Antitrust Law Daily TCPA claim can be based on allegations that unsolicited fax is a marketing ploy
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Friday, June 19, 2020

TCPA claim can be based on allegations that unsolicited fax is a marketing ploy

By Jeffrey May, J.D.

On remand from U.S. Supreme Court, the divided Sixth Circuit reiterates that a Telephone Consumer Protection Act claim can be based on an unsolicited fax that served as a pretext to send additional marketing materials.

A dental practice plausibly alleged that a fax was an unsolicited advertisement insofar as the fax allegedly served as a pretext to send the dentist additional marketing materials. On remand from the U.S. Supreme Court, the U.S. Court of Appeals in Cincinnati again reversed dismissal of the claim. The defending compiler of a medical provider database had argued that the fax, which did not include an opt-out provision, was not an advertisement under the TCPA and, therefore, was not required to include such an opt-out provision (Fulton v. Enclarity, Inc., June 19, 2020, Stranch, J.).

In October 2019, the Supreme Court summarily vacated an earlier decision of the U.S. Court of Appeals in Cincinnati, holding that the unsolicited faxes sent to the dental office were advertisements under the TCPA. The appellate court had concluded that the fax served as a "pretext for a commercial solicitation." The decision was vacated and remanded for further consideration in light of the Supreme Court’s 2019 decision in PDR Network, LLC v. Carlton & Harris Chiropractic, Inc. In PDR Network, the High Court considered whether the Hobbs Act required a district court to adopt and follow a Federal Communication Commission Order interpreting the term "unsolicited advertisement" as including certain faxes that promote "free" goods.

The Sixth Circuit concluded that the Supreme Court’s decision in PDR Network did not impact the resolution of this case. That decision did not change the reasoning or outcome of the court’s 2018 opinion, which concluded that the dentist’s complaint stated a claim for TCPA relief. The appellate court did not reach the dentist's alternative theory that the fax was an advertisement because the defendants sent it with a profit motive.

Dissent. As in 2018, a dissent disagreed with the majority’s conclusion that the fax was an unsolicited advertisement under the TCPA because there were no alleged facts suggesting that the defending database compiler would have used, or even intended to use, this fax as a stepping stone to future solicitations of the complaining dentist. "[T]the fax was not an advertisement under the TCPA because its primary purpose was to improve the service and not to solicit business or sales," the dissent contended.

The case is No. 17-1380.

Attorneys: Phillip A. Bock and David M. Oppenheim (Bock, Hatch, Lewis & Oppenheim, LLC) for Matthew N. Fulton, D.D.S., P.C. Tiffany Cheung, Joseph R. Palmore, and Adam L. Sorensen (Morrison & Foerster LLP) Enclarity, Inc., LexisNexis Risk Solutions, Inc.

Companies: Enclarity, Inc.; LexisNexis Risk Solutions, Inc.; Matthew N. Fulton, D.D.S., PC

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