Gresham v. Picker, 2:16-cv-01848-JAM-CKD
| Decision Date | 06 October 2016 |
| Docket Number | No. 2:16-cv-01848-JAM-CKD,2:16-cv-01848-JAM-CKD |
| Court | U.S. District Court — Eastern District of California |
| Parties | Victor GRESHAM and Conquest Communications Group, LLC, Plaintiffs, v. Michael PICKER, Mike Florio, Carla Peterman, Liane Randolph, and Catherine Sandoval, in their official Capacity as Commissioners of the California Public Utilities Commission, Defendants. |
Bradley A. Benbrook, Stephen M. Duvernay, Benbrook Law Group, Sacramento, CA, Jason Torchinsky, PHV, Holtzman Vogel Josefiak Torchinsky PLLC, Warrenton, VA, for Plaintiffs.
Arocles Aguilar, Christine Jun Hammond, Harvey Y. Morris, California Public Utilities Commission, San Francisco, CA, for Defendants.
ORDER DENYING DEFENDANTS' MOTION FOR PRELIMINARY INJUNCTION
This matter is before the Court on Plaintiffs' Motion for Preliminary Injunction to prohibit Defendants from enforcing California's automatic dialing-announcing device prohibition against Plaintiffs on the grounds that the statute violates the First Amendment. For the following reasons, Plaintiffs' motion is denied.
Plaintiff Victor Gresham is a political consultant who engages in political communications through Plaintiff Conquest Communications Group, LLC, a Virginia based company of which he is a principal. Declaration of Victor Gresham in Support of Plaintiffs' Motion for Preliminary Injunction ("Gresham Decl.") ¶ 2. Gresham and his company want to conduct politically related, automated telephone calls in California during the 2016 election cycle. Id. ¶ 3.
Plaintiffs have refrained from conducting politically related automated telephone calls in California, at least since late Spring 2016, due to California Public Utility Code §§ 2872, 2874(a), and 2876 ("ADAD Statute"). Gresham Decl. ¶ 3. Plaintiffs have declined to place automated telephone communications for clients and have lost potential business opportunities and revenue as a result. Id. ¶ 4. Without the ban, Plaintiffs would make calls such as automated surveys and messages related to political campaigns, automated scripted calls on behalf of political clients, and telephone town hall calls that allow the answerer to join a live, town hall style forum conducted with a politician or officeholder. Id. ¶ 3.
Defendants admit that they, as Commissioners of the California Public Utilities Commission, have the authority to enforce California's ADAD Statute when there is no express or implied consent to the call. Ans. ¶ 3. Under the statute, they may enforce penalties against violators, including a fine not to exceed five hundred dollars for each violation and/or disconnection of telephone service to the automatic dialing-announcing device for a period of time specified by the commission. Cal. Pub. Util. Code § 2876.
Plaintiffs filed their complaint at the beginning of August 2016. ECF No. 1. The complaint contains two causes of action under 42 U.S.C. § 1983. The first cause of action alleges that Cal. Pub. Util. Code §§ 2872 and 2874 violate Plaintiffs' free speech rights guaranteed by the First and Fourteenth Amendments both on their face and as applied. Compl. ¶ 22. The second cause of action alleges that those sections impose impermissible prior restraints on constitutionally-protected speech and that they are unconstitutional for failing to contain adequate standards or guidelines to control the discretion of the decision-maker. Compl. ¶¶ 35, 36.
Plaintiffs filed their Motion for Preliminary Injunction and Request for Advance Hearing on the Motion on August 17, 2016. ECF Nos. 7, 9. Defendants timely filed their opposition and the Court denied Plaintiffs' request to advance the hearing. ECF Nos. 17, 18. The Court heard arguments on October 4, 2016, and took this motion under submission with an order to follow.
A preliminary injunction is "an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief." Winter v. Natural Res. Def. Council, Inc. , 555 U.S. 7, 22, 129 S.Ct. 365, 172 L.Ed.2d 249 (2008). To obtain a preliminary injunction, a plaintiff must demonstrate that: (1) she is likely to succeed on the merits, (2) she is likely to suffer irreparable harm in the absence of preliminary relief, (3) the balance of equities tips in her favor, and (4) an injunction is in the public interest. Boardman v. Pac. Seafood Grp. , 822 F.3d 1011, 1020 (9th Cir. 2016) (quoting Winter , 555 U.S. at 20, 129 S.Ct. 365 ). The last two factors merge when the government is a party. Drakes Bay Oyster Co. v. Jewell , 747 F.3d 1073, 1092 (9th Cir. 2014). In the Ninth Circuit, a preliminary injunction may be appropriate "when a plaintiff demonstrates that serious questions going to the merits were raised and the balance of hardships tips sharply in the plaintiff's favor," as long as the other two Winter factors are also satisfied. Alliance for the Wild Rockies v. Cottrell , 632 F.3d 1127, 1131–35 (2011).
