Bland v. Fessler

• Decision Date: 02 July 1996
• Docket Number: No. 95-55522,95-55522
• Citation: 88 F.3d 729
• Parties: , 24 Media L. Rep. 2072, 96 Cal. Daily Op. Serv. 4944, 96 Daily Journal D.A.R. 7982 William BLAND and National Association of Telecomputer Operators, Plaintiffs-Appellants, v. Daniel Wm. FESSLER; P. Gregory Conlon; Norman D. Shumway; Jessie J. Knight Jr.; and Patricia M. Eckart, in their individual and official capacities as Public Utilities Commissioners, and Daniel E. Lungren, in his official capacity as Attorney General of the State of California, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 729

88 F.3d 729

65 USLW 2055, 24 Media L. Rep. 2072,

96 Cal. Daily Op. Serv. 4944,

96 Daily Journal D.A.R. 7982

William BLAND and National Association of Telecomputer Operators, Plaintiffs-Appellants, v. Daniel Wm. FESSLER; P. Gregory Conlon; Norman D. Shumway Jessie J. Knight Jr.; and Patricia M. Eckart, in their individual and official capacities as Public Utilities Commissioners, and Daniel E. Lungren, in his official capacity as Attorney General of the State of California Defendants-Appellees.

No. 95-55522.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Nov. 17, 1995.

Decided July 2, 1996.

Rex S. Heinke, Los Angeles, California, for plaintiffs-appellants.

Ronald A. Reiter, Los Angeles, California, and Mark Fogelman, San Francisco, California, for defendants-appellees.

Appeal from the United States District Court for the Central District of California, Edward Rafeedie, District Judge, Presiding. D.C. No. CV-94-07275-ER.

Before: FLETCHER, CANBY, and HAWKINS, Circuit Judges.

ORDER

The opinion filed April 1, 1996, Slip op. 3923, is withdrawn.

OPINION

FLETCHER, Circuit Judge:

Plaintiffs appeal the grant of summary judgment dismissing their action against the Commissioners of the California Public Utilities Commission and the dismissal on a Rule 12(b)(6) motion of their action against the Attorney General of California. Plaintiffs' action challenges on First Amendment grounds two California statutes that regulate Automatic Dialing and Announcing Devices ("ADADs"), machines that dial telephone numbers and deliver prerecorded messages. We affirm.

I. FACTS AND PRIOR PROCEEDINGS

William Bland used ADADs to advertise his carpet cleaning services. Bland's ADADs provoked consumer complaints to the telephone company. One telephone user reported he could not terminate calls from Bland's ADADs: "I hung up my telephone several times, but the recording continued and tied up my line for at least a couple of minutes." This consumer also complained that Bland's ADADs were extremely misleading as to the identity of the calling party. In May 1994, the telephone company notified Bland that his use of ADADs violated California law and threatened to disconnect his telephones if he didn't stop using them. Bland immediately stopped using his ADADs.

Two California statutes prohibit the use of ADADs unless a live operator first identifies the calling party and obtains the called party's consent to listen to the prerecorded message. Cal. Pub. Util.Code § 2874(a) ("the utilities statute"); ¹ Cal. Civ.Code § 1770(v)(1) ("the civil statute"). ² The California Public Utilities Commission may enforce the utilities statute with fines and the disconnection of telephone service. Cal. Pub. Util.Code § 2876. The California Attorney General may enforce the civil statute with fines, Cal. Bus. & Prof.Code § 17200 et seq., and citizens injured by violations of the civil statute may file suit for damages, Cal. Civ.Code §§ 1780-1784. The utilities statute applies to all ADAD users, subject to exceptions; the civil statute applies only to commercial users of ADADs.

The State of California is not alone: Congress has also restricted the use of ADADs, 47 U.S.C. § 227 (the Telephone Consumer Protection Act of 1991), as have more than forty states, S.Rep. No. 102-178, 102d Cong., 1st Sess. (1991), reprinted in 1991 U.S.C.C.A.N.1968, 1970. ADADs are common; hundreds of thousands of solicitors have used them to contact millions of people. Id. The California legislature found that "[u]nsolicited prerecorded calls are a source of great aggravation to many people, interrupting their affairs and tying up their lines." Cal. Sen. Judiciary Comm., Hearing Report on AB 4084 of June 19, 1990, at 2. Congress found that ADAD calls are annoying and disruptive in the following ways:

. automated calls are placed to lines reserved for emergency purposes, such as hospitals and fire and police stations;

. the entity placing the automated call does not identify itself;

. the automated calls fill the entire tape of an answering machine, preventing other callers from leaving messages;

. the automated calls will not disconnect the line for a long time after the called party hangs up the phone, thereby preventing the called party from placing his or her own calls;

. automated calls do not respond to human voice commands to disconnect the phone, especially in times of emergency . some automatic dialers will dial numbers in sequence, thereby tying up all the lines of a business and preventing any outgoing calls; and

. unsolicited calls placed to fax machines, and cellular or paging telephone numbers often impose a cost on the called party....

