Flowers v. Tandy Corp.

Decision Date25 September 1985
Docket NumberNo. 85-1064,85-1064
Citation773 F.2d 585
PartiesElizabeth Graham FLOWERS; Frankie Dukes, Appellees, v. TANDY CORPORATION, Appellant, and William Lee Flowers; Martha Floyd Graham, Defendants.
CourtU.S. Court of Appeals — Fourth Circuit

Samuel F. Painter, Columbia, S.C. (Nexsen Pruet Jacobs & Pollard, Columbia, S.C. on brief), for appellant.

James T. McLaren, Columbia, S.C. (C. Dixon Lee, III; Draine, McLaren & Lee, P.A., Columbia, S.C., Jan L. Warner, Sumter, S.C., on brief), for appellees.

Before WINTER, Chief Judge, PHILLIPS, Circuit Judge, and BUTZNER, Senior Circuit Judge.

JAMES DICKSON PHILLIPS, Circuit Judge:

Tandy Corporation (Tandy) appeals a judgment upon a jury verdict finding Tandy liable for damages to appellees Elizabeth Flowers and Frankie Dukes as a result of Tandy's selling a telephone recording control device to William Flowers who then used it to intercept telephone conversations between the appellees. We hold that the district court erred in submitting the case to the jury on the theory that Tandy might be civilly liable for procuring or aiding and abetting illegal wiretapping under 18 U.S.C. Secs. 2511 and 2520 and by instructing the jury that it could consider 18 U.S.C. Sec. 2512, which makes criminal the sale of a device whose primary purpose is surreptitious interception of oral or wire communications, in determining whether Tandy was civilly liable under Sec. 2520. Accordingly, we vacate the district court's judgment and remand the case to the district court.

I

The parties stipulated the following facts. On June 25, 1982, Elizabeth Flowers served a divorce complaint on her husband, William Flowers. The following day, William Flowers went to a Radio Shack store owned and operated by Tandy in Florence, South Carolina. He informed the sales clerk that he was receiving "hang up" calls, that he had a young daughter who was making long distance calls, his bill was getting out of hand and he wanted to know who was making the long distance calls. The salesman thereupon demonstrated the Archer 43-236 telephone recording control, a device which activated a tape recorder when the telephone receiver was in use and turned the recorder off when the receiver was replaced in its cradle. William Flowers returned to the store on June 28, told a second clerk of similar problems with long distance calls, received a second demonstration, and purchased the 43-236.

William Flowers then wired the 43-236 and a tape recorder to his home telephone in order to intercept calls by Elizabeth Flowers. He left the recorder in place for approximately ten days and intercepted several conversations between Elizabeth Flowers and Frankie Dukes. William Flowers' daughter eventually discovered the device and informed Elizabeth Flowers. William Flowers left the home on July 17 and filed a counterclaim in the divorce action alleging adultery, ostensibly as a result of information gleaned from the illegal wiretapping.

Elizabeth Flowers and Frankie Dukes brought this action against William Flowers, Martha Graham, who also used an Archer 43-236 to tap her husband, Charles Graham's, phone, and Tandy Corporation. The complaint alleged that the individual defendants had violated 18 U.S.C. Sec. 2511 1 and that 18 U.S.C. Sec. 2520 2 permitted a civil action for damages resulting from the illegal wiretapping. The complaint further alleged that Tandy had violated 18 U.S.C. Sec. 2511 by procuring the wiretapping or alternatively by aiding and abetting Flowers and Graham. The plaintiffs alleged that 18 U.S.C. Sec. 2520 also permitted recovery of civil damages for Tandy's violation of 18 U.S.C. Sec. 2512. 3 The complaint also stated claims sounding in state tort law for invasion of privacy and infliction of emotional distress.

Before trial, judgment for $75 was entered in favor of Elizabeth Flowers and Frankie Dukes against William Flowers based upon the latter's confession of judgment in that amount.

At trial, the court directed a verdict for Tandy on the allegation that it aided and abetted Ms. Graham. No appeal is taken from that ruling. The court refused to direct a verdict for Tandy on the claim of aiding and abetting William Flowers. The court submitted that claim to the jury, instructed that conduct violative of Sec. 2512 could be a basis for finding Tandy liable under Sec. 2520, and instructed the jury on the state law tort of invasion of privacy. The jury returned general verdicts against Tandy in the amounts of $60,000 actual damages for both plaintiffs and $22,000 punitive damages for Elizabeth Flowers.

