Court Opinion

ID: 2709360
Source: CourtListenerOpinion
Date Created: 2014-08-05 15:14:13.728504+00
Date Added: 2024-06-11T13:24:07.934420
License: Public Domain

In the

      United States Court of Appeals
                      For the Seventh Circuit
                          ____________________  

Nos.  11-­‐‑3188  &  11-­‐‑3746  
IRA   HOLTZMAN,   C.P.A.,   &   ASSOCIATES   LIMITED,   individually  
and  as  representative  of  a  class,  
                                                  Plaintiff-­‐‑Appellee,  
                                        v.  

GREGORY  P.  TURZA,  
                                                         Defendant-­‐‑Appellant.  
                          ____________________  

           Appeals  from  the  United  States  District  Court  for  the  
             Northern  District  of  Illinois,  Eastern  Division.  
             No.  08  C  2014  —  Robert  W.  Gettleman,  Judge.  
                          ____________________  

       ARGUED  MAY  22,  2012  —  DECIDED  AUGUST  26,  2013  
                   ____________________  

   Before   EASTERBROOK,   Chief   Judge,   and   WILLIAMS   and  
TINDER,  Circuit  Judges.  
   EASTERBROOK,   Chief   Judge.   Believing   that   CPAs   would  
find   his   services   attractive,   attorney   Gregory   Turza   sent  
more  than  200  of  them  occasional  fax  sheets  containing  busi-­‐‑
ness  advice.  The  faxes  produced  more  business—but  not  for  
Turza.  He  became  the  defendant  in  this  suit  under  the  Tele-­‐‑
phone   Consumer   Protection   Act   of   1991,   47   U.S.C.   §227,  
Nos.  11-­‐‑3188  &  11-­‐‑3746                                                     2  

which   prohibits   any   person   from   sending   unsolicited   fax  
advertisements.   Even   when   the   Act   permits   fax   ads—as   it  
does   to   persons   who   have   consented   to   receive   them,   or   to  
those   who   have   established   business   relations   with   the  
sender—the  fax  must  tell  the  recipient  how  to  stop  receiving  
future   messages.   47   U.S.C.   §227(b)(1)(C)(iii),   (2)(D).   Turza’s  
faxes   did   not   contain   opt-­‐‑out   information,   so   if   they   are  
properly  understood  as  advertising  then  they  violate  the  Act  
whether  or  not  the  recipients  were  among  Turza’s  clients.  
     The   faxes   bear   the   masthead   The   “Daily   Plan-­‐‑It”,   but  
they  were  not  produced  by  Perry  White’s  editorial  staff  and  
came  every  other  week  rather  than  daily.  Although  they  car-­‐‑
ry   Turza’s   byline,   and   a   notice   claiming   copyright   in   his  
name,  they  had  been  written  by  employees  of  Top  of  Mind,  a  
marketing   firm,   which   sold   the   concept   (and   the   copy)   to  
anyone   who   wanted   promotional   material.   Turza   did   not  
edit   or   even   review   the   faxes   before   they   were   sent   in   his  
name.   But   Turza   does   not   contend   that   Top   of   Mind   is   re-­‐‑
sponsible   as   the   “person”   who   sent   the   faxes.   The   district  
court   held   that   the   faxes   are   “unsolicited   advertisements”  
and   entered   summary   judgment   against   Turza.   2010   U.S.  
Dist.  LEXIS  80756  (N.D.  Ill.  Aug.  3,  2010).  
    The  court  earlier  had  certified  a  class  of  the  faxes’  recipi-­‐‑
ents.   2009   U.S.   Dist.   LEXIS   95620   (N.D.   Ill.   Oct.   14,   2009).   In  
2011   the   court   denied   a   motion   to   reconsider   both   the   class  
certification   and   the   decision   on   the   merits.   2011   U.S.   Dist.  
LEXIS  97666  (N.D.  Ill.  Aug.  29,  2011).  The  court  ordered  Tur-­‐‑
za  to  pay  $500  in  statutory  damages  for  each  of  8,430  faxes.  
The   total   comes   to   $4,215,000.   In   its   final   order,   the   district  
judge  allocated  this  sum  as  follows:  $7,500  to  the  representa-­‐‑
tive  plaintiff,  which  received  32  faxed  editions  of  The  “Daily  
3                                                   Nos.  11-­‐‑3188  &  11-­‐‑3746  

