Walsh v. Teltech Sys., Inc.

• Citation: 821 F.3d 155
• Decision Date: 02 May 2016
• Docket Number: No. 15–1987.,15–1987.
• Parties: Siobhan WALSH, Plaintiff, Appellant, v. TELTECH SYSTEMS, INC., Defendant, Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (1st Circuit)

821 F.3d 155

Siobhan WALSH, Plaintiff, Appellant

v.TELTECH SYSTEMS, INC., Defendant, Appellee.

No. 15–1987.

United States Court of Appeals, First Circuit.

May 2, 2016.

Richard B. Reiling for appellant.

Mark C. Del Bianco, with whom Law Office of Mark C. Del Bianco, Sean T. Carnathan, Joseph P. Calandrelli, and O'Connor Carnathan & Mack LLC were on brief, for appellee.

Before KAYATTA, STAHL, and BARRON, Circuit Judges.

BARRON, Circuit Judge.

This case concerns a prepaid minutes-based calling service—named SpoofCard—that allows customers to disguise the phone number from which they place calls. In 2009, a customer used that service to disguise her identity so that she could make it seem like someone else was sexually harassing the appellant. The appellant sued the provider of that service, TelTech Systems, Inc. (“TelTech”), under Massachusetts's consumer protection statute. The District Court granted summary judgment for the company on the ground that no reasonable jury could find that TelTech caused the appellant's injuries. We affirm.

I.

“On review of an order granting summary judgment, we recite the facts in the light most favorable to the nonmoving party.” Commodity Futures Trading Comm'n v. JBW Capital, 812 F.3d 98, 101 (1st Cir.2016) (quotation marks and citation omitted). As TelTech was the moving party, we recite the facts in the light most favorable to the appellant, Siobhan Walsh.

TelTech's SpoofCard service enables customers, when placing phone calls, to “spoof” or disguise their caller ID by selecting the number they would like to appear on recipients' caller ID screens. That service also permits customers to alter their voices—for example, by making a woman's voice sound like a man's voice—in the course of a call. And, finally, that service provides for a means to ensure that calls are recorded and stored.

The events that gave rise to the current suit relate to a particularly ugly—but, the record sadly indicates, by no means altogether unusual—use of the SpoofCard service. In January 2009, Walsh lived in an apartment complex in Quincy, Massachusetts. John Luciano lived in that same complex. Luciano worked as a chef at a local restaurant. He was acquainted with a man by the name of Michael DiLorenzo, who was married to a woman by the name of Johnienne DiLorenzo.

Johnienne had once worked at Luciano's restaurant, and Luciano had helped her to get the job. But Luciano testified that he fired Johnienne because “she kept screwing it up” and “showing up late.” Johnienne testified that, in fact, she quit the job due to unwanted sexual advances from Luciano.

What matters for present purposes is that one night, after Johnienne had been fired by Luciano, she was at a party when she overheard her friends discussing SpoofCard. Johnienne's friends told her about the SpoofCard website and demonstrated how SpoofCard worked by calling each other's phones and using the SpoofCard features. Johnienne later told her husband, Michael, about SpoofCard.

On January 15, 2009, one of the DiLorenzos—it is not clear who—purchased SpoofCard minutes from the SpoofCard website. On January 28, 2009, Johnienne made six phone calls to Walsh using SpoofCard to mimic a man's voice and to make it appear as if the calls were placed using Luciano's telephone number.

In those calls, Johnienne—posing as Luciano—made a series of sexually harassing comments to Walsh. Through the use of the SpoofCard service, the January 28 phone calls between Johnienne and Walsh were recorded without Walsh's consent, potentially in violation of Mass. Gen. Laws ch. 272, § 99 (“Chapter 272, § 99 ”), which, among other things, proscribes the recording of phone conversations without the consent of each party to the call.

Walsh, believing that Luciano had made the calls, reported Luciano to the Quincy Police Department later that same day. Luciano was arrested on the evening of January 28, 2009, on charges of criminal threatening and criminal harassment. Luciano spent several days in jail.

On February 2, 2009, Walsh received several voicemails from a blocked number. The voicemail messages threatened retaliation if Walsh did not drop the charges against Luciano. Walsh believed these calls, too, came from Luciano, and the confusion about the source of the calls ultimately led authorities to bring felony witness intimidation charges against Luciano. As a result of these events, Walsh moved out of her apartment and quit a job working at the Boston Garden.

According to Walsh's complaint, the DiLorenzos, on December 4, 2009, admitted to Quincy police that they called Walsh on January 28, 2009, and that they made it appear as if the call were coming from Luciano's phone number. The Assistant District Attorney, according to Walsh, thereafter dropped the charges against Luciano and pursued charges against the DiLorenzos for criminal harassment, criminal threatening, witness intimidation, and misleading a police officer.

