Antitrust Law Daily Wrap Up, PRIVACY—9thCir: Debt Collector Enjoined From Using Predictive Dialer to Call Debtors, (Oct 15, 2012)

By Jody Coultas, J.D.

Cellular phone owner Jesse Myer was properly granted a preliminary injunction against a debt collection company, Portfolio Recovery Associates, LLC (PRA), which allegedly violated the Telephone Consumer Protection Act (TCPA) by using a predictive dialer to call debtors’ cell phones, according to the U.S. Court of Appeals for the Ninth Circuit (Meyer v. Portfolio Recovery Associates, LLC, October 12, 2012, Christen, M.).

Meyer filed TCPA claims against PRA and sought a preliminary injunction to prevent PRA from contacting debtors via their cell phones. A district court orally indicated that it would deny the request and entered a minute order on June 23, 2011 to that effect. Meyer filed a notice of appeal from the minute order. However, on September 14, 2011, the district court granted Meyer a preliminary injunction that restrained PRA from using its Avaya Proactive Contact Dialer to place calls to cellular telephone numbers with California area codes that PRA obtained via skip-tracing. The court also certified a class of debtors who were contacted by PRA on their cell phones.

Contrary to PRA’s assertions, the June 23, 2011 notice of appeal was premature and had no operative effect on the court’s jurisdiction. Jurisdiction remained in the district court as of September 14, 2011.

Class Certification

The district court did not abuse its discretion in granting provisional class certification, according to the court, as Meyer met the commonality, typicality, and adequacy requirements of Federal Rule of Civil Procedure 23(a). PRA argued that individualized issues of consent precluded a finding of typicality or commonality because some debtors might have agreed to be contacted on their cell phones. However, prior express consent is granted only if the cell phone number was provided by the consumer to the creditor at the time of the transaction that resulted in the debt at issue. Consumers who provided their numbers to creditors after the time of the original transaction did not consent to be contacted at those numbers for purposes of the TCPA. The district court acted within its discretion when it provisionally decided Meyer was an adequate class representative despite convictions for deceptive conduct, given the positive steps taken in his life.

Meyer’s class definition was not overly broad so as to preclude certification, according to the court. PRA argued that the class was overbroad because it might include debtors who provided express consent but whose telephone numbers were obtained via skip-tracing. However, PRA lacked evidence of even a single instance where a number that had been given by the debtor to the original creditor was also found by PRA via skip-tracing.

Preliminary Injunction

In order to obtain a preliminary injunction, the requesting party must show a likelihood of success on the merits, a likelihood of irreparable harm in the absence of preliminary relief, a favorable balance of equities, and public interest the granting of an injunction.

The district court did not err in finding that it was likely Meyer would succeed in stating TCPA claims against PRA, according to the court. PRA did not dispute that its predictive dialers had the capacity described in the TCPA and this was sufficient to determine that PRA used an automatic telephone dialing system that violated the TCPA. The TCPA was designed to protect against the types of calls at issue in this case.

Meyer demonstrated that he and the class members would suffer irreparable harm absent injunctive relief, according to the court. PRA’s continuing violations of the TCPA violated the class members’ right to privacy, and it was evident that PRA would continue to violate the TCPA if an injunction was not issued. The district court’s order was premised on Ninth Circuit case law approving injunctions without a showing of irreparable harm in cases seeking to prevent violations of federal statutes that specifically provide for injunctive relief.

The court did not address PRA’s allegations that the district court used the wrong legal standard when it decided that Meyer did not need to show irreparable harm in order to obtain a preliminary injunction, since there was evidence of a threat of actual, irreparable harm.

The case is No. 11-56600.

Ethan Preston (Preston Law Offices) for Jesse Myers. Christopher W. Madel (Robins, Kaplan, Miller & Ciresi LLP) for Portfolio Recovery Associates, LLC.

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