{ "id": 4220465, "name": "JONATHAN BLITZ, on behalf of himself and all others similarly situated, Plaintiff v. AGEAN, INC., Defendant", "name_abbreviation": "Blitz v. Agean, Inc.", "decision_date": "2013-06-04", "docket_number": "No. COA12-1133", "first_page": "476", "last_page": "483", "citations": [ { "type": "official", "cite": "227 N.C. App. 476" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "613 S.E.2d 322", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12632960 ], "weight": 5, "year": 2005, "pin_cites": [ { "page": "325" }, { "page": "325", "parenthetical": "citation and brackets omitted" }, { "parenthetical": "citation omitted" }, { "page": "327-28" }, { "page": "325", "parenthetical": "citation omitted" } ], "opinion_index": 0, "case_paths": [ "/se2d/613/0322-01" ] }, { "cite": "246 F.R.D. 642", "category": "reporters:specialty", "reporter": "F.R.D.", "case_ids": [ 4072947 ], "weight": 2, "year": 2007, "pin_cites": [ { "page": "645" } ], "opinion_index": 0, "case_paths": [ "/frd/246/0642-01" ] }, { "cite": "541 F.3d 318", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 3752105 ], "weight": 4, "year": 2008, "pin_cites": [ { "page": "328" }, { "page": "328" }, { "page": "329" } ], "opinion_index": 0, "case_paths": [ "/f3d/541/0318-01" ] }, { "cite": "610 S.E.2d 529", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 3762012 ], "year": 2005, "pin_cites": [ { "page": "532" } ], "opinion_index": 0, "case_paths": [ "/ga/279/0125-01" ] }, { "cite": "354 S.E.2d 459", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1987, "opinion_index": 0 }, { "cite": "319 N.C. 274", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4748509 ], "year": 1987, "opinion_index": 0, "case_paths": [ "/nc/319/0274-01" ] }, { "cite": "170 N.C. App. 545", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 9006051 ], "weight": 4, "year": 2005, "pin_cites": [ { "page": "547" }, { "page": "547" }, { "page": "550-53" }, { "page": "547" } ], "opinion_index": 0, "case_paths": [ "/nc-app/170/0545-01" ] }, { "cite": "522 S.E.2d 577", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1999, "pin_cites": [ { "page": "579", "parenthetical": "quotation marks omitted" } ], "opinion_index": 0 }, { "cite": "351 N.C. 159", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 1155801 ], "year": 1999, "pin_cites": [ { "page": "161-62", "parenthetical": "quotation marks omitted" } ], "opinion_index": 0, "case_paths": [ "/nc/351/0159-01" ] }, { "cite": "392 S.E.2d 735", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1990, "pin_cites": [ { "page": "736" } ], "opinion_index": 0 }, { "cite": "326 N.C. 723", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 5307026 ], "year": 1990, "pin_cites": [ { "page": "725" } ], "opinion_index": 0, "case_paths": [ "/nc/326/0723-01" ] }, { "cite": "677 S.E.2d 1", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 19, "year": 2009, "pin_cites": [ { "parenthetical": "\"Agean F" }, { "page": "4" }, { "page": "10" }, { "page": "5" }, { "page": "5" }, { "page": "5", "parenthetical": "citation omitted" }, { "page": "6", "parenthetical": "citation omitted" }, { "parenthetical": "citation omitted" }, { "page": "10" }, { "page": "6" }, { "page": "10-11" }, { "page": "11" }, { "page": "7" }, { "page": "6" }, { "page": "11" }, { "page": "7", "parenthetical": "citations and quotations omitted" }, { "page": "8" } ], "opinion_index": 0 }, { "cite": "197 N.C. App. 296", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 4167587 ], "weight": 8, "year": 2009, "pin_cites": [ { "parenthetical": "\"Agean F" }, { "page": "299-300" }, { "page": "302" }, { "page": "302" }, { "page": "302" }, { "page": "303" }, { "page": "310-11" }, { "page": "306" } ], "opinion_index": 0, "case_paths": [ "/nc-app/197/0296-01" ] }, { "cite": "47 U.S.C. \u00a7 227", "category": "laws:leg_statute", "reporter": "U.S.C.", "opinion_index": 0 } ], "analysis": { "cardinality": 781, "char_count": 19545, "ocr_confidence": 0.703, "pagerank": { "raw": 4.03580807328026e-08, "percentile": 0.1396677953038961 }, "sha256": "76c525588962de6039210d6d1dfd2bde48ce168be637fddb213433a261004cd6", "simhash": "1:8b2bea2ae6c61f76", "word_count": 3070 }, "last_updated": "2023-07-14T17:48:13.495142+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Chief Judge MARTIN and Judge McGEE concur." ], "parties": [ "JONATHAN BLITZ, on behalf of himself and all others similarly situated, Plaintiff v. AGEAN, INC., Defendant" ], "opinions": [ { "text": "CALABRIA, Judge.