Conboy v. AT&T

Decision Date11 January 2001
Docket NumberNo. 00-7284,00-7284
Citation241 F.3d 242
Parties(2nd Cir. 2001) EDWARD J. CONBOY, EILEEN M. CONBOY, Individually and on behalf of all others similarly situated, Plaintiffs-Appellants, v. AT&T CORP. and AT&T UNIVERSAL CARD SERVICES CORP., Defendants-Appellees, THE ELECTRONIC PRIVACY INFORMATION CENTER, Amicus Curiae
CourtU.S. Court of Appeals — Second Circuit

[Copyrighted Material Omitted]

[Copyrighted Material Omitted] HENRY H. ROSSBACHER (James S. Cahill, Clara I. Duran Reed, of counsel), Rossbacher & Associates, Los Angeles, CA; Daniel T. Hughes, Morgan, Melhuish, Monaghan, Arvidson, Abrutyn & Lisowski, New York, NY; Jonathan W. Cuneo, Michael G. Lenett, The Cuneo Law Group, P.C., Washington, DC, for Plaintiffs-Appellants Edward J. Conboy and Eileen M. Conboy.

PETER D. KEISLER (Virginia A. Steitz, Stephen B. Kinnaird, of counsel), Sidley & Austin, Washington, DC; Laura A. Kaster, Edward A. Harris, AT&T Corp., Basking Ridge, NJ, for Defendant-Appellee AT&T Corp.

GEORGE A. ZIMMERMAN (Lauren E. Aguiar, Andrew Wisch, of counsel), Skadden, Arps, Slate, Meagher & Flom LLP, New York, NY, for Defendant-Appellee AT&T Universal Card Services Corp. David L. Sobel, Marc Rotenberg, Electronic Privacy Information Center, Washington, DC (Harry C. Batchelder, Jr., New York, NY, of counsel), filed a brief for Amicus Curiae Electronic Privacy Information Center.

Before: KEARSE, JACOBS, and CABRANES, Circuit Judges.

JOSE A. CABRANES, Circuit Judge:

We are asked to decide whether plaintiffs have stated a cause of action against their long-distance service provider and its once-affiliated credit card company for allegedly transmitting and using certain information contained in plaintiffs' long-distance bill for purposes of collecting credit card debt. Plaintiffs Edward and Eileen Conboy allege that defendant AT&T Corp. ("AT&T") improperly disseminated proprietary information about them to defendant AT&T Universal Card Services Corp. ("UCS") to help UCS collect credit card debt. Plaintiffs claim that, in disseminating this information, AT&T violated: (1) Section 222 of the Telecommunications Act of 1996 ("Telecommunications Act" or "Act"), Pub. L. No. 104-104, 110 Stat. 56; (2) two regulations-- 47 C.F.R. 51.217 and 64.1201--promulgated by the Federal Communications Commission ("FCC") under the Act, and (3) the Fair Debt Collection Practices Act, 15 U.S.C. 1692 et seq. Plaintiffs also claim that, in using the disseminated information, UCS violated Section 349 of New York's General Business Law and New York's common law prohibiting intentional infliction of emotional distress.

In a thoughtful and comprehensive opinion, the United States District Court for the Southern District of New York (Robert J. Ward, Judge) dismissed plaintiffs' entire amended complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). See Conboy v. AT&T Corp., 84 F. Supp. 2d 492 (S.D.N.Y. 2000). It held that plaintiffs: (1) failed to allege recoverable damages under the Telecommunications Act; (2) had no private right of action to seek monetary relief for alleged violations of 47 C.F.R. 51.217 and 64.1201; (3) were not entitled to injunctive relief under the Telecommunications Act; (4) were not "consumers" for purposes of their claim under the Fair Debt Collection Practices Act; (5) failed to allege "deceptive" conduct to support their claim under New York's General Business Law; and (6) failed to allege extreme and outrageous conduct to support their common law claim of intentional infliction of emotional distress. The District Court also declined to grant plaintiffs' request to file a second amended complaint containing a claim of conspiracy to violate the Telecommunications Act. On appeal, plaintiffs challenge each of these holdings. For the reasons stated below, we affirm.

I. BACKGROUND

Because this is an appeal from a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), we review the District Court's decision de novo, taking all factual allegations in the amended complaint as true and construing all reasonable inferences in favor of plaintiffs. See Conley v. Gibson, 355 U.S. 41, 45-46, 2 L. Ed. 2d 80, 78 S. Ct. 99 (1957); Lee v. Bankers Trust Co., 166 F.3d 540, 543 (2d Cir. 1999).