A preliminary injunction can be prohibitory or mandatory. See Marlyn Nutraceuticals, Inc. v. Mucos Pharma GmbH & Co. , 571 F.3d 873, 878 (9th Cir. 2009). "A prohibitory injunction prohibits a party from taking action and ‘preserves the status quo pending a determination of the action on the merits.’ " Id. (quoting Chalk v. U.S. Dist. Court , 840 F.2d 701, 704 (9th Cir. 1988) ). The "status quo" is "the last, uncontested status which preceded the pending controversy." Id. (quoting Regents of the Univ. of Cal. v. Am. Broad. Cos. , 747 F.2d 511, 514 (9th Cir. 1984) ). A mandatory injunction, on the other hand, "orders a responsible party to take action."
Id. (quoting Meghrig v. KFC W., Inc. , 516 U.S. 479, 484, 116 S.Ct. 1251, 134 L.Ed.2d 121 (1996) ) (internal quotation marks omitted). Mandatory injunctions are particularly disfavored and generally "are not granted unless extreme or various serious damage will result[;] they are not issued in doubtful cases or where the injury complained of is capable of compensation in damages." Id. (quoting Anderson v. United States , 612 F.2d 1112, 1115 (9th Cir. 1980) ).
Plaintiffs seek to change the status quo and thus seek a disfavored, mandatory injunction. As the Ninth Circuit explained in Doe v. Harris , this standard can be difficult to apply in the First Amendment context:
[A]pplication of this standard in First Amendment cases involves an inherent tension: the moving party bears the burden of showing likely success on the merits—a high burden if the injunction changes the status quo before trial—and yet within that merits determination the government bears the burden of justifying its speech-restrictive law. Accordingly, in the First Amendment context, the moving party bears the initial burden of making a colorable claim that its First Amendment rights have been infringed, or are threatened with infringement, at which point the burden shifts to the government to justify the restriction.
772 F.3d 563, 570 (9th Cir. 2014) (quoting Thalheimer v. City of San Diego , 645 F.3d 1109, 1115–16 (9th Cir. 2011) ) (internal quotation marks and citations omitted).
The merits of Plaintiffs' case depend on whether the Ninth Circuit's decision upholding the constitutionality of the ADAD Statute, Bland v. Fessler , 88 F.3d 729 (1996), was overruled by the Supreme Court's more recent decisions regarding First Amendment analysis in Reed v. Town of Gilbert, Ariz. , ––– U.S. ––––, 135 S.Ct. 2218, 192 L.Ed.2d 236 (2015), and Citizens United v. Fed. Election Comm'n , 558 U.S. 310, 130 S.Ct. 876, 175 L.Ed.2d 753 (2010).1 The Bland holding binds this Court unless that decision is clearly irreconcilable with intervening Supreme Court precedent. See Biggs v. Sec'y of Cal. Dep't of Corr. & Rehab. , 717 F.3d 678, 689 (9th Cir. 2013). If the Reed or Citizens United decision effectively overruled Bland , this Court will need to reevaluate the statute in light of the more recent precedent.
Any person operating an automatic dialing announcing device in California is subject to the ADAD Statute. Cal. Pub. Util. Code § 2872 (b).2 An "automatic dialing-announcing device" is "any automatic equipment which incorporates a storage capability of telephone numbers to be called or a random or sequential number generator capable of producing numbers to be called and the capability, working alone or in conjunction with other equipment, to disseminate a prerecorded message to the telephone number called." § 2871.
The ADAD Statute's general provision proscribes use of ADADs to place calls over telephone lines unless "pursuant to a prior agreement between the persons involved, whereby the person called has agreed that he or she consents to receive such calls from the person calling, or as specified in Section 2874." § 2873. Section 2874 requires ADAD calls to be preceded by unrecorded, natural voice that provides certain information and requests consent from the caller to play the prerecorded message. § 2874. The ADAD must disconnect from the line upon termination of the call. Id.
Section 2872 lists a number of exemptions to the article's prohibitions, which are the subject of Plaintiffs' complaint.
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