Thomas C. Blatchley of Gordon & Rees.

On Aug. 28, the U.S. Court of Appeals for the Eleventh Circuit in Salcedo v. Hanna, (D.C. Dkt. No. 0:16-cv-62480-DPG; Appeal No. 17-14077) held that receipt of a single unsolicited text message, sent in violation of the Telephone Consumer Protection Act, is not a concrete injury to establish standing to sue in federal court. The decision is a decisive victory for TCPA call/text defendants in the Eleventh Circuit as it now requires TCPA plaintiffs in that jurisdiction to allege more than the generalized nuisance, trespass, invasion of privacy, etc. harms typically set forth in TCPA complaints. While it now creates a circuit split on Article III standing, thus setting the stage for a re-review of Spokeo v. Robins, the decision has broader implications for TCPA class certification purposes. It should serve as an impediment to class certification as it will require an individualized inquiry into each putative class members' concrete injury and further creates issues as to the adequacy of the class representative if she suffers divergent harms from other putative class members. Such inquiry is fatal to class certification.

Factual Overview

On Aug. 12, 2016, John Salcedo, a former client of Florida attorney Alex Hanna and his law firm (collectively, Hanna), received a multimedia text message from Hanna offering a 10% discount on his services. Salcedo filed a lawsuit in district court (S.D. Fla.) as the representative of a putative class of former Hanna clients who received unsolicited text messages from Hanna in the past four years, alleging violations of the TCPA. He sought, among other relief, statutory damages of $500/text and treble damages of $1,500/text sent willfully or knowingly.

Hanna moved to dismiss the complaint for lack of standing, arguing in the alternative that it should be dismissed as to Hanna for failure to state a claim against him and that certain parts of the complaint should be stricken. The district court disagreed, finding in relevant part that Salcedo had standing based on an unreported district decision. The district court allowed Hanna to pursue an interlocutory appeal and stayed the proceedings. The appeal to the Eleventh Circuit followed.

Analysis

Much like a well-written law review article, the circuit court set the stage as follows: first, it introduced the TCPA. Next it discussed the standing requirements of Article III of the Constitution. Finally, it turned to Salcedo's particular allegations of harm and analyzed them in view of its circuit precedent, history, and the judgment of Congress.

Skipping ahead of the boring TCPA primer/background, the circuit court found, citing Spokeo, that when the concreteness of an alleged injury is difficult to recognize, it must look to the "history and the judgment of Congress" for guidance. Significantly, it found that an act of Congress that creates a statutory right and a private right of action does not automatically create standing; Article III standing requires a concrete injury even in the context of a statutory violation.

Viewing the complaint allegations through the lens of its precedent, history and judgment of Congress, and evaluating the harm qualitatively and not quantitatively, the Eleventh Circuit held that Salcedo did not suffer a concrete injury and thus lacked standing. The circuit court found that Salcedo's allegations of harm from receipt of a single text message (e.g., wasted time answering or addressing the message, rendering Salcedo and his phone unavailable, invasion of privacy and right to enjoy the full utility of his phone) were qualitatively different from those in its precedent that have been successful in establishing standing to sue over a single violation of the TCPA. The court cited two of its recent TCPA fax case decisions, comparing tangible costs associated with a fax (e.g., paper, ink, toner) to the fact that Hanna "has not alleged specifically that [his] text cost him any money," despite the complaint generally alleging that some text messages cause recipients to incur costs. On the question of intangible harms, the circuit court rejected the notion that a fax and text are qualitatively different concerning wasted time and device usage. Regarding unavailability, the circuit court found that Salcedo alleged no particular loss of opportunity to receive other texts. Finding that its precedent in Palm Beach Golf (TCPA single fax receipt case) did not control, and finding its sister circuit's decision unpersuasive (Van Patten, 9th Cir.—receipt of two texts constituted an injury in fact), the circuit court next looked to the history and judgment of Congress.

The circuit court found that the history and judgment of Congress does not support finding concrete injury in Salcedo's allegations. Salcedo did not allege anything like enjoying dinner at home with his family and having domestic peace shattered by the ringing of the telephone. Salcedo did not allege that his cellphone was searched, dispossessed or seized for any length of time. The circuit determined that Salcedo's allegations of a brief, inconsequential annoyance were categorically distinct from those kinds of real but intangible harms. Thus, the circuit court found that the chirp, buzz or blink of a cellphone receiving a single text is more akin to walking down a busy sidewalk and having a flyer briefly waived in one's face. While perhaps annoying, it is not the basis to invoke the jurisdiction of a federal court. For these reasons, the Eleventh Circuit held that Salcedo's allegations did not state a concrete harm that met the injury-in-fact requirement of Article III for purposes of standing.

Implications on Future TCPA Litigation

So what does this mean for TCPA litigation going forward? Certainly TCPA plaintiffs counsel will argue that the Salcedo decision does not alter the landscape, they will just have to be more precise and allege more concerning harms suffered by their clients. Whether that will save the day is unknown and will certainly spur much more litigation practice in the TCPA world. From the perspective of TCPA defense counsel, Salcedo is a favorable decision if for no other reason than it requires enhanced pleading by plaintiffs concerning their claimed "concrete" injury. It also provides defense counsel with new circuit court authority to challenge standing in those cases alleging receipt of a single call or text, perhaps even in those jurisdictions that have considered this type of standing issue in cases alleging receipt of two or more text messages or calls.

More significantly, however, are the broader implications on class certification. First, certification will require a painstaking and time-consuming individualized inquiry to determine each member's concrete injury, which will inevitably be different for each putative class member. Every putative class member will have to demonstrate a discrete concrete harm caused by the receipt of an unsolicited text message or call. In other words, each putative class member will necessarily have to be analyzed, one-by-one, to delineate his/her respective injury for Article III standing purposes. This painstaking and time consuming process is fatal to any class certification. Further, it calls into question whether any named plaintiff could ever be an adequate class representative given divergent concrete harms of the putative class members.

The Salcedo decision just might set the stage for the U.S. Supreme Court to revisit Spokeo v. Robins given the circuit split on Article III standing. Stay tuned, the show has just begun.

Thomas C. Blatchley is a partner in Gordon Rees Scully Mansukhani's Hartford office. He represents a variety of clients in complex litigation in federal and state courts. His practice focuses on litigation matters concerning insurance defense and coverage, business/commercial disputes, employment practices liability, professional liability, products liability, consumer defense, and environmental and land use.