Court Opinion

ID: 810395
Source: CourtListenerOpinion
Date Created: 2012-10-17 17:28:57+00
Date Added: 2024-06-11T18:00:37.827794
License: Public Domain

FOR PUBLICATION
 UNITED STATES COURT OF APPEALS
      FOR THE NINTH CIRCUIT

MICHAEL CHESBRO,                           No. 11-35784
              Plaintiff-Appellant,
              v.                             D.C. No.
                                         2:10-cv-00774-RAJ
BEST BUY STORES, L.P.,
                                             OPINION
             Defendant-Appellee.
                                     
       Appeal from the United States District Court
         for the Western District of Washington
        Richard A. Jones, District Judge, Presiding

                  Argued and Submitted
           August 8, 2012—Seattle, Washington

                  Filed October 17, 2012

       Before: John T. Noonan, Susan P. Graber, and
          Johnnie B. Rawlinson, Circuit Judges.

                Opinion by Judge Noonan

                          12563
                 CHESBRO v. BEST BUY STORES             12565

                        COUNSEL

Gunning, Seattle, Washington, for the plaintiff-appellant.

Anne M. Lockner,        Minneapolis,   Minnesota,    for     the
defendant-appellee.
12566             CHESBRO v. BEST BUY STORES
                           OPINION

NOONAN, Circuit Judge:

   Michael Chesbro, on behalf of himself and a class of simi-
larly situated plaintiffs, argues that a series of automated tele-
phone calls placed to his home by Best Buy violated the
Telephone Consumer Protection Act of 1991 (“TCPA”), 47
U.S.C. § 227, and the Washington Automatic Dialing and
Announcing Device Act (“WADAD”), Wash. Rev. Code
§ 80.36.400. The district court granted summary judgment in
Best Buy’s favor. We reverse and remand for further proceed-
ings.

Factual and Procedural History

   Plaintiff Michael Chesbro purchased a computer from Best
Buy in 2008. At the time of the purchase, he signed up for a
no-interest payment plan to finance the cost of the computer.
He filled out paperwork and provided his contact information,
including his telephone number. The parties dispute whether,
at the time of purchase and when opting for the credit plan,
Chesbro enrolled in Best Buy’s Reward Zone Program
(“RZP”). Best Buy claims that it obtained his signature; Ches-
bro maintains that, if so, he did not know that he was being
enrolled in the RZP or know what the RZP was.

   The RZP allows customers to earn points toward certifi-
cates — coupons with a $5 value for every $250 spent — that
can be applied toward future purchases at Best Buy. See Bl.
13. Best Buy contends that, as an RZP member, Chesbro con-
sented to the terms of the RZP Privacy Policy, which autho-
rizes Best Buy to contact program members with program-
related communications. Best Buy states that, though RZP
members may opt out of receiving marketing communications
regarding the program, Best Buy may still contact members
with program-related communications, such as membership
information.
                  CHESBRO v. BEST BUY STORES               12567
   Chesbro received many automated “robot” calls from Best
Buy following his July 2008 computer purchase. He estimates
that he received “more than five, less than a dozen” calls from
Best Buy during this period; he could identify the caller from
the caller identification feature on his phone. During the
period at issue, Chesbro maintains that he was registered on
the national “Do Not Call” (“DNC”) list.

   On November 12, 2008, Chesbro complained to the Wash-
ington Attorney General’s Office (“AGO”) regarding a call
that he received on November 11. Best Buy concedes that it
made this November 11 automated call but argues that the call
was a courtesy message alerting Chesbro to the looming expi-
ration of his RZP certificates. The undisputed script of the call
is as follows:

       Hello, this is Andrea from Best Buy Reward Zone
    calling for (Recipient’s first and last name) to remind
    you that your Reward Certificates are about to
    expire. (Certificate amount) dollars in Reward Cer-
    tificates were mailed to you on (Mail date) and they
    will expire if not used by (Expiration Date). If you
    do not have your reward certificates, you can re-print
    them online at myrewardzone.com. Thank you for
    shopping at Best Buy.

   Chesbro maintains that, before filing his AGO complaint,
he communicated his desire to opt out by following the
prompts on the automated touch-tone dialing system. Chesbro
also called the Best Buy store and asked to be put on Best
Buy’s internal DNC list. The customer service representatives
with whom he spoke stated that they did not know what
phone calls he was talking about. Chesbro specifically asked
for all marketing calls to cease. In response to the complaint
filed with the AGO, Best Buy agreed to place Chesbro on its
DNC list.

  Seven months later, in June 2009, Chesbro received another
automated phone call from Best Buy with script as follows:
12568             CHESBRO v. BEST BUY STORES
      This is a very important message regarding the
    Best Buy Reward Zone program. We’re making
    some changes to increase the security of the program
    and be more environmentally friendly. Please listen
    to the entire message and then go to MyReward-
    Zone.com for details and to update your member-
    ship.

