Court: District Court, M.D. Florida; May 26, 2016; Federal District Court
The court addressed the Innocutis Defendants' Motion to Dismiss in a case where the Plaintiff claims violations of the Telephone Consumer Protection Act (TCPA) due to unsolicited faxes sent without proper opt-out language. The court granted the motion in part and denied it in part. The Plaintiff argues that the Defendants are "senders" of the fax, that the fax is an advertisement, and that they have standing to sue. The Defendants contended they are not considered senders under the TCPA, that the fax does not qualify as an advertisement, and that the class allegations should be dismissed or struck. The court emphasized that a complaint must include a clear statement of the claim with sufficient factual support, allowing for reasonable inferences of liability, while accepting factual allegations as true but not legal conclusions. A motion to dismiss for lack of standing is evaluated either through facial or factual attacks on the pleadings, with the standard aligning with Rule 12(b)(6) motions when a facial attack is made.
Innocutis Defendants seek to dismiss the Complaint, asserting that the Fax in question is not an advertisement but rather an 'informational communication' since it focuses on the safety features of Sitavig® rather than promoting its sale. In contrast, the Plaintiff claims the Fax serves as an advertisement by introducing Sitavig® to the market, offering incentives such as rebates, detailing co-payment information for insured individuals, and emphasizing the drug's quality. Under the TCPA, sending unsolicited fax advertisements without permission can incur civil liability, with advertisements defined as any materials advertising the availability or quality of goods or services. Consequently, if the Fax is not classified as an advertisement, the Plaintiff's claim under the TCPA would fail.
The Innocutis Defendants argue that the lack of pricing or ordering details in the Fax supports its classification as informational communication. However, it is noted that even faxes promoting goods at no cost can still be classified as unsolicited advertisements. Differentiation exists between advertising and informational faxes, with the FCC outlining criteria for identifying a bona fide informational communication, including periodic issuance, variation in content, and targeting of specific recipients.
In the pharmaceutical context, communications aimed at persuading doctors to prescribe medications, even if not directly observed by patients, are considered advertising. The Plaintiff alleges the Fax is an unsolicited advertisement that details the commercial availability and quality of the Defendants' products. Notably, a third of the Fax describes Sitavig® as a breakthrough treatment, encourages action against cold sores, and provides contact information for rebates and resources while also including a patient access card offer and details on ingredients and side effects.
The Fax primarily serves to promote the prescription drug Sitavig® by Innocutis, qualifying it as an advertisement under the defendants’ motion. Relevant case law, including Sandusky Wellness Center and St. Louis Heart Center, provides context for interpreting whether a fax is an advertisement, indicating that factors like frequency and recipient subscription status may be considered. The Innocutis Defendants argue the plaintiff has not sufficiently alleged they 'sent' the Fax per the TCPA, claiming the plaintiff failed to show that each defendant either physically sent it or that it was sent on their behalf. The TCPA holds any person sending junk faxes liable, and the FCC regulations define 'sender' as the entity on whose behalf the fax is sent or whose goods are advertised. This definition has been clarified over time, indicating that the sender may not always be the party that transmits the fax. The FCC's interpretation aligns with the statutory definition, emphasizing that the sender includes any party whose product or service is promoted in the advertisement.
Innocutis Defendants argue they should not be categorized as 'senders' under the Telephone Consumer Protection Act (TCPA) based on the precedent set in Palm Beach Golf Center-Boca, Inc. v. John G. Sarris, D.D.S. Palm Beach II, which dealt with fax advertisements sent before the FCC defined 'sender' in 2006. The Eleventh Circuit, in Palm Beach II, acknowledged that prior to this definition, the TCPA did not specify 'sender' and deferred to FCC interpretations that also lacked this definition. The court held that entities on whose behalf faxes are sent can be liable for compliance. Consequently, while Palm Beach II indicated that a service advertiser can be held liable, it does not restrict the definition of 'sender' under current regulations.
