ST. LOUIS — U.S. District Judge Stephen Limbaugh has denied a defense motion for entry of judgment and dismissal in a Telephone Consumer Protection Act (TCPA) class action.
Profax Inc. is among 11 defendants facing a proposed class action filed last year in federal court in St. Louis by Levine Hat Co.
The company, accused of sending "junk faxes" to the plaintiff, had sought dismissal from Count VIII of the suit, which accuses it of sending faxes without displaying an opt-out notice.
Under the TCPA, claimants may recover up to $1,500 for each "willful or knowing" violation of the statute.
According to background information in the ruling, in July, Profax deposited $4,000 into a trust account that was held exclusively for the plaintiff. It also provided instructions on how to access the account to get the funds. After that move, the plaintiff first filed a motion for entry of judgment and to dismiss Count VIII, which included an injunction prohibiting Profax from sending more faxes.
In response, Profax filed its motion for entry of judgment saying it provided the plaintiff with "every form of individual relief that plaintiff seeks" and resolves all TCPA claims. It also argued that its $4,000 provision to the plaintiff requires the court to enter judgment and dismiss Count VIII under federal rules of civil procedure.
"Profax essentially argues that its offer was accepted because Profax has made $4,000 available to plaintiff, in an account for its benefit held by Profax’s attorneys," Limbaugh wrote. "In light of the funds and the injunction set forth in the proposed judgment, Profax argues that plaintiff no longer has a ‘personal stake in the outcome of the lawsuit' and that its lawsuit 'must be dismissed as moot.’”
Limbaugh wrote that subsequent defendants have tried similar tactics – that is, offering settlement and making funds available immediately.
"Courts have been split on whether this suffices to end plaintiff’s case," he wrote.
The judge further wrote that his court has previously declined to let a defendant deposit funds and enter judgment in cases in which the class had not yet been certified.
"Ultimately, '[t]he law does not countenance the use of individual offers to thwart class litigation, because the class-action device is designed to allow similarly situated plaintiffs to aggregate smaller claims, promoting judicial efficiency,'" he wrote.
Limbaugh denied Profax's motion on Nov. 15.