good morning ladies and gentlemen our first cases for this morning are the consolidated cases of brodsky against humanity dental insurance an alpha tech hat against makati so we will begin mr hare with you issues that are before the court in this twenty three after appeal are substantially overlap or i'd say we could see that from your briefs i might add there is a slightly different focus because the brodsky court did not reach the effect of down very well so there are two main legal issues the first would be whether this court's twenty thirteen ruling in holtzman be terms of that sender of a facsimile advertisement must include a compliant opt out notice on the facts in order certain defense of established business relationship which is e b are or can set or prior expressed invitation or permission in the statutory language whether that ruling is binding i'm just your courts in the northern district of illinois as we contend t or as the district courts in this case these cases held isn't non binding dicta you know it's hard to find inters or any indication that the issue that you are focusing on that you and your opponents are focusing on in this case was before the court there there's a statement in the first paragraph which might mean the regulation covered it might mean the statute covered it but i don't see any indication that was really thoroughly litigated  there is that there is the sense in the introduction where the crash sites where there are yes and then later in the courts analysis in the fourth paragraph and the court applies that wall to the facts of the case and holds that because top of mind omitted because top of mind omitted opt out notices it does not matter which recipients consented or had the separate business relation with hers the court contrasted that this case with gene and gene which was a fifth circuit case where the facts it was sent before  notice requirement became fact of in two thousand and six where the court held that individual as issues of consent predominated so i let me ask you a somewhat different question i mean i i take your point about some of the language and in terms i still don't think that that tells me that research real focus on that but suppose there was we do now have a rematch and from the d c circuit in the case before it and i think actually the parties may have overstated the scope of the case before the d c circuit and some statements from the federal communications commission should we wait to see what the f c c does on remand before we decide this case if the court doesn't agree with us and that it's binding in that it means what it says at the statute requires up to notice it would not be unreasonable to wait and see what the f c c did going forward or how it how it reached whatever conclusion it's going to reach going forward given the new the regulation which was binding and in effect at the time that the specs were cited well is there any inconsistency in your position about that and your your position about the waiver because the f c c appear appears to have recognized that there was some ambiguity in the regulation there's somewhat contradictory language between the text in a footnote and so expressively invited people such as humana as such is the other parties here to come in and get a waiver and they did and the f c c said you know your your ok and so we're really going to be relying on the f c c isn't that something we should take seriously as well i agree the court to take it seriously but you know as we've argued those those waivers can't affect a private statutory right of action to sue for a violation of the regulations prescribed under the  because because it's a bit of quite i mean they're talking about effectively the scope of the regulation they're almost talking about you know a delayed effective date or whatever it's a it's an unusual sort of thing i agree but it's very unusual i agree the effect of it in practicality is that the f c c delayed the effect of the rule by eight years it said it hasn't been effective since two thousand and six but that wasn't his rationale is rationale was that the rule is valid and we issue just ignorant of what the law is so that's all you do is ask for one and be careful enough not to say we weren't aware of the c p a which is probably actually the truth in a lot of these cases what you get what would have happened if because actually in both of cases finding the language right away to doesn't matter in both of these cases the faxes that were sent did have a sentence that said you know if you're having a problem with this here's a number there were eight hundred numbers that people could call i did not memorize but there were numbers exposed the f c c had instead said you know we think it's important to give people an opportunity to revoke permission so to speak you know we've got established business relationship which doesn't seem to be what we're doing we seem to be on the per the consent branch of of this i don't know they way they said you know we're going to we're just going to take a more lenient approach to what that notice of ability to bail out needs to be and both of these people we don't have a situation where faxes came that were utterly silent about what to do we have simply notices that maybe don't comply with with the letter of the regulation i i think the f c c could have done something like that but i think under any reasonable standard the notices in this case wouldn't pass muster because they're both very similar they have  a they have a toll free phone no that's the only part of that the complies why isn't that the key part you know if somebody says hey you know i don't want to get these annoying faxes from humana i'm going to call this number to take me off the list will become hard is that there's other  why couldn't the f c c in creating a waiver say we're going to at least in these companies situations it wasn't a blanket waiver they didn't repeal the regulation they made people come in and ask  correct yeah right they were asked to do a blanket waiver and they've been and they didn't want to do that right so i think it could have but the up down notices in this case is very important that they're not clearing conspicuous