\nJonathan Blitz (\u201cplaintiff\u2019), recipient of unsolicited fax advertisements, brought an action against a restaurant operator that contracted with an advertising business to send faxes, alleging violation of the Telephone Consumer Protection Act (\u201cTCPA\u201d). Plaintiff appeals from an order denying his motion for class certification. We affirm.\nI. Background\nAgean, Inc. (\u201cdefendant\u201d) owned two restaurants in Durham, Papa\u2019s Grill and Front Street Caf\u00e9 (collectively \u201cthe restaurants\u201d). Defendant designed a coupon redeemable at either or both of the restaurants. In April 2004, defendant purchased a list from InfoUSA (\u201cInfoUSA list\u201d) of approximately 983 business fax numbers in the three zip codes surrounding the restaurants. Defendant contracted with a fax broadcaster, Concord Technologies, Inc. (\u201cConcord\u201d), to fax coupons for defendant\u2019s restaurants to the numbers on the InfoUSA list. During 2004, Concord transmitted by fax 7,000 coupons for defendant\u2019s restaurants to the fax numbers on the InfoUSA list. Plaintiffs name was included on the InfoUSA list and he received five, one-page, fax transmissions, containing defendant\u2019s restaurant coupons. Plaintiff claimed that he did not request any advertisements from defendant, nor did he give defendant permission to send him fax transmissions.\nPlaintiff filed a complaint and subsequently, on 11 February 2005, filed an amended class action complaint in Durham County District Court, seeking, inter alia, class certification, statutory damages and a statutory injunction for violation of the Federal Telephone Consumer Protection Act (\u201cTCPA\u201d), 47 U.S.C. \u00a7 227. The TCPA, inter alia, prohibits the transmission of \u201cunsolicited advertisements\u201d to fax machines. U.S.C. \u00a7 227(b)(1)(C) (2000 & Supp. IV 2004). The case was transferred to the North Carolina Business Court on 20 January 2006. On 17 October 2006, plaintiff filed a motion for class certification which defined the class as:\nAll persons and other entities to whom Defendant sent or caused to be sent, one or more facsimile advertisement transmissions promoting the restaurants of Defendant from February 12, 2001 until February 11, 2005 inclusive, and excluding those persons and other entities who had an established business relationship with Defendant at the time said facsimile advertisement transmissions were sent.\nThe trial court denied the motion and plaintiff appealed. This Court, inter alia, reversed and remanded the trial court\u2019s order denying class certification in Blitz v. Agean, Inc., 197 N.C. App. 296, 677 S.E.2d 1 (2009) (\u201cAgean F).\nOn 18 May 2011, plaintiff filed another amended class action complaint, defining the class as \u201c[t]he holders of the 978 telephone numbers contained in the InfoUSA database ... between the dates of February 1, 2004 and December 31, 2004, inclusive.\u201d On 11 April 2012, the trial court denied plaintiffs motion, concluding that plaintiff had failed to establish the existence of a class because plaintiff \u201cfailed to provide a theory of generalized proof that allows for common questions to predominate over individual inquiries.\u201d In addition, the trial court concluded that class certification would be \u201cunjust on equitable grounds\u201d because it would \u201cprovide plaintiff with inappropriate leverage in settlement negotiations.\u201d Plaintiff appeals.\nII. Interlocutory Appeal\nAs an initial matter, we note that plaintiff\u2019s appeal is interlocutory. Generally there is no immediate right of appeal from interlocutory orders. Goldston v. Am. Motors Corp., 326 N.C. 723, 725, 392 S.E.2d 735, 736 (1990). However, immediate appeal of an interlocutory order is available when the order \u201caffects a substantial right.