Conboy v. At & T Corp.

• Decision Date: 04 February 2000
• Docket Number: No. 99 Civ. 0360(RJW).,99 Civ. 0360(RJW).
• Citation: 84 F.Supp.2d 492
• Parties: Edward J. CONBOY, Eileen M. Conboy Individually and On Behalf of All Others Similarly Situated, Plaintiffs, v. AT & T CORP., and AT & T Universal Card Services Corp., Defendants.
• Court: U.S. District Court — Southern District of New York

84 F.Supp.2d 492

Edward J. CONBOY, Eileen M. Conboy Individually and On Behalf of All Others Similarly Situated, Plaintiffs, v. AT & T CORP., and AT & T Universal Card Services Corp., Defendants.

No. 99 Civ. 0360(RJW).

United States District Court, S.D. New York.

February 4, 2000.

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Rossbacher & Associates, Los Angeles, CA by Henry H. Rossbacher, James S. Cahill, Clara I. Duran Reed, of counsel, Morgan, Melhuish, Monaghan, Arvidson, Abrutyn & Lisowski, NY by Daniel T. Hughes, of counsel, for plaintiffs.

T. Jay Thompson, Basking Ridge, NJ, for defendant AT & T Corp.

Skadden, Arps, Slate, Meagher & Flom, New York by George A. Zimmerman, of counsel, for defendant AT & T Universal Card Services, Corp.

OPINION

WARD, District Judge.

Defendants each move pursuant to Rule 12(b)(6), Fed.R.Civ.P., to dismiss plaintiffs' Class Action First Amended Complaint (hereinafter "complaint") for failure to state a claim upon which relief can be granted. For the following reasons, defendants' motions are granted and the complaint is dismissed.

BACKGROUND

Plaintiffs Edward and Eileen Conboy bring this class action against defendant AT & T Corp. (hereinafter "AT & T") alleging violations of the Federal Telecommunications Act (hereinafter "Telecommunications Act" or "Act"), 47 U.S.C. §§ 151 et seq., and regulations promulgated under the Act by the Federal Communications Commission (hereinafter "FCC"), 47 C.F.R. §§ 51.217 and 64.1201. They also assert claims against AT & T under the Fair Debt Collection Practices Act (hereinafter "FDCPA"), 15 U.S.C. §§ 1692 et seq., and New York General Business Law (hereinafter "N.Y. Gen. Bus. Law") § 349. Finally, plaintiffs assert a claim against AT & T for common law intentional infliction of emotional distress. Plaintiffs bring this class action against defendant AT & T Universal Card Services Corp. (hereinafter "UCS") alleging a violation of N.Y. Gen. Bus. Law § 349, and asserting a claim for common law intentional infliction of emotional distress.

I. Parties

Plaintiffs are individuals residing in New York State. They are customers of AT & T. AT & T is a New York corporation with its principal executive offices located in New Jersey. Plaintiffs allege that AT & T is subject to the mandates of the Telecommunications Act and FCC regulations.

UCS is a Delaware corporation with its principal place of business in Florida. According to the complaint, UCS was AT & T's credit card unit and consumers could receive AT & T Universal Visa or MasterCard credit cards through UCS. UCS was a subsidiary or affiliate of AT & T until April 2, 1998, when AT & T transferred UCS to Citicorp, an entity unaffiliated with AT & T.

II. Factual Allegations

The facts are taken from plaintiffs' complaint and are assumed to be true for purposes of this motion. AT & T provides plaintiffs' long-distance telephone service. It charges plaintiffs for long distance telephone calls through an itemized billing statement. The statement contains information concerning the number and type of calls made, the telephone number from which the calls originated, the date the calls were made, the destination and telephone numbers called, as well as the time, rate and cost of each call.

Plaintiffs pay a monthly fee for non-published service, which is designed to prevent the release of customers' unlisted names, addresses, and telephone numbers. Accordingly, plaintiffs' personal information was neither available in any directory nor accessible through directory assistance. Moreover, plaintiffs never authorized the release of any of this information to UCS, Citicorp, or any other entity.

Plaintiffs allege that AT & T has disseminated their customer proprietary network information (hereinafter "CPNI"),¹ telephone bill information, unlisted telephone numbers, and billing names and addresses to UCS, Citicorp, and other entities without plaintiffs' consent. According to plaintiffs, AT & T continues to disclose this information.

Maria Conboy is plaintiffs' adult daughter-in-law. She applied for, and received an AT & T Universal MasterCard through UCS while UCS was a subsidiary or affiliate of AT & T. Plaintiffs were not guarantors of their daughter-in-law's credit card and were not otherwise obligated to pay her debt to UCS. They did not agree to be contacted by UCS regarding their daughter-in-law's account with UCS nor did they request any communications from UCS for any other reason. Maria Conboy never provided UCS with plaintiffs' names, address, or telephone numbers. Furthermore, she was never listed or named as a customer on plaintiffs' telephone account with AT & T.

