Court Holds Defendants Papers Did Not Earn a Stay Pending SCOTUS TCPA Review

In re Midland Credit Mgmt., Case No. 11-md-2286-MMA (MDD), 2020 U.S. Dist. LEXIS 49091 (S.D. Cal. March 18, 2020) originated in 2011.  A lead class action member and several dozen individual member cases that alleged the Defendants violated the TCPA ATDS provision.  The court dropped the hammer on the Defendants’ request stay the case pending the SCOTUS TCPA review.  The Lead Plaintiff did not oppose the (brief) stay, and the court agreed the TCPA might get struck down by SCOTUS.  Yet the Court still denied the Defendants’ request to stay the case!

A district court has discretionary power to stay proceedings. In determining whether to grant a stay, courts in the Ninth Circuit weigh “competing interests which will be affected by the granting or refusal to grant a stay,” including prejudices resulting from staying the cases versus moving forward, as well as the benefit of legal issues that may get simplified if the parties wait out a stay.

The Court highlighted that deadlines had already been pushed, and that the case had been going on for nearly a decade.  Similarly, the Court wagged its finger noting, “Defendants delayed bringing this motion more than a month after the Supreme Court granted certiorari.” Most importantly, the Defendants argued that a stay would promote judicial economy especially because it would have to waste money on discovery tasks; the court was not convinced.  The court zeroed in on the Defendants’ did not provide “specifics as to what discovery has been completed and what discovery still needs to be done in the few remaining months.”

The Court gave a nod to the Lead Plaintiff’s argument that SCOTUS may not invalidate the entire TCPA (and may adopt a severance approach to keep the TCPA alive) to say a stay would be inappropriate.  Will this gain steam among other district courts, and cause more stay denials?  The Court narrowed its ruling as to “the unique characteristics of this MDL…that Defendants have not carried their burden to persuade the Court to grant a stay.”  TCPAWorld will monitor opinions to track the TCPA-stay climate.

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