A California federal court has denied class certification where questions existed about the use of the plaintiff’s phone number for business.
Christopher Payne filed a putative class action against Sieva Networks, alleging that the company sent unsolicited telemarketing text messages to consumers whose residential phone numbers are registered on the National Do Not Call (DNC) Registry.
Payne alleged that he registered his cell phone number on the National DNC Registry, used his cell phone number for personal use only, and that the number was not associated with a business. However, critically, Payne also alleged that he registered a U.S. Department of Transportation (USDOT) number, and asserted that he used his “residential” cell phone number for this registration.
Payne moved to certify a national class of consumers. Sieva objected on predominance grounds, a required element to certify a class under Federal Rule of Civil Procedure 23, and moved to deny the motion for class certification. U.S. District Court Judge Jon S. Tigar granted the motion.
The U.S. Court of Appeals for the Ninth Circuit recognized in Chennette v. Porch.com, Inc. that cellphone numbers registered to the DNC are presumptively “residential” under the TCPA. However, the court made clear that defendants may rebut the presumption and show that the cellphone is actually a business line.
When considering whether the presumption is rebutted, courts must consider (1) how plaintiffs hold their phone numbers out to the public; (2) whether plaintiffs’ phones are registered with the telephone company as residential or business lines; (3) how much plaintiffs use their phones for business or employment; (4) who pays for the phone bills; and (5) other factors with bearing on how a reasonable observer would view the phone line.
Sieva’s calls target trucking businesses that have registered with the USDOT, the court said, and Payne did not dispute that USDOT numbers are required for companies that operate commercial vehicles transporting passengers or hauling cargo in interstate commerce and for commercial intrastate hazardous materials carriers who haul types and quantities requiring a safety permit.
“Typing Payne’s USDOT number into the query form on the [Federal Motor Carrier Safety Administration] website lists Payne’s name under ‘Company Information’ and states that he is an intrastate-only carrier of non-hazardous materials that has four drivers,” the court wrote. “Payne does not offer any evidence that phone numbers—including what he contends is his personal cellphone number—are registered with the USDOT for any non-business purpose.”
While Payne argued that discovery was necessary on the issue, the court held that “the question raised by [the motion to deny certification] is not whether the issue requires discovery; it is whether it can be resolved by common proof.” . . . [I]n this case, the issue is whether phone numbers contacted by [Sieva]—all of which were registered with the USDOT, which is some indication of a non-residential use—qualify as residential for purposes of the TCPA.”
The court held that resolving each phone number’s residential status requires a fact-intensive inquiry, and the burden to show residential status fell on Payne, who needed to advance a viable theory employing generalized proof to establish residential status to obtain class certification.
“While it is possible that some of the numbers registered with the USDOT—including Payne’s own—might qualify as residential under the fact-specific inquiry required by Chennette, Payne has made no argument as to how that question can be answered without individualized inquiries,” the court concluded.
The court granted Sieva’s motion to deny class certification.
To read the order in Payne v. Sieva Networks, Inc., click here.
Why it matters
The TCPA’s DNC provisions apply to “residential subscribers.” Phone numbers registered on the National DNC Registry are entitled to a presumption of “residential” treatment. However, this presumption can be undermined by evidence that a phone number is used for business purposes. The Payne case demonstrates the use of such evidence to prevent class treatment. Here, the defendant was able to successfully argue that class certification should be denied because determining whether the putative class members were “residential subscribers” would require individualized inquiries into how those potential class members used their cell phones. The presence of such individualized issues undermined plaintiff’s ability to establish that common issues of fact predominate, which is a requirement for class treatment under Fed. R. Civ. P. 23. Importantly, in this case, the court found that all of the putative class members’ phone numbers had a business purpose because they were sourced from USDOT registration information. This finding was enough to rebut the presumption of “residential” treatment across the entire putative class and shift the burden of proof to plaintiff to show that the putative class members were “residential subscribers,” which is a fact intensive inquiry. This decision is particularly useful for business-to-business callers facing class actions brought under the TCPA’s DNC provisions as a result of calls targeted to business numbers. Application of such arguments in cases involving predominately consumer phone numbers have not received the same reception. See, e.g., Mantha v. QuoteWizard.com, LLC, 2024 WL 3912459, at *18 (D. Mass. Aug. 16, 2024) (certifying class despite defendant’s assertion that “some of the numbers on the proposed Class List are allegedly ‘business,’ as opposed to ‘residential numbers’ where defendant stated that it purchased lead information “associated with individual consumers rather than businesses.”).