Doohan v. CTB Investors, LLC

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF MISSOURI

WESTERN DIVISION

ANDY DOOHAN, individually and on behalf

of all others similarly situated,

Plaintiff,

v.

CTB INVESTORS, LLC Case No. 4:19-cv-00111-NKL

d/b/a PBR BIG SKY COWBOY BAR,

THE CORDISH COMPANIES, INC.,

ENTERTAINMENT CONSULTING

INTERNATIONAL, LLC,

Defendants.

ORDER

Before the Court is Defendants’ motion to dismiss Plaintiff’s first amended class action

Complaint alleging violations of the Telephone Consumer Protection Act.1 Doc. 33. Defendants

CTB Investors, LLC d/b/a PBR Big Sky Cowboy Bar, Entertainment Consulting International,

LLC, and the Cordish Companies, Inc., assert Plaintiff’s claims should be dismissed pursuant to

Federal Rule of Civil Procedure 12(b)(2) and (6), for lack of personal jurisdiction and failure to

state a claim. For the reasons discussed below, Defendants’ motion to dismiss is denied.2

1 Also pending before the Court is a separate motion to dismiss Plaintiff’s original Complaint

filed by Defendant CTB Investors, LLC d/b/a PBR Big Sky Cowboy Bar on March 8, 2019.

Doc. 15. On March 22, 2019, Plaintiff filed his first amended Complaint. Doc. 20. An amended

Complaint generally renders moot a pending motion to dismiss the original Complaint. See

Avery v. Boyd Bros. Transp., No. 13-00579-CV-W-BP, 2013 WL 11326558, at *1 (W.D. Mo.

Aug. 21, 2013) (denying motion to dismiss original complaint as moot because amended

complaint "superseded and displaced [the] original complaint"). Therefore, the motion to

dismiss by CTB Investors, LLC d/b/a PBR Big Sky Cowboy Bar, Doc. 15, is denied as moot.

2 On October 31, 2019, the Court denied Defendants’ motions to dismiss in two substantially

similar TCPA class actions, each against Defendants Cordish, ECI, and a Kansas City Power &

Plaintiff’s motions for leave to file supplemental authority, Doc. 55 and Doc. 58, are denied as

moot.

I. BACKGROUND

a. The Telephone Consumer Protection Act

In 1991, Congress enacted the Telephone Consumer Protection Act in response to

concerns from constituents over intrusive and unwanted telephone calls from telemarketers. Pub.

L. No. 102-243, 105 Stat. 2394. The TCPA targeted automated or prerecorded calls and directed

the Federal Communications Commission to implement rules consistent with the statute’s goals.

Id. The purpose of the statute was “to protect residential telephone subscriber privacy rights by

restricting certain commercial solicitation and advertising uses of the telephone and related

telecommunications equipment.” H. R. Rep. No. 102-317, at 5 (1991).

The TCPA prohibits “any person within the United States, or any person outside the

United States if the recipient is within the United States” from using an automated telephone

dialing system (ATDS) to make a non-emergency call without the prior express consent of the

recipient. 47 U.S.C. § 227(b)(1). A text message qualifies as a “call” within the scope of the

Act. Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663, 667 (2016), as revised (Feb. 9, 2016).

Though the TCPA does not define “person,” the Communications Act, which the TCPA

amended, states “[t]he term ‘person’ includes an individual, partnership, association, joint-stock

company, trust or corporation.” 47 U.S.C. § 153(39). The TCPA defines an ATDS as

“equipment which has the capacity—(A) to store or produce telephone numbers to be called,

using a random or sequential number generator; and (B) to dial such numbers.” 47 U.S.C. §

Light venue. See Smith v. Truman Rd. Dev., LLC, No. 4:18-CV-00670-NKL, 2019 WL 5654352

(W.D. Mo. Oct. 31, 2019); Hand v. Beach Entertainment KC, LLC, 4:18-CV-00668-NKL, 2019

WL 5654351 (W.D. Mo. Oct. 31, 2019).

227(a)(1). In 2015, Congress amended the ATDS definition by adding an exemption for calls

“made solely to collect a debt owed to or guaranteed by the United States.” Bipartisan Budget

Act of 2015, Pub. L. No. 114-74, §301(a), 129 Stat. 584 (2015).

In addition to regulating the use of an ATDS, the TCPA also directed the FCC to engage

in rulemaking regarding “the need to protect residential telephone subscribers' privacy rights to

avoid receiving telephone solicitations to which they object.” 47 U.S.C. § 227(c)(1)–(2).

Exempted from the statute’s definition of “telephone solicitation” are calls or messages “by a tax

exempt nonprofit organization.” 47 U.S.C. § 227(a)(4)(C). The FCC has subsequently

promulgated regulations imposing liability for making telephone solicitations to persons who

register their number with the national do-not-call registry, using the same definition of

“telephone solicitation” included in the TCPA. 47 C.F.R. § 64.1200(c)(2). The FCC has also

promulgated regulations prohibiting initiating “any call for telemarketing purposes to a

residential telephone subscriber unless such person or entity has instituted procedures for

maintaining a list of persons who request not to receive telemarketing calls made by or on behalf

of that person or entity,” and prescribing certain minimum standards for such internal

procedures, but exempting tax-exempt nonprofit organizations from its scope. 47 C.F.R. §

64.1200(d).

The TCPA also provides for a private right of action for violations of the § 227(b) ATDS

prohibition and its corresponding regulations, 47 U.S.C. §227(b)(3), as well as a private right of

action for violations of the regulations prescribed pursuant to § 227(c), 47 U.S.C. § 227(c)(5).

b. The Current Litigation

Plaintiff Andy Doohan brings a class action suit against Defendants. The first amended

Complaint states that between July 30, 2014, and April 4, 2018, Plaintiff and putative class

members received text messages that they had not consented to from Defendants advertising

PBR’s products and services.

Defendants are CTB Investors, LLC d/b/a PBR Big Sky Cowboy Bar (“PBR”), a limited

liability company with its principal place of business in Kansas City, Missouri; the Cordish

Companies, Inc. (“Cordish”), a Maryland corporation with its principal place of business in

Maryland; and Entertainment Consulting International, LLC (“ECI”), a Maryland limited-

liability company with its principal place of business in Maryland. PBR is a drinking

establishment located within the Kansas City Live! entertainment block of the Kansas City

Power & Light District, which is a retail, entertainment, office, and residential district located in

downtown Kansas City, Missouri. Plaintiff alleges that Cordish and ECI effectuate and oversee

all, or substantially all, of the marketing decisions of PBR and other venues, and that in that

capacity Defendants have caused promotional text messages and calls to be made to Plaintiff

using the ATDS systems SendSmart and Txt Live! without consent.

Plaintiff has alleged two counts against all Defendants and defined a putative class

corresponding to each count:

• Count I (the “227(b)(1)(A)(iii) Class”) – violations of 47 U.S.C. §

227(b)(1)(A)(iii) for using an ATDS to send text messages without consent;

• Count II (the “64.1200(d) Class”) – violations of 47 U.S.C. § 227(c) and 47

C.F.R. § 64.1200(d) for failing to implement adequate procedures to prevent calls

or text messages to persons who request not to receive calls or text messages by

that entity.

