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Reyes v. BCA Financial Services, Inc.

United States District Court, S.D. Florida, Miami Division

May 14, 2018

ESTRELLITA REYES, Plaintiff,
v.
BCA FINANCIAL SERVICES, INC., Defendant.

          ORDER ON PLAINTIFF'S SUMMARY JUDGMENT MOTION

          JONATHAN GOODMAN, UNITED STATES MAGISTRATE JUDGE

         Plaintiff Estrellita Reyes, individually and on behalf of others similarly situated, has sued Defendant BCA Financial Services, Inc. for allegedly violating the Telephone Consumer Protection Act (the “TCPA”). The TCPA prohibits, among other things, the use of an “automatic telephone dialing system” (“ATDS”) or an artificial or prerecorded voice to call a person's cellphone absent an emergency or prior express consent. 47 U.S.C. § 227(b)(1');">1)(A)(iii). The TCPA defines an ATDS as equipment with the capacity “to store or produce telephone numbers to be called, using a random or sequential number generator, ” and then to “dial such numbers.” § 227(a)(1');">1)(A). Each TCPA violation results in damages of no less than $500, which may be trebled for willful or knowing violations. § 227(b)(3)(B)-(C).

         BCA Financial collects debts for healthcare companies. To call suspected debtors, it uses a “predictive dialer” maintained by a company named Noble Systems. BCA Financial also accompanies some of those calls with an “interactive voice response” (“IVR”), which is an artificial or prerecorded voice that prompts the person called to indicate whether BCA Financial has called the right number. It goes something like: “If this is Jane Doe, press 1');">1; ‘if this is a wrong number, ' press 2.” [ECF No. 86-1');">1, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6].

         The phone numbers BCA Financial automatically dials are fed to the Noble system from a separate collection-software system called “FACS.” FACS is loaded with phone numbers supplied by BCA Financial's healthcare clients. Those clients, in turn, received the numbers from the patients.

         The parties agree that BCA Financial uses the Noble predictive dialer to autodial phone numbers without human intervention. But facts suggest that the Noble system is incapable of generating random or sequential phone numbers (and instead dials from a fixed set of numbers supplied by separate debt-collection software).

         On six occasions, and twice using an IVR, BCA Financial called Reyes' cellphone using the Noble predictive dialer. It was not an emergency. Nor did BCA Financial have Reyes' prior express consent. It was trying to reach a different person who had written Reyes' cellphone number on a medical consent form. Five calls went unanswered, and on the sixth call, Reyes picked up the phone, heeded the IVR prompts, and pressed two -- for wrong number. BCA Financial did not call Reyes again after that.

         Reyes now moves for summary judgment on her individual TCPA claim. [ECF No. 86]. She seeks $1');">1, 500 for each of the eight TCPA violations (i.e., treble damages for six autodialed calls and two IVR uses, the latter constituting separate TCPA violations). BCA Financial filed an opposition response, and Reyes filed a reply. [ECF Nos. 92; 95].

         The parties do not dispute the basic facts of this case: BCA Financial used a predictive dialer and a prerecorded or artificial voice to call Reyes' cellphone several times without her prior express consent or an emergency. But the parties vigorously debate the question of whether the Noble predictive dialer is an ATDS. If an IVR prompted that question, then Reyes would press one for “yes” and BCA Financial would press two for “no.”

         BCA Financial argues that the Noble predictive dialer, although capable of automatically dialing a phone number without human intervention, cannot generate random or sequential phone numbers and is therefore not an ATDS. Reyes, on the other hand, argues that such capability (or lack of capability) is inconsequential. The debate touches on several orders from the Federal Communications Commission (“FCC”), whose final orders interpreting the TCPA are binding on this Court. The debate also concerns a recent D.C. Circuit opinion, ACA International v. Federal Communications Commission, 885 F.3d 687');">885 F.3d 687, 691');">1 (D.C. Cir. 201');">18), which struck down the FCC's latest 201');">15 order interpreting the TCPA.

         In addition, the parties raise two more issues. First, they disagree on whether Reyes is entitled to treble damages. And second, BCA Financial challenges Reyes' ability to raise claims for TCPA violations involving an artificial or prerecorded voice, arguing that those claims were not pled in the Complaint.

         As outlined in detail below, the Court grants in part and denies in part Reyes' summary judgment motion. First, the Court grants summary judgment in Reyes' favor on the ATDS issue because the Noble predictive dialer, as BCA Financial uses it, is an ATDS under the TCPA. Second, the Court denies summary judgment to Reyes on the treble-damages issue because, at least at this stage, the Court cannot determine whether BCA Financial acted willfully or knowingly. Third, the Court denies summary judgment to Reyes on the artificial-or-prerecorded-voice issue because her Complaint alleged only that BCA Financial violated the TCPA through the use of an ATDS, not an artificial or prerecorded voice, which is a separate statutory basis for relief that she should have raised in an amended pleading.

