Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_13-cv-02219/USCOURTS-cand-4_13-cv-02219-28/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1331 Fed. Question

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

TRUE HEALTH CHIROPRACTIC INC, et 

al.,

Plaintiffs,

v.

MCKESSON CORPORATION, et al.,

Defendants.

Case No. 13-cv-02219-HSG 

ORDER DENYING MOTION FOR 

CLASS CERTIFICATION; DENYING 

AS MOOT MOTION FOR STAY; 

SETTING CASE MANAGEMENT 

CONFERENCE

Re: Dkt. Nos. 208, 209

Plaintiff True Health Chiropractic, Inc. filed this putative class action on May 15, 2013, 

alleging that Defendant McKesson Corporation (“McKesson”) sent “unsolicited advertisements” 

by facsimile (“fax”) in violation of the Telephone Consumer Protection Act (“TCPA”). See Dkt. 

No. 1. Plaintiff filed a First Amended Complaint on June 20, 2013, Dkt. No. 7, and a Second 

Amended Complaint (“SAC”), Dkt. No. 90, which added McLaughlin Chiropractic Associates, 

Inc. as a Plaintiff and McKesson Technologies, Inc. (“MTI”) as a Defendant. 

Pending before the Court is Plaintiffs’ motion for certification of a nationwide class 

defined as: “[a]ll persons or entities who received faxes from ‘McKesson’ from September 2, 

2009, to May 11, 2010, offering ‘Medisoft,’ ‘Lytec,’ or ‘Revenue Management Advanced’ 

software or ‘BillFlash Patient Statement Service,’ where the faxes do not inform the recipient of 

the right to ‘opt out’ of future faxes.” Dkt. No. 209 (“Mot.”) at 1. Defendants filed an opposition 

to that motion, Dkt. No. 220 (“Opp.”), and Plaintiffs filed a reply, Dkt. No. 221 (“Reply”). 

The Court has carefully considered the arguments presented by the parties, both in their 

submissions to the Court and during oral argument, and for the reasons discussed below, DENIES 

Plaintiffs’ motion for class certification.

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I. BACKGROUND

The SAC alleges that Defendants violated the TCPA by sending “unsolicited 

advertisements” by fax. SAC ¶¶ 1-2. Plaintiffs contend that they had not invited or given 

permission to Defendants to send the faxes, SAC ¶¶ 14-18, but that even assuming the faxes were 

sent pursuant to a recipient’s express permission or an “established business relationship,” the 

requisite “opt-out notice” was absent, id. at ¶¶ 33-34.

The parties agree that there are approximately 11,979 unique fax numbers at issue. Dkt.

No. 209-3; Dkt. No. 220-18. 

II. CLASS CERTIFICATION STANDARD

Federal Rule of Civil Procedure 23 governs class actions, including the issue of class 

certification. A plaintiff “bears the burden of demonstrating that she has met each of the four 

requirements of Rule 23(a) and at least one of the requirements of Rule 23(b).” Zinser v. Accufix 

Research Inst., Inc., 253 F.3d 1180, 1186 (9th Cir.), opinion amended on denial of reh’g, 273 F.3d 

1266 (9th Cir. 2001); see also Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 351 (2011) (“A party 

seeking class certification must affirmatively demonstrate [her] compliance with the Rule.”).

Rule 23(a) provides that a district court may certify a class only if: “(1) the class is so 

numerous that joinder of all members is impracticable; (2) there are questions of law or fact 

common to the class; (3) the claims or defenses of the representative parties are typical of the 

claims or defenses of the class; and (4) the representative parties will fairly and adequately protect 

the interests of the class.” Fed. R. Civ. P. 23(a). That is, the class must satisfy the requirements of 

numerosity, commonality, typicality, and adequacy of representation to maintain a class action. 

Mazza v. Am. Honda Motor Co., Inc., 666 F.3d 581, 588 (9th Cir. 2012). “Further, while Rule 

23(a) is silent as to whether the class must be ascertainable, courts have held that the Rule implies 

this requirement as well.” In re High-Tech Employee Antitrust Litig., 985 F. Supp. 2d 1167, 1178 

(N.D. Cal. 2013); Chavez v. Blue Sky Natural Beverage Co., 268 F.R.D. 365, 376 (N.D. Cal.