On December 2, 2013, Walsh filed a complaint against TelTech in the United States District Court for the District of Massachusetts. Walsh alleged that TelTech engaged in a number of “unfair and deceptive acts and practices” in violation of Mass. Gen. Laws ch. 93A, § 2 (“Chapter 93A”). In particular, Walsh alleged that TelTech violated Chapter 93A by violating Chapter 272, § 99, and by “offer[ing] the SpoofCard service” while “encourag[ing] [the] use of the SpoofCard for illegal purposes” (as evidenced by the promotional material on SpoofCard's website).¹ For relief, Walsh requested compensatory damages (in the amount of $5 million), treble damages, punitive damages, disgorgement of profits from the sale of the SpoofCard service, and attorneys' fees and costs under Chapter 93A, as well as an injunction against the future sale and promotion of SpoofCard.

On January 30, 2015, TelTech filed a motion for summary judgment. Walsh filed a memorandum opposing TelTech's motion on February 25, 2015. On March 19, 2015, Walsh filed a motion for leave to file a sur-reply.

On July 30, 2015, the District Court granted TelTech's motion for summary judgment. The District Court held that no reasonable jury could find that TelTech's actions caused Walsh's injuries. The District Court found that the offering of the service alone could not give rise to liability under Chapter 93A, because spoofing has legitimate purposes. And the District Court found that the promotional material on TelTech's website could not give rise to liability under Chapter 93A because there was no evidence that the DiLorenzos viewed that material, much less that the DiLorenzos were influenced by it. Finally, the District Court denied Walsh's motion for leave to file a sur-reply, in part because Walsh gave the court no reason to deviate from its rule disfavoring the filing of sur-replies.

On appeal, Walsh makes two main arguments as to how the District Court erred. First, Walsh contends that the District Court failed to address Walsh's contention that TelTech's violation of Chapter 272, § 99, constituted a violation of Chapter 93A. Second, Walsh contends that the District Court erroneously disposed of her remaining Chapter 93A claims on causation grounds. We take up each of these contentions in order.²

II.

Because we are reviewing an award of summary judgment, we may affirm “only if we, like the District Court, conclude that ‘the record shows there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law.’ ” McCue v. Bradstreet, 807 F.3d 334, 340 (1st Cir.2015) (quoting McGrath v. Tavares, 757 F.3d 20, 25 (1st Cir.2014) ). We review “de novo, drawing all reasonable inferences in favor of the nonmoving party while ignoring conclusory allegations, improbable inferences, and unsupported speculation.” Id. (quoting Shafmaster v. United States, 707 F.3d 130, 135 (1st Cir.2013) ).

III.

Chapter 93A is a broad, Massachusetts consumer protection statute. A plaintiff seeking relief under Chapter 93A must prove that the defendant engaged in “unfair or deceptive acts or practices in the conduct of any trade or commerce.” Mass. Gen. Laws ch. 93A, § 2.

Under Chapter 93A, an act or practice is unfair if it falls “within at least the penumbra of some common-law, statutory, or other established concept of unfairness”; “is immoral, unethical, oppressive, or unscrupulous”; and “causes substantial injury to consumers.” PMP Assocs. v. Globe Newspaper Co., 366 Mass. 593, 321 N.E.2d 915, 917 (1975) (quoting 29 Fed. Reg. 8325, 8355 (1964) ). To rise to the level of an “unfair” act or practice, the defendant's conduct must generally be of an egregious, non-negligent nature. See Baker v. Goldman, Sachs & Co., 771 F.3d 37, 51 (1st Cir.2014). Under Chapter 93A, an act or practice is deceptive “if it possesses a tendency to deceive” and “if it could reasonably be found to have caused a person to act differently from the way he [or she] otherwise would have acted.” Aspinall v. Philip Morris Cos., Inc., 442 Mass. 381, 813 N.E.2d 476, 486–87 (2004) (alteration in original) (quotation marks and citations omitted).

The Massachusetts Supreme Judicial Court (“SJC”) has held that “causation is a required element of a successful [Chapter] 93A claim.” Id. at 491. To establish causation, a plaintiff must “prove that the defendant's unfair or deceptive act caused an adverse consequence or loss.” Rhodes v. A.I.G. Domestic Claims, Inc., 461 Mass. 486, 961 N.E.2d 1067, 1076 (2012). A plaintiff's failure to establish both factual causation and proximate causation is fatal to her Chapter 93A claim. See Hershenow v. Enterprise Rent–A–Car Co. of Bos., Inc., 445 Mass. 790, 840 N.E.2d 526, 535 (2006) ; McCann v. Davis, Malm & D'Agostine, 423 Mass. 558, 669 N.E.2d 1077, 1079 (1996).

Walsh sets forth a number of theories as to how TelTech violated Chapter 93A. We first consider Walsh's contention that TelTech is liable under Chapter 93A because TelTech violated an independent statute, Chapter 272, § 99. We then...