PUBLISH

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

_________________

No. 96-9149

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D. C. Docket No. 95-CV-101

SAM NICHOLSON, and All Other Persons

or Entities Similarly Situated, 

Plaintiffs-Appellants, 

 

versus

HOOTERS OF AUGUSTA, INC., 

Defendant-Cross-ClaimantThird-Party PlaintiffAppellee,

BAMBI K. CLARK d.b.a. Value-Fax

of Augusta,

Defendant-CrossDefendant-Appellees.

 

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Appeal from the United States District Court

for the Southern District of Georgia

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(March 10, 1998)

 
*Honorable John R. Gibson, Senior U.S. Circuit

Judge for the Eighth Circuit, sitting by

designation.

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Before DUBINA, Circuit Judge, and HILL and GIBSON*, Senior

Circuit Judges.

JOHN R. GIBSON, Senior Circuit Judge:

Sam Nicholson appeals the district court's dismissal

of his action against Hooters of Augusta, Inc. for

failure to state a claim. Nicholson alleged that Hooters

violated the Telephone Consumer Protection Act, 47 U.S.C.

§ 227 (1994), by sending unsolicited advertisements to

Nicholson's facsimile machine. Nicholson contends the

court erred in concluding that the Telephone Consumer

Protection Act covers only interstate, and not

intrastate, transmissions of unsolicited advertisements

by facsimile, and that individual citizens may not bring

suit under the Act. Because we conclude that Congress

granted state courts exclusive subject matter

jurisdiction over private actions under the Act, we

vacate the judgment of the district court and remand with

directions to dismiss this case for lack of subject
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matter jurisdiction.

The Telephone Consumer Protection Act prohibits "any

person within the United States... [from] us[ing] any

telephone facsimile machine, computer, or other device to

send an unsolicited advertisement to a telephone

facsimile machine." 47 U.S.C. § 227(b)(1)(C). The Act

creates a private right of action to obtain injunctive

relief as well as to recover actual damages or $500.00,

whichever is greater, for each violation. 47 U.S.C. §

227(b)(3). The private right of action may be filed "if

otherwise permitted by the laws or rules of court of a

State,...in an appropriate court of that State." Id.

Nicholson filed a complaint in the Superior Court of

Richmond County, Georgia, alleging that Hooters violated

the Telephone Consumer Protection Act by sending

unsolicited advertisements to his facsimile machine. The

state court entered a temporary restraining order

enjoining Hooters from sending further advertisements by

facsimile. 

Hooters removed the case to the United States

District Court for the Southern District of Georgia.
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Hooters then filed a motion to dismiss for failure to

state a claim upon which relief could be granted, arguing

that the Act did not apply to intrastate facsimiles, and

that an individual could not bring a private right of

action. The district court granted Hooters' motion to

dismiss, ruling first that Nicholson could not maintain

a private right of action. The court reasoned that the

language in the Act providing that a private right of

action could be brought "if otherwise permitted by the

laws or rules of the court of a State," authorized a

private right of action only if state law specifically

authorized a private action. Because there was no

specific provision for private actions under Georgia law,

the court held there could be no private action in

federal court. The court rejected Nicholson's argument

that the Act provides for concurrent jurisdiction of

private actions in state and federal courts. The court

also held that the Telephone Consumer Protection Act

applied only to interstate facsimile transmissions.

Because Nicholson received an intrastate facsimile, the

court held there could be no claim under the Act.
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Nicholson appealed. After the district court's

decision, the Fourth Circuit considered a similar action,

International Science & Tech. Inst. Inc. v. Inacom Comm.,

Inc., 106 F.3d 1146 (4th Cir. 1997). The Fourth Circuit

affirmed the district court's dismissal of the case for

lack of subject matter jurisdiction. Id. At 1150. The

Fourth Circuit reached the "somewhat unusual conclusion"

that the Act vests jurisdiction only in state courts.

Id. at 1150-1152. 

Because the Act is silent as to federal court

jurisdiction, the Fourth Circuit relied on several

sources to determine whether the federal court had

subject matter jurisdiction. The Fourth Circuit rejected

the argument that section 227(b)(3) conferred

jurisdiction to both the federal and state courts. The

court determined that the permissive authorization

contained in section 227(b)(3) did not confer federal

court jurisdiction because the language was not a

specific grant of authorization. Id. at 1151-52. The

court interpreted the silence as to federal court

jurisdiction and the express grant of jurisdiction to
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state courts as telling for several reasons. The court

found it "meaningful" that Congress explicitly mentioned

only state courts because, in general, it is unnecessary

to vest state courts with concurrent jurisdiction. Id.

at 1152. The court found confirmation of its

interpretation by the fact that section 227(f)(2) of the

Act while authorizing state court jurisdiction for a

private right of action, conferred exclusive federal

jurisdiction over an action brought by a state attorney

general. Id. "We find it significant that in enacting

the [Telephone Consumer Protection Act], Congress wrote

precisely, making jurisdictional distinctions in the very

same section of the Act by providing that private actions

may be brought in appropriate state courts and that

actions by the states must be brought in the federal

courts." Id. Also observing that other parts of the

Communications Act of 1934 gave specific grants of

jurisdiction, the court concluded that Congress would

have authorized federal jurisdiction, if it so intended.

