CASE DISMISSED AS MOOT: Five9 an ATDS? and Last-Minute Individual Settlements
Saturday, March 18, 2023

Happy Friday and St. Patrick’s Day TCPA World!

Let’s talk a little about this new Memorandum in Stewart v. Vision Solar LLC, No. 20-2185, 2023 WL 2539017 (E.D. Pa. Mar. 16, 2023). On 3/16/23, Judge Michael M. Baylson addressed both Five9’s status as an ATDS and the precertification settlement of the named plaintiffs’ individual claims.

As to the first issue of whether Five9 qualifies as an ATDS:

After hearing expert testimony from both sides, the Court found that a “genuine issue of material fact exists as to whether the dialing system employed by [Defendant] was an ATDS and whether the calls resulted from the capacity to use random or sequential number generation to produce or store numbers.”

Now, the Court here starts off by stating that whether equipment qualifies as an ATDS is a mixed question of law and fact. Defendant’s expert argued there was no evidence Five9 had the capacity to use random or sequential number generation to produce or store numbers and that Five9 systems employed here would not meet the ATDS definition. Plaintiff’s expert argued otherwise and added that the dialing system, in fact, used a sequential number generator. This was enough for the Court to say this is the finder of fact’s problem to resolve.

Now, for you long term readers, this should be of no shock and somewhat déjà vu. Morgan v. On Deck Capital, however, went a bit more in depth on this issue.  Still, the gist of both cases is Five9 may be an ATDS.

The Court’s main focus here was on the precertification settlement of the named Plaintiffs’ individual claims. The Court found that under current law the individual claims here were able to be settled without any regard to the class and prior to a ruling as to the class certification. This could have been a major issue because of the timing of the settlement being shortly after the arguments on class certification concluded.

So, in other words, if an individual settlement agreement is seemingly any time before the actual ruling on class certification, the individual settlement is permissible.

The Court dismissed this case because the named Plaintiffs’ claims became moot upon settlement, and the general rule is that “the mooting of named plaintiff’s claim prior to class certification moots the entire case.” And here, the general rule applied. The claims were now moot as they have no further interest in the case. Simple as that.

The Court also discussed circumstances where this would not be true. “Mootness exceptions” exist but only “where mooting of the individual claim occurred at so early a point in litigation that the named plaintiff could not have been expected to file a class certification motion.” In those cases, the conditional certification motion would relate back to the filing of the initial complaint.

Have a great weekend!

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