Partial Win for Company Facing Nationwide ATDS Class Action: Court cannot Exercise Personal Jurisdiction Over Out-of-State Named Plaintiffs, but Arbitration Clause “Unconscionable” and ATDS Allegations Sufficient

Facing a nationwide TCPA class action for calls allegedly made using an ATDS, DirecTV sought partial dismissal on multiple grounds:  (1) the lack of personal jurisdiction over certain named plaintiffs; (2) the enforcement of an arbitration clause against a different named plaintiff; and (3) the lack of allegations of ATDS use in the operative complaint.  The Northern District of West Virginia accepted DirecTV’s jurisdictional argument but rejected its other two arguments.  See Mey v. DirecTV, No. 5:17-CV-179, 2021 U.S. Dist. LEXIS 35823 (N.D.W.V. Feb. 25, 2021).

Before we get to the merits, we should note that this case included several repeat TCPA Plaintiffs–all in one case: Diana Mey, Stewart Abramson, and James Shelton.  (Though, as explained next, the Court dismissed Abramson and Shelton on jurisdictional grounds.)

First, for personal jurisdiction, the Court summarized its understanding of the legal landscape following the Supreme Court’s decision in Bristol-Myers Squibb.  Namely, that in class actions “the named representatives must be able to demonstrate either general or specific personal jurisdiction” over the defendant.  Since three named Plaintiffs (including Abramson and Shelton) could not, the Court dismissed their claims.  (The Court also rejected their argument that “pendant personal jurisdiction” salvaged their claims.)

Second, on arbitration, the Court repeated its conclusion from earlier briefing that the arbitration clause was “unconscionable.”  The Court’s opinion does not include its analysis about why the provision is unconscionable.  Notably though, this conclusion is, at a minimum, in some tension with the Federal Arbitration Act, which requires courts to enforce arbitration clauses like any other written contract.  9 U.S.C. § 2; see Muriithi v. Shuttle Express, Inc., 712 F.3d 173, 178-79 (4th Cir. 2013) (reversing district court for refusing to enforce an arbitration clause and class action waiver as “unconscionable”).

Finally, for the ATDS allegations, the Court endorsed (and quoted at length from) the Sixth Circuit’s reasoning in AllenRecall that in Allen,  the Sixth Circuit ruled that a predictive dialer system is an automatic telephone dialing system (“ATDS”) because the TCPA’s definition of ATDS includes all dialers that call from a list, not just those that call using a random or sequential number generator.  This Court followed that reasoning and concluded that the plaintiffs sufficiently stated a claim because “the definition of ATDS includes autodialer which dial from a stored list of numbers.”

This case is not all bad.  The jurisdictional ruling is favorable and hopefully consistent with a trend about how Courts apply Bristol-Meyer Squibb.  But, on balance, the class action continues despite an arbitration clause and flimsy ATDS allegations.  We will keep our eye on it.


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