I know it seems like a minor point to most folks but, for purists, making substantive merits arguments as part of a “standing” play at the pleadings stage is a real no no.
TCPA defendants will often try these sorts of arguments where unpleaded facts afford a complete defense. Unlike the rules around 12(b)(6) motions to dismiss, standing motions can be made on a “factual” basis–meaning that extrinsic evidence can be brought into the record at a very early stage in the case. Its a useful end run around the firm limitations of Rule 12 where it works, but fewer and fewer courts are inclined to accept that invitation these days.
For instance, last Friday in Aleisa v. Square, Inc., Case No. 20-cv-00806-EMC, 2020 U.S. Dist. LEXIS 188024 (N.D. Cal. Oct. 9, 2020) a court rejected a “consent means no standing” argument attempted by a Defendant that contended Plaintiff had requested the text messages from the start.
If the Plaintiff lacks consent, the argument goes, he could not have been harmed by the conduct in a legal sense and must therefore lack standing. While the necessary facts establishing consent were not pleaded in the complaint, the Defendant presented pretty compelling evidence of consent to the Court as part of a motion to dismiss for lack of standing and asked for a dismissal. But no dice.
The problem with that argument, in the Aleisa court’s view at least, is that it conflates a substantive merits defense to a claim, on the one hand, with a court’s inability to weigh and resolve a claim, on the other. Indeed, if a court lacked standing to resolve a claim every time a Defendant had a complete defense then it would be impossible for a court to ever judgment in a TCPA defendant’s favor– the lack of a valid claim would instantly deprive the court of jurisdiction to dispose of the claim on the merits.
The Seventh Circuit really hammered this point home back in Craftwood II, Inc. ., No. 18-2883, 2019 U.S. App. LEXIS 9504, at *2 (7th Cir. Apr. 1 2019), in which the great Judge Easterbrook explained: “[t]he difference between a jurisdictional and a substantive characterization of a defense matters not just because federal courts must raise jurisdiction on their own . . . but because different procedures apply to jurisdictional and substantive issues.” Id. Put another way, a plaintiff’s failure on the merits does not deprive the trial court of jurisdiction to say that the plaintiff has failed on the merits. (You can read about that case here: https://tcpaworld.com/2019/04/08/rolling-the-dice-on-12b1-do-not-pass-go-do-not-collect-200/)
The Court in Aleisa was similarly persuaded and had little trouble discounting the standing argument: “Contesting the merits of causation, a common matter in dispute in tort and statutory cases, does not raise a constitutional standing issue in every case.”
The Aleisa court was also troubled with the introduction of extrinsic evidence to resolve a merits defense at the pleadings stage more broadly– setting aside the metaphysical standing issues, the Court just flat refused to consider the merits of a fact-based motion until the record could be properly developed later in the case.
Notably the Defendant in Aleisa also argued that a single unwanted text message cannot cause Article III harm, which is the law in the Eleventh Circuit. But the Aleisa case is venued in the California which is subject to different binding law—the Ninth Circuit Court of Appeals has already determined squarely that receipt of a single unwanted text does create Article III harm. So the motion to dismiss on that ground was swiftly defeated as well.
But Square’s hard work wasn’t for naught—the Court did end up staying the case pending the big Facebook SCOTUS ATDS appeal. So there’s that.
Keep these distinctions in mind when litigating folks. While it might sometimes be worth a shot to “educate” the Court with an evidentiary/factual standing challenge where a 12(b)(6) simply will not do, it is more likely that the Court will be unmoved on the merits at so early a stage. As Aleisa demonstrates, most courts now refuse to dismiss for lack of “standing” when all the defense has really done is raise a likely viable defense.
Where you do have a clear consent defense you want before the Court ASAP, consider an early Rule 56 motion or– perhaps most effectively- raise the consent defense as part of a request to bifurcate discovery and hammer the issue at the Rule 16 conference. I have found that courts have little tolerance for having their time wasted and will come down like a chainsaw on a Plaintiff’s lawyer that is proceeding with a TCPA class action in the face of clear consent.
But the whole “don’t waste my time” thing cuts both ways– which is why lobbing that “standing” motion based on consent might not be such a good idea either. 😉
Play your had accordingly TCPAWorld.