\u201d Sharpe v. Worland, 351 N.C. 159, 161-62, 522 S.E.2d 577, 579 (1999) (quotation marks omitted). \u201c[T]he appeal of an interlocutory order denying class certification has been held to affect a substantial right[,]\u201d and therefore, plaintiff\u2019s appeal is immediately appealable. Harrison v. Wal-Mart Stores, Inc., 170 N.C. App. 545, 547, 613 S.E.2d 322, 325 (2005).\nIII. Standard of Review\nIn general, \u201cappeal from the denial of class certification involves an abuse of discretion standard of review[,]\u201d however, \u201cin appeals from the grant or denial of class certification this Court reviews issues of law, such as statutory interpretation, de novo.\u201d Agean I, 197 N.C. App. at 299-300, 677 S.E.2d at 4. After conducting a de novo review of \u201cthe law underpinning the trial court\u2019s denial of class certification, we [then] turn to the specific facts of the instant case to determine if denial of class certification was proper.\u201d Id. at 310, 677 S.E.2d at 10. \u201c[A]n appellate court is bound by the trial court\u2019s findings of fact if they are supported by competent evidence.\u201d Harrison, 170 N.C. App. at 547, 613 S.E.2d at 325 (citation and brackets omitted). A trial court has abused its discretion if its decision \u201cis manifestly unsupported by reason, or so arbitrary that it could not have been the result of a reasoned decision].]\u201d Id. (citation omitted).\nIV. Class Certification\nPlaintiff argues that the trial court erred by concluding that plaintiff had failed to establish the existence of a class. We disagree.\nA class action may be initiated \u201c[i]f persons constituting a class are so numerous as to make it impracticable to bring them all before the court, such of them, one or more, as will fairly insure the adequate representation of all may, on behalf of all, sue or be sued.\u201d N.C. Gen. Stat. \u00a7 1A-1, Rule 23 (2011). \u201cThe party seeking to bring a class action ... has the burden of showing that the prerequisites to utilizing the class action procedure are present.\u201d Agean 1,197 N.C. App. at 302, 677 S.E.2d at 5. If all the prerequisites are met, the trial court has discretion to determine whether a class action is superior to other available methods for adjudication of the controversy. Id.\nThe first prerequisite for certification of a class action is whether a class exists. See Crow v. Citicorp Acceptance Co., Inc., 319 N.C. 274, 354 S.E.2d 459 (1987); Agean 1,197 N.C. App. at 302, 677 S.E.2d at 5. \u201c[A] \u2018class\u2019 exists ... when the named and unnamed members each have an interest in either the same issue of law or of fact, and that issue predominates over issues affecting only individual class members.\u201d Agean I, 197 N.C. App. at 302, 677 S.E.2d at 5 (citation omitted). This first step is known as the \u201ccommonality and typicality\u201d prong of the test. Id. The test is whether individual issues will predominate over common ones in terms of being the focus of the litigants\u2019 efforts. Harrison, 170 N.C. App. at 550-53, 613 S.E.2d at 327-28. \u201c[A] common question is not enough when the answer may vary with each class member and is determinative of whether the member is properly part of the class.\u201d Carnett\u2019s, Inc. v. Hammond, 610 S.E.2d 529, 532 (Ga. 2005).\nIn the instant case, plaintiff is seeking, for each proposed class member, $500.00 in statutory damages per fax as well as injunctive relief, pursuant to the TCPA. At the time the faxes in question were allegedly sent, the 2004 version of the TCPA was in effect: \u201cIt shall be unlawful for any person within the United States ... to use any telephone facsimile machine, computer, or other device to send an unsolicited advertisement to a telephone facsimile machine[.]\u201d Agean 1,197 N.C. App. at 303, 677 S.E.2d at 6 (citation omitted). \u201cThe term \u2018unsolicited advertisement\u2019 means any material advertising the commercial availability or quality of any property, goods, or services which is transmitted to any person without that person\u2019s prior express invitation or permission.\u201d Id. (citation omitted). Since the TCPA only applies to \u201cunsolicited advertisements\u201d it is the \u201c[p]laintiff\u2019s burden to show the fax advertisements sent to the class were unsolicited.