2010) (holding that a class “must be adequately defined and clearly ascertainable before a class 

action may proceed”). 

If the four prerequisites of Rule 23(a) are met, a court also must find that the plaintiff 

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“satisf[ies] through evidentiary proof” one of the three subsections of Rule 23(b). Comcast Corp. 

v. Behrend, 133 S. Ct. 1426, 1432 (2013). Plaintiffs assert that they meet the requirements of both 

Rule 23(b)(2) and 23(b)(3). Rule 23(b)(2) provides for certification where “the party opposing the 

class has acted or refused to act on grounds that apply generally to the class, so that final 

injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole.” 

Fed. R. Civ. P. 23(b)(2). Rule 23(b)(3) applies where there is “predominance” and “superiority”: 

“questions of law or fact common to class members predominate over any questions affecting only 

individual members, and . . . a class action is superior to other available methods for fairly and 

efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). 

III. DISCUSSION

Plaintiffs seek certification under either Rule 23(b)(2) or 23(b)(3). The Court finds 

certification under either rule inappropriate. 

A. TCPA Provisions Applicable to Faxes 

The TCPA provides that it shall be unlawful for any person:

(C) to use any telephone facsimile machine, computer, or other 

device to send, to a telephone facsimile machine, an unsolicited 

advertisement, unless--

(i) the unsolicited advertisement is from a sender with an 

established business relationship with the recipient;

(ii) the sender obtained the number of the telephone 

facsimile machine through--

(I) the voluntary communication of such number, 

within the context of such established business 

relationship, from the recipient of the unsolicited 

advertisement, or

(II) a directory, advertisement, or site on the Internet 

to which the recipient voluntarily agreed to make 

available its facsimile number for public distribution,

except that this clause shall not apply in the case of 

an unsolicited advertisement that is sent based on an 

established business relationship with the recipient 

that was in existence before July 9, 2005, if the 

sender possessed the facsimile machine number of 

the recipient before July 9, 2005; and

(iii) the unsolicited advertisement contains a notice meeting 

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the requirements under paragraph (2)(D),

except that the exception under clauses (i) and (ii) shall not apply 

with respect to an unsolicited advertisement sent to a telephone 

facsimile machine by a sender to whom a request has been made not 

to send future unsolicited advertisements to such telephone facsimile 

machine that complies with the requirements under paragraph 

(2)(E)[.]

47 U.S.C. § 227(b)(1)(C). The statute defines “unsolicited advertisement” as “any material 

advertising the commercial availability or quality of any property, goods, or services which is 

transmitted to any person without that person's prior express invitation or permission, in writing or 

otherwise.” § 227(a)(5). 

B. Certification under Rule 23(b)(2) 

Defendants argue that Plaintiffs’ attempt to certify an “injunction-only” class under Rule 

23(b)(2) must fail because the TCPA provides for individualized monetary damages to class 

members. See Opp. at 24; Dukes, 131 S.Ct. at 2557 (“[Rule 23(b)(2)] does not authorize class 

certification when each class member would be entitled to an individualized award of monetary 

damages.”). Several courts have considered Dukes in the context of a TCPA claim and held that 

the individual monetary awards provided by the statute foreclose the certification of a 23(b)(2) 

class. See Connelly v. Hilton Grand Vacations Co., LLC, 294 F.R.D. 574, 579 (S.D. Cal. 2013) 

(holding the availability of statutory damages renders “Plaintiffs’ TCPA claims . . . ineligible for 

Rule 23(b)(2) certification” (citing Dukes, 131 S.Ct. at 2557)); Balschmiter v. TD Auto Fin. LLC, 

303 F.R.D. 508, 516 (E.D. Wis. 2014) (“[P]ermitting certification under Rule 23(b)(2) in TCPA 

cases would impermissibly allow the monetary tail to wag[ ] the injunction dog.” (internal 

quotation marks omitted) (citing Dukes, 131 S.Ct. at 2557)); Abdeljalil v. Gen. Elec. Capital 

Corp., 306 F.R.D. 303 (S.D. Cal. 2015) (same). 