Plan-­‐‑It”   (although   the   judge   called   this   an   “incentive  
award”,  it  is  less  than  the  $16,000  entailed  by  32  faxes  at  $500  
a   fax);   $1,430,055.90   to   class   counsel   for   attorneys’   fees   and  
expenses;  and  any  residue,  after  payments  to  class  members,  
to  the  Legal  Assistance  Foundation  of  Metropolitan  Chicago  
“as  a  cy  pres  award”.  Oddly,  the  judge  did  not  say  how  much  
each   recipient   who   submits   a   claim   receives.   Is   it   $500   per  
fax,  on  the  assumption  that  enough  would  go  unclaimed  to  
cover  the  attorneys’  fees?  Or  is  it  $330.72  per  fax,  the  number  
appropriate   if   attorneys’   fees   (and   the   award   to   plaintiff)  
come   off   the   top?   The   question   may   be   academic,   because  
Turza  has  not  ponied  up  the  fund  and  may  be  unable  to  do  
so.  But  we  must  reach  the  procedural  and  substantive  ques-­‐‑
tions  before  deciding  how  much  Turza  owes.  
    Class   certification   is   normal   in   litigation   under   §227,   be-­‐‑
cause  the  main  questions,  such  as  whether  a  given  fax  is  an  
advertisement,   are   common   to   all   recipients.   See   Brill   v.  
Countrywide   Home   Loans,   Inc.,   427   F.3d   446   (7th   Cir.   2005).  
There   can   be   doubt   about   whether   a   particular   person   is   a  
good  representative  of  the  class,  and  whether  class  counsel  is  
suitable,   see   Creative   Montessori   Learning   Centers   v.   Ashford  
Gear  LLC,  662  F.3d  913  (7th  Cir.  2011);  CE  Design  Ltd.  v.  King  
Architectural   Metals,   Inc.,   637   F.3d   721   (7th   Cir.   2011),   but  
Turza   does   not   question   the   adequacy   of   the   class   repre-­‐‑
sentative  or  its  chosen  counsel.  Because  Top  of  Mind  omitted  
opt-­‐‑out  notices,  it  does  not  matter  which  recipients  consent-­‐‑
ed  or  had  an  established  business  relation  with  Turza.  Con-­‐‑
trast   Gene   &   Gene   LLC   v.   Biopay   LLC,   541   F.3d   318   (5th   Cir.  
2008).   Nonetheless,   he   contends,   class   certification   is   inap-­‐‑
propriate  because  individual  issues  about  who  received  how  
many  faxes  predominate  over  the  common  questions.  
Nos.  11-­‐‑3188  &  11-­‐‑3746                                                        4  

     To   the   extent   Turza   contends   that   each   recipient   must  
prove   that   he   printed   the   fax   (wasting   paper)   or   otherwise  
suffered  monetary  loss,  he  is  wrong  on  the  law.  The  statute  
provides   a   $500   penalty   for   the   annoyance.   47   U.S.C.  
§227(b)(3)(B).   Even   a   recipient   who   gets   the   fax   on   a   com-­‐‑
puter   and   deletes   it   without   printing   suffers   some   loss:   the  
value  of  the  time  necessary  to  realize  that  the  inbox  has  been  
cluttered   by   junk.   That   loss,   and   the   statutory   remedy,   are  
the  same  for  all  recipients;  the  sort  of  problem  that  prevent-­‐‑
ed   class   certification   in   Comcast   Corp.   v.   Behrend,   133   S.   Ct.  
1426  (2013),  does  not  arise.  
     To   the   extent   Turza   contends   that   each   recipient   must  
prove  that  his  fax  machine  or  computer  received  the  fax,  he  
is  right  on  the  law  but  wrong  on  the  facts.  The  record  estab-­‐‑
lishes   which   transmissions   were   received   and   which   were  
not.   Top   of   Mind   hired   MessageVision   to   send   the   faxes.   It  
compiled  information  about  which  faxes  were  received,  and  
by  whom;  no  reasonable  juror  could  conclude  that  these  data  
are  inaccurate.  
     Transmitting   a   fax   requires   a   sending   and   a   receiving  
machine   to   communicate   using   a   standard   protocol.   If   the  
transmission  ends  successfully,  the  receiving  machine  sends  
a  code  indicating  this.  MessageVision  kept  a  log  of  the  codes  
received   during   the   process   of   sending   Turza’s   faxes.   This  
log   shows   that   it   tried   to   send   a   total   of   11,945   faxes   to   221  
unique   numbers;   the   receiving   fax   machines   reported   that  
8,630   of   these   were   delivered   successfully.   (Five   persons,  
who   collectively   received   200   faxes,   opted   out   of   the   class;  
that’s  why  the  district  court  used  8,430  faxes  as  the  basis  for  
calculating   damages.)   Turza   has   not   offered   any   reason   to  
think  that  MessageVision’s  fax  machines  recorded  the  codes  
5                                                 Nos.  11-­‐‑3188  &  11-­‐‑3746  

