On April 12, an Oregon federal jury in Wakefield v. Visalus, Case No. 3:15-cv-01857-SI, handed down what may turn out to be the largest Telephone Consumer Protection Act (TCPA) class action verdict ever awarded.
Health supplement marketer ViSalus, a lifestyle products company, was charged with making more than 1.8 million autodialed calls in violation of the TCPA. The court certified a class of 800,000 members. Although the jury did not assess a monetary award, the court will award statutory penalties pursuant to the TCPA, which prescribes up to $500 per violation and $1500 per willful violation. The total penalty could reach almost $1 billion, and if the court finds willfulness, this award could conceivably be tripled.
Privacy cases are difficult to certify because consent and injury, among other factors, tend to present individualized questions not susceptible to class treatment under Rule 23. For example, in Dolmage v. Combined Ins. Co. of Am., No. 14 C 3809, 2017 WL 1754772, at *7 (N.D. Ill., May 3, 2017), the court refused to certify a class of employees subject to a data breach because typicality and commonality requirements were not met and explained why data security cases may be unsuitable for class resolution. Similarly, in In re Hannaford Bros. Co. Customer Data Sec. Breach Litig., 293 F.R.D. 21, 33 (D. Me., 2013), the court denied class certification for customers whose data was stolen because common issues did not predominate over individual issues. And many TCPA and privacy cases are subject to arbitration and class waiver provisions.
Wakefield highlights the risk of extraordinary exposure where a TCPA class can be certified, however, and companies need to be mindful of the need to maintain (and be able to prove on a classwide basis) robust compliance programs addressing TCPA and other privacy consent requirements.
The Wakefield verdict is also likely to bring further scrutiny to the need for TCPA reform. Even following the Federal Circuit’s decision in ACA International v. Federal Communications Commission, 885 F.3d 687 (D.C. Cir. 2018), the statutory scheme remains confusing and outdated: courts do not agree on whether the definition of an auto-dialer applies to predictive dialers, for example, and the lack of a class damages cap or other mechanism to stem the tide of litigation remains controversial.