Redbox Seeks Temporary Stay in FTSA Case Pending Fla. Amendment, 11th Circuit Review

Defendant Redbox requested an order Friday in U.S. District Court for Northern Florida in Pensacola to temporarily stay a class action filed against it last month by a consumer alleging violation of the Florida Telephone Solicitation Act (FTSA) (see 2304260048). In the motion (docket 3:23-cv-08760), Redbox referenced the Florida legislature’s recent passage and “imminent enactment” of a bill, HB-761, to amend portions of the FTSA. The amendment passed Florida’s House and Senate and is expected to be signed into law by Gov. Ron DeSantis (R).

The FTSA amendment contemplates “significant revisions,” including: (1) narrowing the prohibition to only “unsolicited” telephonic sales calls that select and automatically dial certain phone numbers; (2) creating a 15-day safe harbor before imposing liability under the FTSA for telephone solicitors; and (3) requiring prospective plaintiffs to reply “Stop” to the number from which the recipient received the allegedly unsolicited text messages or call before filing suit, Redbox said. If signed into law by DeSantis, the FTSA amendment would apply to any putative class action not certified on or after the effective date, including the instant action, the motion said.

Redbox also cited the 11th Circuit U.S. Court of Appeals’ forthcoming en banc review of Drazen v. Pinto (docket 21-10199), in which appellant Juan Pinto is challenging a district court’s decision that a class-action settlement predominantly comprising coupons isn't subject to the Class Action Fairness Act (CAFA) when there is a cash option.

A more relevant aspect of Drazen v. Pinto to the Redbox case was the court’s decision finding “an Article III standing problem with the class [and thus] vacat[ing] the District Court’s approval of class certification and settlement,” said Carlton Fields attorneys Aaron Weiss and Charles Throckmorton in a September blog. The “most significant part of Drazen" is the court’s definitive statement that a class settlement may not be approved unless the district court is satisfied that all class members have Article III standing, they said, noting the Telephone Consumer Protection Act (TCPA) was the “vehicle the court took to get there.”

Weiss and Throckmorton also cited Salcedo v. Hanna, which said the receipt of a single unwanted text “does not establish a concrete injury in fact.” Contrary to other circuits that addressed the issue, in Salcedo the 11th Circuit “fundamentally rejected the argument that any TCPA violation automatically satisfies Article III standing,” they noted. Once the court rejected the categorical rule, “it then further rejected Salcedo's argument that his alleged waste of time and temporary loss of use of his phone resulting from the receipt of the single text message rose to the level of concrete injury,” they noted.

The 11th Circuit also said a text message, unlike a fax or a phone call, “does not immobilize a phone and is substantially less harmful than a phone call because an individual receiving a text message can ‘continue to use all of the device's functions, including receiving other messages, while [the phone] is receiving a text message,’" they said. The plaintiff in Salcedo alleged receipt of only a single text message, so the question of multiple texts wasn’t part of the briefing or the court’s majority opinion. That “leaves unaddressed whether a plaintiff who alleged that he had received multiple unwanted and unsolicited text messages may have standing to sue under the TCPA,” the blog said.

The 11th Circuit’s holding in Salcedo v. Hanna was contrary to precedent in other circuits -- that a single unwanted text message isn't sufficient to give rise to Article III standing under the TCPA, said Jeffrey Huberman in a March Covington blog. Because the panel was bound by Salcedo, and because the proposed class definition in the Drazen settlement included individuals whose sole harm was an unwanted text message, those individuals did not have standing,” he said: “The panel therefore vacated the district court’s approval of the settlement.”

If the en banc court decides Salcedo was wrongly decided, then the Drazen decision “will almost certainly be reversed,” said Huberman. He noted the 11th is the only circuit court that has said unwanted text messages are insufficient to confer standing under the TCPA; the decision in Salcedo conflicts with decisions in the 2nd, 5th, 7th and 9th circuits, he said.

In Pinto’s April en banc brief (docket 21-10199), he said all class members have Article III standing because they sustained an injury-in-fact by receipt of at least one violative text message or phone call. History and “the judgment of Congress, as reflected in the interpretation of the FCC, indicate a single unwanted text message is a concrete injury sufficient to confer Article III standing under the TCPA,” Pinto said. In addition to clarifying the law in the 11th Circuit, the court should “reverse the district court’s order and judgment approving the settlement and awarding attorneys’ fees as violative of CAFA," he said. Alternatively, the Court should "remand to the panel for consideration of these issues.”