Plaintiff and the putative classes seek statutory damages for each violation as well as injunctive

relief against future calls pursuant to 47 U.S.C. § 227(b)(3).

Defendants ECI, Cordish, and PBR together file a motion to dismiss. Defendants ECI

and Cordish move to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(2) for lack of

personal jurisdiction. All Defendants move to dismiss pursuant to Rule 12(b)(6) for failure to

state a claim, asserting that the statute upon which Plaintiff’s claims rely contain unconstitutional

provisions that are not severable. Specifically, Defendants assert that by exempting calls made

pursuant to a federal government debt from the definition of ATDS, by exempting government

speakers from ATDS prohibitions, and by exempting non-profits from the definition of telephone

solicitation and from prohibitions on certain calls made for telemarketing purposes, the TCPA

places content-based restrictions on free speech that cannot survive strict scrutiny and are

therefore in violation of the First Amendment and Equal Protection. Moreover, they argue the

statutory definition of “ATDS” is unconstitutionally vague in violation of the Fifth Amendment

Due Process Clause.

Federal Rule of Civil Procedure 24 permits a non-party to intervene when the non-party

“is given an unconditional right to intervene by a federal statute.” Fed. R. Civ. P. 24(a). Rule

5.1(c) permits the United States Attorney General to intervene in an action where the

constitutionality of a federal statute is challenged. Fed. R. Civ. P. 5.1(c). Accordingly, the

Attorney General (the “Government”) has intervened in this action for the purpose of defending

the constitutionality of the TCPA.

II. PERSONAL JURISDICTION

Defendants Cordish and ECI move to dismiss the first amended Complaint, arguing the

Court lacks personal jurisdiction over them as non-resident entities. In response, Plaintiff asserts

that both ECI and Cordish have the requisite minimum contacts with Missouri to make personal

jurisdiction proper, and that in the alternative, PBR’s contacts with Missouri can be imputed to

them through an alter-ego or agency theory.3

3 Because the Court finds that Plaintiff has made a prima facie showing that both ECI and

Cordish have sufficient contacts to warrant specific personal jurisdiction, it will not address the

To survive a motion to dismiss for lack of personal jurisdiction, “a plaintiff must make a

prima facie showing that personal jurisdiction exists, which is accomplished by pleading

sufficient facts to support a reasonable inference that the defendant can be subjected to

jurisdiction within the state.” K–V Pharm. Co. v. J. Uriach & CIA, S.A., 648 F.3d 588, 591–92

(8th Cir. 2011) (internal quotations omitted). “The allegations in the Complaint must be taken as

true to the extent they are uncontroverted by the defendant's affidavits. If the parties present

conflicting affidavits, all factual disputes are resolved in the plaintiff's favor, and the plaintiff's

prima facie showing is sufficient notwithstanding the contrary presentation by the moving

party.” Cantrell v. Extradition Corp. of Am., 789 F. Supp. 306, 308–09 (W.D. Mo. 1992); see

also Dever v. Hentzen Coatings, Inc., 380 F.3d 1070, 1076 (8th Cir. 2004). Although “[t]he

evidentiary showing required at the prima facie stage is minimal,” Johnson v. Arden, 614 F.3d

785, 794 (8th Cir. 2010) (quotations omitted), it “must be tested, not by the pleadings alone, but

by the affidavits and exhibits” supporting or opposing the motion to dismiss, Dever, 380 F.3d at

1072 (quotations omitted).

For non-residents ECI and Cordish to be subject to personal jurisdiction in Missouri,

personal jurisdiction must be proper under both the Missouri long-arm statute and the Due

Process Clause. Where, as here, a court’s subject matter jurisdiction is based upon a federal

statute that is silent regarding service of process, the Court “may exercise personal jurisdiction

only to the extent permitted by the forum state’s long-arm statute.” Velez v. Portfolio Recovery

Assocs., Inc., 881 F. Supp. 2d 1075, 1082 (E.D. Mo. 2012). In relevant part, Missouri's long-

arm statute authorizes personal jurisdiction over defendants who transact business or commit a

parties’ alternative arguments for and against imputing PBR’s contacts onto the other Defendants

on an agency or alter-ego theory at this stage.

tort within the state, as to any cause of action arising from the commission of such acts. Mo.

Rev. Stat. § 506.500.1. “A person or firm transacts business by visiting Missouri or sending its

product or advertising here.” Dairy Farmers of Am., Inc. v. Bassett & Walker Int'l, Inc., 702

F.3d 472, 476 (8th Cir. 2012). Missouri courts have interpreted the “tortious act” prong to

include “[e]xtraterritorial acts that produce consequences in the state.” Bryant v. Smith Interior

Design Grp., Inc., 310 S.W.3d 227, 232 (Mo. 2010). These categories are construed broadly,

such that if a defendant commits one of the acts specified in the long-arm statute, the statute will

be interpreted “to provide for jurisdiction . . . to the full extent permitted by the [D]ue [P]rocess

[C]lause.” Viasystems, Inc. v. EBM-Papst St. Georgen GmbH & Co., 646 F.3d 589, 593 (8th Cir.

2011) (quotations omitted).

To satisfy due process a defendant must have “sufficient minimum contacts” with the

forum state so as not to “offend traditional notions of fair play and substantial justice.” Romak

USA, Inc. v. Rich, 384 F.3d 979, 984 (8th Cir. 2004) (quotations omitted). Personal jurisdiction

can be specific or general.4 For specific jurisdiction to exist, “the injury giving rise to the lawsuit

[must have] occurred within or had some connection to the forum state, meaning that the

defendant[s] purposely directed [their] activities at the forum state and the claim arose out of or

relates to those activities.” Johnson, 614 F.3d at 795 (citation omitted). In determining whether a

nonresident defendant's contacts with Missouri are sufficient to subject it to personal jurisdiction,

the Court considers five factors, the first three of which are the most important: “(1) the nature

4 In Plaintiff’s first amended Complaint, he implies that Defendants may also be subject to

general jurisdiction, because “Defendants’ affiliations with the state of Missouri are so

continuous and systematic as to render them at home in this District, because Defendants’

regular and systematic corporate decision-making is made in Kansas City, Missouri.” Doc. 20, ¶

10. In their motion to dismiss, Defendants argue ECI and Cordish are not subject to general

jurisdiction, and Plaintiff does not contest this in his response. Therefore, the Court will treat

Plaintiff’s argument as one for specific rather than general jurisdiction.

and quality of the contacts with the forum state; (2) the quantity of the contacts; (3) the

relationship of the cause of action to the contacts; (4) the interest of [the forum state] in

providing a forum for its residents; and (5) the convenience or inconvenience to the parties.” Id.

at 794.