Given that each plaintiff is independently entitled to statutory damages under the TCPA, 

and that Plaintiffs expressly seek “actual monetary loss from such violations or the sum of five 

hundred dollars ($500.00) for each violation,” see SAC ¶ 39, the Court finds certification under 

Rule 23(b)(2) impermissible. See Dukes, 131 S.Ct. at 2557 (holding that certification is improper 

for claims for “individualized relief,” including claims that entail an “individualized award of 

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monetary damages”).

1

 

C. Certification under Rule 23(b)(3)

The predominance inquiry of Rule 23(b)(3) “tests whether proposed classes are sufficiently 

cohesive to warrant adjudication by representation.” Amchem Prods., Inc. v. Windsor, 521 U.S. 

591, 623 (1997). Accordingly, the predominance analysis “focuses on the relationship between 

the common and individual issues in the case.” Wang v. Chinese Daily News, Inc., 737 F.3d 538, 

545 (9th Cir. 2013) (internal quotation marks omitted); see also In re Wells Fargo Home 

Mortgage Overtime Pay Litig., 571 F.3d 953, 958 (9th Cir. 2009) (“Whether judicial economy will 

be served in a particular case turns on close scrutiny of the relationship between the common and 

individual issues.” (internal quotation marks omitted)).

Undertaking the predominance analysis requires some inquiry into the merits, as the Court 

must consider “how a trial on the merits would be conducted if a class were certified.” Gene &

Gene LLC v. BioPay LLC, 541 F.3d 318, 326 (5th Cir. 2008) (internal quotation marks omitted); 

see also Zinser, 253 F.3d 1180, 1189-90 (noting that district courts must consider as part of the 

predominance analysis whether a manageable class adjudication can be conducted); Hanlon v. 

Chrysler Corp., 150 F.3d 1011, 1022 (9th Cir. 1998) (finding predominance “[w]hen common 

questions present a significant aspect of the case and they can be resolved for all members of the 

class in a single adjudication” (internal quotation marks omitted)); Berger v. Home Depot USA, 

Inc., 741 F.3d 1061, 1068 (9th Cir. 2014) (same).

Here, Defendants argue that Plaintiffs cannot establish predominance because individual 

issues regarding prior express permission predominate over any common issues of fact. 

Defendants have provided evidence demonstrating that such individualized inquiries will be 

necessary. For example, Defendants’ former sales representative Jeffrey Paul explained that he 

would have “numerous conversations with customers over the phone on a daily basis” and that it 

 

1

The Ninth Circuit affirmed the district court’s provisional certification of a Rule 23(b)(2) class in 

Meyer v. Portfolio Recovery Associates, LLC, 707 F.3d 1036 (9th Cir. 2012). Although Meyer

was a TCPA class, the Court finds Meyer does not dictate a different outcome here. Unlike the 

facts in Meyer where it appears plaintiffs sought only injunctive relief, here Plaintiffs explicitly 

seek individualized monetary relief. Thus, under Dukes, Rule 23(b)(2) certification would be 

impermissible. 

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“was commonplace for customers to ask [him] . . . to send them information by fax, including 

information on promotions.” Dkt. No. 220-1 ¶¶ 2-4. Like other sales representatives working 

with him, Paul’s “long-standing relationships and dealings with customers” allowed him to 

become “familiar with [his] customers’ communications preferences.” Id. at ¶¶ 4-6; see also Dkt. 

No. 220-15 at 4 (“[B]ecause of these longstanding and well developed relationships, PPS sales 

representatives would learn and know that a particular customer exclusively preferred to receive 

faxes over, for example, emails.”). Relying on these individualized communications and 

relationships, representatives would send faxes as requested. Dkt. No. 220-1 at ¶ 3-4.

Another member of the sales team, Kari Holloway, see Dkt. No. 210-3 at 5, testified that 

“customers would request a lot of information via fax,” and that she and other sales team members 

would send faxes either “in a bulk communication or a one-by-one fax,” Dkt. No 220-13 at 5. She 

explained that they would send faxes to existing customers based on their communications with 

each fax recipient. Id. Customers would make specific requests for faxes “through oral 

conversations,” and the “sales representatives had a decent handle on who their customers were. . . 