         I. Background

         A. Procedural History

         Reyes brings a two-count Complaint against BCA Financial. [ECF No. 1');">1]. The first count is for allegedly violating the TCPA. [ECF No. 1');">1, p. 9');">p. 9]. The second count was for allegedly violating the Fair Debt Collection Practices Act, but Reyes later dismissed that claim. [ECF Nos. 1');">1, pp. 9');">p. 9-1');">10; 78]. Thus, the TCPA claim remains, and Reyes brings it on behalf of herself and a proposed class of persons. [ECF No. 1');">1].[1');">1" name="FN1');">1" id="FN1');">1">1');">1]

         In support of her TCPA claim, Reyes alleged under her general allegations that BCA Financial “routinely violates 47 U.S.C. § 227(b)(1');">1)(A)(iii) by using an automatic telephone dialing system to place non-emergency calls to numbers assigned to a cellular telephone service, without prior express consent.” [ECF No. 1');">1, p. 1');">1 ¶ 2]. Reyes alleged that BCA Financial placed several calls to her cellphone when trying to collect a debt owed by someone else. [ECF No. 1');">1, pp. 3-5 ¶¶ 1');">16-22, 26, 28-29].

         She then alleged that “in light of the frequency, number, nature, and character of the calls, Defendant placed its calls to Plaintiff's cellular telephone number by using an automatic telephone dialing system.” [ECF No. 1');">1, p. 3 ¶ 23]. Reyes then makes several more references to BCA Financial using an ATDS to call her and to call others, including proposed class members. [ECF No. 1');">1, pp. 3-7 ¶¶ 24-25, 33, 37-38, 43, 52].

         Reyes includes just one specific paragraph under her TCPA count, which reads: “Defendant violated 47 U.S.C. § 227(b)(1');">1)(A)(iii) by using an automatic telephone dialing system to place non-emergency calls to Plaintiff's cellular telephone number, absent prior express consent.” [ECF No. 1');">1, p. 9');">p. 974].

         In neither her general allegations nor her one specific allegation that concerns the TCPA does Reyes allege that BCA Financial called her using an artificial or prerecorded voice. The only reference to artificial or prerecorded voices is within her initial proposed T C PA class action definition, which read:

TCPA class: All persons and entities throughout the United States (1');">1) to whom BCA Financial Services, Inc., placed, or caused to be placed, calls (2) directed to a number assigned to a cellular telephone service, (3) by using an automatic telephone dialing system or an artificial or prerecorded voice, (4) within the four years preceding the date of this complaint, (5) absent prior express consent-in that the called party was not the intended recipient.

[ECF No. 1');">1, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6 ¶ 44 (emphasis added)].

         But in her class certification motion, Reyes edited her class action definition, removing any explicit reference to artificial or prerecorded voices:

All persons and entities throughout the United States (1');">1) to whom BCA Financial Services, Inc. placed more than one call, (2) directed to a number assigned to a cellular telephone service, but not assigned to the intended recipient of BCA Financial Services, Inc.'s calls, (3) by using computer assisted dialing technology manufactured or designed by Noble, (4) from September 23, 201');">12 through September 23, 201');">16.

[ECF No. 59, p. 1');">1 (emphasis added)].

         In the Complaint's wherefore clause, Reyes generally asks, among other things, that the Court declare that BCA Financial violated the TCPA. [ECF No. 1');">1 p. 1');">10');">1');">1 p. 1');">10].

         BCA Financial answered the Complaint, raising several affirmative defenses. [ECF No. 8]. As its second affirmative defense, BCA Financial raised “prior express consent” and alleged that “Plaintiff's claims under the TCPA are not actionable as Defendant has established the requisite ‘prior express consent' to communicate with the Plaintiff at the telephone number provided as authorized by the Federal Communication Commission and the law of this Circuit.” [ECF No. 8, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. But BCA Financial later withdrew that defense, explaining in a notice that, “[b]ased on information learned and developed through the course of discovery in this case, BCA withdraws without prejudice its Second Affirmative Defense as to the individual named . . . Reyes only, and not as to any purported class members.” [ECF No. 74, p. 1');">1].

         B. Undisputed Facts

         The parties do not dispute the majority of the underlying facts. The undisputed facts pertinent to the summary judgment motion are as follows: BCA Financial is a receivable management company operating in the medical billing industry for the recovery of past due debt. [ECF Nos. 86-1');">1, p. 1');">1; 93');">93');">93');">93, p. 5');">p. 5]. In general, BCA Financial “receives accounts from its various medical or healthcare provider clients and calls the telephone number provided to the client by the patient.” [ECF Nos. 93');">93');">93');">93, p. 1');">1; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 4]. BCA Financial “utilizes ‘computer assisted dialing technology' manufactured and designed by Noble Systems to place telephone calls.” [ECF Nos. 86-1');">1, p. 4; 93');">93');">93');">93, pp. 3, 6; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 5');">p. 5].

