State ex rel. Stenehjem v. Freeeats.Com, Inc.

Decision Date21 April 2006
Docket NumberNo. 20050171.,20050171.
Citation2006 ND 84,712 N.W.2d 828
PartiesSTATE of North Dakota ex rel. Wayne STENEHJEM, Attorney General, Plaintiff and Appellee v. FREEEATS.COM, INC., dba The FreeEats Companies, ccAdvertising, ccAdvertising.biz, ccAdvertising.Info, ElectionResearch.com, FECads.com, and FECResearch.com, Defendant and Appellant.
CourtNorth Dakota Supreme Court

James Patrick Thomas (argued), Assistant Attorney General, Parrell D. Grossman (appeared), Assistant Attorney General, Office of Attorney General, Bismarck, ND, and Wayne K. Stenehjem (appeared), Attorney General, Office of Attorney General, Bismarck, ND, for plaintiff and appellee.

Patrick J. Ward (argued), Lawrence E. King (appeared), Zuger Kirmis & Smith, Bismarck, ND, Emilio W. Cividanes (appeared), Venable, L.L.P., Washington, DC, David H. Bamberger (on brief), and James P. Rathvon (on brief), DLA Piper Rudnick Gray Cary, U.S., L.L.P., Washington, DC, for defendant and appellant.

KAPSNER, Justice.

[¶ 1] FreeEats.com, Inc. ("FreeEats") has appealed from a summary judgment finding FreeEats in violation of North Dakota's telephone solicitation statutes and imposing civil penalties, attorney fees, costs, and disbursements. We affirm, concluding North Dakota's prohibition against placement of political polling calls using an automatic dialing — announcing device is not preempted by federal law.

I

[¶ 2] FreeEats is based in Herndon, Virginia, and conducts telephone surveys and polling services. In August 2004, FreeEats placed numerous political polling calls from its call center in Ashburn, Virginia, to residences in North Dakota. FreeEats employed an automatic dialing-announcing device to place the calls, and all of the calls used prerecorded messages with no live person on the line.

[¶ 3] On September 17, 2004, the State brought this action against FreeEats seeking civil penalties for violations of N.D.C.C. § 51-28-02. FreeEats admitted it made the automated calls to North Dakota residents, but argued application of N.D.C.C. § 51-28-02 to interstate political polling calls was preempted by federal law. On cross-motions for summary judgment, the district court concluded that application of N.D.C.C. § 51-28-02 was not preempted by federal law and that the calls placed by FreeEats to North Dakota residents violated the statute. Judgment was entered ordering FreeEats to pay $10,000 in civil penalties and $10,000 in attorney fees, costs, and disbursements. FreeEats has appealed, alleging the district court erred in concluding that federal law did not preempt application of N.D.C.C. § 51-28-02 to interstate political polling calls.

II

[¶ 4] Summary judgment is a procedural device for the prompt resolution of a controversy on the merits without a trial if there are no genuine issues of material fact or inferences that can reasonably be drawn from the undisputed facts, or if the only issues to be resolved are questions of law. Wheeler v. Gardner, 2006 ND 24, ¶ 8, 708 N.W.2d 908; Jacob v. Nodak Mut. Ins. Co., 2005 ND 56, ¶ 11, 693 N.W.2d 604. Summary judgment is appropriate if the issues in the case are such that resolution of any factual disputes will not alter the result. Jacob, at ¶ 11; Tibert v. Slominski, 2005 ND 34, ¶ 8, 692 N.W.2d 133. Whether the trial court properly granted summary judgment is a question of law that we review de novo on the entire record. Wheeler, at ¶ 8; Heng v. Rotech Med. Corp., 2004 ND 204, ¶ 9, 688 N.W.2d 389.

[¶ 5] In this case there are no disputed issues of material fact, and the sole question presented involves interpretation of statutes. Interpretation and application of a statute is a question of law, which is fully reviewable on appeal. Wheeler, 2006 ND 24, ¶ 10, 708 N.W.2d 908; Smith v. Hall, 2005 ND 215, ¶ 15, 707 N.W.2d 247. Accordingly, this case was appropriate for resolution on a motion for summary judgment.

III

[¶ 6] The sole question presented on appeal is whether federal law preempts the application of N.D.C.C. § 51-28-02 to automated political polling calls made from Virginia to residents in North Dakota.

[¶ 7] Section 51-28-02, N.D.C.C., prohibits the placement of telephone calls using an automatic dialing-announcing device except in certain enumerated instances:

A caller may not use or connect to a telephone line an automatic dialing-announcing device unless the subscriber has knowingly requested, consented to, permitted, or authorized receipt of the message or the message is immediately preceded by a live operator who obtains the subscriber's consent before the message is delivered. This section and section 51-28-05 do not apply to a message from a public safety agency notifying a person of an emergency; a message from a school district to a student, a parent, or an employee; a message to a subscriber with whom the caller has a current business relationship; or a message advising an employee of a work schedule.

