Chapman v. First Index, Inc.

• Citation: 796 F.3d 783
• Decision Date: 06 August 2015
• Docket Number: 14–2775.,Nos. 14–2773,s. 14–2773
• Parties: Arnold CHAPMAN, Plaintiff–Appellant, and All American Painting, Inc., Putative Intervenor–Appellant, v. FIRST INDEX, INC., Defendant–Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)

796 F.3d 783

Arnold CHAPMAN, Plaintiff–Appellant
and
All American Painting, Inc., Putative Intervenor–Appellant
v.
FIRST INDEX, INC., Defendant–Appellee.

Nos. 14–2773
14–2775.

United States Court of Appeals, Seventh Circuit.

Argued May 19, 2015.
Decided Aug. 6, 2015.

796 F.3d 784

Phillip A. Bock, Attorney, Tod A. Lewis, Attorney, Robert M. Hatch, Attorney, James Michael Smith, Attorney, Bock & Hatch, Chicago, IL, Brian J. Wanca, Attorney, Anderson & Wanca, Rolling Meadows, IL, for Plaintiff–Appellant.

Molly Arranz, Attorney, Albert M. Bower, Attorney, Michael L. Resis, Attorney, Eric Samore, Attorney, Smithamundsen, LLC, Chicago, IL, for Defendant–Appellee.

Before POSNER, EASTERBROOK, and MANION, Circuit Judges.

Opinion

EASTERBROOK, Circuit Judge.

This is another of the surprisingly many junk-fax suits under 47 U.S.C. § 227, the Telephone Consumer Protection Act, which together with the FCC's implementing regulations establishes some simple rules that many fax senders ignore. This suit involves two of those requirements: first, that commercial faxes be sent only to those who have agreed to receive them; second, that commercial faxes include instructions about how to opt out of receiving more.

When this suit began in 2009, its sole plaintiff, Arnold Chapman, proposed to represent a class of persons who received faxes from First Index despite not having given consent. First Index responded that it always had recipients' consent, though it may have been verbal (at trade shows or during phone conversations). Discovery was conducted and experts' reports submitted. Chapman then asked the judge to

796 F.3d 785

certify a class of all persons who had received faxes from First Index since August 2005 (four years before the complaint was filed) without their consent. The district court declined, ruling that the difficulty of deciding who had provided oral consent made it infeasible to determine who is in the class. 2014 U.S. Dist. LEXIS 27556 (N.D.Ill. Mar. 4, 2014).

Chapman then proposed a different class: All persons whose faxes from First Index either lacked an opt-out notice or contained one of three specific notices that Chapman believes violate the FCC's regulations. The district court declined to certify that class too, ruling that the proposal came too late—more than 18 months after discovery had closed. 2014 U.S. Dist. LEXIS 96397 (N.D.Ill. July 16, 2014). The district judge found that Chapman had known about the potential notice issue from the outset of the litigation but had made a strategic decision not to pursue it earlier. Changing the focus of the litigation almost five years into the case was impermissible, the judge concluded. For good measure, the judge dismissed Chapman's own claim as moot and entered a final, take-nothing judgment.

The parties and the district judge have proceeded as if Chapman's proposal to certify a class defined with reference to the opt-out notice requires an amendment to the complaint, to which the standards of Fed.R.Civ.P. 15(a)(2) apply. They don't say why, and we can't see why. A complaint must contain three things: a statement of subject-matter jurisdiction, a claim for relief, and a demand for a remedy. Fed.R.Civ.P. 8(a). Class definitions are not on that list. Instead the obligation to define the class falls on the judge's shoulders under Fed.R.Civ.P. 23(c)(1)(B). See Kasalo v. Harris & Harris, Ltd., 656 F.3d 557, 563 (7th Cir.2011). The judge may ask for the parties' help, but motions practice and a decision under Rule 23 do not require the plaintiff to amend the complaint.

This does not affect the disposition, however, because no matter how the subject is approached a district judge has discretion to reject an attempt to remake a suit more than four years after it began. The judge thought Chapman's delay inexcusable. He knew about the potential opt-out issue from the outset but did not propose a class centered on it until the parties had borne the expense of discovery into how First Index obtained consent from the recipients, and the judge had resolved motions addressed to that topic. Chapman wanted a fallback position, but the court thought that the opt-out issue should have been pressed earlier. The judge wrote: “Such gamesmanship is not appropriate, particularly where Chapman was aware of the potential that his class definition was deficient yet spurned several opportunities to cure that deficiency.” 2014 U.S. Dist. LEXIS 96397 at *10. Insisting that representative plaintiffs put their class definitions on the table “[a]t an early practicable time” (Rule 23(c)(1)(A) ) is not an abuse of discretion, as that's the Rule's own schedule for judicial action. Four and a half years into the case cannot be called “early”.

Having declined to certify a class identified by the opt-out notices, the district court concluded that All American Painting, Inc., could not intervene as a new representative plaintiff. All American wanted to replace Chapman, should the district court dismiss his claim, but only if the court certified a class centered on the opt-out notices. Given our conclusion that the court was entitled to reject an opt-out-notice class, we also affirm its denial of All American's motion to intervene.

This brings us to Chapman's personal claim. He contends that he did not agree to receive faxes from First Index but got

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