      The following changes take effect October 31st,
    2009:

    •   First, to help reduce paper use, reward certificates
        will only be available by logging onto MyRe-
        wardZone.com.

    •   Second, reward certificates will no longer be
        transferable.

    •   Lastly, for the following three conditions, points
        will be cashed out to the $5 level and the remain-
        ing points will be forfeited:

         •   You will need to provide an e-mail
             address at MyRewardZone.com. Mem-
             bers who haven’t provided an e-mail
             address will no longer be eligible to par-
             ticipate in the program.

         •   Reward Zone is becoming an annual
             program, which means that points no
             longer roll over from year-to-year[.]

         •   You will need to make 1 purchase every
             12 months to remain in the program[.]

       For full details and to make sure you’re ready for
    these changes, go to MyRewardZone.com.
                   CHESBRO v. BEST BUY STORES              12569
         If you would like to hear this message again, press
    9.

      Thank you for your time — and for being a valued
    Reward Zone program member.

Chesbro filed a class-action complaint in Washington state
court alleging federal and state violations. Best Buy removed
the case to federal court under the Class Action Fairness Act
of 2005, 28 U.S.C. § 1453, asserting an amount in contro-
versy exceeding $5,000,000. Best Buy filed a motion for
judgment on the pleadings under Federal Rule of Civil Proce-
dure 12(c), which the court converted into a motion for sum-
mary judgment under Rule 12(d). The court denied Chesbro’s
motion for a continuance under Rule 56(d) and granted sum-
mary judgment in Best Buy’s favor. This appeal followed.

   We review a grant of summary judgment de novo. See
Lopez v. Smith, 203 F.3d 1122, 1131 (9th Cir. 2000)(en banc).
We determine “whether, viewing the evidence in the light
most favorable to the nonmoving party, there are any genuine
issues of material fact and whether the district court correctly
applied the relevant substantive law.” Id.

  TCPA Claims

   [1] The TCPA makes it unlawful “to initiate any telephone
call to any residential telephone line using an artificial or pre-
recorded voice to deliver a message without the prior express
consent of the called party, unless the call is initiated for
emergency purposes or is exempted by rule or order by the
Commission under paragraph (2)(B).” 47 U.S.C.
§ 227(b)(1)(B). The parties do not dispute that these were pre-
recorded calls to a residential telephone line.

   Paragraph (2)(B) provides that the Federal Communica-
tions Commission (“FCC”) may exempt non-commercial calls
and “such . . . calls made for commercial purposes as . . . (I)
12570             CHESBRO v. BEST BUY STORES
will not adversely affect the privacy rights that this section is
intended to protect; and (II) do not include the transmission
of    any      unsolicited    advertisement.”      47     U.S.C.
§ 227(b)(2)(B)(ii). “ ‘[U]nsolicited advertisement’ means 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 per-
mission . . . .” 47 U.S.C. § 227(a)(5).

   [2] Pursuant to its delegated authority, the FCC has
exempted from the general prohibition on automated commer-
cial calls those that both “do[ ] not include or introduce an
unsolicited advertisement or constitute a telephone solicita-
tion[,]” 47 C.F.R. § 64.1200(a)(2)(iii) (2011) (amended
2012), and do not adversely affect the privacy rights of the
called party, see In re Rules and Regulations Implementing
the Telephone Consumer Protection Act of 1991, Report and
Order, 18 FCC Rcd. 14014, 14095 ¶ 136, 2003 WL 21517853
(F.C.C. July 3, 2003) (“2003 Report and Order”). The FCC
has determined that so-called “dual purpose” calls, those with
both a customer service or informational component as well
as a marketing component, are prohibited. See 2003 Report
and Order at 14097-98 ¶¶ 140-142. The FCC explains:

       The so-called “dual purpose” calls described in
    the record—calls from mortgage brokers to their cli-
    ents notifying them of lower interest rates, calls from
    phone companies to customers regarding new calling
    plans, or calls from credit card companies offering
    overdraft protection to existing customers—would,
    in most instances, constitute “unsolicited advertise-
    ments,” regardless of the customer service element
    to the call. The Commission explained in the 2002
    Notice that such messages may inquire about a cus-
    tomer’s satisfaction with a product already pur-
    chased, but are motivated in part by the desire to
    ultimately sell additional goods or services. If the
    call is intended to offer property, goods, or services
                  CHESBRO v. BEST BUY STORES               12571
    for sale either during the call, or in the future (such
    as in response to a message that provides a toll-free
    number), that call is an advertisement.

Id. ¶ 142 (footnote omitted).