This case arises out of a claim that AT&T disseminated, and continues to disseminate, proprietary information about its customers to UCS and other unidentified companies in order to help them collect credit card debt. Prior to this suit, AT&T served as plaintiffs' long-distance telephone carrier. During this time, AT&T had access to information contained in plaintiffs' long-distance telephone bill, such as their names, unlisted phone number, billing address, and the details of their long-distance calls. Plaintiffs never authorized the release of this information to UCS or to anyone else, and even paid a monthly fee for "non-published service," the purpose of which was to prevent the * release of their names, address, and telephone number to any directory or anyone who directed inquiries to directory assistance.

Plaintiffs' adult daughter-in-law, Maria Conboy, held a MasterCard issued by UCS when UCS was a subsidiary of AT&T.1 Plaintiffs were neither the guarantors of their daughter-in-law's credit card, nor otherwise obligated to pay her debt to UCS. Plaintiffs also did not agree to be contacted by UCS regarding their daughter-in-law's account, and Maria Conboy never provided UCS with their names, address, or telephone number.

From May to June 1998, representatives of UCS telephoned plaintiffs at their unlisted home telephone number between thirty and fifty times seeking information about Maria Conboy's whereabouts. The telephone calls were made repeatedly, and some were made at unusual hours. Plaintiffs informed the UCS representatives that Maria Conboy did not reside with them and requested that the telephone calls cease. Nonetheless, the phone calls continued. During one call, a representative revealed that he knew plaintiffs' unlisted personal information and the details of their long-distance telephone bill. Plaintiffs surmised that AT&T had provided UCS with this information to help UCS collect credit card debt.

In May 1999, plaintiffs filed an amended class-action complaint against AT&T and UCS. They claimed that, by disseminating information contained in their long-distance bill, AT&T violated: (1) Section 222(c) of the Telecommunications Act; (2) two FCC regulations-- 47 C.F.R. 51.217(c)(3)(iii) and 64.1201(c)(2); (3) the Fair Debt Collection Practices Act ("FDCPA"); (4) Section 349 of New York's General Business Law; and (5) New York's common law prohibiting intentional infliction of emotional distress. They also contended that UCS committed the fourth and fifth violations concerning New York General Business Law 349 and intentional infliction of emotional distress, by calling their residence at all hours in an attempt to collect credit card debt.

The District Court dismissed the entire amended complaint for failure to state a claim upon which relief can be granted. See Conboy, 84 F. Supp. 2d at 492. With respect to the claims against AT&T, the District Court held that plaintiffs: (1) failed to allege recoverable monetary damages under Sections 206 and 207 of the Communications Act of 1934 ("Communications Act"), 47 U.S.C. 151 et seq., which govern private rights of action against common carriers under the Telecommunications Act; (2) had no explicit or implied right of action to seek monetary damages for alleged violations of 47 C.F.R. 51.217 and 64.1201; (3) could not seek injunctive relief under the circumstances of this case; and (4) failed to qualify as "consumers" for purposes of their claim under the FDCPA. Having dismissed these federal claims, the District Court declined to exercise supplemental jurisdiction over plaintiffs' state-law claims against AT&T. The District Court also dismissed both claims against UCS on the ground that UCS's alleged conduct of calling plaintiffs in an attempt to collect credit card debt was neither "deceptive, " as defined by New York General Business Law 349(a), nor "extreme and outrageous," as required to state a common law claim of intentional infliction of emotional distress. The District Court also declined to grant plaintiffs' motion to amend their complaint for a second time to include a claim against AT&T and UCS for conspiracy to violate the Telecommunications Act.

On appeal, plaintiffs challenge each of these holdings. We discuss each issue in turn.

II. DISCUSSION
A. Damages Under Sections 206 and 207 of the Communications Act for Violations of Section 222(c) of the Telecommunications Act

Plaintiffs' first argument is that AT&T disseminated their customer proprietary network information ("CPNI")2 in violation of Section 222(c) of the Telecommunications Act,3 and that they can recover damages as a result under Sections 2064 and 2075 of the Communications Act. As an initial matter, we need not decide which types of information allegedly disseminated by AT&T constitutes CPNI because, even if we assume arguendo that AT&T disseminated plaintiffs' CPNI in violation of Section 222(c), we agree with the District Court that plaintiffs failed to allege recoverable damages under Sections 206 and 207.

The District Court provided three reasons for why plaintiffs failed to allege recoverable damages. See Conboy, 84 F. Supp. 2d at 499-500. First, plaintiffs' monthly telephone bill clearly indicated that their payments for "non-published service" had gone to their local-exchange carrier Bell Atlantic, not defendant AT&T. See id. at 499. The telephone bill attached to plaintiffs' amended complaint was divided into two sections--one for Bell Atlantic charges and the other for AT&T charges. Plaintiffs' monthly payment of $ 1.95 for "non-published service" fell on the Bell Atlantic section of the bill. Accordingly, plaintiffs could not seek...

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