In Fields v. Mobile Messengers America, Inc., 2013 WL 6073426 (N.D.Cal. 2013), Judge Alsup denied certification of a TCPA class action due to individualized inquiries on the issue of consent.
Plaintiffs are consumers who claim to be victims of a cell-phone scam known as “cramming.” This is the practice of “placing unauthorized, misleading, or deceptive charges on a consumer’s telephone bill.” Federal Trade Commission v. Inc21.com Corp., 745 F.Supp.2d 975, 996 (N.D.Cal.2010). The Federal Trade Commission states that, along with the Federal Communications Commission, it has “reviewed thousands of complaints about unauthorized third-party charges on wireless bills [which] undoubtedly understates the full extent of wireless cramming by a substantial amount…. Many of the complaints involve recurring charges of just under $10 a month for ‘premium services’ that provide trivia or horoscope information by text message to a consumer’s phone…. Consumers often report receiving a text message informing them of a subscription to a service of which they have never heard and that they never requested.” Federal Trade Commission, FTC Calls Wireless Phone Bill Cramming a Significant Consumer Problem (July 23, 2012), http:// www.ftc.gov/opa/2012/07/cramming.shtm. ¶ Defendants in this action claim that plaintiffs consented to participating in the textmessage subscription plans by entering their information into defendant Wise Media, LLC’s websites, such as www.lovegenietips.com, www.horoscopegenie.com, and www.diettipz.com, which detailed the subscription plans. After entering their information, individuals would receive text messages from Wise Media containing information about Wise Media’s subscription plans that offered flirting tips, horoscope updates, celebrity gossip, or weight-loss advice. These messages were sent by five-digit sender numbers (“short codes”) allegedly owned by Wise Media. Plaintiffs, however, claim never to have visited any of Wise Media’s websites and deny voluntarily enrolling in a text-message subscription plan. Some plaintiffs never responded to the initial text message, some sent a reply text message rejecting enrollment, and some never even received an initial text message because their phones were not programed to allow textmessaging services. Regardless of the response, all plaintiffs were sent a “confirmation text” of their subscription. Once enrolled, defendants charged each plaintiff $9.99 per month for the subscription plan on their phone. ¶ Although Wise Media is a defendant, the action has been stayed as to it by reason of a stay order by the United States District Court for the Northern District of Georgia at the behest of a receiver. So, plaintiffs are instead pursuing so-called “aggregators” who had the roles described below. ¶ Defendant Mobile Messenger Americas, Inc. served as an aggregator for Wise Media by helping Wise Media administer the subscription plans. The complaint also names as defendants two more aggregators, mBlox Incorporated and Motricity, Inc., who allegedly played the same role as Mobile Messenger in the scam. Plaintiffs allege that aggregator defendants helped facilitate the scam by serving as the middlemen between the mobile carriers and merchant defendant Wise Media by processing billings and monitoring customer complaints. Moreover, aggregator defend-ants allegedly initiated and reviewed the subscription plans and managed carrier suspension and termination of the plans. As a result, aggregator defendants retained a significant portion of the revenue earned from the plans. ¶ Defendants were allegedly able to enroll plaintiffs in subscription plans without their consent by means of a software platform created by non-party Binary Factory and owned by Wise Media. The platform allegedly enabled defendants to send the initial text messages to plaintiffs using a random sequential number generator, log plaintiffs’ allegedly fake confirmations in the subscription plans, and manage the subscription plans.