Although “[e]ach defendant's contacts with the forum State must be assessed

individually,” Calder v. Jones, 465 U.S. 783, 790 (1984), “[n]aturally, the parties' relationships

with each other may be significant in evaluating their ties to the forum,” Rush v. Savchuk, 444

U.S. 320, 332 (1980).

a. Whether Plaintiff has made a prima facie showing that ECI and Cordish fall

within the Missouri long-arm statute

As an initial matter, Plaintiff has made a prima facie showing that ECI’s and Cordish’s

alleged conduct giving rise to Plaintiff’s cause of action falls within the Missouri long-arm

statute.5 Plaintiff has alleged Defendants “transact significant amounts of business within this

District,” Doc. 20, ¶ 8, and provided evidence that ECI and Cordish maintain offices and officers

or employees in Kansas City, and that ECI is registered as a foreign limited liability corporation

with the state of Missouri and has executed an operating agreement with PBR to provide

marketing services. See Doc. 49, pp. 4–9. Plaintiff has further alleged that all Defendants,

including Cordish and ECI, and/or their agents, utilized SendSmart and Txt Live! to send

5 Plaintiff asserts that “if jurisdiction comports with Due Process requirements—as here—then it

is also proper under Missouri’s long-arm statute.” Doc. 49, p. 3. However, the Eighth Circuit

has made clear that Missouri courts intend the state long-arm statute and Due Process inquiries to

be distinct. See Dairy Farmers of Am., Inc. v. Bassett & Walker Int'l, Inc., 702 F.3d 472, 475

(8th Cir. 2012) (finding that “[w]hile [Missouri’s] long-arm statute extends jurisdiction to the

limits of the Due Process Clause, it does so only for acts within its enumerated categories . . .

True, courts have often treated the statutory and constitutional inquiries together . . . The

inquiries, however, are separate.”)

unconsented text messages in Missouri to advertise the services of PBR to the putative class

using an ATDS, giving rise to this cause of action. See Doc. 20, ¶¶ 48–60. These allegations

sufficiently state a claim of a tortious act that has produced in-state consequences under the

TCPA.

Defendants have not argued the behavior alleged here falls outside of the scope of

Missouri’s long-arm statute. The affidavits they present do not rebut Plaintiff’s contention that

they have transacted business in Missouri or that their actions, even if extraterritorial, may have

produced consequences in the state. To the extent that the affidavit presented by Defendants

stating that Cordish is a “passive company” without employees may imply it could not engage in

tortious conduct, this is countered by Plaintiff’s showing that Cordish owns and manages

businesses around the country, and the Court must resolve this factual conflict in the

nonmovant’s favor at this stage of the proceedings. Therefore, Plaintiff has made a prima facie

showing that Defendants’ conduct falls within the scope of the Missouri long-arm statute. See

Schwartz & Assocs. v. Elite Line, Inc., 751 F. Supp. 1366, 1369 (E.D. Mo. 1990) (finding

allegations that a Defendant fraudulently induced Missouri plaintiff to perform legal services

from out-of-state were sufficient to support exercise of personal jurisdiction under the Missouri

long-arm statute); KCI Auto Auction, Inc. v. Anderson, No. 5:17-CV-06086-NKL, 2018 WL

665313, at *4 (W.D. Mo. Feb. 1, 2018) (“KCI argues that the consequences of Anderson’s

tortious acts were primarily felt by KCI, in Missouri. Anderson has provided no defense, and

thus KCI presents a sufficient prima facie showing that Anderson is within the reach of

Missouri’s long-arm statute.”) Because “‘the Missouri long-arm statute authorizes the exercise

of jurisdiction over non-residents to the extent permissible under the due process clause,’ this

court considers ‘whether the assertion of personal jurisdiction would violate’ due process.” Aly

v. Hanzada for Imp. & Exp. Co., LTD, 864 F.3d 844, 849 (8th Cir. 2017) (quoting Eagle Tech. v.

Expander Americas, Inc., 783 F.3d 1131, 1136 (8th Cir. 2015)).

b. Whether Plaintiff has made a prima facie showing that ECI has sufficient

minimum contacts with Missouri

Defendants argue that ECI lacks sufficient minimum contacts with Missouri and thus

should not be subject to personal jurisdiction here because none of the alleged conduct took

place in Missouri as ECI is headquartered in Maryland, no ECI employee directly engaged in

sending the text messages at issue, and ECI directs its consulting services to venues across the

country, not specifically toward Missouri.6 Therefore, ECI has not aimed its conduct into the

forum state. Plaintiff responds that personal jurisdiction over ECI is proper because ECI was

heavily involved in developing, instituting, and overseeing the data collection and text message

campaigns carried out by PBR and other Kansas City Power & Light venues, including

coordinating the SendSmart and Txt Live! programs and providing materials for data collection.

Further, ECI is registered to do business in Missouri as a foreign limited liability corporation and

6 Defendants also argue that Plaintiff “asserts no allegations that allow the Court to evaluate

[ECI’s and Cordish’s] contacts with the forum related to this action,” and “this failure alone is

sufficient to conclude the Court lacks specific jurisdiction over [ECI and Cordish].” Doc. 34, p.

7. Given the Court’s discussion herein of each of Plaintiff’s allegations that permit the Court to

evaluate personal jurisdiction over ECI and Cordish, this argument is rejected. The authorities

cited by Defendants do not persuade the Court otherwise. See, e.g., Goans Acquisition, Inc., v.

Merchant Solutions, LLC, et al., No. 12-00539-cv-S-JTM, 2012 WL 4957628 (E.D. Mo. Oct. 16,

2012) (finding it could not exercise personal jurisdiction where the Plaintiff relied exclusively on

the Complaint’s allegations in opposing a motion to dismiss, and the complaint “contain[ed] no

allegations specifically naming” two Defendants and “offer[ed] no specific information about”

those Defendants); Nexgen HBM, Inc. v. Listreports, Inc., No. 16-cv-3143-SRN/FLN, 2017 WL

4040808 (D. Minn. Sept. 12, 2017) (after finding that the plaintiff “fail[ed] to distinguish

between each Defendant’s conduct,” continuing with the personal jurisdiction analysis by

parsing out the allegations and evidence against each individual defendant).

has employees living and working out of Kansas City in concert with Kansas City Power &

Light district venues, including PBR.

As an initial matter, Defendants’ assertion that because ECI is incorporated in Maryland,

“none of their actions took place in Missouri” is unavailing. ECI’s headquarters location does

not prevent them from acting in other locations, and even if it did, the Supreme Court has

“consistently rejected the notion that an absence of physical contacts can defeat personal

jurisdiction there.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476 (1985).

