Antitrust Law Daily Wrap Up, PRIVACY—E.D. Cal.: Ruling that debt collection calls were subject to Telephone Consumer Protection Act denied reconsideration, (Dec 6, 2013)

By Peter Reap, J.D., LL.M.

The federal district court in Sacramento has denied a motion by The CBE Group, Inc., to reconsider its ruling that the Telephone Consumer Protection Act of 1991 (TCPA) does apply to debt collection calls, and that therefore plaintiff Nancy Iniguez had an actionable TCPA claim against CBE (Iniguez v. CBE Group, Inc., December 4, 2013, Mendez, J.). In addition, CBE’s alternative request for interlocutory appeal of the ruling was denied because CBE failed to show that there was a substantial ground for difference of opinion on the issue.

Iniguez alleged that CBE Group, in violation of the TCPA, had placed numerous collection calls to her cell phone, seeking to collect a debt owed to Dish Network by a third party who had previously been identified with her phone number.

Motion for reconsideration. CBE argued in support of its motion for reconsideration that three “recent federal district court opinions have held that debt collection calls, similar to those underlying plaintiff’s TCPA claim, are exempt from TCPA, and thus these calls cannot give rise to a TCPA violation.”

First, the three cases cited by CBE were all decided before the court made its order on the motion to dismiss, and even before CBE filed its reply to plaintiff’s opposition to CBE’s motion to dismiss. Thus, these three cases were not recent and should have been included in the original motion to dismiss, according to the court.

The three cases cited failed to show how manifest injustice would result if the court declined to reconsider its order, and certainly did not support CBE’s contention that debt collection calls are categorically exempt from the TCPA, the court decided. For example, in Martinez v. Johnson, 11-CV-157-DN, 2013 WL 1031363 (D. Utah Mar. 14, 2013), the court found that a regulatory exemption applied to the calls, and therefore the TCPA did not prohibit them. However, the provision relied on by the district court in Martinez showed that it was inapplicable to the case at hand.

By the explicit language of the regulation, the exemption relied on by the court in Martinez applied to residential lines. It did not reference calls made to cell phones, which were discussed elsewhere in the regulation. As stated, the TCPA made a clear distinction between the provisions that apply to residential lines and those that applied to numbers assigned to a cellular telephone service. As such, the Martinez case did not apply to the claims at issue in the instant case, and it provided no support for CBEs motion for reconsideration, the court held.

Moreover, the other case law cited in the motion for reconsideration did not in any way support CBE’s broad contention that debt collection calls were categorically exempt from the TCPA restrictions, the court explained. Further, CBE failed to meet the standards required for a successful motion for reconsideration as required under Federal Rule of Civil Procedure 60(b) and Local Rule 230(j), and accordingly the motion was denied.

Interlocutory appeal. CBE also requested the court to certify its order for an interlocutory appeal pursuant to 28 U.S.C. § 1292(b). This section applies when a district judge, in making a civil action order not otherwise appealable under this section, believes that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation. In such circumstances, the judge shall state such a belief in writing.

Much of CBE’s argument for certification focused on the same cases discussed in its motion for reconsideration, the court noted. These cases did not provide adequate, if any, support for CBE’s contention that the TCPA did not apply to debt collection calls.

In addition, the case law that actually dealt with this question of law almost unanimously found that debt collection calls were not categorically exempt from the TCPA, and that debt collectors could be found liable for offending calls. Therefore, CBE failed to show a substantial ground for difference of opinion, and therefore failed to meet the high standard placed upon a moving party for an interlocutory appeal.

The case is No. 2:13-cv-00843-JAM-AC.

Attorneys: Seyed Abbas Kazerounian (Kazerounian Law Group) for Nancy Iniguez. Sean Patrick Flynn (Foley & Mansfield, PLLP) for CBE Group, Inc.

Companies: CBE Group, Inc.

Cases: Privacy CaliforniaNews