Opinion ID: 3066757
Heading Depth: 3
Heading Rank: 2

Heading: The zone of interests protected by the Act

Text: The paragraph that establishes the “[p]rivate right of action” for violations of the Act’s robocall provisions permits any “person or entity” to file a lawsuit. 47 U.S.C. § 227(b)(3). The text of this provision does not limit the universe of plaintiffs who may file suit in federal court.10 Even if this were all the Act said (which it is not), Congress’s broad grant of statutory standing would not enable every “person or entity” to sue under the Act. Article III of the Constitution imposes its own standing requirements, and only certain plaintiffs will have suffered the particularized injury required to maintain an action in federal court for a statutory violation. See Raines v. Byrd, 521 U.S. 811, 818-20 & n.3 (1997); Doe v. Nat’l Bd. of Med. Examiners, 199 F.3d 10 In full, the relevant portion of the paragraph states that “[a] person or entity may, if otherwise permitted by the laws or rules of court of a State, bring [an action] in an appropriate court of that State.” 47 U.S.C. § 227(b)(3). But it “does not state that a private plaintiff may bring an action under the [Act] ‘only’ in state court, or ‘exclusively’ in state court,” and as a result the Supreme Court has held that federal courts have concurrent jurisdiction over such actions. Mims, 132 S. Ct. at 750. Any limitations imposed by “the laws or rules of court of a State” presumably would not apply in federal court. 14 146, 153 (3d Cir. 1999).11 Someone with a generalized interest in punishing telemarketers, for example, would not qualify on that basis alone. Cf. Lujan v. Defenders of Wildlife, 504 U.S. 555, 578 (1992). But here, Article III is not the only barrier faced by potential plaintiffs. Congress surely did not intend, for example, to enable a plaintiff to sue merely because she learned that a friend or neighbor had received a robocall. This commonsense judgment is embodied in an interpretive doctrine of special importance here: the “presum[ption] that a statutory cause of action extends only to plaintiffs whose interests ‘fall within the zone of interests protected by the law invoked.’” Lexmark Int’l, 134 S. Ct. at 1388 (quoting Allen v. Wright, 468 U.S. 737, 751 (1984)). The Supreme Court’s decision in Lexmark is instructive. There, the Court was called upon to construe the Lanham Act, which “authorizes suit by ‘any person who believes that he or she is likely to be damaged’ by a defendant’s false advertising.” Id. at 1388 (quoting 15 U.S.C. § 1125(a)(1)). “Read literally, that broad language might suggest that an action is available to anyone who can satisfy the minimum requirements of Article III.” Id. The Supreme Court, however, found it unlikely that “Congress meant to allow all factually injured plaintiffs to recover.” Id. (internal quotation marks omitted). 11 Notably, the Supreme Court has granted certiorari in a case that will require it to consider the limits on Congress’s power to confer Article III standing on plaintiffs. See Spokeo, Inc. v. Robins, 135 S. Ct. 1892 (2015). 15 Instead, the Court invoked the “presum[ption] that a statutory cause of action extends only to plaintiffs whose interests ‘fall within the zone of interests protected by the law invoked.’” Id. (quoting Allen, 468 U.S. at 751). Because Congress is assumed to legislate against the background of this “zone of interests” limitation, it “applies to all statutorily created causes of action.” Id. The breadth of the zone of interests depends on the provisions and purposes of the statute being analyzed. See id. In Lexmark, the Court analyzed the Lanham Act’s detailed list of purposes and concluded that a false-advertising plaintiff “must allege an injury to a commercial interest in reputation or sales,” rather than injury to its interests as a consumer of a product. Id. at 1390. We apply a similar analysis here. Within the subsection of the Act at issue in this appeal, 47 U.S.C. § 227(b) (entitled “Restrictions on use of automated telephone equipment”), the first paragraph sets forth “[p]rohibitions,” id. § 227(b)(1); the second discusses the FCC’s authority to promulgate “[r]egulations,” id. § 227(b)(2); and the third creates a “[p]rivate right of action” for “a violation of this subsection,” id. § 227(b)(3).12 In order to delineate the zone of interests protected by the statute, it makes sense to start by looking at the prohibitions that the private right of action is intended to enforce. 12 In using the term “subsection,” Congress ordinarily refers to the statutory subdivisions that are labeled with lowercase letters—(a), (b), (c), and so forth. Within subsections, “paragraphs” are labeled with numbers, and “subparagraphs” are labeled with uppercase letters. See Koons Buick Pontiac GMC, Inc. v. Nigh, 543 U.S. 50, 60-61 (2004). 