As to the nature, quality, and quantity of ECI’s contacts with Missouri, Plaintiff has

demonstrated a number of contacts between ECI and the state. He points to ECI’s registration as

a foreign limited liability company with Missouri; ECI employees who operate out of Kansas

City and participated in the coordination of the SendSmart and Txt Live! programs with Kanas

City Power & Light venues; ECI President Reed Cordish’s appointment of an ECI employee as

a non-managing member of PBR and other venues in the Kansas City Live! block of the Power

& Light district who also participated in the coordination of marketing programs; testimony from

a Kansas City Live! employee that she communicated with ECI employees as frequently as

“daily” regarding marketing programs; testimony from a Kansas City Power & Light employee

that he worked with two ECI employees to develop Txt Live!, and reported directly to an ECI

Senior Vice President; the operating agreement between ECI and PBR stating the agreement

was “negotiated, executed, delivered, and intended to be performed” in the Western District of

Missouri, as the location of PBR; ECI’s contract with a Kansas City software developer to

create the Txt Live! program; testimony that the data cards venues used to collect contact

information were provided to venues by ECI; and finally, a variety of emails between ECI

employees, Kansas City Power & Light employees, and employees of individual venues

including PBR, communicating policies with respect to marketing and implementation of the

alleged ATDS systems at issue. See Doc. 49, pp. 4–9. These contacts demonstrate that ECI was

in consistent communication with Kansas City Power & Light venues in order to develop,

implement, and coordinate the SendSmart and Txt Live! systems, including having employees

working from Kansas City and the President of ECI Reed Cordish signing off on the marketing

programs being implemented. Doc. 49, pp. 6–7. These contacts are not random or fortuitous but

purposeful and directed at the Missouri venues here, including PBR.

As to the third factor, Plaintiff has also demonstrated a direct relationship between the

contacts and the cause of action here. ECI executed an operating agreement with PBR in which

it agreed to “provide web-based and paid advertising and marketing services [for PBR]”. Doc.

49, p. 11. Plaintiff alleges that “[a]mong the suite of services that ECI coordinates and directs

for all Cordish bars and restaurants, including PBR, is the ability to mass text message potential

customers.” Doc. 20, ¶ 43. Plaintiff also provides evidence that ECI was an account holder of

SendSmart and the coordinator of Txt Live!, the two systems Plaintiff contends were used to

send the messages at issue here. Doc. 49, pp. 6–7. The evidence Plaintiff cites indicates that

ECI manages the website that venue employees use to upload consumer cell phone numbers and

create text message campaigns, and that ECI developed and enforced the policies and procedures

for executing text messaging campaigns and collecting lists of consumers’ names and phone

numbers for use in campaigns for Kansas City Power & Light venues, including PBR. Doc. 20,

¶¶ 44–46; Doc. 49, pp. 6–8. These are the campaigns that Plaintiff alleges he was contacted

through. Though Defendants present an affidavit stating it was ECI’s policy to not send text

messages, Doc. 34-3, that ECI employees did not themselves send the text messages is not

determinative of personal jurisdiction. Due process only requires the cause of action to arise out

of or relate to a defendant’s contacts with the forum state. Johnson, 614 F.3d at 795. Plaintiff’s

claim that he received text messages from PBR as part of mass text message campaigns directly

relates to ECI’s development and coordination of PBR’s text message campaigns. Thus, the first

three factors of the jurisdictional inquiry weigh in favor of the Court’s exercise of specific

personal jurisdiction over ECI.

As to the final two factors, Plaintiff has provided evidence that Defendants sent over

thirty-thousand text messages to phones with Missouri area codes, some of which belong to class

members. Doc. 49, p. 9. Missouri “obviously has an interest in providing a forum for [its]

resident[s] . . .” K-V Pharm. Co., 648 F.3d at 595; see also Frank v. Gold's Gym of N. Augusta,

No. CV 18-447(DSD/KMM), 2018 WL 3158822, at *3 (D. Minn. June 28, 2018) (finding it

“generally true” that a forum state “has an interest in providing a forum for its citizens harmed

by violations of the TCPA”). Plaintiff also contends the venue is convenient for all other parties

because PBR, evidence, witnesses, ECI employees, and the bulk of the putative class are located

in Missouri. Defendants do not argue otherwise. Therefore, these two factors support Plaintiff’s

prima facie showing.

Plaintiff’s uncontroverted allegations in conjunction with the evidence offered establish a

prima facie showing that ECI has sufficient minimum contacts with Missouri. All five factors

weigh in Plaintiff’s favor, and Defendants’ evidence does not diminish this showing. ECI

purposefully directed its activities at Missouri when it registered to do business in Missouri,

installed employees in Missouri, and substantially involved itself with developing and

implementing, through consistent and prolonged communication with PBR and other Missouri

venues, the alleged text message system at issue. ECI’s contacts with Missouri are such that ECI

“should reasonably anticipate being haled into court” here. Burger King Corp., 471 U.S. at 747.

At this stage of the proceedings, Plaintiff has satisfied the “minimal” burden of making a prima

facie showing that personal jurisdiction exists as to ECI. ECI’s motion to dismiss for lack of

personal jurisdiction is denied.

c. Whether Plaintiff has made a prima facie showing that Cordish has sufficient

minimum contacts with Missouri

In their motion to dismiss, Defendants argue Cordish does not have sufficient minimum

contacts with Missouri, because none of the alleged conduct took place in Missouri, Cordish

does not have any employees and therefore could not have been engaged in sending text

messages, and Cordish does not own any property but rather is a passive company with a “trade

name [that] is often used to describe real estate developments located around the country”. Doc.

34, p. 8. Plaintiff argues personal jurisdiction over Cordish is proper, because not only did they

participate in the oversight, development, and use of the ATDS as well as creation of the data

collection policy used to promote Missouri venues to Missouri customers, but Cordish also has a

physical presence in the state through its executives, office, and ownership interests located here.

The only evidence Defendants provide to counter Plaintiff’s allegations with respect to

Cordish is the affidavit by Robert Fowler who is an attorney for CTR Management, Inc., a

Maryland corporation that provides real estate development services, including to properties

associated with Cordish. In relevant part, the Fowler affidavit states Cordish “is a passive

company that does not have any employees and does not own any property, including in the state

of Missouri,” and that rather, “Cordish functions primarily as a trade name often used to describe

real estate developments around the country, which are each owned by a separate and distinct

legal entity.” Doc. 34-2. At this stage, the Court must take Plaintiff’s allegations as true to the

extent they are uncontroverted by Defendants’ affidavits. Cantrell, 789 F. Supp. at 308–09.

However, Plaintiff does not rely solely on allegations to support his contention that Cordish

operates out of Kansas City and owns and manages businesses there; rather, he rests these

allegations on Cordish’s own statements asserting those facts.7 See Doc. 20, ¶¶ 38–39; Doc. 49,

pp. 5–6. In addition, Defendants’ contention that “Cordish has no employees and therefore no

individual could possibly be engaged in sending text messages,” Doc. 34, p. 7, is countered to

some degree by Plaintiff’s showing that Cordish does have individuals working on its behalf in

some capacity, including Cordish’s website listing Reed Cordish as a Cordish principal and Nick

Benjamin as a Cordish executive, as well as individuals using an email address with the

@cordish.com domain. At this stage, the Court is required to resolve these factual conflicts in

Plaintiff’s favor.

Turning to the minimum contacts analysis, with respect to the nature, quality, and

quantity of Cordish’s contacts with Missouri, Plaintiff has demonstrated a variety of contacts.