See id. 

The court also decided that the legislative history
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of the Act supported its interpretation that Congress

intended private actions to be treated as "small claims

best resolved in state courts ... so long as the states

allow such actions." Id. The Fourth Circuit rejected

the argument that Congress intended to establish

concurrent jurisdiction manifested through its preemptive

occupation of interstate telecommunications for two

reasons. Id. at 1153. First, it determined that even if

the Act preempted substantive state law, the Act

specifically provided for state courts to hear cases

under the Act unless there was a contrary congressional

intent. Id. Second, it noted that the Act specifically

held that it did not preempt any state law that imposed

more restrictive intrastate requirements or which

prohibited certain practices. Id.

Finally, the Fourth Circuit determined that its

decision that Congress intended to confer exclusive

jurisdiction upon state courts was consistent with the

Act's history and purpose, which was to allow consumers

to easily and inexpensively enforce the Act. Id. at

1152-53. 
1

The district court for the Southern District of New

York adopted the Fourth Circuit's approach in Foxhall

Realty Law Offices, Inc. v. Telecommunications Premium

Services, Ltd., 975 F. Supp. 329 (S.D.N.Y. 1997). The

district court of Indiana, however, ruled that the Act

confers subject matter jurisdiction of private actions

upon both state and federal courts. See Kenro, Inc. v.

Fax Daily, Inc., 904 F. Supp. 912 (S.D. Ind. 1995), on

reconsideration, 962 F. Supp. 1162 (S.D. Ind. 1997).

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In light of this decision, we requested additional

briefing from the parties. After the parties submitted

their supplemental briefs, the Fifth Circuit also held

that Congress granted state courts exclusive subject

matter jurisdiction over private actions under the

Telephone Consumer Protection Act.1 Chair King, Inc. v.

Houston Cellular Corp., 131 F.3d 507 (5th Cir. 1997).

Like this case, the plaintiffs in Chair King brought

a private suit under the Act. Id. at 509. The district

court dismissed the claims brought under the Act, holding

that the Act only regulates interstate telemarketing

activity. Id. Following the lead of the Fourth Circuit,

the Fifth Circuit vacated the judgment of the district

court and remanded with directions to dismiss the case

for lack of subject matter jurisdiction. Id. at 514.
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We have carefully examined the reasoning of the

Fourth and Fifth Circuits and, we too, are persuaded that

federal courts lack subject matter jurisdiction of

private actions under the Act.

Like the Fourth and Fifth Circuits, we also reject

Hooters's argument that federal-question jurisdiction

exists under 28 U.S.C. § 1331 (1994) because Nicholson's

complaint clearly presents a federal question as it

alleges a violation of federal law. See International

Science, 106 F.3d at 1154; Chair King, 131 F.3d at 510.

We recognize that "as a general matter, a cause of action

created by federal law will properly be brought in the

district courts." 106 F.3d at 1154. Nevertheless, the

general jurisdictional grant of section 1331 does not

apply if a specific statute assigns jurisdiction

elsewhere. Id. Here, the text of the Act, including

the specific grant of federal jurisdiction to state

attorneys general, as well as the Act's legislative

history, demonstrate that Congress intended to assign the

private right of action to state courts exclusively.

Relying on Kenro, Inc. v. Fax Daily, Inc., 904 F.
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Supp. 912 (S.D. Ind. 1995), on reconsideration, 962 F.

Supp. 1162 (S.D. Ind. 1997), Hooters contends that the

use of the permissive word "may" in section 227(b)(3)

does nothing more than provide concurrent state and

federal court jurisdiction. The Fourth Circuit, however,

rejected this argument, reiterating that courts of

limited jurisdiction require a specific grant of

jurisdiction, and that it could not imply a grant of

jurisdiction in light of the language of the Act, its

history, and its purpose. International Science, 106

F.3d at 1151-52. For these same reasons, we cannot

accept Hooters' argument that the federal court has

concurrent jurisdiction. 

Accordingly, we VACATE the judgment of the district

court and REMAND the case to the district court with

directions to dismiss this cause for lack of subject

matter jurisdiction.