[and] the ways they would like to be communicated with.” Id. at 6-7. 

Moreover, Defendants’ interrogatory responses list additional ways Defendants say they 

obtained prior express permission to send faxes. Some customers may have given permission by 

providing their fax numbers during the registration process. Dkt. No. 220-15 at 3. Others 

allegedly gave permission by checking a box during “their software registration that indicated 

their express permission to be sent faxes as a preferred method of communication.” Id. at 4. And 

in some instances, customers completed written consent forms providing express permission to 

receive faxes. Id. Thus, in addition to the individualized oral and email communications sales 

team members had with customers, Defendants identify several other methods by which customers

could have provided permission. 

Although there are some common issues present, including whether the faxes are 

advertisements and whether the product registration forms constitute “express permission,” the 

diversity of ways in which Defendants allegedly received permission suggests “that the issue of 

consent should be evaluated individually, rather than on a classwide basis.” Connelly, 294 F.R.D. 

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at 578. The facts underlying the issue of “express permission” here are unlike cases in which

consent was received through uniform means, thus facilitating generalized determinations under 

the law. Compare Manno v. Healthcare Revenue Recovery Group, LLC, 289 F.R.D. 674, 688 

(S.D. Fla. 2013) (finding putative class members “went through the same or similar admissions 

process, during which they provided their phone numbers” and thus, the class “will prevail or lose 

together both on their claims and on [d]efendants’ affirmative defense of consent”)2, and Kavu, 

Inc. v. Omnipak Corp., 246 F.R.D. 642, 647 (W.D. Wash. 2007) (finding common issues 

predominated where defendants “obtained all of the recipients’ facsimile numbers from the 

Manufacturers’ News database,” thus creating the common issue of “whether the recipients’ 

inclusion in the Manufacturers’ News database constitutes express permission to receive 

advertisements via facsimile”) with Connelly, 294 F.R.D. at 578 (finding individual issues 

predominated where defendant argued that class members consented via “the individualized 

experience that each guest shared with Hilton,” including by signing up for the loyalty rewards 

program over the phone, online, or through a paper application, or by reserving rooms online, over 

the phone, or through brick-and-mortar travel agencies), Gannon v. Network Tel. Servs., Inc., No. 

CV 12-9777-RGK PJWX, 2013 WL 2450199, at *2 (C.D. Cal. June 5, 2013) (holding that where 

defendants provided evidence of varied ways in which class members consented, the class was not 

ascertainable or identifiable, because significant inquiry as to each individual would be required), 

aff’d, 628 F. App’x 551 (9th Cir. 2016), and Gene, 541 F.3d at 329 (noting that because defendant 

“culled fax numbers from a variety of sources,” “individual inquiries of the recipients are 

necessary to sort out which transmission was consented to” and thus “class-wide proof of consent 

is not possible”). 

While the issue of whether any class member actually granted permission is not before the 

Court at this stage of litigation, the Court is required to determine at the class certification stage 

 

2 Unlike in this case, the plaintiffs in Manno expressly excluded “those individuals who had any 

communications with [defendant] prior to being called” from the class definition. 289 F.R.D. at 

689-90 (emphasis in original). This approach conclusively eliminated the need for any 

individualized inquiry regarding consent. 

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“whether the issue of consent is a common issue with a common answer that predominates over 

any individual issues.” Blair v. CBE Grp., Inc., 309 F.R.D. 621, 630 (S.D. Cal. 2015). 

Defendants have presented sufficient evidence to establish that this Court would need to make 

detailed factual inquiries regarding whether each fax recipient granted prior express permission.

