Jessica Karmasek Aug. 29, 2016, 9:14am


JOHNSTOWN, Pa. (Legal Newsline) - Melody Stoops admits she was in the “business” of bringing lawsuits against companies over calls they made to her cell phones without her permission.

Stoops, according to testimony included in a recent federal court decision, bought and collected at least 35 different pre-paid cell phones and stored them in a shoebox when not “in use.”

When companies -- including Comenity, Credit One, Navient and Wells Fargo, among others -- would call the phones, the Pennsylvania woman would sometimes answer, telling them they had the wrong number. On occasion, she would tell them not to call again. But she always documented the calls in her log.

She then started filing lawsuits against the companies, arguing they were in violation of the Telephone Consumer Protection Act.

Current TCPA regulations prohibit businesses from making automated, pre-recorded calls without written consent from those on the receiving end. The law permits any “person or entity” to bring an action to enjoin violations of the statute and/or recover actual damages or statutory damages ranging from $500 to $1,500 per violation.

Stoops testified that was her plan all along -- that the phones were specifically bought in order to manufacture lawsuits.

“It’s my business. It’s what I do,” she testified, saying a friend in Nebraska gave her the idea for the business model. She has filed at least 11 TCPA cases in the U.S. District Court for the Western District of Pennsylvania and has sent at least 25 pre-litigation demand letters. Her sister, Taisha Campbell, has filed similar lawsuits of her own.

In her lawsuit against Wells Fargo, originally filed in Cambria County Common Pleas Court in March 2015, Stoops argues the mortgage lender violated her privacy interests when she received the calls and her economic interests because she had to buy airtime minutes for her phones.

Judge Kim R. Gibson, in his June 24 order, rejected the plaintiffs’ argument that she suffered an injury-in-fact.

In his order, Gibson pointed to the U.S. Supreme Court’s recent decision in Spokeo v. Robins.

The nation’s high court explained that for an injury to be particularized, it must affect the plaintiff in a “personal and individual way.” The injury-in-fact also must be “concrete,” which means “real” and “not abstract.” But “concrete” is not necessarily synonymous with “tangible.”

“The Supreme Court emphasized that ‘Congress’ role in identifying and elevating intangible harms does not mean that a plaintiff automatically satisfies the injury-in-fact requirement whenever a statute grants a person a statutory right and purports to authorize that person to sue to vindicate that right,’” Gibson noted in his order.

“Thus, the Supreme Court made clear that ‘Article III standing requires a concrete injury even in the context of a statutory violation.’”

In Stoops’ case, her privacy interests weren’t violated when she received calls from Wells Fargo because the company’s calls did not adversely affect the privacy rights that the TCPA is intended to protect, Gibson said.

“Because Plaintiff has admitted that her only purpose in using her cell phones is to file TCPA lawsuits, the calls are not ‘a nuisance and an invasion of privacy,’” the judge wrote.

Same goes for her economic interests, Gibson said.

“Plaintiff’s testimony once again establishes that she has not suffered an injury-in-fact,” he wrote. “It is well settled that a plaintiff ‘cannot manufacture standing by choosing to make expenditures based on hypothetical future harm that is not certainly impending.’”

The judge granted Wells Fargo’s motion for summary judgment and denied Stoops’ cross-motion.

Earlier this month, Gibson denied the plaintiff’s motion to amend the judgment. Stoops had argued in her motion that because the federal court concluded she lacked constitutional standing, it was required to remand the case to state court.

Henry Pietrkowski, an attorney at the Chicago office of Reed Smith LLP, said the case serves as a good example of Spokeo’s potential impact on TCPA litigation.

A big part of Pietrkowski’s practice is defending TCPA cases -- usually dozens each year. At first they were lawsuits over junk or “blast” faxes, and now it’s mostly robocalls and text message claims, he said.

But Stoops’ lawsuit takes the cake, said Pietrkowski, who had no part in the litigation.

“Here, this woman collected a shoebox full of cell phones for the purpose of bringing TCPA claims,” the attorney said. “Congress never intended for a person who wanted these kind of calls to have standing.”

Some courts have said, in the context of unsolicited phone calls and text messages, that concrete injuries can include such things as a cell phone battery being used up, charges for text messages and the recipient’s privacy being invaded, Pietrkowski explained.

While he does not agree with these decisions, at least they point to some sort of arguable injury.

But now there are exceptions, Pietrkowski pointed out.

“What if you don’t actually know you’re getting a call? What if you put a call block app on your phone or put your phone on silent? Then you have no idea the calls are being made,” he said. “You look and see there are missed calls, but you’re not being bothered. So is that a concrete injury? Spokeo said no, that’s not good enough to be a concrete injury.

“It’s essentially the equivalent of deciding not to answer a phone call from your mom.”

Pietrkowski, a member of Reed Smith’s Financial Industry Group, practicing in the area of Financial Services Litigation, said Spokeo is especially important in terms of TCPA class action lawsuits.

In its May ruling, the Supreme Court said each member has to prove the same concrete injury.

“If the named plaintiff has a claim but the other members fall into other categories, then how can the named plaintiff represent those people? It’s a good class certification defense,” Pietrkowski explained.

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.

Organizations in this Story

U.S. District Court for the Western District of Pennsylvania Pittsburgh Division
700 Grant Street
Pittsburgh, PA 15219

U.S. Supreme Court
1 First St NE
Washington, DC 20543

Reed Smith LLP
10 South Wacker Drive
Chicago, IL 60606

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