Source: https://case-law.vlex.com/vid/281-f-3d-1350-597318878
Timestamp: 2020-08-09 05:47:39
Document Index: 171822773

Matched Legal Cases: ['§ 1961', '§ 201', '§ 1341', '§ 1961', '§ 1341', '§ 1955']

281 F.3d 1350 (11th Cir. 2002), 99-8007, Sikes v Teleline Inc. - Federal Cases - Case Law - VLEX 597318878
281 F.3d 1350 (11th Cir. 2002), 99-8007, Sikes v Teleline Inc.
Docket Nº: 99-8007
Party Name: JAMES W. SIKES, FELIX KEMP, Individually and On Behalf of All Other Persons Similarly Situated, Plaintiffs-Appellees, v. TELELINE, INC, USA NETWORKS, Defendants, AMERICAN TELEPHONE & TELEGRAPH COMPANY, Defendant-Appellant.
281 F.3d 1350 (11th Cir. 2002)
TELELINE, INC, USA NETWORKS, Defendants,
No. 99-8007
Appeal from the United States District Court for the Southern District of Georgia, D. C. Docket No. 92-00147-CV-6
Before TJOFLAT, WILSON and FLETCHER[x], Circuit Judges.
American Telephone & Telegraph Corporation ("AT&T") appeals the district court's certification, pursuant to Fed. R. Civ. P. 23(b)(3), of a class of plaintiffs who present claims arising from a "900-number" telemarketing program. We conclude that the district court abused its discretion in holding that the questions of law or fact common to the members of the proposed class predominate over any questions affecting only individual members and that,
therefore, the class would be manageable.1 We therefore reverse the certification of the class and remand for further proceedings.
In Andrews v. American Telephone & Telegraph Co., 95 F.3d 1014 (11th Cir. 1996), we held that the district court erred in certifying two classes under Rule 23(b)(3)2 of the Federal Rules of Civil Page 1353
Procedure because the plaintiffs had failed to demonstrate that common issues predominated.3 The first class of plaintiffs, the "Andrews class," brought suit against various telecommunications carriers and services providers, alleging that several 900-number telephone programs,4 which the defendants were providing to the public, were
gambling activity [that] is illegal under the laws of all of the fifty states, and constitutes racketeering activity in violation of the federal RICO statute, 18 U.S.C. § § 1961 to 1968 (1994), the Communications Act of 1934, 47 U.S.C. § § 201 to 229 (1994), and the federal common law of communications law.
[The] complaint further allege[d] that the defendants committed mail and wire fraud, in violation of 18 U.S.C. § § 1341 & 1343 (1994), in furtherance of a RICO enterprise . . . . In addition to the allegations concerning a national gambling enterprise, [the plaintiffs] allege[d] that the defendants . . . violated Georgia statutes that prohibit the operation of a gambling business within that state.
[i]t may be true that, at a general level, the predominant issue presented in Andrews is whether the [defendants] were involved in the operation of illegal gambling schemes that used 900 numbers to facilitate caller participation . . ., as a practical matter, the resolution of this overarching common issue breaks down into an unmanageable variety of individual legal and factual issues.
Id. at 1023. Drawing on Pelletier v. Zweifel, 921 F.2d 1465, 1499-1500 (11th Cir. Page 1354
1991), for the proposition that "each plaintiff must demonstrate reliance on deceptive conduct in furtherance of [an] alleged RICO scheme," we stated that "[t]he class's mail and wire fraud allegations . . . are not wholly subject to class-wide resolution." Id. at 1023-24. As to the claims based upon state gambling laws, we held that "the need to interpret and apply the gaming laws of all fifty states to assess the legality of each 900-number program [is] foremost among the difficulties in trying the gambling claims on a class basis." Id. at 1024.
We were "even more certain that the Harper class is unsustainable under Rule 23(b)(3)" than we were about the Andrews class, because "individual issues abound and are magnified by the necessity of applying diverse state laws to programs that in many cases have little in common beyond their use of 900 numbers." Id. at 1024. After noting the significant problem that "the [multiple] 900-number programs at issue . . . differ widely" in many respects, we held that the class was unsustainable because of the individualized nature of the plaintiffs' claims:
This automated interactive telephone game was modeled on the television game show of the same name. The game had up to six levels, and at each level the caller could win a prize by selecting the correct "door" behind which the prize was concealed. Upon winning a prize, the caller could either accept that prize or advance to the next level. If the caller chose to advance, any previously awarded prize was forfeited in exchange for a chance at a Page 1355
larger prize. Plaintiffs claim that the odds of ultimately winning the maximum $2,000.00 cash prize were 1 in 2,700.
Sikes v. Am. Tel. & Tel. Co., No. CV-692-147 (S.D. Ga. Mar. 26, 1998) at 2-3.6
Plaintiffs, individuals who had called LMAD and incurred charges (in excess of any winnings they may have received), brought suit, individually and on behalf of all others similarly situated, in the United States District Court for the Southern District of Georgia.7 The plaintiffs sued: (1) Page 1356
Teleline, Inc. ("Teleline"), the creator and operator of LMAD; (2) the U.S.A. Network, which broadcast a portion of the television advertising for LMAD; and (3) AT&T, which acted as Teleline's telecommunications carrier and billing contractor.
Count One of the plaintiffs' complaint8 asserted that the defendants had violated the federal Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. § § 1961-1968 ("federal RICO").9 Section 1962(c) criminalizes participation "in the conduct of an enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt."10 Section 1962(d) criminalizes conspiracy to do the same.11 Section 1964(c) permits a civil plaintiff to sue for recovery of costs, attorneys' fees, and treble damages sustained as a result of a defendant's violation of section 1962.12
Count One alleged that the defendants had violated sections 1962(b),13 (c), and (d) by engaging in a pattern of racketeering activity that included "numerous acts of connected, related and continuing mail and wire fraud with the advertisement and solicitation of calls to [LMAD's 900 numbers], the answering of each individual 900 number call to these number[s], and the billing and collection of charges for each such 900 number call." Such activity was allegedly in violation of the wire and mail fraud statutes, 18 U.S.C. § § 1341 and 1343,14 which satisfy the definition of "racketeering activity" as set forth in section 1961(1)(B).15 Further, Count One asserted that the defendants engaged in an Page 1357
illegal gambling business, in violation of 18 U.S.C. § 1955,16 by operating LMAD. The plaintiffs alleged that this illegal gambling business constituted racketeering activity under section 1961(1)(B) and the continued operation of LMAD established a pattern of racketeering activity. Finally, Count One asserted that each charge incurred by a caller to LMAD's 900 numbers constituted a gambling debt, which is an unlawful debt within the meaning of section 1961(6). The defendants' billing and collection of this unlawful debt thus constituted unlawful debt collection. Since Count One asserted that the defendants had violated sections 1962(c) and (d) by engaging in and conspiring to engage in a pattern of racketeering activity (wire and mail fraud and illegal gambling) and collection of...