inaccurately   or   that   its   software   maintained   the   log   incor-­‐‑
rectly.   There   is   accordingly   no   need   for   recipient-­‐‑by-­‐‑
recipient   adjudication,   and   the   district   court   did   not   err   in  
concluding   “that   the   questions   of   law   or   fact   common   to  
class  members  predominate  over  any  questions  affecting  on-­‐‑
ly  individual  members”.  Fed.  R.  Civ.  P.  23(b)(3).  
     Turza  relies  on  Laouini  v.  CLM  Freight  Lines,  Inc.,  586  F.3d  
473   (7th   Cir.   2009),   for   the   proposition   that   electronic   con-­‐‑
firmation   of   a   fax’s   receipt   could   be   refuted   by   other   evi-­‐‑
dence.   That’s   true   enough.   The   question   in   Laouini   was  
whether  a  charge  of  discrimination  had  been  received  by  the  
agency  on  the  last  date  allowed  for  filing.  Plaintiff  produced  
a   record   of   a   successful   fax   transmission   on   that   date—but  
perhaps  plaintiff  had  faxed  a  document  other  than  a  charge  
of  discrimination  (none  was  in  the  agency’s  records),  or  per-­‐‑
haps  the  clock  on  the  sender’s  fax  machine  was  incorrect  and  
the  transmission  was  too  late.  We  held  in  Laouini  that  in  the  
absence  of  evidence  on  such  matters,  however,  the  electronic  
confirmation   suffices.   That’s   equally   true   here,   because   the  
record   would   not   permit   reasonable   jurors   to   reject   the   fax  
log.  Indeed,  this  case  is  easier,  because  there  is  no  doubt  what  
MessageVision   sent   out,   and   when   each   issue   of   The   “Daily  
Plan-­‐‑It”  was  sent  does  not  matter.  
    That   Ira   Holtzman,   the   principal   of   the   representative  
plaintiff,  retained  and  remembers  only  one  of  the  faxes  does  
not  call  the  logs  into  question.  Holtzman  testified  by  deposi-­‐‑
tion  that  his  secretary  screened  and  deleted  unwanted  faxes.  
Turza  has  not  demonstrated  that  even  a  single  entry  in  Mes-­‐‑
sageVision’s   log   was   inaccurate,   and   its   corporate   repre-­‐‑
sentative   explained   in   detail   how   the   logs   were   compiled.  
There  is  no  material  dispute  requiring  trial.  
Nos.  11-­‐‑3188  &  11-­‐‑3746                                                 6  

     The  only  question  on  the  merits  is  whether  the  faxes  con-­‐‑
tained   ads.   “Unsolicited   advertisement”   is   a   defined   term,  
meaning  “any  material  advertising  the  commercial  availabil-­‐‑
ity   or   quality   of   any   property,   goods,   or   services   which   is  
transmitted   to   any   person   without   that   person’s   prior   ex-­‐‑
press   invitation   or   permission,   in   writing   or   otherwise.”   47  
U.S.C.   §227(a)(5).   The   faxes   Top   of   Mind   devised   for   Turza  
may  not  have  touted  the  quality  of  his  services,  but  they  did  
declare   their   availability.   Here   is   a   copy   of   the   first   issue  
plaintiff  received:  
7     Nos.  11-­‐‑3188  &  11-­‐‑3746  

                                            
Nos.  11-­‐‑3188  &  11-­‐‑3746                                                   8  