   [3] Neither party argues that the interpretation set forth in
the 2003 Report and Order is unreasonable or otherwise not
entitled to this court’s deference. We agree that our deference
is due. See Satterfield v. Simon & Schuster, Inc., 569 F.3d
946, 952-54 (9th Cir. 2009) (affording deference under United
States v. Mead Corp., 533 U.S. 218 (2001), and Skidmore v.
Swift & Co., 323 U.S. 134 (1944), to the FCC’s interpretation,
as set forth in its 2003 and 2004 Reports, of what constitutes
a “call”).

   Finally, the regulations contain a DNC provision stating:
“Persons or entities making calls for telemarketing purposes
. . . must honor a residential subscriber’s do-not-call request
within a reasonable time . . . .” 47 C.F.R. § 64.1200(d)(3)
(2011) (amended 2012). “[T]elemarketing means the initia-
tion of a telephone call or message for the purpose of encour-
aging the purchase or rental of, or investment in, property,
goods, or services, which is transmitted to any person.” 47
C.F.R. § 64.1200(f)(10) (2011) (amended 2012).

   [4] “[A]pplication of the prerecorded message rule should
turn, not on the caller’s characterization of the call, but on the
purpose of the message.” 2003 Report and Order at 14098 ¶
141 (footnote omitted). We thus turn to the calls at issue to
determine whether they demonstrate a prohibited advertising
purpose.

  Best Buy argues that its calls were purely informational
courtesy calls to RZ members. It further maintains that,
because the scripts did not explicitly reference any property,
goods, or services within the meaning of 47 U.S.C.
12572            CHESBRO v. BEST BUY STORES
§ 227(a)(5), the calls did not run afoul of the TCPA and its
implementing regulations. We disagree.

   [5] We approach the problem with a measure of common
sense. The robot-calls urged the listener to “redeem” his
Reward Zone points, directed him to a website where he
could further engage with the RZP, and thanked him for
“shopping at Best Buy.” Redeeming Reward Zone points
required going to a Best Buy store and making further pur-
chases of Best Buy’s goods. There was no other use for the
Reward Zone points. Thus, the calls encouraged the listener
to make future purchases at Best Buy. Neither the statute nor
the regulations require an explicit mention of a good, product,
or service where the implication is clear from the context.
Any additional information provided in the calls does not
inoculate them. See 2003 Report and Order ¶ 142.

   [6] Any assertion that Chesbro either consented to receiv-
ing these communications or that the communications were
not unsolicited is unpersuasive on this summary judgment
record. Chesbro repeatedly and expressly asked not to be con-
tacted. The calls violated the TCPA and its implementing reg-
ulations.

   [7] Because the calls encouraged recipients to engage in
future purchasing activity, they also constituted telemarketing
under the DNC regulation. See 47 C.F.R. §§ 64.1200(d)(3),
(f)(10)(2011).

  Washington Claims

   [8] The WADAD similarly prohibits using an automatic
dialing and announcing device “for purposes of commercial
solicitation.” Wash. Rev. Code § 80.36.400(2) (2012). “Com-
mercial solicitation means the unsolicited initiation of a tele-
phone conversation for the purpose of encouraging a person
to purchase property, goods, or services.” Wash. Rev. Code
§ 80.36.400(1)(b). A violation of the WADAD is automati-
                  CHESBRO v. BEST BUY STORES              12573
cally a violation of the Washington Consumer Protection Act
(“WCPA”). See Wash. Rev. Code § 80.36.400(3).

   Washington’s DNC provision prohibits for one year the
telephone solicitation of anyone who indicates that he or she
does not want to be called. See Wash. Rev. Code
§ 80.36.390(3)(a). The definition of “telephone solicitation” is
nearly identical to that of “commercial solicitation” discussed
above. Compare Wash. Rev. Code § 80.36.390(1) with Wash.
Rev. Code § 80.36.400(1)(b).

   [9] We have no guidance from the Washington courts on
how Washington interprets these provisions. The text of the
WADAD is substantially similar to its federal counterpart, as
is its purpose. See Wash. Rev. Code § 80.36.400 notes (1986).
We therefore apply the same reasoning as discussed above
and find that the instant calls violated the WADAD’s prohibi-
tion on automated solicitation, the WCPA, and Washington’s
DNC provision.

  Rule 56 Claim

  In light of our reversal, we need not reach Chesbro’s
remaining claim regarding the denial of a continuance.

  In sum, these calls were aimed at encouraging listeners to
engage in future commercial transactions with Best Buy to
purchase its goods. They constituted unsolicited advertise-
ments, telephone solicitations, and telemarketing, and were
prohibited by the TCPA, the WADAD, and the WCPA.

  REVERSED and REMANDED.