16 The “Prohibitions” paragraph makes it “unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States,” to transmit certain types of telephone calls and facsimiles. Id. § 227(b)(1). It contains four subparagraphs, each of which identifies the “recipient” and type of communication at issue. Id. The first subparagraph forbids using an “automated telephone dialing system or an artificial or prerecorded voice” without the consent of the “called party” when calling emergency telephone lines, hospital patient rooms, pagers, cell phones, or any service for which the “called party” would be charged. Id. § 227(b)(1)(A). The second subparagraph, which Bank of America is accused of violating, proscribes “using an artificial or recorded voice” when calling “any residential telephone line” without the consent of the “called party.” Id. § 227(b)(1)(B). The third prohibits sending “unsolicited advertisement[s]” by facsimile to a “recipient.” Id. § 227(b)(1)(C). And the fourth prohibits using “an automatic telephone dialing system” to tie up two or more telephone lines of a “multi-line business” simultaneously. Id. § 227(b)(1)(D). In the subparagraph at issue here, the “called party” is relevant because its prior consent to receiving robocalls provides a defense to liability. Id. § 227(b)(1)(B). Thus, although Congress did not expressly limit standing to the “called party,” its primary concern in enacting § 227(b)(1)(B) was to protect that party from unwanted robocalls. This necessarily means that the “called party” is within the zone of interests protected by the Act. 17 The District Court determined that the term “called party” refers to the intended recipient of the robocall, rather than the actual recipient. And, because Leyse was not the intended recipient, the Court held he lacked standing. There are good reasons to doubt the equation of “intended recipient” with “called party,”13 but the parties did not brief the issue, 13 In its findings in support of the Act, Congress appears to equate the “called party” with the “receiving party.” Telephone Consumer Protection Act of 1991, Pub. L. No. 102-243, § 2(12), 105 Stat. 2394 (note following 47 U.S.C. § 227). Subsection 227(b)(1) itself suggests that the “called party” is the actual “recipient.” 47 U.S.C. § 227(b)(1). Indeed, we referred to it as the “recipient” in another case construing the Act. See Gager, 727 F.3d at 269. The Seventh and Eleventh Circuits have concluded from the Act’s text and structure that the term “called party” refers to “the person subscribing to the called number at the time the call is made,” rather than the intended recipient of the call. Soppet v. Enhanced Recovery Co., LLC, 679 F.3d 637, 643 (7th Cir. 2012); see also Osorio, 746 F.3d at 1251-52. Their reasoning also suggests, however, that the “person who answers the call” may qualify as well. Soppet, 679 F.3d at 640. Perhaps most significantly, however, the FCC recently issued a declaratory ruling defining “called party” as “the subscriber, i.e., the consumer assigned the telephone number dialed and billed for the call, or the non-subscriber customary user of a telephone number included in a family or business calling plan.” In the Matter of Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, CG Docket No. 02-278, WC Docket No. 07-135, FCC 15-72, 2015 WL 4387780, at 18 and we need not decide it here. This is because—as was the case with the Lanham Act in Lexmark—Congress made several findings in the Telephone Consumer Protection Act that allow us to trace the contours of the protected zone of interests. The zone protected by § 227(b)(1)(B) may well be coextensive with the scope of the term “called party.” But given the existence of relevant congressional findings, we may determine whether Leyse has statutory standing without first concluding that he is a “called party.” In passing the Act, Congress was animated by “outrage[] over the proliferation” of prerecorded telemarketing calls to private residences, which consumers regarded as “an intrusive invasion of privacy” and “a nuisance.” Telephone Consumer Protection Act of 1991, Pub. L. No. 102-243, § 2(5)-(6), (10), 105 Stat. 2394 (note following 47 U.S.C. § 227); see also id. § 2(9), (12)-(13). The congressional findings describe the persons aggrieved by these calls using a variety of labels: “consumers,” “residential telephone subscribers,” and “receiving part[ies].” Id. § 2(5)-(6), (10)- (12). The task facing Congress was that “[i]ndividuals’ privacy rights, public safety interests, and commercial freedoms of speech and trade must be balanced in a way that protects the privacy of individuals and permits legitimate  ¶ 73 (F.C.C. July 10, 2015) (Declaratory Ruling and Order); see also id. at -27 ¶¶ 72-77,  ¶ 78 (rejecting “proposals that we interpret ‘called party’ to be the ‘intended recipient’ or ‘intended called party’”). 19 telemarketing practices.” Id. § 2(9). In striking this balance, Congress determined that “[b]anning . . . automated or prerecorded telephone calls to the home, except when the receiving party consents to receiving the call or when such calls are necessary in an emergency situation affecting the health and safety of the consumer, is the only effective means of protecting telephone consumers from this nuisance and privacy invasion.” Id. § 2(12). As was forcefully stated by Senator Hollings, the Act’s sponsor, “Computerized calls are the scourge of modern civilization. They wake us up in the morning; they interrupt our dinner at night; they force the sick and elderly out of bed; they hound us until we want to rip the telephone right out of the wall.” 137 Cong. Rec. 30,821-22 (1991). Although his views are not controlling, see Mims, 132 S. Ct. at 752, they are consistent with the findings that appear in the text of the Act, and it is relevant that he emphasized the potential of robocalls to harass the occupants of private residences. See also Osorio v. State Farm Bank, F.S.B., 746 F.3d 1242, 1258 (11th Cir. 2014) (noting that a