Like   the   other   issues,   this   one   devotes   about   75%   of   the  
space   to   mundane   advice   and   the   remainder   to   Turza’s  
name,   address,   logo,   and   specialties.   The   district   court  
thought  it  impossible  for  any  reasonable  juror  to  doubt  that  
this  fax  plugs  the  commercial  availability  of  Turza’s  services.  
Top  of  Mind  told  its  clients,  including  Turza,  that  The  “Daily  
Plan-­‐‑It”  is  a  “promotional”  device,  and  Turza’s  own  lawyer  
called   it   “marketing”   in   his   brief   and   oral   argument.   That  
simply  recognizes  the  obvious.  
    Turza  contends  that  the  25%  of  the  fax  alerting  potential  
clients   to   the   availability   of   his   services   is   “merely   inci-­‐‑
dental”   to   the   75%   that   delivers   business   advice.   But   the  
statute   does   not   ask   whether   a   notice   of   availability   is   inci-­‐‑
dental  to  something  else.  If  Macy’s  faxes  potential  customers  
a  page  from  the  New  York  Times  that  is  devoted  75%  to  news  
about  international  relations  and  25%  to  an  ad  for  goods  on  
sale  at  Macy’s,  it  has  sent  an  advertisement.  That  75%  of  the  
page  is  not  an  ad  does  not  detract  from  the  fact  that  the  fax  
contains  an  advertisement.  
    Section   227(b)(2)   gives   the   Federal   Communications  
Commission  authority  to  issue  regulations  implementing  the  
statute,  and  Turza  maintains  that  the  FCC  has  adopted  a  rule  
that  incidental  ads  don’t  count  under  the  Act.  Turza  does  not  
cite   to   any   such   regulation,   however.   The   FCC   has   defined  
“advertisement”   in   language   that   closely   tracks   the   statute.  
“The  term  advertisement  means  any  material  advertising  the  
commercial  availability  or  quality  of  any  property,  goods,  or  
services.”   47   C.F.R.   §64.1200(f)(1).   The   “Daily   Plan-­‐‑It”   satis-­‐‑
fies  that  definition;  we  are  tempted  to  ask  what  part  of  “any”  
Turza   finds   hard   to   understand.   (We   have   quoted   the   cur-­‐‑
rent   definition;   the   regulation   in   force   when   Turza   sent   his  
9                                                           Nos.  11-­‐‑3188  &  11-­‐‑3746  

ads   defined   “unsolicited   advertisement”   in   the   statutory  
language.  See  47  C.F.R.  §64.1200(f)(13)  (2007).)  
    The  FCC’s  use  of  “incidental”  appears  not  in  the  regula-­‐‑
tion   but   in   the   explanation   the   agency   gave   when   adopting  
the  regulation.  The  FCC  wrote:  
      [F]acsimile   communications   that   contain   only   information,   such  
      as  industry  news  articles,  legislative  updates,  or  employee  bene-­‐‑
      fit  information,  would  not  be  prohibited  by  the  [statutory]  rules.  
      An  incidental  advertisement  contained  in  such  a  newsletter  does  
      not  convert  the  entire  communication  into  an  advertisement.  (In  
      determining  whether  an  advertisement  is  incidental  to  an  infor-­‐‑
      mational  communication,  the  Commission  will  consider,  among  
      other  factors,  whether  the  advertisement  is  a  bona  fide  “informa-­‐‑
      tional   communication.”   In   determining   whether   the   advertise-­‐‑
      ment   is   to   a   bona   fide   “informational   communication,”   the  
      Commission  will  consider  whether  the  communication  is  issued  
      on   a   regular   schedule;   whether   the   text   of   the   communication  
      changes   from   issue   to   issue;   and   whether   the   communication   is  
      directed  to  specific  regular  recipients,  i.e.,  to  paid  subscribers  or  
      to  recipients  who  have  initiated  membership  in  the  organization  
      that   sends   the   communication.   The   Commission   may   also   con-­‐‑
      sider   the   amount   of   space   devoted   to   advertising   versus   the  
      amount   of   space   used   for   information   or   “transactional”   mes-­‐‑
      sages   and   whether   the   advertising   is   on   behalf   of   the   sender   of  
      the  communication,  such  as  an  announcement  in  a  membership  
      organization’s   monthly   newsletter   about   an   upcoming   confer-­‐‑
      ence,  or  whether  the  advertising  space  is  sold  to  and  transmitted  
      on  behalf  of  entities  other  than  the  sender).  Thus,  a  trade  organi-­‐‑
      zation’s  newsletter  sent  via  facsimile  would  not  constitute  an  un-­‐‑
      solicited  advertisement,  so  long  as  the  newsletter’s  primary  pur-­‐‑
      pose   is   informational,   rather   than   to   promote   commercial   prod-­‐‑
      ucts.  The  Commission  emphasizes  that  a  newsletter  format  used  
      to   advertise   products   or   services   will   not   protect   a   sender   from  
      liability   for   delivery   of   an   unsolicited   advertisement   under   the  
      [statute]   and   the   Commission’s   rules.   The   Commission   will   re-­‐‑
      view  such  newsletters  on  a  case-­‐‑by-­‐‑case  basis.  
Nos.  11-­‐‑3188  &  11-­‐‑3746                                              10  