7 In 2015, Cordish was the defendant in a personal injury suit where its ownership of the

Maryland Live! Casino was at issue. The plaintiff there pointed to statements on Cordish’s

website similar those Plaintiff points to here, including the identical statement that Cordish “still

owns and manages virtually every business it has created.” Stocks v. Cordish Companies, Inc.,

118 F. Supp. 3d 81, 85 (D.D.C. 2015). Cordish there also submitted an affidavit stating that it

“does not own Maryland Live! and that none of its employees work at the casino or were

involved in the incident.” Id. The District of Columbia district court reviewed the contradictory

showings:

Cordish acknowledges that its website contains statements suggesting it owns

Maryland Live!. But it states that “[t]hose statements on the website are

inaccurate,” and that these “inaccurate references were made in an effort to

demonstrate to viewers of the website that The Cordish Companies, Inc. was

involved as a developer of the casino and to further the marketing of The Cordish

Companies, Inc. as a developer in the Gaming and Lodging industry.” Cordish

represented to the court in mid-March 2015 that, “[g]iven the lack of clarity

caused by the inaccurate statements on the websites identified above, the websites

are being revised to remove the incorrect information concerning ownership and

operation of the Maryland Live! Casino.” As of the filing of this memorandum

opinion, however, Cordish's website contains the very same statements identified

by Plaintiff.

Id. (internal citations omitted). It appears that four years later, Cordish has still not removed

these statements from its website.

Plaintiff produced evidence that Cordish claims to own and manage several developments in

Missouri, including the Kansas City Power & Light District, citing to Cordish’s website stating

that it “owns and manages virtually every business it has created,” as well as other Cordish

statements claiming the Power & Light District as a “Development[] Owned and Managed,”

Doc. 20, ¶ 38–39, and listing Kansas City Live, LLC, which is a part of the Power & Light

District, and Defendant CTB Investors, LLC, as its “subsidiaries.” Id. at ¶ 11. Cordish’s website

also states that Cordish has a Kansas City office out of which it manages the Kansas City Live!

entertainment block, and that Cordish has an executive operating out of Kansas City. Doc. 49, p.

5–6. Plaintiff points to multiple individuals with an email address utilizing the @cordish.com

domain name who are also in prominent positions at ECI or Kansas City Power & Light, and

who are in daily contact with an employee of Kansas City Power & Light about marketing

strategies for local venues. Doc. 49, p. 6. Plaintiff further alleges Cordish and ECI have

exclusive and complete control over PBR’s operation, including its marketing and promotion,

Doc. 20, ¶ 14, and that Cordish uses its self-proclaimed asset Txt Live! to provide mobile

marketing services to PBR and other venues, Doc. 20, ¶ 43. These services include the ability to

mass text message potential customers. Id.

Plaintiff’s showing concerning Cordish’s relationship with ECI is also relevant. Though

the Court does not impute ECI’s contacts onto Cordish, the nature of Plaintiff’s allegations about

Cordish’s organization indicate that “the parties' relationships with each other may be significant

in evaluating their ties to the forum.” Rush, 444 U.S. at 332. Though Plaintiff acknowledges

ECI is a separate entity, he alleges ECI was created by Cordish and functions “part and parcel of

Cordish itself. Cordish uses [ECI], along with numerous holding corporations or ‘subsidiary

entities,’ such as Kansas City Live, LLC, to develop, implement, manage, and operate multiple

entertainment district (and dozens of bars and restaurants within those districts) across the

country, including PBR.” Doc. 20, ¶ 41. A principal of Cordish, Reed Cordish, is also the

President of ECI and has overseen the development of the Txt Live! policies and software that

PBR used. Doc. 49, pp. 6–7. This assortment of contacts indicates that there are Cordish

executives or affiliates working closely with, and even as a part of, both ECI and Kansas City

Power & Light, and exercising control over the development and implementation of the

messaging system and campaigns, all in the service of the entities Cordish claims to own and

manage.

It is true that generally, “telephone calls, written communications, and . . . wire-transfers

to and from a forum state do not create sufficient contacts to comport with due process such that”

a court can properly exercise personal jurisdiction over a foreign defendant. Eagle Tech. v.

Expander Ams., Inc., 783 F.3d 1131, 1137 (8th Cir. 2015). However, Plaintiff has presented

evidence of more than just calls, written communications, or wire-transfers. Rather, the evidence

presented indicates Cordish may have a physical presence in Kansas City through its executive

and office, and may own and manage Kansas City Power & Light and Kansas City Live!, the

entertainment district that houses PBR. Taken together, Cordish’s contacts permit the first two

factors to weigh in favor of finding personal jurisdiction is proper over Cordish. Cf. Austad Co.

v. Pennie & Edmonds, 823 F.2d 223, 226 (8th Cir. 1987) (holding personal jurisdiction was not

proper over Defendant and finding of particular significance that defendant law firm “does not

maintain an office in South Dakota nor do any of its attorneys reside there or maintain a license

to practice law there,” “never advertised or solicited business in South Dakota,” and “did not

actively seek out [the South Dakota plaintiff] as a client”).

As to the third factor, specific jurisdiction requires that “the litigation results from alleged

injuries that ‘arise out of or relate to’ [Defendants’] activities.” Myers v. Casino Queen, Inc.,

689 F.3d 904, 912–13 (8th Cir. 2012). The Eighth Circuit has “not restricted the relationship

between a defendant's contacts and the cause of action to a proximate cause standard. Rather, we

have said specific jurisdiction is warranted when the defendant purposely directs its activities at

the forum state and the litigation ‘result[s] from injuries ... relating to [the defendant's] activities

[in the forum state.]’” Id. (quoting Steinbuch v. Cutler, 518 F.3d 580, 586 (8th Cir. 2008)).

Cordish’s own statements indicate it owns and manages Kansas City Power & Light and

Kansas City Live!, entities which Plaintiff’s exhibits demonstrate were involved in crafting and

orchestrating the text message policies. Plaintiff also provides evidence that Cordish was an

account holder of SendSmart, the first text messaging system allegedly used to send messages to

consumers. Doc. 49, p. 6. Moreover, Plaintiff has shown individuals affiliated with Cordish

were included in conversations with PBR on executing the text message campaign. Id. at 6–7.

Defendants contend that the contacts Plaintiff has demonstrated are “irrelevant” because

“none of these purported contacts evidence any involvement by [ECI and Cordish] with the text

messages allegedly sent to Plaintiff.” Doc. 51, p. 5. However, the “arise out of or relate to”

standard is not so strict. In Myers, the Eighth Circuit found an Illinois casino’s advertisements

targeting customers in Missouri were sufficiently related to a tort action arising from injuries

incurred after Plaintiff visited the casino, because although the “injuries did not arise out of

Casino Queen’s advertising activities in a strict proximate cause sense, his injuries are

nonetheless related to Casino Queen’s advertising activities because he was injured after

responding to the solicitation.” Myers, 689 F.3d at 913. Plaintiff’s assertion that Cordish,

through and in concert with ECI and PBR, developed and executed a mass text messaging

system to target PBR customers and expand their customer base “relates to” Plaintiff’s cause of

action claiming he and the putative class received a mass text message from PBR using that same

system. Plaintiff provides emails between ECI, PBR, individuals with @cordish.com email

addresses, Reed Cordish, and other Kansas City Power & Light employees and venues

communicating detailed use policies and engaging in regular oversight of venues’ use of the

Send Smart and Txt Live! systems over the course of the four-year class period. These contacts

relate to Plaintiff’s cause of action here. The third factor weighs in favor of finding personal

jurisdiction.

