Duane Morris Class Action Review - 2023 - Report - Page 367
merely numbers. The Ninth Circuit also noted that before Duguid, some circuits held
that equipment could qualify as an autodialer just because it autodialed stored phone
numbers that had not been randomly or sequentially generated in the first instance. But,
the Supreme Court in Duguid rejected this interpretation.
Similarly, in McCurley, et al. v. Royal Seas Cruises, Inc., 2022 U.S. App. LEXIS 9079
(9th Cir. Mar. 8, 2022), the Ninth Circuit affirmed the district court’s grant of summary
judgment on the issue of apparent authority because the record did not support a
finding that the defendant’s agent had apparent authority from the defendant to call nonconsenting individuals. The defendant hired a company to generate leads (Lead
Generator) and initiate calls to prospective consumers for cruise packages. The issue
on appeal was whether the defendant was liable under the TCPA for prerecorded voice
calls made by the Lead Generator to those plaintiffs who had not given prior express
consent to be called. The plaintiffs asserted that the defendant had a non-delegable
duty under the TCPA to ensure that the Lead Generator had prior express consent for
each call it made to solicit potential customers for the defendant. The Ninth Circuit
disagreed. It opined that the FCC, the agency responsible for implementing the TCPA,
instructs that the relationship between a seller and a telemarketer should be assessed
under federal common law agency principles. The Ninth Circuit followed precedent that
defers to the FCC’s interpretation that the TCPA requires vicarious liability, not strict
liability, and the plaintiff presented no compelling reason why this position should be
changed. The Ninth Circuit also reviewed the legal theory of apparent authority and
determined that the record did not support a finding that the Lead Generator had
apparent authority from the defendant to call non-consenting individuals. When the
Lead Generator placed calls, it asked an individual who answered “qualifying questions”
about products and services that ranged from home improvement to medical equipment
to leisure packages, including cruises. Id. at *5. The defendant approved the scripts
used, but no script was in the record. There was no record evidence of whether, or
when, between making the phone call and transferring the individual answering to a live
person at the defendant, the Lead Generator stated that it was calling on behalf of a
third party or mentioned the defendant. Thus, the Ninth Circuit concluded that there is
no basis to find that the person answering the Lead Generator’s call would reasonably
believe that the Lead Generator was acting on behalf of the defendant before the point
of the transfer. Thus, the Ninth Circuit reversed the district court’s summary judgment
order in favor of the defendant as to ratification because the evidence supported that
the defendant knew facts that should have led it to investigate the Lead Generator’s
work for TCPA violations.
A circuit split emerged in 2022 over faxes offering “free” goods, money, or services and
whether they constitute an “unsolicited advertisement” under the TCPA. The Second
Circuit held that an unsolicited faxed invitation to participate in a market research survey
in exchange for money does not constitute an “unsolicited advertisement” as defined by
the TCPA. In Bruce Katz, MD, P.C., et al. v. Focus Forward LLC, 22 F.4th 368 (2d Cir.
2022), the Second Circuit determined that the fax was not an “unsolicited
advertisement” because it did not promote the commercial availability or quality of any
property, goods, or services, as prohibited by the TCPA. At issue was whether two
facsimiles offering $150 in exchange for participation in a market research study
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Duane Morris Class Action Review – 2023