\u201d Id. at 311, 677 S.E.2d at 10.\nThe primary issue regarding class certifications involving the TCPA \u201cis whether, under the \u2018commonality and typicality\u2019 prong of the test, individualized issues concerning whether sent fax advertisements were \u2018unsolicited\u2019 predominate over issues of law and fact common to the proposed class members.\u201d Id. at 303, 677 S.E.2d at 6. In Agean I, this Court held that plaintiff did not meet his burden of showing that the fax advertisements were unsolicited, because his class definition did not limit the class to \u201cpersons receiving \u2018unsolicited\u2019 fax advertisements\u201d and \u201cthe trial court had no basis to determine how many of the fax numbers included in the list represented persons or entities that had given express prior invitation or permission to [defendant to receive fax advertisements.\u201d Id. at 310-11, 677 S.E.2d at 10-11. However, the Court still reversed and remanded the case for reconsideration by the trial court because it disagreed with the trial court\u2019s analysis in denying class certification. Id. at 311, 677 S.E.2d at 11.\nThis Court rejected a bright line rule regarding class certification because class certification in TCPA cases depends on the facts of each case. Id. at 305, 677 S.E.2d at 7. The Court adopted the reasoning of other courts and found that the only statutory defense to a cause of action based on an unsolicited fax advertisement was a defendant\u2019s \u201cprior express invitation or permission],]\u201d which could not be inferred from an established business relationship. Id. at 304-05, 677 S.E.2d at 6. In addition, the Court found that in class certification of TCPA cases, a North Carolina Court should determine whether the plaintiff proceeded with \u201ca theory of generalized proof of invitation or permission\u201d as articulated in Gene & Gene, LLC v. BioPay, LLC, 541 F.3d 318 (5th Cir. 2008) and Kavu, Inc. v. Omnipak Corp., 246 F.R.D. 642 (W.D. Wash. 2007). Agean I, 197 N.C. App. at 310-11, 677 S.E.2d at 11.\nIn Kavu, where the defendant purchased all the fax numbers from a common source, the Court certified the class because of the common question, \u201cwhether the inclusion of the recipients\u2019 fax numbers in the purchased database indicated their consent to receive fax advertisements, and there were therefore no questions of individualized consent.\u201d Gene, 541 F.3d at 328; Kavu, 246 F.R.D. at 645. In Gene, the defendant used a purchased database of fax numbers but also gathered numbers from other sources, including the defendant\u2019s website, trade shows, and lists of affiliated companies. Gene, 541 F.3d at 328. That Court held that class certification was inappropriate because the plaintiff could not \u201cadvance a viable theory of generalized proof to identify those persons, if any, to whom [the Defendant] may be liable under the TCPA\u201d as there was evidence that the defendant had obtained consent, the defendant used multiple sources to gather fax numbers and the plaintiff offered \u201cno sensible method of establishing consent or the lack thereof via class-wide proof.\u201d Id. at 329.\nIn the instant case, after this Court\u2019s decision in Agean I, plaintiff amended the definition of the class to include \u201c[t]he holders of the 978 telephone numbers contained in the InfoUSA database ... between the dates of February 1, 2004 and December 31, 2004, inclusive.\u201d Plaintiff claimed that there were three common legal and factual questions under the TCPA:\n1. Whether Defendant\u2019s fax is an advertisement;\n2. Whether Defendant violated the TCPA by faxing that advertisement without first obtaining express invitation or permission to do so; and\n3. Whether Plaintiff and the other class members are entitled to statutory damages.\nThe trial court determined that the answer to plaintiff\u2019s second question would \u201cbe a focal point of the litigants\u2019 evidence, and likely direct the outcome of the case.