TCPA Cases Against Realtors For Calls By Independent Agents Uncertifiable? So Holds the First District Court to Consider the Issue
I love a first-in-the-nation result following a holiday weekend.
First—the trend. A large number of recent cases have sought to hold real estate brokerages liable for calls purportedly violating the Telephone Consumer Protection Act (TCPA) made by their independent agents. Obviously these independent agents are—wait for it—independent so there is a deep question as to whether the brokerage can be held liable for the acts of these agents from a vicarious liability perspective.
While the issue of vicarious liability remains critically important from a substantive perspective in these case, it was also a critical animator of a certification denial last week in Chinitz v. Nrt W., Case No. 18-cv-06100-NC, 2019 U.S. Dist. LEXIS 148699 (N.D. Cal. Aug. 30, 2019).
In Chinitz the court issued what appears to be a first-in-the-nation ruling on the issue of whether TCPA class actions against brokerages for calls by independent agents can be certified—and the answer was a definitive no.
Chinitz offers a couple of neat pieces of analysis. First, the Court found two of Plaintiff’s proposed classes failed numerosity—yes, numerosity—for want of any affirmative evidence as to the size of the classes. The Court found that the Plaintiff’s reliance on an expert declaration declaring how she intended to identify class members was not the same thing as presenting evidence of the actual number of class members. While this is an entertaining and swift end to two classes in Chinitz beware the double-edged sword here—failing a stipulation on numerosity, a Court’s unwillingness to accept a methodology on numerosity may mean that a Plaintiff is required to demand ample class data to find class members pre-certification; an expensive and burdensome process (for Defendant) that would not otherwise be necessary until after a class is actually certified, if at all. Something to keep in mind.
As to adequacy the Court followed the majority position and concluded that Plaintiff—a repeat TCPA player—is not inadequate to represent the class due to his *ahem* experience with these cases. (Parenthetically, are TCPA class actions brought by anyone but repeat-litigants these days?)
Now onto the meat. Commonality.
Avid TCPAWorld.com readers will recall that just a month ago a Court in California found that whether or not a Defendant was in an agency relationship with its vendors was actually a common issue justifying class certification since the answered would be the same as to every class member receiving calls from each such vendor. See Moser v. Health Ins. Innovations, Inc., Case No.: 17-cv-1127-WQH-KSC, 2019 U.S. Dist. LEXIS 132790 (S.D. Cal. Aug. 7, 2019). That was a remarkable—and scary—ruling. But it had obvious limits—as Chinitz demonstrates.
In Chinitz the Plaintiff was seeking to hold Defendant responsible for any illegal call made by any of its numerous agents. Thus although class member claims against the Defendant turned on a common question—whether the Defendant had the requisite control over the conduct of the specific agent—the Plaintiff had failed to show that the level of control the Defendant exercised was the same as to each individual agent. In the Court’s words:
NRT may exert different levels of supervisory control over its associates, such that it is vicariously liable for the actions of some associates, but not others.
In the Court’s view this was a case of a Plaintiff biting off more than he could chew. (Which seems to be happening more and more in TCPAWorld.) Rather than focus on the acts of one or two associates, the Plaintiff tried to big out and certify a class composed of every call made by everyassociate of the Defendant real estate brokerages. That, of course, creates the possibility—if not the reality—of endless trials about the individual level of control exercised over each independent associate. Here again the Court says it best: “Absent a preponderance of evidence that NRT’s relationship with its associates can be determined across the board, Chinitz has not satisfied the commonality requirement.”
Bada bing. Bada boom. Certification denied.
One important final point to keep in mind here: Chinitzfinds that Plaintiff failed to establish even basic Rule 23(a) commonality. This is not a predominance ruling folks. Many class action practitioners have seem to have forgotten the importance of Rule 23(a) commonality—indeed I have seen a number of recent opinions where a Defendant concedes the issue away from some reason. But following Dukes commonality has teeth and consequences—as Chinitz demonstrates. Don’t stipulate the issue away.
Happy Tuesday TCPAWorld.