Tandy then moved for judgment notwithstanding the verdict and, conditionally, for a new trial. The court denied these motions. Tandy also moved to amend the judgment; it contended that the consent judgment entered in favor of appellees against Flowers served to release Tandy because Tandy's liability, if any, was joint and several. Alternatively, Tandy contended that the damage formula provided in Sec. 2520 limited its liability to $100 a day. The court denied the motion, ruling that the confession of judgment was a covenant not to sue and therefore did not release Tandy. The court made no ruling on the alternative ground. This appeal followed.

II

At the outset we hold that the district court erred in permitting the jury to consider the criminal statute, 18 U.S.C. Sec. 2512, as a basis for imposing civil liability. The court instructed the jury in part as follows:

Now, if a defendant does not know, or has no reason to know, that a device is primarily useful for the purpose of surreptitious interception of wire or oral communications, then that defendant has not violated the statute.

The term "primarily useful" means use which is first in rank or importance, chief, principal, basic or fundamental.

The phrase "primarily useful" for the purpose of surreptitious interception, relates to a narrow category of devices whose principal use is likely to be for that of wiretapping or eavesdropping.

Now, the question of whether a device, such as the one involved in this lawsuit, is primarily useful for surreptitious interception, is a question for you, the jury, to decide, based upon all of the facts as developed by the evidence in this case.

* * *

I charge you that if you find from the preponderance of the evidence, that the defendant corporation, directly or indirectly, willfully and knowingly took a hand in the wiretapping by aiding, abetting, assisting or encouraging the other defendants, particularly the defendant, Flowers, by words or by acts to wiretap, or by supplying a device, the primary useful purpose for which is to surreptitiously intercept wire or oral communications, known to have that use, then the defendant would be liable.

Looking first to the language of the statute, we find no merit in appellees' assertion that Sec. 2520 expressly provides a private cause of action for violations of the criminal proscriptions of Sec. 2512. Though Sec. 2520 provides an action for any person whose communication is "intercepted, disclosed or used in violation of this chapter," (emphasis added), the language defining the class of persons liable is not comparably broad. The statute expressly limits those against whom the private action lies to the person who "intercepts, discloses, or uses, or procures any other person to intercept, disclose, or use such communications." This language tracks very closely the criminal offenses set out in Sec. 2511, whereas the criminal offenses set out in Sec. 2512 are defined in such terms as "manufacture," "assemble," "possess," and "sell." The express language of Sec. 2520 is therefore not susceptible to a construction which would provide a cause of action against one who manufactures or sells a device in violation of Sec. 2512 but does not engage in conduct violative of Sec. 2511.

Appellees then argue that such a private cause of action may be implied from Sec. 2512 under the statutory purpose doctrine. See Bivens v. Six Unknown Federal Narcotics Agents, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971). We disagree.

"It is an elemental canon of statutory construction that where a statute expressly provides a particular remedy or remedies, a court must be chary of reading others into it." Transamerica Mortgage Advisers Inc. v. Lewis, 444 U.S. 11, 19, 100 S.Ct. 242, 247, 62 L.Ed.2d 146 (1979). Congress has expressly provided a criminal sanction against the wiretapper and his agents; we must be wary of reading into the statute a further private civil remedy against the seller of a device primarily useful for wiretapping.

It is of course true that "provision of a criminal penalty does not necessarily preclude implication of a private cause of action for damages," Cort v. Ash, 422 U.S. 66, 79, 95 S.Ct. 2080, 2088, 45 L.Ed.2d 26 (1974). Nevertheless, implied causes of action are disfavored and should be found only where a statute clearly indicates that the plaintiff is one of a class for whose benefit the statute was enacted and there is some indication that Congress intended such a cause of action to lie. Cort, 422 U.S. at 78, 95 S.Ct. at 2088; Touche Ross & Co. v. Redington, 442 U.S. 560, 575, 99 S.Ct. 2479, 2489, 61 L.Ed.2d 82 (1979). See also Arvai v. First Federal Savings & Loan Association, 539 F.Supp. 921, 924 (D.S.C.1982), aff'd 698 F.2d 683 (4th Cir.1983). Congressional intent may be gleaned from the language of the statute, the legislative history, and the purpose and focus of the statute. See Touche Ross & Co., 442 U.S. at 576-77, 99 S.Ct. at 2489-90.

We believe that neither criterion is satisfied in the statute in issue here. Though any criminal statute is in part enacted for the benefit of the victims of the crime, see Cort, 422 U.S. at 79-80, 95 S.Ct. at 2088-89, Sec. 2512 appears to have been designed for benefitting the public as a whole by removing such devices from the market. Section 2511, which makes criminal the actual...

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