\u201d\nPlaintiff\u2019s amended proposed class definition, \u201c[t]he holders of the 978 telephone numbers contained in the InfoUSA database ... between the dates of February 1,2004 and December 31,2004, inclusive,\u201d was not limited to individuals or businesses receiving \u201cunsolicited\u201d fax advertisements because it included every number purchased on the InfoUSA list. The trial court found that the restaurants had received numerous requests to fax materials concerning its hours, accommodations and capacity and multiple requests for defendant to fax or email its menus and other materials related to the restaurant\u2019s services. Therefore, it was difficult for the court to discern whether members in defendant\u2019s proposed \u201cclass\u201d had previously consented to receive the faxes. Since consent could potentially be shown for numbers on both defendant\u2019s Customer List and the InfoUSA list, plaintiff\u2019s proposed class definition did not \u201cexplicitly exclude owners of fax numbers who had previously consented to receive faxes.\u201d It was plaintiff\u2019s burden to exclude the numbers of persons that had authorized receipt of the faxes. However, plaintiff failed to exclude them, therefore, the class was left open to those individuals.\nThe trial court applied the authorities set forth by this Court in Agean I regarding the \u201ccommonality and typicality\u201d prong of the class certification test to the facts of this case and determined that there was \u201cno common source from which the [c]ourt [could] determine consent.\u201d Therefore, under the facts of the case, plaintiff was \u201cunable to articulate a theory of generalized proof\u2019 and thus the litigants\u2019 efforts would be focused on \u201cindividual questions of whether each class member consented rather than any common questions the class might share.\u201d The trial court ultimately concluded that because plaintiff \u201cfailed to provide a theory of generalized proof that allow[ed] for common questions to predominate over individual inquiries, they... failed to establish the existence of a class and therefore [did] not meet Crow\u2019s requirements for class certification.\u201d\nPlaintiff relies on Kavu. When reviewing the trial court\u2019s certification of a class, the court in Kavu found that the question of consent could be easily shown by common proof and would not require individualized evidence. Kavu, 246 ER.D. at 647. Plaintiff claims that because he limited the class to those businesses on the InfoUSA list, the question of whether the class members in the instant case consented to receive faxes from defendant was common to all potential class members. However, plaintiff is mistaken. The trial court found that defendant served over 500,000 meals in its twelve years of service, many of those customers requested information and some of them consented to having information transmitted to them by fax. Since the InfoUSA list included business fax numbers in the three zip codes surrounding defendant\u2019s restaurants, the trial court found there was a likelihood of some overlap between numbers from the InfoUSA list and defendant\u2019s Customer List. In addition, when Kavu was decided, an \u201carguably applicable\u201d federal regulation stated \u201cif a sender obtains the facsimile number from a [commercial database], the sender must take reasonable steps to verify that the recipient agreed to make the number available for distribution.\u201d Agean I, 197 N.C. App. at 306, 677 S.E.2d at 7 (citations and quotations omitted). However, the statute \u201crelied upon by the Kavu Court was not in effect for the relevant time period\u201d of the instant case. Id. at 306, 677 S.E.2d at 8. Therefore, the statute cannot be applied in the same way to plaintiff\u2019s class as it was in Kavu.\nFinally, although plaintiff cites this Court\u2019s language in Agean I that the \u201cmere possibility\u201d some of the class members will later be removed from the class [because of consent] did not \u201cautomatically defeat\u201d class certification, the facts in this case present more than a \u201cmere possibility.