January 27, 2020

January 27, 2020

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TCPA Class Melts Under Sweltering Scrutiny: Company-Wide Training Policy and Plaintiff’s “Distressing” Ignorance of Her Claim Against Ice Cream Company Defeats Typicality and Adequacy

Like many chains, Häagen-Dazs operates a Rewards Program where members receive points for their purchases, coupons, and other offers, as well as information regarding their favorite creamery. The Rewards Program is managed through the Häagen-Dazs App. During a visit, a Häagen-Dazs cashier would enroll a willing customer into the program by taking the customer’s phone number and entering that phone number into a third-party platform, which then “sen[t] a single, on-demand text message to the customer.” The single text message provided: “Thank you for joining Häagen-Dazs Rewards! Download our App here” and provided a link to download the App.

Häagen-Dazs maintained a company-wide policy of signing up customers to the Rewards Program by training all of its cashiers to say the following during the sign-up process:

“Would you like to enroll in our Reward Program and receive points towards a free reward on your next visit? All I need is your phone number and then you will receive a text message to download our mobile application and start earning rewards today.”

And, if the customer consented to join the Rewards Program, the cashier would then say:

“You will receive a text message in just a second to download our Häagen-Dazs App so you can keep track of your points and get special offers including a free frozen treat. Thanks and have a great day!”

All’s well, right? Under relevant FCC authority, the TCPA does not require express written consent for a text message where “a one-time text message [is] sent immediately after a consumer’s request for the text . . . .” In re Rules & Regulations Implementing the TCP Act of 1991 et al. , 30 FCC Rcd 7961, 8015 (F.C.C. July 10, 2015), (set aside in part on other grounds by ACA Int’l v. FCC, 885 F.3d 687 (D.C. Cir. 2018)).

But hold on to your sweets – in San Pedro-Salcedo v. Häagen-Dazs Shoppe Co., 2019 U.S. Dist. LEXIS 208228 (N.D. Cal. Dec. 3, 2019) – a cashier waffled on this policy, taking Häagen-Dazs down a Rocky Road of litigation.

In that case, the plaintiff visited a local mall-based Häagen-Dazs, where a cashier asked her if she would like to join the Rewards Program and for her phone number. Plaintiff agreed and complied, and then received the above-referenced one-time text. However, plaintiff claimed “that the cashier did not notify her that she would receive any text message” and that, “had she been notified about the text message, she would not have brought . . . suit.”

Well, surprise, while still at the mall, plaintiff “called her husband [to] discuss[] the text message” and he “recommended that she contact his close [lawyer] friend,” which she did that same day. Plaintiff and her new lawyer filed suit shortly thereafter (within a month!) and sought to represent a nationwide class of Häagen-Dazs patrons who “received at least one text message from Defendant[]” relating to the Rewards Program.

However, the District Court denied plaintiff’s motion for class certification on two grounds: the court found she was both (1) atypical of the class she sought to represent; and (2) inadequate to represent the putative class.

As to typicality, plaintiff argued that she was “typical of . . . the class because both she and the class members received the [same] [Rewards Program] text message” and neither she nor “the class members, per Häagen-Dazs’s policy, were asked to provide written consent.” However, as referenced above, the Court noted that, under the FCC’s interpretation of the TCPA, such a one-time text message does not require express written consent. Moreover, the Court held that, because of Häagen-Dazs’s uniform policy on cashier training, “most customers consented to the one-time text message with the link to download the App.”

Thus, according to the court, because plaintiff testified that “she was not advised that she would receive the text message” by the cashier, she was critically atypical of the class she sought to represent. Indeed, “Häagen-Dazs would be able raise the FCC rules as a defense against the class members . . . but that defense would not apply to [plaintiff]” – in other words, by testifying that she was not told she would receive the text message, plaintiff did not “request . . . the text” under the FCC’s interpretation of the TCPA, whereas the majority of the class she sought to represent had “consented to the one-time text message.” Because plaintiff and “absent class members are subject to differing defenses,” the court held class certification was inappropriate under the “typicality” prong.

Not stopping there, however, the court put the “cherry on top” of the opinion by finding that the plaintiff was also wholly inadequate to represent the proposed class. And on this point, the court seriously took plaintiff to task. Specifically, the court found that, “coupled with her close personal relationship with her attorney,” the plaintiff “lacks [the] minimal, basic familiarity with her allegations and claims that is necessary to protect the interests of the absent class members.”

For instance, the court noted that plaintiff testified that her lawsuit concerned twelve unsolicited phone calls – but “[h]er testimony simply ha[d] no connection with her single cause of action, which [was] based only on the one text message concerning the App.” (emphasis in original). Further, plaintiff testified that she “understands what an ATDS is” but then went on to basically concede her entire case, testifying that “she did not believe that Häagen-Dazs had used an ATDS to send her the text message. . . . [Or] whether [that fact] was significant to her case.” To paraphrase the court, “Yikes!” The court went on to note that plaintiff’s request to represent the class was “complicated” by her and her husband’s close relationship with her attorney, noting that “their personal relationship and her lack of familiarity with the lawsuit raise[d] substantial concerns as to her credibility in representing the interests of the putative class.”

On both basis, the court denied plaintiff’s motion for class certification, effectively ending the purported class action by finding that she was an inadequate representative. While the court’s holding on typicality is interesting for its application of the FCC’s one-time text exemption as to customer-initiated requests for information, the case is more exceptional for its holding on the issue of adequacy.

Quite simply, while a putative class representative need not understand the TCPA as a lawyer would, the plaintiff must have at least a basic understanding of her lawsuit. Otherwise, a class action can be stopped dead in its tracks if the putative plaintiff “indicates [a] distressing lack of understanding of or familiarity with her claim.”

© Copyright 2020 Squire Patton Boggs (US) LLP

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About this Author

Brandon Howard Litigation Lawyer SPB Law Firm
Associate

Brandon Howard is an associate in our Atlanta office whose practice focuses on litigation. Brandon handles all levels of a dispute, often championing his clients’ causes in federal and state courts.

Brandon has counseled financial institutions in regulatory, examination and enforcement matters relating to the federal Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Consumer Financial Protection Bureau, and various state consumer protection laws and entities. Specifically, Brandon's experience includes defending his clients...

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