United States v. Dish Network LLC

• Decision Date: 05 June 2017
• Docket Number: No. 09-3073.,09-3073.
• Citation: 256 F.Supp.3d 810
• Parties: UNITED STATES of America, and the States of California, Illinois, North Carolina, and Ohio, Plaintiffs, v. DISH NETWORK LLC, Defendant.
• Court: U.S. District Court — Central District of Illinois

256 F.Supp.3d 810

UNITED STATES of America, and the States of California, Illinois, North Carolina, and Ohio, Plaintiffs,

v.DISH NETWORK LLC, Defendant.

No. 09-3073.

United States District Court, C.D. Illinois, Springfield Division.

Signed June 5, 2017

Albert N. Shelden, Jinsook Ohta, California Attorney General's Office, Jon F. Worm, California Department of Justice Office of the Attorney General, San Diego, CA, Daniel Kadane Crane–Hirsch, Patrick R. Runkle, Sang H. Lee, United States Department of Justice, Lisa K. Hsiao, United States Department of Justice, Civil Division, Washington, DC, Elizabeth A. Blackston, Paul A. Isaac, Philip I. Heimlich, Illinois Attorney General, Gregory M. Gilmore, US Attorney, Springfield, IL, Erin B. Leahy, Michael S. Ziegler, Ohio Attorney General's Office Consumer Protection Section, Jeffrey Robert Loeser, Office of the Ohio Attorney General, Columbus, OH, Kevin Anderson, David N. Kirkman, Teresa L. Townsend, North Carolina Department of Justice, Consumer Protection Division, Raleigh, NC, Adelina Rosa Viviana Acuna, California Department of Justice, San Francisco, CA, for Plaintiffs.

Catherine Emily James, Henry T. Kelly, Kelley Drye & Warren LLP, Chicago, IL, Damon William Suden, Kelley Drye & Warren, Elyse D. Echtman, John L. Ewald, Peter A. Bicks, Orrick Herrington & Sutcliffe LLP, New York, NY, Edward Ellis Weiman, Kelley Drye & Warren LLP, Los Angeles, CA, Geoffrey W. Castello, III, Joseph A. Boyle, Lauri A. Mazzuchetti, Kelley Drye & Warren LLP, Parsippany, NJ, for Defendant.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

Sue E. Myerscough, UNITED STATES DISTRICT JUDGE

This matter came before the Court on January 19, 2016, for a bench trial. The first phase of the bench trial was completed on February 17, 2016. The trial resumed on October 25, 2016. The Court heard testimony on October 25–27, 2016 and November 2, 2016. The Plaintiff United States appeared by Assistant United States Attorneys Patrick Runkle, Lisa Hsiao, and Sang Lee, and also by Federal Trade Commission Attorney Russell Deitch and Gary Ivens; the Plaintiff State of California appeared by Assistant Attorneys General Jinsook Ohta, Jon Worm, and Adelina Acuna; the Plaintiff State of Illinois appeared by Assistant Attorneys General Paul Isaac, Elizabeth Backston, and Philip Heimlich; the Plaintiff State of North Carolina appeared by Assistant Attorney General David Kirkman and Teresa Townsend; and the Plaintiff State of Ohio appeared by Assistant Attorneys General Erin Leahy and Jeff Loeser. The Defendant Dish Network, LLC (Dish) appeared by attorneys Peter Bicks, Elyse Echtman, John Ewald, Jamie Shookman, Shasha Zou, Louisa Irving, Joseph Boyle, and Lauri Mazzuchetti.¹ Dish's in-house counsel Stanton Dodge, Larry Katzin, and Brett Kitei also appeared. On November 2, 2016, the parties and the witness appeared by videoconference, except that Dish in-house counsel Dodge's and Kitei's and California's counsel Ohta and Acuna appeared by telephone.

The Plaintiffs alleged twelve counts against Dish for violations of federal and state laws and regulations prohibiting certain outbound telemarketing calls (Do–Not–Call Laws). The term "Do–Not–Call" is also sometimes referred to as "DNC." The Plaintiffs allege that Dish violated the Telemarketing Consumer Fraud and Abuse Prevention Act (Telemarketing Act), 15 U.S.C. § 6101 et seq. ; the Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227 ; the Telephone Sales Rule (TSR) promulgated by the Federal Trade Commission (FTC) pursuant to the Telemarketing Act, 16 C.F.R. Part 310; the Rule (FCC Rule) promulgated by the Federal Communications Commission (FCC) pursuant to the TCPA, 47 C.F.R. 64.1200 et seq. ; the California Do–Not–Call Law, Cal. Bus. & Prof. Code § 17592(c) ; the California Unfair Competition Law, Cal. Bus. & Prof. Code § 17200 ; the North Carolina Do–Not–Call Law, N.C. Gen. Stat. § 75–102(a) ; the North Carolina Automatic Telephone Dialer Law, N.C. Gen. Stat. § 75–104 ; the Illinois Automatic Telephone Dialers Act (IATDA), 815 ILCS 305/1 et seq. ; and the Ohio Consumer Sales Protection Act, Ohio Rev. Code §§ 1345.02 and 1345.03. Third Amended Complaint (d/e 483), Count I–XII. For a detailed discussion of the applicable statutes and rules, see Opinion entered December 14, 2014 (d/e 445) (Opinion 445), 75 F.Supp.3d 942, 954–62, 1026–31 (C.D. Ill. 2014), vacated in part on reconsideration, 80 F.Supp.3d 917 (C.D. Ill. 2015). The Court entered partial summary judgment on some the Plaintiffs' claims. Opinion 445, 75 F.Supp.3d at 1032–34.