\u201d In this case, the question remains, if anyone on the list of the 978 fax numbers gave their consent to receive defendant\u2019s coupons. As the trial court noted, plaintiff was the only individual of the 978 recipients who came forward complaining about the fax transmissions. Accordingly, given the evidence, we agree with the trial court\u2019s findings and conclusions that the \u201cindividualized issues concerning whether sent fax advertisements were \u201cunsolicited\u201d predominate [d] over issues of law and fact common to the proposed class members.\u201d The trial court\u2019s findings of fact are supported by competent evidence. Plaintiff failed to define a class that was subject to generalized proof and therefore, he failed to show that the trial court abused its discretion in denying its motion for class certification.\nV. Leverage in Settlement Negotiations\nPlaintiff also argues that the trial court abused its discretion by refusing to certify the class because of the conclusion that class certification \u201cwould principally serve to provide plaintiff with inappropriate leverage in settlement negotiations.\u201d The trial court also concluded that \u201ceven if the elements [establishing a class] were met,\u201d class certification \u201cwould be unjust on equitable grounds.\u201d Since we have concluded that the trial court correctly denied class certification, there is no need to determine whether or not it would be unjust on equitable grounds.\nVI. Conclusion\nSince the trial court\u2019s findings of fact are supported by competent evidence, we are bound by them. The trial court\u2019s findings support its conclusion that plaintiff failed to provide a theory of generalized proof that allows for common questions to predominate over individual inquiries. Therefore, plaintiff failed to establish the existence of a class. Since the trial court properly denied class certification, the trial court\u2019s decision was neither manifestly unsupported by reason nor so arbitrary that it could not have been the result of a reasoned decision. Harrison, 170 N.C. App. at 547, 613 S.E.2d at 325 (citation omitted). Therefore, the trial court did not abuse its discretion in denying plaintiff\u2019s motion for class certification.\nAffirmed.\nChief Judge MARTIN and Judge McGEE concur.\n. \u201cThe InfoUSA invoice shows [d]efendant bought 983 fax numbers but the excel file [defendant supplied to plaintiff]... contained 978 entries.\u201d", "type": "majority", "author": "CALABRIA, Judge." } ], "attorneys": [ "DeWitt Law Group, PLLC by N. Gregory DeWitt and Bock & Hatch, LLC, by Phillip A. Bock, pro hac vice, for plaintiff-appellant.", "Brown, Crump, Vanore & Tierney, L.L.P., by R. Scott Brown and W. John Cathcart, Jr., for defendant-appellee." ], "corrections": "", "head_matter": "JONATHAN BLITZ, on behalf of himself and all others similarly situated, Plaintiff v. AGEAN, INC., Defendant\nNo. COA12-1133\nFiled 4 June 2013\n1. Appeal and Error \u2014 interlocutory orders \u2014 class certification \u2014 substantial right\nThe Court of Appeals addressed the merits of plaintiff\u2019s interlocutory appeal from the trial court\u2019s order denying plaintiff\u2019s motion for class certification. An interlocutory order denying class certification affects a substantial right.\n2. Class Actions \u2014 class certification \u2014 generalized proof\nThe trial court did not err by concluding that plaintiff failed to establish the existence of a class. Plaintiff failed to define a class that was subject to generalized proof and therefore, he failed to show that the trial court abused its discretion in denying its motion for class certification.\n3. Class Actions \u2014 class certification \u2014 equitable grounds\nThe trial court did not err by denying plaintiff\u2019s motion for class certification. Since the Court of Appeals concluded that the trial court correctly denied class certification, there was no need to determine whether it was unjust on equitable grounds.\nAppeal by plaintiff from order entered 11 April 2012 by Judge Calvin E. Murphy in Durham County Superior Court. Heard in the Court of Appeals 11 February 2013.\nDeWitt Law Group, PLLC by N. Gregory DeWitt and Bock & Hatch, LLC, by Phillip A. Bock, pro hac vice, for plaintiff-appellant.\nBrown, Crump, Vanore & Tierney, L.L.P., by R. Scott Brown and W. John Cathcart, Jr., for defendant-appellee." }, "file_name": "0476-01", "first_page_order": 486, "last_page_order": 493 }