A Fast Sign Co. v. Am. Home Servs., Inc.

• Citation: 291 Ga. 844,734 S.E.2d 31
• Decision Date: 05 November 2012
• Docket Number: No. S11G1708.,S11G1708.
• Parties: A FAST SIGN COMPANY, INC. d/b/a Fastsigns v. AMERICAN HOME SERVICES, INC.
• Court: Supreme Court of Georgia

291 Ga. 844

734 S.E.2d 31

A FAST SIGN COMPANY, INC. d/b/a Fastsigns

v.AMERICAN HOME SERVICES, INC.

No. S11G1708.

Supreme Court of Georgia.

Nov. 5, 2012.

Roy E. Barnes, The Barnes Law Group, LLC, Marietta, Ned Blumenthal, Weissman, Nowack, Curry & Wilco P.C., Marc Brian Hershovitz, Marc B. Hershovitz, P.C., Michael K. Jablonski, Atlanta, for appellant.

Otto F. Feil, III, Celeste McCollough, Taylor, Feil, Harper, Lumsden & Hess PC, Atlanta, for appellee.

BENHAM, Justice.

In 2002 and 2003, appellee American Home Services, Inc. (AHS), a siding, window, and gutter installation company, contracted with Sunbelt Communications, Inc. (Sunbelt), for Sunbelt to send a total of 318,000 unsolicited advertisements to various facsimile machines operating in metropolitan Atlanta. In October 2003, appellant A Fast Sign Company, Inc. d/b/a Fastsigns (Fastsigns), one of the recipients of these unsolicited advertisements, brought a class-action lawsuit ¹ against AHS, asserting violations of the TelephoneConsumer Protection Act of 1991 (TCPA), 47 U.S.C. § 227. At the conclusion of a bench trial, the trial court found that AHS violated the TCPA because it admitted in judicio that it had sent 306,000 unsolicited facsimile advertisements. Finding that violation of the TCPA was wilful and knowing, the trial court awarded the class $459 million in damages, or the amount of $1,500 for each fax sent. The trial court declined to award punitive damages and attorney's fees. AHS appealed the ruling to the Court of Appeals.

The Court of Appeals vacated the trial court's judgment and remanded the case, finding that the trial court erroneously applied the TCPA by basing liability and damages on the number of unsolicited advertisements sent rather than the number of unsolicited advertisements received by class members. American Home Services, Inc. v. Fast Sign Co., Inc., 310 Ga.App. 315, 713 S.E.2d 396 (2011).² We granted Fastsigns' petition for certiorari, posing the question whether the Court of Appeals erred when it determined that only the receipt of an unsolicited fax created an actionable violation of the TCPA. For the reasons set forth below, the judgment of the Court of Appeals is reversed and the case is remanded for further proceedings.

At the time the activities in this case transpired, the TCPA provided, “[i]t shall be unlawful for any person within the United States ... to use any telephone facsimile machine, computer, or other device to send an unsolicited advertisement to a telephone facsimile machine.” 47 U.S.C. § 227(b)(1)(C) (1991).³ The statute allowed for a private cause of action by which a claimant could recover his actual monetary loss or $500 for each violation of the statute, whichever amount was greater. 47 U.S.C. § 227(b)(3)(B); Hooters of Augusta, Inc. v. Nicholson, 245 Ga.App. 363(1)(a), 537 S.E.2d 468 (2000). Additionally, a trial court could impose treble damages if it found the violation of the statute to be wilful and knowing. 47 U.S.C. § 227(b)(3)(C). “The TCPA is essentially a strict liability statute which imposes liability for erroneous unsolicited faxes. [Cit.]” Alea London Limited v. American Home Services, Inc., 638 F.3d 768, 776 (11th Cir.2011).

When construing a federal statute such as the TCPA, the “ ‘starting point must be the language employed by Congress,’ [cit.]” and courts must “assume ‘that the legislative purpose is expressed by the ordinary meaning of the words used.’ [Cit.]” Am. Tobacco Co. v. Patterson, 456 U.S. 63, 68, 102 S.Ct. 1534, 71 L.Ed.2d 748 (1982). By its plain terms, the TCPA prohibits a person from using a device to send an unsolicited advertisement to a telephone facsimile machine. To establish a TCPA claim, the plaintiff must show: 1) the defendant used a fax machine, computer, or other similar device to send a fax to the plaintiff; 2) that the fax was unsolicited; and 3) that the fax contained an advertisement. Hinman v. M & M Rental Ctr., Inc., 545 F.Supp.2d 802, 805 (N.D.Ill.2008). The statute does not make actual receipt of a fax an element of a private right of action. Critchfield Physical Therapy v. Taranto Group, Inc., 293 Kan. 285, 298, 263 P.3d 767 (2011); First Nat'l Collection Bureau, Inc. v. Walker, 348 S.W.3d 329, 340–341 (Tex.Ct.App.2011) (a call “made” is actionable under the TCPA; Texas statute that limited liability to telemarketing calls received was preempted by the TCPA); Pasco v. Protus IP Solutions, Inc., 826 F.Supp.2d 825, 831 (D.Md.2011) (summary judgment denied where question remained as to the number of faxes plaintiffs could prove were sent by the defendant); Fun Services of Kansas City, Inc. v. Love, 2011 WL 1843253 (W.D.Mo. May 11, 2011) (the TCPA is violated when an unsolicited advertisement is sent and the statutory remedy is per violation). The argument that a claim cannot be stated unless there is actual receipt is flawed. Hinman v. M & M Rental Ctr., Inc., 596 F.Supp.2d 1152, 1159 (N.D.Ill.2009). Neither Congress nor the Federal Communications Commission, which is tasked with issuing regulations implementing the TCPA, require proof of receipt to establish a private cause of action. Id.

In making its erroneous determination that a TCPA claim is predicated on receipt, the Court of Appeals relied on a sentence in Carnett's, Inc. v. Hammond, 279 Ga. 125, 127(3), 610 S.E.2d 529 (2005) wherein this Court stated that “The TCPA is violated only if a plaintiff receives an ‘unsolicited’ fax.” In Carnett's however, we were not construing or analyzing the language of 47 U.S.C. § 227(b)(1)(C) or 47 U.S.C. § 227(b)(3)(B), but were determining whether an established business relationship existed between the parties. While persons or entities who actually receive unsolicited advertisements via their fax machines may certainly state a claim under 47 U.S.C. § 227(b)(3)(B), persons or entities who are intended recipients, or who are targeted to receive unsolicited advertisements via their fax machines, may also have a cause of action.

The reality that some plaintiffs may not have received the unlawful fax transmissions does not defeat their entitlement to damages. Although the harm resulting from unsolicited fax transmissions is often described in terms of recipients, the harm also extends to intended recipients, or targets of mass fax advertising. For example, a business may have considered it necessary to turn off its fax machine because of unwanted fax transmissions. The business might not have received the advertising, but it would still have incurred a disadvantage as a result of advertisers sending the fax messages.... [T]he legislation expressly using the word “send” is to be construed to mean “send” and not “receive.”

Critchfield Physical Therapy, supra, 293 Kan. at 298, 263 P.3d 767.⁴ Alternatively stated, a sender is liable for the unsolicited advertisements it attempts to send to fax machines, whether or not the transmission is completed or received by the targeted recipient. Id. at 299, 263 P.3d 767. Indeed, requiring receipt to state a cause of action under the TCPA would create a limitation not contemplated by Congress. Cf. In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 21 F.C.C.R. 3787(56) (F.C.C.2006)....