From May to June 1998, representatives of UCS telephoned plaintiffs at their unlisted home telephone number between thirty and fifty times seeking information regarding Maria Conboy's whereabouts. The telephone calls were made repeatedly and at unusual hours. Plaintiffs informed representatives of UCS that their daughter-in-law did not reside with them and requested that the telephone calls cease.

On or about June 28, 1998, Andrew Coleman, a representative of UCS, telephoned plaintiffs at their home requesting information about Maria Conboy. During the conversation, Coleman revealed that he knew plaintiffs' unlisted personal information. He also suggested that he knew the details of plaintiffs' telephone bill, including the cost and destination of telephone calls made by plaintiffs.

Plaintiffs allege that AT & T is using customers' billing statements not only to provide customers with details of their service charges, but also to help UCS and other entities collect credit card debts. They also claim that the statements do not provide a clear warning that AT & T is assisting third parties in collecting a debt, and that customers' information may be used for that purpose.

DISCUSSION

I. Standard for Motion to Dismiss

Defendants move to dismiss plaintiffs' complaint for failure to state a claim upon which relief can be granted pursuant to Rule 12(b)(6), Fed.R.Civ.P. In deciding such a motion, the Court must accept as true the factual allegations set forth in the complaint and must draw all reasonable inferences in plaintiffs' favor. See Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984); Scheuer v. Rhodes, 416 U.S. 232, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974); Bernheim v. Litt, 79 F.3d 318, 321 (2d Cir.1996). The Court, therefore, "may dismiss a complaint only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations." Hishon, 467 U.S. at 73, 104 S.Ct. 2229; Conley v. Gibson, 355 U.S. 41, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957).

II. Count I Alleging Violations of 47 U.S.C. § 222(c), and 47 C.F.R. §§ 51.217(c)(3)(iii) and 64.1201(c)(2) Against AT & T

A. Private Action For Damages Based on a Violation of Section 222(c)

Plaintiffs allege that AT & T violated Section 222(c) of the Telecommunications Act. That section governs the proper use of CPNI and provides:

Except as required by law or with the approval of the customer, a telecommunications carrier that receives or obtains customer proprietary network information by virtue of its provision of a telecommunications service shall only use, disclose, or permit access to individually identifiable customer proprietary network information in its provision of (A) the telecommunications service from which such information is derived, or (B) services necessary to, or used in, the provision of such telecommunications service, including the publishing of directories.

47 U.S.C. § 222(c)(1).

Sections 206 and 207 of the Telecommunications Act govern private rights of action.² Taken together, these sections provide that a suit may be brought either before the FCC or in federal court, but not both, for damages resulting from a common carrier's violation of specific provisions of the Telecommunications Act. Ivy Broadcasting Co. v. American Tel. & Tel. Co., 391 F.2d 486, 489 (2d Cir.1968).

In RCA Global Communications, Inc. v. Western Union Tel. Co., 521 F.Supp. 998 (S.D.N.Y.1981), the court addressed whether plaintiff stated a claim for relief pursuant to Sections 206 and 207. In dismissing one of plaintiff's claims, the court found that plaintiff failed to allege damages resulting from a violation of the Act. The court stated:

Sections 206 and 207 of the [Telecommunications Act] by their terms provide a private cause of action for a party damaged by another's violation of the [Telecommunications Act]. [Plaintiff] has failed to allege any damage flowing from the lack of a tariff or to articulate any possible damages which it may be able to prove at trial.

Id. at 1006 (emphasis in the original). See also In re Matter of Communications Satellite Corp., 97 F.C.C.2d 82, 90 at ¶ 25 (1984) (finding that in order to state a claim under Sections 206 and 207, "a complainant must allege and prove specific damages flowing from violations of the Act").

AT & T moves to dismiss Count I on the ground that plaintiffs have no private right of action to enforce Section 222 because they have not suffered damages as required by Sections 206 and 207. Plaintiffs counter that they have suffered damages.³ First, they argue that they have paid AT & T a monthly fee to keep their names, address, and telephone number unlisted. Second, they argue that they have paid AT & T for telephone services which include the privacy protections of the Telecommunications Act. According to plaintiffs, the actions of AT & T deprived them of the value of both of these payments.

Plaintiffs' first argument must fail because, as AT & T correctly points out, the fee for non-published service to which plaintiffs refer, is paid to Bell Atlantic, and not AT & T. Plaintiffs' telephone bill dated May 7, 1998, attached to the complaint as Exhibit 1 (hereinafter "Ex. 1"), is divided into two sections: the first for Bell Atlantic charges...