And significantly, Plaintiffs have not offered their own satisfactory method of establishing a lack 

of “express permission” via class-wide proof. See Zinser, 253 F.3d at 1186 (party seeking class 

certification has the burden of meeting the class certification requirements); Gene, 541 F.3d at 328 

(holding that plaintiff had not met its burden to show that the class certification requirements were 

satisfied where plaintiff failed to offer a “sensible method of establishing consent or lack thereof 

via class-wide proof”). This remains equally true whether the lack of consent is an element of a 

TCPA claim (as Defendants argue) or the presence of consent is an affirmative defense under the 

TCPA (as Plaintiffs claim). See Gene, 541 F.3d at 327 (“Whether established by [defendant] as an 

affirmative defense or by [plaintiff] as an element of the cause of action, the issue of consent will 

entirely determine how the proposed class-action trial will be conducted on the merits.”). 

Moreover, the Federal Communications Commission’s (“FCC”) grant of a retroactive 

waiver to Defendants does not affect this outcome. The waiver stems from a FCC regulation that 

requires even solicited faxes to include opt-out notice. See 47 C.F.R. § 64.1200(a)(3)(iv); Rules 

and Regulations Implementing the Telephone Consumer Protection Act of 1991; Junk Fax 

Prevention Act of 2005, 71 FR 25967-01, 25972 (“[E]ntities that send facsimile advertisements to 

consumers from whom they obtained permission must include on the advertisements their opt-out 

notice and contact information to allow consumers to stop unwanted faxes in the future.”). In 

August 2015, the agency retroactively excused Defendants from providing opt-out notice in faxes

sent with prior express permission before April 30, 2015. See In the Matter of Rules & 

Regulations Implementing the Tel. Consumer Prot. Act of 1991, 30 F.C.C. Rcd. 8598, 8613 (2015)

(“Waiver Order”). 

As a threshold matter, the Court notes that its consideration of the waiver does not violate 

separation of powers. Whereas the statute on its face pertains to unsolicited advertisements, the 

waiver relates only to solicited faxes, and stems directly from the agency’s regulation of solicited 

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faxes. Because the waiver’s scope is unrelated to Defendants’ alleged liability for problems with 

unsolicited faxes, there is no retroactive release of statutory liability and thus no potential 

separation of powers issue. Accordingly, assuming arguendo that the FCC’s promulgation of the

regulation regarding solicited faxes was proper (notwithstanding the statute’s facial limitation to 

unsolicited faxes), the FCC also must have authority “to determine when and how to apply [that] 

regulation, and to waive it for good cause.” See Bais Yaakov of Spring Valley v. Graduation 

Source, LLC, No. 14-CV-3232 (NSR), 2016 WL 1271693, at *5 (S.D.N.Y. Mar. 29, 2016); see 

also Simon v. Healthways, Inc., No. CV1408022BROJCX, 2015 WL 10015953, at *6–7 (C.D. 

Cal. Dec. 17, 2015) (analyzing FCC waiver in denying motion for class certification in TCPA case 

involving faxes). The regulations provide that the FCC may waive any provision of the rules if 

good cause exists, see 47 C.F.R. § 1.3, and that is exactly what the FCC has done through its grant 

of waiver. 

Turning to the waiver’s impact on certification, the Court finds that because the waiver

does not confirm or deny whether Defendants had express permission or invitation to send the 

faxes, it does not resolve the predominance problem here. See Waiver Order at 8610 (stating that 

the question of express permission “remains a question for triers of fact in the private litigation”). 

The waiver applies only once there is a determination that Defendants sent solicited faxes, and the 

Court therefore still would have to conduct the numerous individual inquiries described above to 

determine which advertisements were “solicited” and thus fall within the waiver’s scope. 

Because Plaintiffs have failed to satisfy the predominance requirement, the Court finds a 

class action would not be superior to other methods for fairly and efficiently adjudicating the 

controversy. Therefore, certification is improper under Rule 23(b)(3). 

IV. CONCLUSION

In light of the foregoing, the Court DENIES Plaintiffs’ motion for class certification, Dkt. 

No. 209. The Court also DENIES Defendants’ motion for a stay as moot, Dkt. No. 208.

//

//

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The Court sets a case management conference for Tuesday, September 6, 2016 at 2:00 p.m. 

The parties should be prepared to discuss case scheduling at the hearing.

IT IS SO ORDERED.

Dated:

HAYWOOD S. GILLIAM, JR.

United States District Judge

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