The Innocutis Defendants' reliance on this case is deemed misplaced concerning the allegations against them for sending a fax in 2015, which Plaintiff claims was sent without permission. The Plaintiff alleges that the Defendants benefit from the goods advertised in this fax and specifically states that the fax was sent on September 16, 2015. The fax contains multiple references to Innocutis, including its role in patent holding, distribution of a drug, and customer service. Therefore, Innocutis is considered a 'sender' under the TCPA since its goods are promoted in the fax. In contrast, the fax does not mention Cipher, and although the Plaintiff claims Cipher acquired Innocutis in 2015, there is insufficient evidence linking Sitavig® as Cipher’s product. The allegations that Cipher profits from Sitavig® sales do not establish it as the product of Cipher, failing to meet the 'on-whose-behalf' standard. Thus, the Plaintiff does not provide a plausible claim that Cipher is a sender under the TCPA, leading to the dismissal of claims against Cipher while rendering the Defendants' argument about improper grouping moot.
In a challenge to the Plaintiff's statutory standing under the Telephone Consumer Protection Act (TCPA), the Innocutis Defendants argue that the Plaintiff lacks standing because he does not claim ownership of the fax machine or that the fax was directed to him. The Plaintiff responds by asserting that his allegations, which state that the Defendants sent advertisements to his fax line and machine, are sufficient to establish standing. The TCPA allows a private right of action for recipients of unsolicited faxes, intended to protect against the occupation of fax machines and phone lines during transmissions. The court, in prior rulings, focused on the injury caused by the fax transmission rather than the specific recipient details. The Innocutis Defendants maintain that only fax machine owners, subscribers, and recipients have standing under the TCPA, but the Plaintiff's claims imply he may fit one of those categories. Therefore, the court will deny the motion to dismiss based on standing.
Regarding class allegations, the Innocutis Defendants seek to strike or dismiss the Plaintiff's proposed class definition as a fail-safe class, which only includes those entitled to relief. The Plaintiff argues this motion is premature, as the case is still in early discovery stages. Courts can strike redundant or impertinent matter from pleadings, but doing so at this stage equates to denying class certification. Eleventh Circuit precedent suggests that determining class certification often requires further discovery and is not conclusively resolvable from the pleadings alone. The Defendants' characterization of the Plaintiff's class as a fail-safe class is deemed premature, leading to the denial of their motion to strike or dismiss the class allegations.
Innocutis Defendants’ Motion to Dismiss is granted in part and denied in part. The claim against Cipher Pharmaceuticals US LLC is dismissed without prejudice, allowing the Plaintiff to amend the complaint within fourteen days or notify the court of the decision not to amend. Following this, Innocutis Holdings, LLC and/or Cipher Pharmaceuticals US LLC must respond within fourteen days. The order emphasizes that district courts cannot evaluate the validity of FCC orders, as such reviews are reserved for appellate courts under the Hobbs Act. It reiterates that courts must defer to FCC final orders unless a violation of FCC rules is alleged. The excerpt discusses the requirements for prescription-drug advertisements and the consistent definition of the "sender" since 2006. Case law is cited to clarify the scope of liability under the TCPA, noting that the entity on whose behalf an advertisement is sent may differ from the entity whose product is promoted. The FCC has expanded liability to include both entities, and the court has established criteria for determining liability, which includes various factors such as control over content and awareness of compliance with the TCPA. The Complaint identifies the Defendants as Cipher, Innocutis, and John Does 1-10, who will be named during discovery.
Cipher's dismissal renders the Innocutis Defendants' claim that all Defendants are improperly grouped moot. The Plaintiff must amend the complaint to identify any remaining John Doe Defendants and adequately allege their liability under the Telephone Consumer Protection Act (TCPA). Defendants suggest that a different corporate entity is responsible for the fax line, citing a Florida Department of State filing where the Plaintiff is listed as a shareholder. However, this filing does not confirm that the corporate entity subscribes to the fax line in question. Relevant case law supports the notion that rulings on class allegations are subject to interlocutory review under Rule 23(f), as seen in Scott v. Family Dollar Stores, Inc. and In re Bemis Co. Inc. Furthermore, the parties have established a discovery and briefing schedule for class certification in their case management report.
