Courts Continue to Be Skeptical of Professional Plaintiffs in TCPA Cases

By Joseph C. Wylie II, Molly K. McGinley, and Lexi D. Bond

In a ruling issued on December 1, 2016, the District Court for the Central District of California denied class certification in a Telephone Consumer Protection Act (“TCPA”) case due to the putative class representatives’ status as a so-called professional plaintiff. This ruling continues a trend in which courts have significantly limited the ability of professional plaintiffs to bring TCPA class actions. Courts increasingly view professional plaintiffs’ conduct in inviting the complained-of communications as a basis to challenge these plaintiffs’ standing and rendering them inadequate class representatives.

In Phillip Nghiem v. Dick’s Sporting Goods, Inc., the court declined to certify the plaintiff’s putative class on grounds that plaintiff was not an adequate representative and that his claims were not typical of those of the putative class members. The plaintiff, Phillip Nghiem (“Nghiem”), is a plaintiffs’ attorney who handles consumer and debtor disputes, including TCPA claims. Nghiem alleged that Defendants Dick’s Sporting Goods (“Dick’s”) and Zeta Interactive Corporation administered a marketing program that used “mobile alerts” in the form of text messages sent to subscribers. Nghiem admitted that he signed up for Dick’s mobile alerts but alleged that he continued to receive automated text messages after revoking his consent, in violation of the TCPA. In ruling on Nghiem’s motion to certify a class, the court concluded that his proposed class could not meet the standard for the typicality and adequacy requirements.

First, the court found that Nghiem’s claims were not typical of the proposed class as required by Rule 23 because Nghiem “is no ordinary class representative for a TCPA action.” Notably, Nghiem had represented plaintiffs in TCPA cases on at least six occasions. Additionally, he opted into Dick’s and several other similar mobile alert programs around the same time, without taking advantage of any promotions of the programs, suggesting that his motivation was finding potential TCPA violations. The court concluded that the typical member of the class would have no special knowledge of the TCPA nor experience litigating TCPA claims. The typical member of the class “signed up for Dick’s mobile alert program because he was undisputedly interested in Dick’s merchandise and looking to score a bargain.” Most importantly, the typical member of the class opted in and out of Dick’s mobile alert program with the expectation that his privacy would be respected and not invaded by unwanted text messages from Dick’s. The court questioned whether Nghiem could in fact have suffered an invasion of privacy if he signed up for Dick’s mobile alert program for the specific purpose of discovering a TCPA violation that could support a lawsuit. (In a separate ruling, the court denied Dick’s motion to dismiss on standing grounds, but left open its ability to challenge standing in further proceedings.) Thus, the court could not find that Nghiem’s claims were typical of the class as required by Rule 23.

Next, the court concluded that Nghiem failed to satisfy the adequacy requirement for class certification. Because of his background and conduct, the court was convinced that if Nghiem were the class representative, he and his counsel would have to devote most of their time and resources trying to refute Defendants’ attacks on his character and his motivations for filing and litigating the lawsuit. This skewed focus and diversion of resources would come at the expense of Nghiem’s ability to “vigorously prosecute” the case on behalf of the rest of the class. Consequently, Nghiem could not fairly and adequately protect the interests of the class as required by Rule 23. Since Nghiem could not satisfy either the typicality or adequacy requirements, the court denied Nghiem’s motion for class certification.

The Nghiem decision follows two recent district court decisions dismissing TCPA claims where the plaintiffs appeared to manufacture standing (previously discussed here). In Telephone Science Corp. v. Asset Recovery Solutions and Stoops v. Wells Fargo Bank, N.A, courts dismissed TCPA claims based on communications that the professional plaintiffs sought out. These decisions demonstrate the trend of increasing skepticism by courts of plaintiffs who invite communications for purposes of bringing TCPA litigation. In light of the considerable burden of TCPA claims brought by repeat litigants, these rulings may provide an effective defense against the most egregious attempts to exploit the TCPA for profit.