Antitrust Law Daily Wrap Up, PRIVACY—S.D. Cal.: TCPA class action settlement given preliminary approval, (Dec 13, 2013)

By Edward L. Puzzo, J.D.

The federal district court in San Diego has given preliminary approval to a class action settlement arising from claims of Telephone Consumer Protection Act (TCPA) violations by Capital Management Services (Grant v. Capital Management Services, December 11, 2013, Hayes, W.).

Wade Grant, on behalf of a purported class, had alleged that Capital Management Services had violated the Telephone Consumer Protection Act (TCPA) by making unsolicited calls to various cell phones by use of an automated dialing system. The claim was submitted to mediation, which resulted in a proposed class settlement.

Proposed settlement. The proposed settlement called for the defendant to submit to a stipulated injunction for three years, during which time it would employ a system to distinguish cell phone telephone numbers from land line telephone numbers, and to refrain from placing calls to cell phones unless prior consent had been obtained. The settlement called for injunctive relief only, and defendant’s agreement to pay plaintiff’s attorneys fees.

The court’s role in preliminarily approving a proposed settlement of a class action claim, the court stated, was ratify the propriety of the class certification and the fairness of the settlement and to ensure that class counsel and named plaintiffs did not put their own interests above that of absent class members.

Propriety of certification. The court ruled that the proposed settlement met the four requirements of Fed. R. Civ. P. 23(a), namely numerosity, commonality, typicality and adequacy of representation, and one of the prongs of 23(b), namely that the claims would not entitle named or unnamed class members to any form of individualized injunctive relief.

Fairness of settlement. The court concluded that the procedure for reaching settlement was fair, reasonable, and the product of arms-length negotiations, with the assistance of a retired judge as mediator. The settlement did not include monetary relief, the court noted, but it did bar defendant from similar practices in the future, and did not prevent individual members from seeking legal recourse. Consequently, the court ruled, the class settlement was preliminarily approved. Finally, since it provided only for injunctive relief, and unnamed class members were not bound by the agreement, no notice of class certification was required.

The case is Civil Action No. 10-cv-2471-WQH (BGS).

Attorneys: James Patrick Frantz (Frantz Law Group APLC) for Wade Grant. Andrew M. Steinheimer (Ellis Law Group, LLP) for Capital Management Services, LP.

Companies: Capital Management Services, LP

Cases: Privacy CaliforniaNews