so the recipient wouldn't there wouldn't be apparent to a reasonable consumer they don't invite advise the recipients of important factors that the regulations in the statute require such as that the request is binding only give you used the instructions in the up out notice so if you have a number for a  question before your initial time runs out this is a twenty three f appeal correct the district courts in both instances concluded that common questions didn't predominate really just a these two district judges abuse that discretion it's because that decision that that individual has to issues of prior transformation predominated was based on legal errors and pure errors of of law in our in our position one that you know when we say it's actually ruling the case of the defendants want to be overruled that should be their burden to file a petition for hearing on bali and that the regulation is valid and it a notwithstanding the waivers that the defendants got from the bureau which is on appeal to the f c c right that my clients appealed that to the full commission is not a final order and once we do get a final order if it's at first to us we will take object to people from that to either this court where two all right thank you very much so you are ms  the solicited facts rule applies it did not did apply the solicit sex rule to the facts before it did and if you look at the procedural history of that case what was at issue was the established business relationship that business relationship exception under the t c p a a which governs unsolicited faxes that happen to be sent to customers so at the time that judge easterbrook wrote the terms opinion in the fourth sentence provides an overview of the law he was exactly correct that that was the state of the law at the time the court cited to the t c p statute which i don't know if the intention was i'm citing to the the court is citing to the statute and thereby incorporating the regulations promulgated there under or perhaps the solicited fax roll should have also been cited because there is no debate that in the t c p a there is not a requirement to include off that disclosure language on solicited faxes well but that the question i think and i want to get to the vice case too but the question is going forward you know you have either the established business relationship or the consent were on consent i think and going forward suppose you don't want to consent anymore i mean i think the motivation behind the rule that the f c c passed which didn't it wasn't called the solicited facts rule it was it was just a rule trying to make sure that people who didn't want faxes going forward even if they had accepted them in the past had a way of making that view known and that was through the same mechanism of getting the numbers and all the rest of it the conspicuous disclosure i understood your honor and that's the issue that the bioscope court had dealt with well it sort of dealt with it i both parties have vastly over read that because i'm going to read you the holding of the bias yacov case the court says we hold that the f c c has two thousand and six solicited facts rules unlawful to the extent that it requires opt out notices unsolicited faxes and then now we come to what it really did the f order in this case that was a two thousand and fourteen order interpreted and applied that two thousand and six rules so it's an application we've vacate that word or that is just say the two thousand and fourteen order and remand this was not an end run around the timeliness rules of bringing a hobbs act challenge to the two thousand and six rule because of all people had to do was just say oh well now you've applied it there wouldn't even be a time limit so i think what the d c circuit did was to simply vacate a two thousand and fourteen order and that has some implication for the breadth of the holding the breadth of the application this was not there there were issues related to an f c c one nine hundred ninety two water and the two thousand and eight order and there was a question of timeliness and what the d c circuit said is actually the petitioners did it right they didn't take an appeal or a petition for review up to the d c circuit you know the ninety two or the two thousand and eight order an untimely matter they went back to the agency and said we need some guidance here and then once that ruling became a final order the issue was timely brought to the d c circuit so here there at that that's the only thing that i agree with all of that you know but that's the only thing that's before us to it's not when we look at what the d c circuit did in a real ho situation you know a direct attack on the rule of the statutory system boils it down to one court of appeals that's going to take that and that sort of implicitly just as though you know this court was to look patent case well they belong in the federal circuit it's not like well we can't do a collateral attack on a federal circuit patent issue anymore than you can do a collateral attack on  this is different this is the application of the two thousand and fourteen rule which i mean we can certainly read respectfully what they said but it's not the same thing as the two thousand and six it's important to view where that two thousand and fourteen rule came from so as the f c c acknowledged there was confusion about whether the disclosure requirement applied to solicited or unsolicited faxes so let me ask you a question about that yes there was confusion i pointed that out to your opponent  i don't see any reason for who got the benefit of a waiver and who didn't it's an interesting question your honor and one that the d c circuit didn't reach him by as yaka but the f c c given the confusion that folks had over there and the f c c admitted that it had been internally inconsistent i think it was the right course for the f c c particularly considering the consequences the it's just a matter hundreds of millions in exposure because we're not including a compliant opt out notice when we read your orders at c c you say first it should be included on unsolicited faxes and then later that it should be included in solicited access so what the f c c did there