August 28, 2019

Oregon district court allows class certification to stand in TCPA action

In June 2017, the US District Court for the District of Oregon certified a class of individuals who received calls promoting the products or services of ViSalus, a seller of dietary supplement, weight-loss products and energy drinks, where the calls “featured an artificial or prerecorded voice” and the company had no record of express written consent to the calls.  Following a three-day trial, the jury found in April 2019 that the plaintiffs had proved that ViSalus had made or initiated at least 1,850,436 telemarketing calls in violation of the Telephone Consumer Protection Act, 47 USC § 227. 

Three months after the class was certified – and nearly two years after the plaintiff filed her complaint – ViSalus petitioned the Federal Communications Commission for a retroactive waiver of the express written consent requirements of the TCPA.  In June 2019, nearly two months after the jury verdict, the FCC granted ViSalus retroactive waiver request as it applied to calls for which ViSalus had obtained written consent.  The court noted that since the effective date of the rules implementing the TCPA in 2013, several companies had petitioned for retroactive waivers allowing them to rely on previously-obtained consent, and in 2015 the FCC issued a declaratory ruling granting such waiver for a limited period of time, which expired on October 7, 2015.

ViSalus then moved to decertify the class, arguing that the FCC’s retroactive waiver would require decertification, since the consent issue was particular to each individual and would predominate over class-wide issues.  ViSalus further argued that neither the commonality, the typicality nor the numerosity requirement was satisfied, that the class was unmanageable because of factual questions about the specific messages heard by the various class members, and that the class constituted an impermissible “fail-safe” class.

The court noted that ViSalus had never raised the affirmative defense of consent, and had never requested that the court stay the litigation pending a decision by the FCC on the waiver request.  The record was thus not developed on the issue of whether ViSalus had obtained written consent from the plaintiffs.  The court thus held that ViSalus’ failure to raise the consent issue, given the likelihood that the FCC would grant its waiver petition (based on nine previously granted waivers) was unreasonable, and would unfairly prejudice the plaintiff.

The court dismissed ViSalus’ other challenges, holding most notably that a TCPA class member need not actually hear a marketing message:  the requirement is that the message actually play, not that it be heard – hence, a prerecorded message left on a voicemail would satisfy the requirements of the statute.

Damages have not yet been determined, but could exceed $900 million, and the court has not yet ruled on the plaintiffs’ request for a finding of willfulness and enhanced damages, which could result in a trebling of damages.

Opinion and order | Motion to de-certify class