument that only the owners of the fax machines have standing to sue under the TCPA, the court noted that the statute contained no such limitation.

Finally, the defendants did not establish the inadequacy of one of the plaintiffs as a class representative. There is no violation of the TCPA if the recipient of the fax advertisement gave consent to the defendant to receive such advertisements. In this case, the plaintiff company’s fax number had been published in a building industry publication without its consent. Moreover, the defendants did not claim that other class members consented to receive the fax advertisements from the defendants. Thus, the court concluded that the appeal had no merit.

The case is No. 14-8004.

Attorneys: Robert Connor Heist (R. Connor & Associates, PC) for Wagener Equities, Inc. Phillip A. Bock (Bock & Hatch) for Arnold Chapman and Paldo Sign And Display Company.

Companies: Wagener Equities, Inc.; Paldo Sign & Display Company

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