As to the final two factors, Plaintiff has demonstrated Defendants sent over thirty-

thousand messages to phones with Missouri area codes, some of which belong to class members.

Doc. 49, p. 9. Missouri “obviously has an interest in providing a forum for [its] resident[s] . . .”

K-V Pharm. Co., 648 F.3d at 595. Further, because Plaintiff has presented evidence that

Defendant has an officer and an office in Missouri, as well as evidence that Defendant owns and

manages multiple properties in Missouri, there is no reason to believe the maintenance of the

action in Missouri would be unduly burdensome to Cordish, and Defendants do not assert it

would be inconvenient. Plaintiff also notes that the venue is convenient for all other parties,

because PBR, evidence, witnesses, and the bulk of the putative class are located in Missouri.

Therefore, these two factors support Plaintiff’s prima facie showing.

Taking as true all uncontroverted allegations and resolving all factual conflicts in

Plaintiff’s favor, Plaintiff has met his “minimal” burden of presenting a prima facie case that

Cordish should be subject to personal jurisdiction. Cordish’s contacts with Missouri are not so

random, attenuated, or fortuitous that it could not reasonably anticipate being haled into Missouri

court. Cordish’s motion to dismiss for lack of personal jurisdiction is denied.

III. CONSTITUTIONAL CLAIMS

To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), a

complaint “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that

is plausible on its face.’” Zink v. Lombardi, 783 F.3d 1089, 1098 (8th Cir. 2015) (quoting

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). A claim has facial plausibility when “the plaintiff

pleads factual content that allows the court to draw the reasonable inference that the defendant is

liable for the misconduct alleged.” Iqbal, 556 U.S. at 678.

Defendants assert that Plaintiff’s first amended Complaint should be dismissed, because

it is premised on an unconstitutional statutory framework.8 Specifically, Defendants contend that

the government-debt exception, the government-speaker exception, and the non-profit exception

each violate the First Amendment Free Speech Clause and Equal Protection. Defendants also

contend the TCPA’s definition of the term ATDS is unconstitutionally vague in violation of the

Fifth Amendment Due Process Clause. Finally, Defendants assert that the unconstitutional

provisions are not severable from the TCPA, and therefore the entire statute should be struck

down.

8 Defendants’ motion to dismiss roots part of their arguments about the unconstitutionality of the

government-speaker exemption and the non-profit exemption in Orders and regulations

promulgated by the FCC. The Administrative Orders Review Act provides that the Court does

not have jurisdiction to review the constitutionality of orders and regulations promulgated by the

FCC, even if raised defensively. See 28 U.S.C. § 2342(1); United States v. Neset, 235 F.3d 415,

420 (8th Cir. 2000) (holding the “district court lacked subject matter jurisdiction over Neset's

affirmative defenses attacking the validity of the microbroadcasting regulations”). At oral

argument, Defendants clarified they sought to challenge the constitutionality of only the TCPA

statute. Therefore, the Court will not consider Defendants’ arguments with respect to FCC

orders and regulations in its analysis.

a. First Amendment

The First Amendment prevents Congress from enacting laws “abridging the freedom of

speech.” U.S. Const. amend. I. It is well established that “[c]ontent-based laws—those that

target speech based on its communicative content—are presumptively unconstitutional and may

be justified only if the government proves that they are narrowly tailored to serve compelling

state interests” under strict scrutiny. Reed v. Town of Gilbert, Ariz., 135 S. Ct. 2218, 2226

(2015) (citing R.A.V. v. St. Paul, 505 U.S. 377, 395 (1992); Simon & Schuster, Inc., v. Members

of N.Y. State Crime Victims Bd., 502 U.S. 105, 115 (1991)). A regulation is content-based if it

“applies to particular speech because of the topic discussed or the idea or message expressed.”

Id. at 2227. A facially content-based speech regulation “defin[es] regulated speech by particular

subject matter,” and is subject to strict scrutiny regardless of the government’s purpose in

enacting the restriction. Id. at 2227–28. Other restrictions more subtly “defin[e] regulated

speech by its function or purpose” or while appearing facially content-neutral, “cannot be

justified without reference to the content of the regulated speech.” Id. (quoting Ward v. Rock

Against Racism, 491 U.S. 781, 791 (1989)). These restrictions are also considered content-based

and are thus subject to strict scrutiny. Id. However, “[a] regulation that serves purposes

unrelated to the content of expression is deemed neutral, even if it has an incidental effect on

some speakers or messages but not others.” Josephine Havlak Photographer, Inc. v. Vill. of

Twin Oaks, 864 F.3d 905, 914 (8th Cir. 2017) (quoting Ward, 491 U.S. at 791). Restrictions on

speech that are content-neutral are subject to a lower, intermediate level of scrutiny.

Following the Reed framework, the Court must first decide whether the provisions

objected to are a content-based restriction on speech to determine whether strict or intermediate

scrutiny applies. Next, the Court will analyze the statute under the applicable level of scrutiny.

Finally, if it finds a provision fails the relevant level of scrutiny, the Court will need to determine

if the provision is nevertheless severable from the TCPA.

i. ATDS Government-Debt Exemption

In relevant part, the TCPA as modified by Congress’ 2015 amendment provides that it

shall be unlawful for any person to make a call using an ATDS “to any telephone number

assigned to a paging service, cellular telephone service, specialized mobile radio service, or other

radio common carrier service, or any service for which the called party is charged for the call,

unless such call is made solely to collect a debt owed to or guaranteed by the United States.” 47

U.S.C. § 227(b)(1)(A)(iii). Defendants argue that “[o]n their face, the ATDS restrictions

discriminate based on a call’s content . . . i.e., a caller may use an ATDS to collect a government

debt, but not, for example, to inform someone about a beneficial service, or . . . communicate

with a customer.” Doc. 34, p. 11. Defendants contend that these content-based restrictions are

subject to strict scrutiny, that they fail strict scrutiny, and that they are not severable from the

remainder of the statute.

As a preliminary matter, the Government argues this Court should consider severance

prior to reaching the constitutionality of the government-debt exception to avoid unnecessary

constitutional adjudication. They assert that the Court should first make a severability

determination, and if the challenged provision is severable and severance would provide no

relief, the Court may decline to determine the constitutionality of the government-debt exception.