The calls placed by FreeEats to North Dakota residents in 2004 did not fit under any of the exemptions in N.D.C.C. § 51-28-02.

[¶ 8] FreeEats contends, however, that application of N.D.C.C. § 51-28-02 to interstate calls is preempted by 47 U.S.C. § 227, the Telephone Consumer Protection Act of 1991 ("TCPA"). The TCPA prohibits calls to a residential telephone line using an artificial or prerecorded voice without the recipient's prior express consent, "unless the call is initiated for emergency purposes or is exempted by rule or order by the [Federal Communications] Commission under paragraph (2)(B)." 47 U.S.C. § 227(b)(1)(B). Under paragraph (2)(B), the FCC is authorized to exempt calls that are not made for a commercial purpose. 47 U.S.C. § 227(b)(2)(B)(i). The FCC has adopted a regulation exempting calls not made for a commercial purpose from the TCPA's general prohibition on calls using an artificial or prerecorded voice message. 47 C.F.R. § 64.1200(a)(2)(ii) (2005). FreeEats contends the political polling calls at issue in this case were not made for a commercial purpose, and were therefore permissible under federal law.

A

[¶ 9] The crux of this case lies in the interpretation of the TCPA's "savings clause," 47 U.S.C. § 227(e)(1):

(1) State law not preempted

Except for the standards prescribed under subsection (d) of this section and subject to paragraph (2) of this subsection, nothing in this section or in the regulations prescribed under this section shall preempt any State law that imposes more restrictive intrastate requirements or regulations on, or which prohibits —

(A) the use of telephone facsimile machines or other electronic devices to send unsolicited advertisements;

(B) the use of automatic telephone dialing systems;

(C) the use of artificial or prerecorded voice messages; or

(D) the making of telephone solicitations.

[¶ 10] The parties offer conflicting interpretations of the statute, centering upon the scope of the term "intrastate." The State contends the language of the statute is clear and unambiguous, and the term "intrastate" modifies only "more restrictive. . . requirements or regulations," and does not modify "which prohibits." The State argues that the TCPA therefore expressly permits application of state statutes which prohibit certain classes of calls placed with automatic dialing systems or which use artificial or prerecorded voice messages to interstate calls placed to North Dakota residents. FreeEats argues the legislative history of the TCPA indicates Congressional intent to preempt state regulation of interstate calls, and therefore urges that the term "intrastate" must be read as applying to the phrase "which prohibits." Thus, FreeEats contends, the TCPA preempts any attempt by a state to either regulate or prohibit interstate calls which employ automatic dialers or prerecorded messages.

[¶ 11] In interpreting the statute, we are guided by well-settled rules of federal statutory construction. When the language of a statute is plain, "the sole function of the courts—at least where the disposition required by the text is not absurd—is to enforce it according to its terms." Dodd v. United States, 545 U.S. 353, ___, 125 S.Ct. 2478, 2483, 162 L.Ed.2d 343 (2005) (quoting Hartford Underwriters Ins. Co. v. Union Planters Bank, N.A., 530 U.S. 1, 6, 120 S.Ct. 1942, 147 L.Ed.2d 1 (2000)); Lamie v. United States Trustee, 540 U.S. 526, 534, 124 S.Ct. 1023, 157 L.Ed.2d 1024 (2004) (quoting Hartford). The "preeminent canon of statutory interpretation" requires that courts "presume that [the] legislature says in a statute what it means and means in a statute what it says there." BedRoc Ltd. v. United States, 541 U.S. 176, 183, 124 S.Ct. 1587, 158 L.Ed.2d 338 (2004) (quoting Connecticut Nat'l Bank v. Germain, 503 U.S. 249, 253-54, 112 S.Ct. 1146, 117 L.Ed.2d 391 (1992)); see Dodd, at 2482 (quoting Connecticut Nat'l Bank). The court's inquiry "begins with the statutory text, and ends there as well if the text is unambiguous," BedRoc, at 183, 124 S.Ct. 1587, and courts and administrative agencies must give effect to the unambiguously expressed intent of Congress. Norfolk & Western Ry. Co. v. American Train Dispatchers Ass'n, 499 U.S. 117, 128, 111 S.Ct. 1156, 113 L.Ed.2d 95 (1991).

[¶ 12] The Supreme Court has concluded that "vague notions of a statute's `basic purpose' are . . . inadequate to overcome the words of its text regarding the specific issue under consideration." Great-West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204, 220, 122 S.Ct. 708, 151 L.Ed.2d 635 (2002) (quoting Mertens v. Hewitt Assocs., 508 U.S. 248, 261, 113 S.Ct. 2063, 124 L.Ed.2d 161 (1993)). It is not a court's function "to find reasons for what Congress has plainly done," but rather the court's job is to "avoid rendering what Congress has plainly done . . . devoid of reason and effect." Great-West, at 217-18, 122 S.Ct. 708. It is for Congress, not the courts, to amend a statute if the plain language of the statute does...

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