For the reasons set forth below, this Court enters judgment in favor of the Plaintiffs United States and the States of California, Illinois, North Carolina, and Ohio and against Defendant Dish on Counts I, II, III, V, VI, VII, VIII, IX, X, and XII of the Third Amended Complaint and judgment in favor of Plaintiff United States and against Defendant Dish on the claim that Defendant provided substantial assistance to Dish Order Entry Retailer Star Satellite as alleged in Count IV of the Third Amended Complaint, and judgment in favor of Defendant Dish and against the United States on the claim that Dish provided substantial assistance to Dish Order Entry Retailer Dish TV Now as alleged in Count IV of the Third Amended Complaint. The Court enters judgment in favor of Defendant Dish and against Plaintiff State of Illinois on Count XI of the Third Amended Complaint.

The Court awards civil penalties and statutory damages in favor of the Plaintiffs United States and the States of California, Illinois, North Carolina, and Ohio and against Defendant Dish in Counts I, II, III, IV, V, VI, VII, VIII, IX, X, and XII of the Third Amended Complaint in the total sum of $280,000,000.00. The amount awarded in each Count is set forth below in the Conclusion.

The Court also enters a Permanent Injunction in favor of the Plaintiffs and against Defendant Dish Network, L.L.C. in the manner set forth in the separate Permanent Injunction Order filed with this Findings of Fact and Conclusions of Law.

The following constitutes findings of fact and conclusions of law for the issues remaining for trial. Fed. R. Civ. P. 52(a).

This case is complex and covers years of telemarketing by Dish and numerous related entities. The Court organizes the findings of fact under various headings. The organizational structure does not limit any findings to any particular issue. Unless otherwise indicated, all findings of fact may be relevant to all issues.

JURISDICTION

This Court has jurisdiction to hear the United States' claims in Counts I–IV pursuant to 28 U.S.C. §§ 1331, 1337(a), 1345, and 1355; Federal Trade Commission Act (FTC Act), 15 U.S.C. §§ 45(m)(1)(A), 53(b), 56(a), and 57(b); and the Telemarketing Act, 15 U.S.C. § 6105(a) & (b). The FTC authorized the Attorney General to commence this action on behalf of the United States pursuant to FTC Act § 56(a). This Court has jurisdiction to hear the Plaintiff States' TCPA claims in Counts V & VI pursuant to 28 U.S.C. §§ 1331, 1337(a), 1345, and 1355; and exclusive jurisdiction pursuant to TCPA, 47 U.S.C. § 227(g)(2). This Court has supplemental jurisdiction to hear the Plaintiff States' state law claims in Counts VII–XII pursuant to 28 U.S.C. § 1367(a).

Dish argues that the Plaintiff States lack standing to bring the TCPA claims alleged in Counts V and VI. A lack of standing is jurisdictional. Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 93, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998). To establish standing, a plaintiff must have "(1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision." Spokeo, Inc. v. Robins, ––– U.S. ––––, 136 S.Ct. 1540, 1547, 194 L.Ed.2d 635 (2016).

The TCPA § 227(g) authorizes the Plaintiff States to bring this action. Section 227(g)(1) states that when the State Attorney General, "has reason to believe that any person has engaged or is engaging in a pattern or practice of telephone calls or other transmissions to residents of that State in violation of this section or the regulations prescribed under this section," then "the State may bring a civil action on behalf of its residents." 47 U.S.C.A. § 227(g)(1). The Plaintiff States, therefore, are bringing the claims in Counts V and VI in parens patriae to protect the well-being of each Plaintiff State's populace. The Plaintiff States must demonstrate Article III standing. The Plaintiff States must demonstrate some concrete injury to its residents by Dish that can be redressed by the claims in Counts V and VI. Alfred L. Snapp & Son, Inc., v. Puerto Rico ex rel. Barez, 458 U.S. 592, 602–05, 102 S.Ct. 3260, 73 L.Ed.2d 995 (1982). The Congressional grant of a right to statutory damages in the TCPA § 227(g) is not sufficient by itself to establish standing. The Plaintiff States must show some injury in fact from the unwanted telemarketing calls. Spokeo, 136 S.Ct. at 1543.

Several District Courts have considered whether unwanted calls made in violation of the TCPA cause concrete injury necessary to establish standing. Many of these District Courts have found that the annoyance and distress caused by unwanted calls established concrete injuries sufficient to establish standing. E.g., Krakauer v. Dish Network, L.L.C., 168 F.Supp.3d 843, 845 (M.D. N.C. 2016) ; Wilkes v. CareSource Management Group Co., 2016 WL 7179298, at *3 (N.D. Ind. December 9, 2016) ; Mbazomo v. Etourandtravel, Inc., 2016 WL 7165693, at *2 (E.D. Cal. December 8, 2016) ; Griffith v. ContextMedia, Inc., 2016 WL 6092634, at *1–2 (N.D. Ill. October 19, 2016) ; LaVigne v. First Community Bancshares, Inc., 215 F.Supp.3d 1138, 1142–43 (D.N.M. 2016) ; Espejo v. Santander Consumer USA, Inc., 2016 WL 6037625, at *9 n.3 (N.D. Ill. Oct. 14, 2016) ; Dolemba v. Illinois Farmers Insurance Company, 213 F.Supp.3d 988 (N.D. Ill. 2016) ; Juarez v. Citibank, N.A., 2016 WL 4547914, at *3 (N.D....