Judge Alsup found the class was no certifiable due to individualized inquires:
Yet, more to the point, the decision in Meyer also stated, “[t]he three elements of a TCPA claim are: (1) the defendant called a cellular telephone number; (2) using an automatic telephone dialing system; (3) without the recipient’s prior express consent.” Meyer, 707 F.3d at 1043. California district court decisions issued after Meyer have diverged regarding whether consent in TCPA putative class actions is a common issue that can be resolved with common proof and none address the possible contradiction in Meyer. Compare Gannon v. Network Tel. Servs., Inc., No. 12–9777, 2013 U.S. Dist. LEXIS 81250 (C.D. Cal. June 5, 2013) (Judge R. Gary Klausner); Connelly v. Hilton Grand Vacations Co., No. 12–599, 2013 WL 5835414 (S.D.Cal. Oct. 29, 2013) (Judge Janis Sammartino) with Lee v. Stonebridge Life Ins. Co., 289 F.R.D. 292, 295 (N.D.Cal.2013) (Judge Richard Seeborg). Because our court of appeals has stated that consent is an element of a prima facie TCPA claim, this order is duty-bound to place the burden on plain-tiffs to prove a lack of prior express consent. Meyer, 707 F.3d at 1043. ¶ Both parties proffer evidence on the issue of consent. Defendants primarily rely on the testimony of Ryan McDonnell, the architect of Wise Media’s subscription platform, as evidence of mass consent. McDonnell stated that the platform “confirmed the validity of consumer subscription requests with secure PIN numbers” and that he tested the platform frequently (Decl. of Ryan McDonnell ¶ 6; Dep. of Ryan McDonnell at 41:3–43:14). These subscription requests and confirmations also reflected the IP addresses of the computers used to visit Wise Media’s website and the PIN codes associated with each consumer. McDonnell also maintained that he trusted the data as “accurate” for purposes of reporting subscription information (id. at 76:15–77:13). According to plaintiffs’ own expert, Arthur Olsen, over 1.5 million “subscriptions were confirmed” by consumers by Wise Media’s platform (Decl. of Arthur Olsen ¶ 10). Defendants also submit records of incidents where putative class members consented to defendants’ texts by responding with a PIN and offer a report created by defendants that categorized why consumers allegedly complained to their carriers about their subscription plans (Decl. of Jonathan Murad, Exh. 1; Decl. of Jonathan Vimont, Exh. 5). ¶ Plaintiffs argue, however, that the supposed confirmations logged by Wise Media’s platform were fraudulent because Wise Media employees could access the platform (Decl. of Ryan McDonnell ¶ 15). Olsen stated that after analyzing a subset of confirmations recorded by Wise Media’s platform, he no-ticed suspicious patterns suggesting programmic confirmations, rather than actual confirmations by con-sumers (Decl. of Arthur Olsen ¶ 12). Defendants challenge Olsen’s conclusions by noting that one of the allegedly suspicious patterns analyzed by Olsen represented less than 10 percent of the total recorded confirmations on Wise Media’s platform. Olsen also admits that he has no experience and no benchmark to differentiate between “erratic” and “uniform” subscription confirmation patterns (Dep. of Arthur Olsen at 72: 11–74:14; 74:24–75:3; 77:5–11; 108:24–110:7). Moreover, Jonathan Murad, a director for defendant Mobile Messenger Americas, Inc., submitted evidence demonstrating that seemingly unusual patterns actually reflect normal confirmation patterns experienced by other text-message merchants (Decl. of Jonathan Murad ¶ 16). Finally, defendants point out that McDonnell, the architect for Wise Media’s platform, stated that wide-scale fraud in Wise Media’s platform is not possible because the platform records a consumer’s confirmation with the consumer’s phone number, PIN, and IP address (Decl. of Ryan McDonnell at 138: 5–25). ¶ Plaintiffs offer evidence that many putative class members, including named plaintiffs, did not consent to being enrolled in the subscription plans (Decl. of Edward Fields ¶¶ 4–9, 14; Decl. of Erik Kristianson ¶¶ 3–10; Decl. of David Hanson ¶¶ 3–10, 15; Decl. of Richard Parmentier ¶¶ 3–10, 13; Decl. of Kevin Brewster ¶¶ 3–10, 13–14, Decl. of Kristian Kunder, ¶¶ 3–10, 12). Furthermore, wireless carriers issued notices of suspension and termination of de-fendants’ subscription plans in part because of ab-normally high subscription refund rates (Decl. of Karl Kronenberger, Exh. 15). ¶ After examining the evidence and other submitted documentation, this order finds that plaintiffs have failed to meet their burden to prove that the issue of consent can be addressed with class-wide proof. In contrast to Meyer, where the court of appeals found that the defendant “did not show a single instance where express consent was given before the call was placed,” Wise Media’s platform has recorded over 1.5 million instances of consent by subscribers on Wise Media’s platform. Meyer, 707 F.3d at 1043 (emphasis added). Plaintiffs’ argument alleging mass fraud does not satisfy their evidentiary burden under Rule 23(b) because it merely speculates, without any actual evidence, that mass fraud may have occurred. Comcast Corp. v. Behrend, ___ U.S. ___, 133 S.Ct. 1426, 1432 (2013). Thus, even if consent is an affirmative defense, individualized inquiries regarding consent remain. Plaintiffs have failed to prove predominance under Rule 23(b) and their motion to certify a nationwide text-receipt class is hereby DENIED .