71  Fed.  Reg.  25967,  25973  (May  3,  2006).  
    This   passage   is   mysterious.   It   does   not   elaborate   on   the  
meaning  of  the  word  “advertisement”  in  the  statute  or  regu-­‐‑
lation.   Instead   it   discusses   the   meaning   of   “informational  
communication”,   a   phrase   that   does   not   appear   in   either  
§227  or  the  regulation.  It  seems  to  be  a  species  of  untethered  
legislative  history—and  the  Supreme  Court  has  told  us  that,  
although   legislative   history   may   assist   in   understanding   an  
ambiguous   text,   a   freestanding   declaration   untied   to   an  
adopted   text   must   be   ignored.   See,   e.g.,   Puerto   Rico   Depart-­‐‑
ment  of  Consumer  Affairs  v.  Isla  Petroleum  Corp.,  485  U.S.  495,  
501  (1988);  Lincoln  v.  Vigil,  508  U.S.  182,  192  (1993).  
     Perhaps  this   passage   is   best   understood  as   a  declaration  
of  the  Commission’s  enforcement  plans.  Section  227  author-­‐‑
izes   private   litigation,   however;   recipients   need   not   depend  
on  the  FCC.  At  all  events,  even  the  passage  on  which  Turza  
so   heavily   relies   declares   that   “a   newsletter   format   used   to  
advertise  products  or  services  will  not  protect  a  sender  from  
liability   for   delivery   of   an   unsolicited   advertisement”.   The  
“Daily  Plan-­‐‑It”  has  a  newsletter  format,  but  it  is  not  remotely  
like  a  trade  association’s  newsletter  to  its  members  or  a  law  
firm’s  newsletter  alerting  clients  to  legal  developments.  The  
plug   for   Turza’s   services   was   not   incidental   to   a   message  
that  would  have  been  sent  anyway;  promotion  or  marketing  
was  the  reason  these  faxes  were  transmitted.  Like  the  district  
court,  we  conclude  that  The  “Daily  Plan-­‐‑It”  is  an  advertise-­‐‑
ment  as  a  matter  of  law.  
    Now  for  the  remedy.  The  district  judge  ordered  Turza  to  
pay  $4,215,000  but  did  not  say  to  whom.  To  the  court’s  regis-­‐‑
try?  To  plaintiff’s  lawyers,  as  agents  for  the  class’s  members?  
To  a  third-­‐‑party  administrator?  None  of  the  individual  class  
11                                                  Nos.  11-­‐‑3188  &  11-­‐‑3746  

