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Plumbers Overcome Spokeo-Based Standing Blockage in Putative TCPA Class Action

February 27, 2018 by Carlton Fields

The Northern District of Illinois cleared the way for a plumbing company’s putative TCPA class action against Allstate Insurance Company and Oh Insurance Agency by denying defendants’ motions to dismiss, which were inspired by the Supreme Court’s Spokeo v. Robins decision. The plumbing company alleged that the insurance companies committed TCPA violations when they placed two phone calls to it: one went to voicemail and another was answered by a company employee. The company’s purported injuries were the statutory violation as well as business interruption, annoyance of the company’s principal, and invasions of privacy. The defendants moved to dismiss on two grounds: lack of standing because the plumbing company had not alleged sufficiently concrete injuries under Spokeo, and mootness based on Campbell-Ewald v. Gomez because Allstate had offered a settlement and deposited the settlement funds into an escrow account.

First, the court found the plumbing company had suffered sufficiently concrete injuries and thus had standing to sue. It noted that several courts in the Seventh Circuit have held, post-Spokeo, that alleged TCPA violations satisfy Article III’s requirement for concrete injury-in-fact. Under Spokeo, a statutory violation can constitute sufficient injury where the violation risks harm to the “underlying concrete interest” Congress intended to protect in the statutory enactment. Not only did the complaint allege harm to the interest Congress intended to protect in the TCPA, the court concluded, but the plumbing company also alleged injuries of business interruption, invasion of privacy, and annoyance of an employee which were in addition to the pure statutory violation. Notably, the court refused to consider whether and at what volume putative class members received calls in violation of the TCPA because such had “no bearing” on whether the plumbing company alleged sufficient injury or whether its claims were moot — issues which must be addressed “prior to consideration of any class claims.”

Second, the court rejected the idea that Allstate’s proffer of a settlement and deposit of funds into an escrow account mooted the claims under Campbell-Ewald. After the parties briefed the mootness issue the Seventh Circuit had decided several cases extending Campbell-Ewald’s reasoning against forced settlements to circumstances similar to this case — including a reversal of a district court decision Allstate heavily relied upon in its briefing. Accordingly, the court held that Allstate’s “offer of judgment and deposit of funds into an escrow account” did not moot the claims. Additionally, the facts here encouraged this specific holding, because the escrow agreement’s terms restricted the bank’s disbursement until a court order directed it to do so, an impossible outcome because mooting the claims would deprive the court of any jurisdiction to enter a merits judgment.

Abante Rooter & Plumbing, Inc. v. Oh Ins. Agency, Case No. 15-9025 (N.D. Ill. February 20, 2018).

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