Court Rejects $6mm TCPA Class Settlement Because Class Definition Includes “Unascertainable” ATDS Reference

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Although there have been a couple of notable exceptions, most multi-million dollar TCPA settlements go sailing through approval. When they do get hung up, it is usually because the dollars aren’t quite multi-million enough.

But in a new decision out of Washington a district court has rejected a class settlement because the class definition was not based on clearly-defined objective criteria—specifically, it included reference to the TCPA’s amorphous “automated telephone dialing system” definition.

In Pine v. A Place for Mom, C17-1826 TSZ, 2019 U.S. Dist. LEXIS 164560 (W.D. Wa. Sept. 25, 2019) the Court was presented with a $6MM settlement for approval, representing a potential resolution of ATDS telemarketing calls regarding a retirement home. The class definition included individuals that had received calls from a device: “characterized by the plaintiff as an automated telephone dialing system or an artificial or prerecorded voice.” In the Court’s view this was a non-starter: “the Court declines to define a class using a disputed term of art. The proposed class definition, which relies solely on plaintiff’s characterization of an ATDS, rather than an ascertainable fact, lacks the clarity required to determine who is in the class.”

Indeed, the definition adopted in this case was very unusual, and makes me wonder what in the world Defendant was thinking. What good is a release tied to the characterizations of a different Plaintiff regarding whether equipment is an ATDS? Seems to me like the Court bailed the Defendant out, but what do I know.

The settlement was denied on other grounds as well, however. Interestingly the court found that the claims made process for the settlement was per se unacceptable because the pro rata payment to opted in class members creates an incentive to keep the number of opt ins low. This is an odd holding as claims made settlements are very common in TCPA class actions where identifying injured class members is often-times impossible.

The Court also took issue with class counsel’s failure to identify an upper limit of fees and costs for notification purposes, and questioned whether the Alzheimer’s Research Foundation was an acceptable cy pres recipient.