purpose of the Act is to protect “residential privacy”). From this evidence, it is clear that the Act’s zone of interests encompasses more than just the intended recipients of prerecorded telemarketing calls. It is the actual recipient, intended or not, who suffers the nuisance and invasion of privacy. This does not mean that all those within earshot of an unwanted robocall are entitled to make a federal case out of it. Congress’s repeated references to privacy convince us that a mere houseguest or visitor who picks up the phone would likely fall outside the protected zone of interests. On the other hand, a regular user of the phone line who occupies the residence being called undoubtedly has the sort of interest 20 in privacy, peace, and quiet that Congress intended to protect.14 Limiting standing to the intended recipient would disserve the very purposes Congress articulated in the text of the Act. If the caller intended to call one party without its consent but mistakenly called another, neither the actual recipient nor the (uninjured) intended recipient could sue, even if the calls continued indefinitely. We doubt Congress meant to leave the actual recipient with no recourse against even the most unrelenting caller. The District Court, however, focused on the plight of the callers, many of whom manage to obtain the consent of their intended recipients. It reasoned as follows: If any person who . . . answers the telephone call has standing to sue, then businesses will never be certain when . . . placing a call with a prerecorded message would be a violation of the TCPA. Under the statute, a business is permitted to send a . . . phone call with a prerecorded message to persons who have given prior express consent . . . . When a business places such a call[,] . . . it does not know whether the intended recipient or a roommate or employee will answer the phone . . . . If the 14 Bank of America suggests that standing must be limited to one person because the Act authorizes only one $500 award per violation. See 47 U.S.C. § 227(b)(3)(B). Putting aside the fact that § 227(b)(3) makes available other forms of relief, we see no reason why the statutory sum could not be divided among the injured parties. 21 business is liable to whomever happens to answer the phone[,] . . . a business could face liability even when it intends in good faith to comply with the provisions of the TCPA. (App. 12 (quoting Leyse, 2010 WL 2382400, at ).) The District Court’s concerns are misplaced. The caller may invoke the consent of the “called party” as a defense even if the plaintiff is someone other than the “called party.” Thus, if Dutriaux were the “called party” by virtue of being the intended recipient of the call, her consent to receive robocalls would shield Bank of America from any suit brought by Leyse. We would not need to deny statutory standing to Leyse in order to protect Bank of America from unanticipated liability. On the other hand, if Leyse were the “called party” despite being an unintended recipient, it is undisputed that he would have statutory standing regardless of the policy considerations raised by the District Court.15 Finally, we observe that “[b]ecause the TCPA is a remedial statute, it should be construed to benefit 15 We note that in the recent declaratory order of the FCC described earlier, the FCC defined the “called party” as the “subscriber” or “customary user” of the phone number and found that it was “reasonable for callers to rely” on “consent to receive robocalls” from either type of called party. In the Matter of Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991, 2015 WL 4387780, at  ¶ 73,  ¶¶ 75-76. By this logic, Dutriaux and Leyse would both qualify as “called parties,” and consent from either would shield Bank of America from liability. 22 consumers.” Gager, 727 F.3d at 271. Even if the various proposed interpretations of the Act were equally plausible— which they are not—the scales would tip in Leyse’s favor. Given the variety of arrangements that exist for sharing living spaces and telephones, there may be close cases under the zone-of-interests test—at least until cell phones entirely displace landlines. Leyse’s, however, is by no means a close case. The complaint alleges that Bank of America placed a call “to Leyse’s residential telephone line.” (App. 21.) At the motion to dismiss stage, we are required to treat this allegation as true, and it places Leyse squarely within the zone of interests. We would reach the same conclusion even if we were to look beyond the complaint and consider the allegations made by the parties during oral argument and in other actions. The parties agree that Leyse’s roommate Dutriaux was the subscriber and intended recipient of the call. But Leyse claims that he regularly used the phone, and the fact that he was Dutriaux’s roommate indicates that he, too, had a privacy interest in avoiding telemarketing calls to their shared home. Under the zone-of-interests test, Leyse has alleged enough to survive a motion to dismiss, and it was error for the District Court to dismiss the complaint for lack of statutory standing. We note, however, as we state supra, that it is the actual recipient, intended or not, who suffered the nuisance or invasion of privacy. The burden of proof will, therefore, be on Leyse in the District Court, to demonstrate that he answered the telephone when the robocall was received. 23