and also did ask the f c c to address the issue of its own authority did you at c c have the authority to be regulating in the area of solicited faxes at all because the t c p didn't give you that authority and the f c c of course answered that question  of concerns i mean just to give some credit you know and this is of course formal rules making chevron considerations come in we are not the supreme court when you walked in the dirksen building you probably saw that so if chevron goes by the wayside so be it but at the moment it's there understood yes and so the f c c reached its ruling and then there was a petition to review taken under the act and that brings to i think a really important question in this case what the plaintiffs are advocating for is to write the hobbs act out of existence oh i don't think so i think that they're just saying what what's the scope of what the d c circuit did  circuit had had before it a direct attack on the two thousand and six regulation then as i told you as far as i'm concerned that's the d c circuits business such a direct attack can come in one of the regional courts from the f c c in which case  the two thousand and fourteen letter was although it did call into question a two thousand and six ruling that it's just an application of the two thousand and six ruling and there could be other applications and so the d c circuit was not ruling for all sorts of applications that were not before it i do think the d c circuit made very clear that they were invalidating as unlawful the f c c as ability to regulate solicited faxes which is what the two thousand and six rule did and it was a complete no they overreached you're saying no i don't believe so  have that issue before them they actually i believe that they did your honor because onda had called that that was the question that onda had brought to the f c c it was the attitude as nation of the two thousand and six rule they add that in the on the application they did ask the f c c to opine or make a decision on its own authority so an advisory opinion no they had that they asked the f c c to to look at whether it had a the authority to govern solicited fact as if it determine that that's in fact what it had done and if it hadn't fact done that then to look at the internally consistencies so isn't that the issue that's right now before the commission remained well on remained i think what the f c c is going to have to do is deal with these facts labor waters that are out there and i think they're ultimately will be some agency action taken which may result in another final order which would then create the potential for another hobbs act appeal but as things stand at this point the solicited tax rule in two thousand and six order and the two thousand and fourteen order have been invalidated by the d c circuit yeah i just agree with you on the first of those i think what the d c circuit says is we vacate that order the two hundred the two thousand and fourteen order every man for further proceedings they didn't say they were invalidating the two thousand and six solicited fax rule and if it doesn't have the power to it wasn't before them if that even if that is is correct your honor that the application to this case you know depends on the two thousand and fourteen rule and the same one and yes that would get us to the back to the same result and that would mean that the district court did the right thing here and they should be affirmed ok sounds good thank you obviously i'm happy to answer any other questions you may have but that's really where i was going to i'd be interested to hear which i have to say about the waiver well i think it's important in light of the conversations that we just had i think it's important to kind of recap where the waiver came from the f c c had identified think that in light of all that what the f c c did is what players council acknowledged they delayed the effective date that's what the waiver essentially did is it delayed the effective date of the solicited fax rule for folks who had it who came in and said i've i've sent a fax about a compliant opt out notice before april thirty twenty fifteen now your client was one of the ones that came in and received by name that the waiver right that's correct so did you have to make any particular showing to do that did you just have to stand up there and say we were confused by the tension between your footnote in the text of your order we had to show that we were innocent we were similarly situated to the individual entities and individuals who had received a waiver the two thousand and fourteen on the order which was that we had sent faxes during that time period and and that that was essentially the showing that was required did anybody get turned down for a waiver people got there were applicants in the twenty sixteen order which is the one that granted the waiver to see that said that they said we we knew nothing about the footnote we knew nothing about that well they may not have mentioned the proposed rulemaking but they said they didn't know anything about the a funny situation doesn't it with a given the legal basis at least of the d c circuit opinion which i do think relates to the two thousand and fourteen order that was what was before the court that was with the petition for review presented to the court i know there is language there is addictive about you know sweeping the entire if in fact there's actually did any opinion about who uses circuit but yeah i just am concerned about what seems to be a rather arbitrary just position of of the waivers  wonder if there's anything that we should do about that well i think to to that point your honor and i know you had some discussion with miss mary cary about this with to that point if there's a problem if printers council has a problem with the content of the of the waiver waivers i guess that we're seeing in this case this this isn't the this isn't the time to address it those arguments are right now you're not going to be ripe until the f c c issues a final the t c p a covers or at least empowers the f c c to speak to both existing consent and future consent so that the solicited fact what we're all ok if the commission has that