members   is   entitled   to   $4,215,000   or   anything   like   that  
much—and   it   is   the   persons   who   got   the   faxes,   not   “the  
class”   as   a   whole,   who   are   entitled   to   damages   under  
§227(b)(3).  A  class  certified  under  Rule  23(b)(3)  is  not  a  jurid-­‐‑
ical   entity.   Decisions   such   as   Zahn   v.   International   Paper   Co.,  
414  U.S.  291  (1973),  and  Clark  v.  Paul  Gray,  Inc.,  306  U.S.  583  
(1939),  which  hold  that  class  members’  losses  cannot  be  ag-­‐‑
gregated  to  reach  the  minimum  required  for  diversity  juris-­‐‑
diction,   demonstrate   this   principle.   Each   class   member   has  
an  interest  in  his  own  damages.  See  Gilman  v.  BHC  Securities,  
Inc.,   104   F.3d   1418,   1427   (2d   Cir.   1997).   Some   class   actions  
stem  from  aggregate  and  undifferentiated  injuries;  these  cre-­‐‑
ate   genuine   common   funds.   But   this   action   stems   from   dis-­‐‑
crete  injuries  suffered  by  each  recipient  of  the  faxes;  it  does  
not   create   a   common   fund.   Travelers   Property   Casualty   v.  
Good,  689  F.3d  714  (7th  Cir.  2012),  discusses  how  to  identify  
genuine  common-­‐‑fund  cases.  
    Because   the   district   judge   contemplated   that   Turza  
would   pay   a   lump   sum   to   (or   for)   the   class   as   a   whole,   the  
judge  had  to  decide  what  would  happen  if  some  of  the  mon-­‐‑
ey  went  unclaimed.  Without  soliciting  the  parties’  views,  the  
judge   declared   that   any   residue   would   be   turned   over   to   a  
charity  rather  than  be  returned  to  Turza.  (Plaintiff  contends  
that  Turza  forfeited  any  objection  to  this  decision  by  not  pro-­‐‑
testing  it  in  the  district  court,  but  “[a]  formal  exception  to  a  
ruling  or  order  is  unnecessary.”  Fed.  R.  Civ.  P.  46.  Given  the  
opportunity,   parties   must   state   their   positions   before   the  
fact;  they  need  not  remonstrate  with  a  judge  who  decides  an  
issue  without  giving  the  litigants  a  chance  to  state  their  posi-­‐‑
tions.)  The  judge  did  ask  the  parties  which  charity  they  pre-­‐‑
ferred,  and  from  their  suggestions  he  selected  the  Legal  As-­‐‑
sistance  Foundation  of  Metropolitan  Chicago.  He  called  this  
Nos.  11-­‐‑3188  &  11-­‐‑3746                                                 12  

a   “cy   pres   award”,   but   as   we   explained   in   Mirfasihi   v.   Fleet  
Mortgage   Corp.,   356   F.3d   781,   784   (7th   Cir.   2004),   this   is   a  
misnomer—though   one   common   in   the   legal   literature.   See  
Comment,   Damage   Distribution   in   Class   Actions:   The   Cy   Pres  
Remedy,  39  U.  Chi.  L.  Rev.  448  (1972)  (using  the  cy  pres  doc-­‐‑
trine  of  trust  law  as  an  analogy).  
      Turza  contends  that  any  residue  belongs  to  him.  The  dis-­‐‑
trict  judge  thought  otherwise  but  did  not  say  why—and,  as  
it  is  far  from  clear  that  Turza  has  the  money  needed  to  pay  
the  class  members  who  submit  claims,  it  is  premature  to  de-­‐‑
cide  whether  and,  if  so,  when,  defendants  are  entitled  to  re-­‐‑
funds  of  any  surplus.  The  district  judge  may  not  have  appre-­‐‑
ciated  the  difference  between  common-­‐‑fund  suits  and  those  
that   arise   from   individual   injuries.   It   may   well   make   sense  
for  the  district  judge  to  direct  Turza  to  pay  the  damages  into  
the  court’s  registry,  or  to  a  third-­‐‑party  administrator,  so  that  
members   of   the   class   can   receive   pro   rata   distributions   if   it  
turns   out   that   Turza   cannot   satisfy   the   full   award.   Only   if  
Turza   pays   more   than   enough   to   satisfy   all   claims   by   class  
members  will  it  be  necessary  to  decide  whether  the  residue  
goes  back  to  him  or  is  put  to  some  other  use.  
     This   also   means   that   it   was   premature   for   the   district  
court  to  have  directed  that  any  remainder  be  turned  over  to  
a   particular   charity.   It   was   doubly   inappropriate   to   enter  
such  an  order  without  soliciting  argument  from  the  litigants  
and   without   discussing   the   difference   between   common-­‐‑
fund  suits  and  those  involving  the  use  of  the  class  device  to  
vindicate  individually  held  claims.  
      Charitable   distribution   of   remainders   in   class   actions  
originated  when  courts  had  to  deal  with  non-­‐‑reverter  clauses  
in   common-­‐‑fund   settlements.   If   the   defendant   settles   a   suit  
13                                                 Nos.  11-­‐‑3188  &  11-­‐‑3746  