         The Noble dialing system is a “predictive dialer.” [ECF Nos. 86-1');">1, pp. 4, 5; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. And the Noble predictive dialer, as BCA Financial uses it, “automatically dials telephone numbers without human intervention.” [ECF Nos. 86-1');">1, p. 5');">p. 5; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6].

         Also, from April 201');">16 to September 201');">16, BCA Financial used the IVR capability of its Noble predictive dialer to greet called persons with an automated prompt, asking them to press one key if the correct person had been called and a different key if the wrong number had been reached. [ECF Nos. 86-1');">1, p. 4; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. When an answering party selects the number indicating a wrong call during an IVR message, the FACS system automatically generates a “B” flag. [ECF Nos. 93');">93');">93');">93, pp. 2-3; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 1');">11');">1]. And if an answering person receives a call from a BCA Financial agent and indicates that the agent has called the wrong number, the agent selects a “WN” code within the Noble system to show that this is a wrong number. [ECF Nos. 93');">93');">93');">93, p. 4; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. At the end of each business day, the Noble system communicates to the FACS system which numbers received a “WN” code, and the next day, the Noble system would have no phone numbers with a “B” code. [ECF Nos. 93');">93');">93');">93, p. 4; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6].

         BCA Financial obtained Reyes' cellphone number from one of its clients, Barnabas Health, to collect a debt. [ECF Nos. 86-1');">1, p. 1');">1; 93');">93');">93');">93, pp. 2, 5; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, pp. 4, 7]. Barnabas gave BCA Financial the patient's biographical information, including the phone number, as part of the patient's medical consent documentation. [ECF Nos. 93');">93');">93');">93, p. 2; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 4]. But the name Barnabas associated with the cellphone number was not Reyes'. [ECF Nos. 86-1');">1, p. 2; 93');">93');">93');">93, p. 5');">p. 5].

         BCA Financial did not ask Barnabas if the number was accurate. [ECF Nos. 86-1');">1, p. 1');">1; 93');">93');">93');">93, p. 5');">p. 5]. Barnabas did not know that the number belonged to someone other than the patient. [ECF Nos. 93');">93');">93');">93, p. 5');">p. 5; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 7');">p. 7]. And so Barnabas did not inform BCA Financial that the number belonged to someone else. [ECF Nos. 93');">93');">93');">93, p. 5');">p. 5; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 7');">p. 7].

         Using the Noble predictive dialer, BCA Financial placed six calls to Reyes' cellphone number. [ECF Nos. 86-1');">1, p. 4; 93');">93');">93');">93, pp. 2, 6; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 4]. Reyes did not answer the first five calls, and BCA Financial stopped calling Reyes after the sixth call. [ECF Nos. 93');">93');">93');">93, p. 2; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 4]. BCA Financial never spoke to Reyes during any of the attempted communications. [ECF Nos. 93');">93');">93');">93, p. 2; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 4].

         BCA Financial did not intend to call Reyes but was trying to reach someone else to collect a debt. [ECF Nos. 86-1');">1, p. 1');">1; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. Moreover, Reyes never had a business relationship with BCA Financial. [ECF Nos. 86-1');">1, p. 2; 93');">93');">93');">93, p. 5');">p. 5]. BCA Financial did not call Reyes' number for emergency purposes. [ECF Nos. 86-1');">1, p. 3; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. And Reyes did not provide BCA Financial with prior express consent to call her cellphone. [ECF Nos. 86-1');">1, p. 2; 93');">93');">93');">93, p. 5');">p. 5].

         BCA Financial did not manually dial Reyes' number first to confirm the intended caller. [ECF Nos. 86-1');">1, p. 3; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. And it is not BCA Financial's policy and procedure to manually dial a telephone number before autodialing it to make sure that the person on the other end is the intended recipient. [ECF Nos. 86-1');">1, p. 3; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6].

         At least two of BCA Financial's calls to Reyes “were accompanied by an artificial or prerecorded voice.” [ECF Nos. 86-1');">1, p. 5');">p. 5; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. The IVR Reyes received gave a message to the following effect: “If this is Jane Doe, press 1');">1; ‘if this is a wrong number, ' press 2.” [ECF Nos. 86-1');">1, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6]. Reyes pressed two. [ECF Nos. 86-1');">1, p. 4; 93');">93');">93');">93, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6].

         BCA Financial maintains and makes available to all employees a T C PA Participant Guide. [ECF Nos. 86-1');">1, p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6');">p. 6; 93');">93');">93');">93, p. 7');">p. 7]. It also trains its employees and instructs its representatives on how to notate each account and operate FACS. [ECF Nos. 93');">93');">93');">93, p. 1');">1; 96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96');">96, p. 4]. And it provides training compliance for various state and federal consumer-protection laws, including ...


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