power it also has the power to modify the application of its own rule try to use neutral terminology and once it's modified the application for people like your clients the commonality of the question of consent disappears and so this was properly not handled as a class action is that right so even to even if even if the statute covers all of this and even if the regulatory authority was there for the solicitor facts rule the regulatory authority you would say i'm thinking would also be there for the waivers or for the for the change in the effectiveness of the regulation and once the regulation allows your clients to go forward with the kind of language they used there's no commonality on consent so there are parts of that that i agree with and parts that i don't i agree that if if the waiver is valid yes the comma questions predominate and the class action is not a superior method for educational questions don't forget me i'm sure you meant to say i'm sorry what's that i said you probably meant to say common questions do not predominate yes if  right yes thank you but i don't think that you can i don't think that the if you were talking about the f c c is authority to issue to solicit factual and the waiver i don't think those are the same thing  factual is only to implement regulations that implement the requirements of the act and i understand that i understand that that's your position i was just saying if we were to disagree with your position and think that the statute is broad enough to allow the commission to worry about what i'm going to call future consent not just existing consent that my nestle the rule that everybody's decided to call th rule which is not called you know in the federal register but that might be enough to nestle the rule under the statute but if that's true then the f c c might also have the power to decide under what circumstances the rule is going to apply that that would save your waivers and if the waivers are good then the common questions are not good i think your honor i might my position is is that that the f c c has to issue regulations with respect to the t c p a is comes from a different source and the authority that it has to issue the waiver that the authority has issued a waiver comes into the telecommunications act more broadly  it was implementing a one of its own rules section one point three that's not part of the t c p a so i take your point but i think they come i think the sources of those f c c actions come from different places and why does that matter well because it because you can then you can't tie then the authority to issue this list of factual is a really tied to the authority to issue the waiver are different they come from different places you have to look at what the authority is to shoot a waiver and what congress intended there versus the authority to issue the solicitor factual and what congress intended with respect to that and it's clear from the t c p i think that congress only intended to regulate soliciting  unsolicited faxes it doesn't talk about faxes sent with permission or all right so let me give you this hypothetical suppose humana is happily sending these faxes and it goes to mr brodsky or anybody you know john smith and instead of issuing the actual faxes that you are with the phone numbers at the bottom there's nothing there's no contact information there's nothing and mr brodsky decides i'm tired of getting these faxes from humana how can i bail out and he searches through the internet me googles and he does everything he can find any way to get in touch with you is this isn't that a sick situation that the f c c would rightly be concerned about the facts in our case are a little bit different some i don't know as i'd say so your theory would allow a fax with no information whatsoever about revoking consent and that worries me i understand your honor i think the the f c c spoke to that in a twenty fifteen order that i don't have a cite from me i believe it is cited in plaintiff's brief  that said in there that revocation of consent can be done by any reasonable means but i don't understand your point that it doesn't tell them exactly how to do it it doesn't tell them right so i'm just trying to figure out that the logic of your theory and you're right your case isn't quite that bad because you did put a couple of phone numbers in but under your theory the f c c is powerless to say you need to give people some way to opt out even if in the past they've accepted and you say no you don't have to do that at all so it puts no significant burden on people if you're free from any obligation and maybe your companies are reputable company that would never do that there are others out there in the market who are not so scrupulous that i would have to agree three hundred percent my client is a scrupulous company that would always do something like that i think your honor i see that my time and all these please observe i i just would thank you for the opportunity to present here today i think the only way that thing i would do to wrap up is to say that that question that you raise about what happens if nobody puts anything on there is something that the we can expect the f c c is going to address in the upcoming upcoming rulemaking i think after the remains and from the buy shock of decision as well as the the the petitions for review that have been fil the start where my colleague left off a future hob ject appeal from the proceedings that are pending before the f c c right now as i was thinking about this yesterday and let's say the f c c as it's currently constituted and the current chairman circuit that the f c c didn't have statutory authority to issue the opt out regulation so let's assume that my client's application for review the f c c enters a final order saying this regulations invalid and so you don't even need to whether in fact the f c c does have statutory authority to require up that notice unfairness it with prior express permission so what is that circuit court going to do is it going to say my hands are tied the d c circuit has decided this issue  don't worry about that for me it is a new appeal from a new order will properly go to a core there's going to be a holding