for   a   sum   certain,   and   disclaims   any   right   to   whatever   re-­‐‑
mains  after  claims  from  class  members  have  been  paid,  then  
the  court  has  to  do  something  with  what’s  left  over.  Escheat  
to   the   state   is   one   possibility.   Another   is   an   augmented   re-­‐‑
covery  for  those  class  members  who  submitted  claims.  Still  a  
third   option,   under   the   cy   pres   banner,   is   distribution   to   a  
group  that  will  use  the  money  for  the  benefit  of  class  mem-­‐‑
bers.  This  third  option  is  most  useful  when  individual  stakes  
are  small,  and  the  administrative  costs  of  a  second  round  of  
distributions   to   class   members   might   exceed   the   amount  
than  ends  up  in  class  members’  pockets.  
      Our  case  did  not  end  in  settlement  and  is  not  a  common-­‐‑
fund  situation.  Turza  did  not  agree  to  give  up  his  interest  in  
money   unclaimed   by   class   members.   The   stakes   per   fax   are  
large   enough   to   make   a   second   round   of   distribution   feasi-­‐‑
ble.   And   the   Legal   Assistance   Foundation   of   Metropolitan  
Chicago  does  not  directly  or  indirectly  benefit  certified  pub-­‐‑
lic  accountants,  the  victims  of  Turza’s  junk  faxes.  The  Foun-­‐‑
dation   is   a   worthy   organization,   but   many   courts   have   ex-­‐‑
pressed  skepticism  about  using  the  residue  of  class  actions  to  
make  contributions  to  judges’  favorite  charities.  See,  e.g.,  In  
re   Lupron   Marketing   &   Sales   Practices   Litigation,   677   F.3d   21,  
31–38  (1st  Cir.  2012);  Klier  v.  Elf  Atochem  North  America,  Inc.,  
658  F.3d  468,  475–76  (5th  Cir.  2011),  and  id.  at  480–82  (Jones,  
C.J.,  concurring);  Nachshin  v.  AOL,  LLC,  663  F.3d  1034,  1038–
39  (9th  Cir.  2011).  
    Money  not  claimed  by  class  members  should  be  used  for  
the  class’s  benefit  to  the  extent  that  is  feasible.  See  Six  Mexi-­‐‑
can  Workers  v.  Arizona  Citrus  Growers,  904  F.2d  1301  (9th  Cir.  
1990);  Dennis  v.  Kellogg  Co.,  687  F.3d  1149  (9th  Cir.  2012).  See  
also,   e.g.,   ALI,   Principles   of   the   Law   of   Aggregate   Litigation  
Nos.  11-­‐‑3188  &  11-­‐‑3746                                                 14  

§3.07   (2010);   Martin   H.   Redish,   Peter   Julian   &   Samantha  
Zyontz,   Cy   Pres   Relief   and   the   Pathologies   of   the   Modern   Class  
Action:  A  Normative  and  Empirical  Analysis,  62  Fla.  L.  Rev.  617  
(2010).  Perhaps  that  would  not  be  feasible  here,  making  oth-­‐‑
er  charities  more  suitable  as  recipients,  but  the  absence  of  an  
adversarial   presentation—and   the   considerable   doubt   that  
Turza   will   be   able   to   pay   enough   to   allow   full   payment   to  
class  members  who  submit  claims—means  that  such  a  deci-­‐‑
sion  would  be  premature.  
       The   district   court’s   decision   on   the   merits   is   affirmed,  
but  the  remedial  order  is  vacated.  The  case  is  remanded  with  
instructions  to  enter  a  judgment  requiring  Turza  to  remit  to  
the  registry  or  to  a  third-­‐‑party  administrator.  Once  the  court  
knows  what  funds  are  available  for  distribution,  it  should  (if  
necessary)  reconsider  how  any  remainder  will  be  applied.  It  
may  also  be  necessary  to  reconsider  the  “incentive  award”  to  
the  representative  plaintiff  (which  appears  to  be  a  “disincen-­‐‑
tive   award”)   and   the   way   in   which   class   counsel   are   com-­‐‑
pensated.  See  Boeing  Co.  v.  Van  Gemert,  444  U.S.  472  (1980).