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Physicians Healthsource, Inc. v. Cephalon, Inc.

Citation: 340 F. Supp. 3d 445Docket: CIVIL ACTION NO. 12-3753

Court: District Court, E.D. Pennsylvania; October 29, 2018; Federal District Court

Narrative Opinion Summary

In this case, a healthcare provider initiated a class action lawsuit against a pharmaceutical company and associated entities under the Telephone Consumer Protection Act (TCPA) and the Junk Fax Prevention Act (JFPA). The plaintiff alleged receiving unsolicited fax advertisements lacking opt-out notices, in violation of the JFPA, and sought statutory damages. Defendants contended they had express permission to send the faxes, exempting them from this requirement, and filed motions for summary judgment. The court assessed whether the faxes were unsolicited and whether the Solicited Fax Rule mandated opt-out notices for solicited faxes. The court determined that prior express permission is an affirmative defense, placing the burden on the defendants to prove consent. It concluded that the faxes were sent with prior express permission from a physician associated with the plaintiff, thus classifying them as solicited and exempt from JFPA regulations. The court granted summary judgment in favor of the defendants, dismissing the plaintiff's claims. Additionally, the case addressed issues surrounding the jurisdictional impact of the FCC's Solicited Fax Rule, following its invalidation by the D.C. Circuit, which influenced the court's ruling.

Legal Issues Addressed

Affirmative Defense of Prior Express Permission

Application: The court held that prior express permission is an affirmative defense, requiring defendants to prove consent for the faxes.

Reasoning: Thus, prior express permission is categorized as an affirmative defense for which Cephalon and SciMedica must bear the burden of proof.

Burden of Proof in Summary Judgment

Application: Defendants argued that the plaintiff did not meet the burden of proof to show lack of consent for the faxes, which constitutes an affirmative defense.

Reasoning: PHS contended that it does not bear the burden of proof for lack of consent, as prior express permission constitutes an affirmative defense under § 227(b)(1)(C).

Jurisdictional Impact of FCC Rules

Application: The court considered the applicability of the FCC's Solicited Fax Rule, affected by the D.C. Circuit's ruling, in determining the validity of opt-out notice requirements.

Reasoning: Consequently, the court concluded that the Solicited Fax Rule does not apply in this case.

Summary Judgment Outcome

Application: The court granted summary judgment in favor of the defendants, determining the faxes were sent with prior express permission.

Reasoning: As a result, the Court grants Defendants' Motions for Summary Judgment, favoring them against PHS's claim for violation of the statute.

Summary Judgment Standard

Application: Defendants filed for summary judgment, asserting no factual disputes existed that warranted judgment in favor of the plaintiff.

Reasoning: Both Cephalon and SciMedica filed motions for summary judgment, asserting there were no material facts in dispute warranting a judgment in favor of PHS.

Telephone Consumer Protection Act and Junk Fax Prevention Act Violations

Application: The plaintiff alleged violations due to receiving unsolicited fax advertisements lacking opt-out notices, seeking statutory damages.

Reasoning: PHS's complaint alleges a violation of the JFPA, seeking either actual damages or statutory damages of $500 per violation.