The cases Defendants cite to support this argument incorporate the severability analysis

into the standing inquiry. See I.N.S. v. Chadha, 462 U.S. 919, 931 (1983) (considering

severability before going on to consider constitutionality where Congress had argued the

appellant “lacks standing to challenge the constitutionality of the one-House veto provision

because he could receive no relief even if his constitutional challenge proves successful”);

Advantage Media, L.L.C. v. City of Eden Prairie, 456 F.3d 793, 801 (2006) (rejecting Plaintiff’s

overbreadth challenge because “[s]ince most of the content based restrictions and procedural

mechanisms which Advantage claims violate the First Amendment rights of other parties were

not factors in the denial of its own permit applications, it cannot show causation with respect to

them. These challenges fail for lack of constitutional standing.” (internal citation omitted)).

However, in the First Amendment context where a party is arguing a statute is

underinclusive, the Supreme Court has rejected such arguments. In Arkansas Writers' Project,

Inc. v. Ragland, a Plaintiff magazine challenged as unconstitutionally underinclusive under the

First Amendment a state statute that subjected the magazine to a sales tax while exempting

newspapers. 481 U.S. 221 (1987). The state court found that “it would avail appellant nothing if

it wins its argument . . . It is immaterial that an exemption in favor of some other taxpayer may

be invalid, as discriminatory. If so, it is the exemption that would fall, not the tax against” the

Plaintiff. Id. at 226 (internal citations and alterations omitted). The Supreme Court rejected this

argument, finding “[w]e do not accept the Commissioner's notion of standing, for it would

effectively insulate underinclusive statutes from constitutional challenge, a proposition we [have]

soundly rejected . . . The Commissioner's position is inconsistent with numerous decisions of this

Court in which we have considered claims that others similarly situated were exempt from the

operation of a state law adversely affecting the claimant.” Id. at 227 (listing cases). See also Orr

v. Orr, 440 U.S. 268, 272 (1979) (“We have on several occasions considered this inherent

problem of challenges to underinclusive statutes, and have not denied a plaintiff standing on this

ground” (internal citations omitted)).

In the context of the TCPA, a New York district court also considered and rejected a

similar argument. In Mejia v. Time Warner Cable, Inc., defendants Time Warner moved to

dismiss a TCPA claim by alleging the government-debt exemption rendered the statute

underinclusive and therefore unconstitutional. No. 15-CV-6445 (JPO), 2017 WL 3278926

(S.D.N.Y. Aug. 1, 2017). Plaintiff and the Government responded by asserting that the

severability of the provision should be decided first, as it implicated Defendants’ standing to

challenge the exemptions. The Mejia court rejected this argument based on the nature of an

underinclusiveness challenge:

Time Warner is challenging the statute’s underinclusiveness—that is, imposing

liability for its calls but not for analogous calls placed for the purposes of debt

collection. Put another way, Time Warner is not directly challenging the

imposition of liability for its conduct in the first instance—which on its own

would certainly be constitutional. Rather, Time Warner is disputing Congress’s

ability to penalize its conduct while at the same time immunizing others' conduct,

solely on the basis of the content of the communications at issue . . . So too with

the incarnation of this argument in the guise of severability. Severability is a

question of remedy, to be addressed once a constitutional violation has been

identified . . To treat severability as an issue of justiciability would risk insulating

underinclusive statutes from constitutional challenge, as it would foreclose

challenges by parties liable under a rule made unconstitutional by a potentially

severable exception.

Id. at 12–13. Therefore, this Court will not avoid invalidating an unconstitutional provision of

law alleged to be underinclusive because severance would not affect Defendants’ eventual

liability under the TCPA. See also Whole Woman’s Health v. Hellerstedt, 136 S.Ct. 2292, 2319

(2016) (rejecting defendants’ argument that a severability clause in a Texas abortion law

precluded facial invalidation and required a “more narrowly tailored judicial remedy.” The

Supreme Court found that “[t]he provisions are unconstitutional on their face: Including a

severability provision in the law does not change that conclusion. . . if a severability clause could

impose such a requirement on courts, legislatures would easily be able to insulate

unconstitutional statutes from most facial review”); Perrong v. Liberty Power Corp., No. CV

18-712 (MN), 2019 WL 4751936, at *3 (D. Del. Sept. 30, 2019) (rejecting the Government’s

argument that Defendants did not have standing to challenge the TCPA because severing the

government-debt collection exemption would leave the possibility of liability under the

remaining portion).

Therefore, the Court will first address the constitutionality of the government-debt

exemption and then turn to severability.

1. Whether the government-debt exception is content-based

Under Reed, the threshold question is whether the provision, on its face, is content-

neutral. Reed, 135 S. Ct. at 2228 (“A law that is content based on its face is subject to strict

scrutiny regardless of the government's benign motive, content-neutral justification, or lack of

animus toward the ideas contained in the regulated speech.”).

Two courts of appeals have recently found the government-debt exception to be a

content-based restriction on speech. In Duguid v. Facebook, Inc., the Ninth Circuit reviewed a

challenge to the government-debt exception by defendant Facebook. 926 F.3d 1146 (9th Cir.

2019). The Ninth Circuit first considered whether the statute was content neutral on its face, and

concluded “it is obvious from the text that the debt-collection exception’s applicability turns

entirely on the content of the communication—i.e. whether it is ‘solely to collect a debt owed to

or guaranteed by the United States.’” Id. at 1153 (quoting 47 U.S.C. §227(b)(1)(A)(iii)). The

Fourth Circuit in American Association of Political Consultants, Inc., (AAPC) v. Federal

Communications Commission determined the same, holding that “the debt-collection exemption

to the automated call ban facially distinguishes between phone calls on the basis of their

content.” 923 F.3d 159, 166 (4th Cir. 2019). Several district courts have also concluded the

government-debt exception is content-based. See, e.g., Perrong, 2019 WL 4751936; Katz v.

Liberty Power Corp., LLC, No. 18-CV-10506-ADB, 2019 WL 4645524 (D. Mass. Sept. 24,

2019); Gallion v. Charter Commc’ns Inc., 287 F. Supp. 3d 920 (C.D. Cal. 2018); Greenley v.

Laborers’ Int’l Union of N. Am., 271 F. Supp. 3d 1128 (D. Minn. Sept. 2017); Mejia v. Time

Warner Cable Inc., No. 15-CV-6445, 2017 WL 3278926 (S.D.N.Y. Aug. 2017); Holt v.

Facebook, Inc., 240 F. Supp. 3d 1021 (N.D. Cal. Mar. 2017); Brickman v. Facebook, Inc., 230

F. Supp. 3d 1036 (N.D. Cal. Jan. 2017).

The Court agrees. On its face, the government-debt exception clearly applies only where

the call was made “solely to collect a debt owed to or guaranteed by the United States.” 47

U.S.C. § 227(b). The only way to determine whether a call falls within this exemption is to

examine whether the subject of the call was to collect a government debt.