S.Rep. No. 102-178, reprinted in 1991 U.S.C.C.A.N. at 1969.

In October 1994, Bland and the National Association of Telecomputer Operators ("NATO") ³ sued the Commissioners and the Attorney General of California in federal district court, alleging that both of California's ADAD statutes violate the First and Fourteenth Amendments to the United States Constitution. In March 1995, the court upheld both statutes, granting the Commissioners' motion for summary judgment pursuant to Rule 56, and granting the Attorney General's motion to dismiss pursuant to Rule 12(b)(6). Plaintiffs appeal. The Attorney General urges on appeal that the dismissal of the action against him should have been for lack of standing, rather than for failure to state a claim. ⁴

II. DISCUSSION

The appeal presents three questions. First, is the utilities statute constitutional? Second, do the plaintiffs have standing to challenge the civil statute? ⁵ Third, is the civil statute constitutional?

A. THE UTILITIES STATUTE

Plaintiffs argue that the utilities statute violates the First Amendment. We review determinations as to the constitutionality of a statute de novo. Gray v. First Winthrop Corp., 989 F.2d 1564, 1567 (9th Cir.1993).

Two recent decisions guide our analysis: this court's Moser v. FCC, 46 F.3d 970 (9th Cir.1995), and the Eighth Circuit's Van Bergen v. Minnesota, 59 F.3d 1541 (8th Cir.1995), both of which upheld ADAD statutes as permissible time, place, and manner restrictions on speech. Moser concerned a federal ADAD statute, 46 F.3d at 972 (considering 47 U.S.C. § 227), and Van Bergen concerned a Minnesota ADAD statute, 59 F.3d at 1544-45 n. 2 (considering Minn.Stat. §§ 325E.26-.31). Both statutes resemble the statute at bar.

The plaintiffs argue that two different decisions ought to guide our analysis: Martin v. City of Struthers, 319 U.S. 141, 63 S.Ct. 862, 87 L.Ed. 1313 (1943), and Project 80's, Inc. v. City of Pocatello, 942 F.2d 635 (9th Cir.1991), both of which struck down statutes prohibiting door-to-door solicitation. We find Martin and Project 80's inapposite for two reasons.

First, compared to door-to-door solicitors, the annoyance and disruption of ADADs is of a different order of magnitude. As the Eighth Circuit explained, ADAD calls create a much greater problem because of their "sheer quantity" and the fact that they offer recipients who want to hang up immediately no opportunity to tell the caller not to call again. Van Bergen, 59 F.3d at 1555. Moreover, while door-to-door solicitation involves a conversation between two people, ADADs involve a one-way onslaught of information. Indeed, Congress determined that ADAD calls are "more of a nuisance and a greater invasion of privacy" than telemarketing with live operators, as ADADs "cannot interact with the customer except in preprogrammed ways" and "do not allow the caller to feel the frustration of the called party...." S.Rep. No. 102-178, reprinted in 1991 U.S.C.C.A.N. at 1972. ADADs are less like door-to-door solicitation and more like sound trucks and public address systems, both of which the government may regulate. Kovacs v. Cooper, 336 U.S. 77, 69 S.Ct. 448, 93 L.Ed. 513 (1949) (plurality opinion) (sound trucks); Ward v. Rock Against Racism, 491 U.S. 781, 109 S.Ct. 2746, 105 L.Ed.2d 661 (1989) (public address systems).

Second, while the statutes in Martin and Project 80's prohibited essentially all door-to-door solicitation, ⁶ whether or not a homeowner wanted to speak to a solicitor, the statute at bar permits the use of ADADs, so long as the called party consents to listen to the prerecorded message. Central to the door-to-door solicitation decisions were concerns over the dangers of state paternalism that deprives people of information they might wish to receive. Martin, 319 U.S. at 141, 63 S.Ct. at 862 (solicitation should "depend upon the will of the individual master of each household, and not upon the determination of the community"); Project 80's, 942 F.2d at 638-39. In contrast, the California statute makes no decisions for the called parties who remain free to decide for themselves whether or not to listen to prerecorded messages.

Thus, Moser and Van Bergen inform our inquiry, and not Martin and Project 80's. However, neither the federal ADAD statute upheld in Moser nor the Minnesota ADAD statute upheld in Van Bergen is identical to the California statute. The federal statute regulates only calls to residences, while the California statute regulates calls to both residences and businesses. Although Minnesota's statute applies to both residences and businesses, its exemptions are different. Accordingly, we must apply discretely to the California statute the time, place, and manner test, to determine whether its particular restrictions 1) are content neutral, 2) serve a significant governmental interest, 3) are narrowly tailored to serve this interest, and 4) leave open ample alternative channels of communication. Ward, 491 U.S. at 791, 109 S.Ct. at 2753-54 (citations omitted).

1. Content Neutrality

For the purposes of analysis, the utilities statute can be divided into its central prohibitory provision and its exemptions.

The statute forbids the use of ADADs unless preceded by a live operator who identifies the calling party...