that the twenty fourteen ford are applying the two thousand and six rule had to be set aside but the twenty fourteen order won't be before your hypothetical new court now correct the twenty agin order will be the twenty eighteen  twenty nine thousand or whatever year it may be order will be and there that court will undoubtedly give respect to whatever else has been said that was part of the rationale of the circuits opinion that i think that's why it's important to be clear about what's before court and what is not i agree and the defendants in that future proceeding will rely on the majority opinion and base yakov from the d c circuit we will rely on judge pillar to dissent which it creates to penalties for violations of the regulations prescribe you're talking about a future case i don't see why that's this case given the fact that you know what we have here is the fact that these companies both of the defendants here received waivers from the f c c and the f c c appears to have the authority to construe its own regulations or even things like our out there which the supreme court's been wondering about that it's also still out there we give deference to agencies interpretations of their own rules so why isn't that the same a legitimate safe harbor that these particular companies get if if it was an agency enforcement proceeding of course the f c c could waive or just choose not to enforce the regulations against any defendant that it wishes to it but there are private rights at issue here there's my client's rights to enforce the regulations prescribed under the keys he p a and this court held in terms of that that provision is there the right to sue for the regulations prescribed and to c p a so that consumers do not need to rely on the f c c for enforcement they can do it themselves and i contrasted in our opening brief the overall structure of the t c p it's a tripartite enforcement scheme where private parties such as my clients can bring can bring in force and actually district courts or state courts state governments state attorneys general can bring in forty seven u s c in various sections but the f c c has no power to intervene in a private right about action the appropriate court has the statutory language the appropriate court determines if there has been a violation of the statute or the regulations prescribe under the statute regulation but you're saying that the waiver regulation is not one of those regulations prescribed under the statute i'm saying that's what that is true which is  c so it's bootstrapping well somewhat i mean you know they created the first one it didn't create the statutory right of action it didn't create the statute that's true and i analogize this to the securities fraud context in our brief private securities fraud plaintiffs sue under the securities exchange act for violations of f c c will ten p five which is what makes it illegal to make an untrue material statement fact or omit a material statement that's necessary to make it not misleading i'm she doesn't use just a little bit because the supreme court would strike down a regulation that exceeded the scope of the statute but the supreme court has not done that with rule ten b five in jail case against or act it says that rule  fits under the umbrella of the statutory section ten b which has pretty capacious language in ten b five implements that if can be thought i was off there in left field you know or outside the stadium altogether the court would say the agency has exceeded its authority but that's i agree but that's a different question because so i just don't want to proceed on the basis that the regulation somehow can go beyond the scope of the statute or regulation labyrinths the scope of the statute i agree we maintain that with the opt out regulation this case does fall within the f c c statutory authority for there to be a waiver the thing being waived has to be valid it has to be presumed valid we cited if you're asking for a waiver of the requirement you're presuming the validity of the requirement and you're presuming that it was violated because without a violation of a valid rule there's nothing to waive i would say maybe it's just a belt and suspenders you know maybe you think there's a problem with it but you know you'll be happy if you can just get it waived to in any case i can for sure say that the f c c has twenty fourteen order granted the waivers to the parties there  because it held the regulation was valid if you know what i'm saying wouldn't of the f c c has stuck by the validity of the regulation up until the present time although they may change their mind based on statements that chairman pa and others have made they  may i kind of touched on you asked the question if the agency can issue the regulation doesn't necessarily have the power to waive it too right and that's why i discussed the f c c regulation in there because he says he's never granted a waiver like that the closest case i could on the clean air act and the e p a tried to create by regulation in affirmative defense to be used in those statutory citizen suits where they the the polluter the defendant could prove that the pollution even even to create a defense that the defendant had to go into court and prove whereas here all you have to do is go to the f c c and say i'd like one too i'd like a waiver to may please have as always you were careful not to say we were ignorant of the law you like to touch on the the question of future consent whether you're once you give prior trust permission let's assume a recipient does and then they get the first facts ok and i'm really interested in this more you get another fax and they keep coming and you say you know what i keep sto that particular implication because if you're silent then you put the burden on the fax recipient to search all over creation to find some way to get through to the fax sender i think that is what motivated the decision in terms of i think that's what the court was thinking about there and that rational spelled out more thoroughly in the physicians health source versus striker case from the western district of michigan where he reaches the judge younger their reach the same result as the f c c but