Analogizing to an Eighth Circuit decision reviewing a state analogue of the TCPA, the

Government argues that the government-debt exemption is content-neutral, because it is based

“principally on the relationship between the two parties—namely the relationship between the

government and a debtor.” Doc. 53, p. 9. In Van Bergen, the Eighth Circuit reviewed the

Minnesota statute regulating the use of automatic dialing-announcing devices to determine

whether the statute’s three exemptions violated the First Amendment. Van Bergen v. State of

Minn., 59 F.3d 1541 (8th Cir. 1995). The three exemptions at issue were “messages to

subscribers with whom the caller has a current business or social relationship; messages from

schools for parents, students, or employees; and messages to employees advising them of work

schedules.” Id. at 1550. The Eighth Circuit found that each of these exemptions were content-

neutral, because they “exempt certain groups from the restrictions, not on the basis of the content

of their message, but on the basis of their relationship with the subscriber.” Id. A key detail was

that each of the relationships identified in the exemptions involved an established business,

social, or educational relationship, and the exemptions “merely identify groups of subscribers

that perforce already have consent to contact the subscriber, and who do not have to go through

the formality of obtaining additional specific consent to satisfy the statute.” Id. at 1551.

It is true that calls made pursuant to the government-debt exception may relate to the

relationship between the federal government and a debtor. However, on its face, the statute does

not limit the exemption on that basis. The provision explicitly limits its applicability to when the

content of the call is for the purpose of collecting a government debt. It does not mention the

relationship, nor is its scope limited to parties who have already consented to a relationship as in

Van Bergen. As the Ninth Circuit held, “[t]he text of the TCPA makes clear that the availability

of the exception depends exclusively on the purpose and content of the call. The relationship

between caller and recipient, though not coincidental, does not bear on the exception’s

applicability.” Duguid, 926 F.3d at 1155. See also Greenley v. Laborers' Int'l Union of N. Am.,

271 F. Supp. 3d 1128, 1149 (D. Minn. 2017) (“[I]n one sense [the TCPA government-debt

exception] is relationship based . . . But that relationship is between the debtor and the

government, whereas the debt collector initiating a telephone call often may be a third party that

has no preexisting relationship with the debtor.”). Therefore, the government-debt exception is

content-based and is subject to strict scrutiny.

2. Whether the government-debt exception survives strict scrutiny

In order to survive strict scrutiny, the Government “must demonstrate that the TCPA’s

differentiation between [robocalls to collect a debt owed to or guaranteed by the United States]

and other types of [robocalls] . . . furthers a compelling government interest and is narrowly

tailored to that end.” Duguid, 92 F.3d at 1155 (quoting Reed, 135 S. Ct. at 2231). “Importantly,

we focus our analysis on the content-based differentiation—the debt-collection exception—not

on the TCPA overall.” Id. at 1155. See also AAPC, 923 F.3d at 167 (“[I]n order to survive strict

scrutiny, the Government must show that the debt-collection exemption has been narrowly

tailored to further a compelling governmental interest.”).

The Government advances the governmental interest of “residential privacy.” The

Government also states in a footnote that “because the TCPA prevents robocalls made to private

places beside the home (e.g., hospitals churches, and workplaces), it also advances interest

beyond residential privacy.” Doc. 53, p. 11, n. 9 (emphasis in original). The Government does

not explain what those interests are or how they are furthered by the government-debt exception.

The Eighth Circuit has held residential privacy is not a compelling government interest. 9

Kirkeby v. Furness, 92 F.3d 655, 659 (8th Cir. 1996) (“Although the interest [in protecting

9 The Government cites two district court cases to support its proposition that the TCPA

promotes a compelling interest in residential privacy. However, the cases cited do not support

that proposition. Though a California district court in Gallion did find that “the TCPA as a

whole serves a compelling government interest” in residential privacy, see Gallion v. Charter

Communications Inc., 287 F.Supp.3d 920, 929 (C.D. Cal. 2018), the Ninth Circuit in Duguid

subsequently held the inquiry should be narrowed to the government-debt exception, and that the

government-debt exception “hinders—not furthers—the government’s asserted interest.”

Duguid, 926 F.3d, at 1155. The Minnesota district court in Greenley also found “that [residential

privacy] is a compelling interest is well-established in the Eighth Circuit and elsewhere.”

Greenley v. Laborers’ International Union of N. Am., 271 F.Supp.3d 1128, 1150 (D. Minn.

2017). However, in Greenley, neither party disputed the existence of a compelling interest.

Moreover, the cases cited by the Greenley court also do not support the conclusion that

residential privacy is a compelling interest to justify a content-based restriction. See, e.g., Van

Bergen v. State of Minn., 59 F.3d 1541, 1553–54 (8th Cir. 1995) (finding “residential privacy is a

significant government interest” in upholding a content-neutral state statute under intermediate

scrutiny); Patriotic Veterans, Inc., v. Zoeller, 845 F.3d 303 (7th Cir. 2017) (upholding state

statute as valid content-neutral time, place, and manner speech restriction and confirming the

“legitimacy” of the state’s interest in preventing unwanted calls); Cahaly v. Larosa, 796 F.3d

399, 405 (4th Cir. 2015) (“assuming” the interest in protecting residential privacy and tranquility

is compelling for the purposes of holding that the state anti-robocall statute is was not narrowly

tailored to that interest). These cases do not establish that residential privacy is a compelling

interest in the Eighth Circuit. Kirkeby is controlling.

residential privacy and tranquility] is a ‘substantial’ one, the Supreme Court has never held that it

is a compelling interest, and we do not think that it is.” (internal citations omitted)).

Further, the Government does not meaningfully explain how the government-debt

exception furthers its interest in residential privacy. Carey v. Brown, 447 U.S. 455 (1980), is

instructive on this point. In Carey, Illinois asserted that “ensur[ing] privacy in the home” was a

compelling interest justifying a state statute that generally prohibited residential picketing, but

permitted picketing related to labor disputes in certain circumstances. Carey, 447 U.S. at 457.

Though the Supreme Court acknowledged “[t]he State's interest in protecting the well-being,

tranquility, and privacy of the home is certainly of the highest order in a free and civilized

society,” it nonetheless found the distinction in the statute had no bearing on that privacy

interest. Id. at 465. “[T]he exclusion for labor picketing cannot be upheld as a means of

protecting residential privacy for the simple reason that nothing in the content-based labor-

nonlabor distinction has any bearing whatsoever on privacy. Appellant can point to nothing

inherent in the nature of peaceful labor picketing that would make it any less disruptive of

residential privacy than peaceful picketing on issues of broader social concern.” Id.

The government-debt exception makes no attempt to accommodate privacy concerns, and

the Government advances no justification for why calls pertaining to a debt owed to the

government are any less of a nuisance or privacy invasion. It is precisely this underinclusivity

that Defendants argue belies the Government’s asserted interest. See Nat'l Fed'n of the Blind v.

F.T.C., 420 F.3d 331, 345 (4th Cir. 2005) (finding that underinclusiveness is objectionable where

“it renders implausible the government’s claim that the regulation making this distinction is

narrowly tailored to address a certain interest.”). Therefore, even assuming residential privacy is

a compelling interest, the government-debt exception does not further that interest. See also

Duguid, 926 F.3d at 1155 (“Permitting callers to collect government debt thus hinders—not

furthers—the government’s asserted interest.”).

The government-debt exception is also not narrowly tailored to achieve its interest in

privacy. “A statute is narrowly tailored if it targets and eliminates no more than the exact source

of the ‘evil’ it seeks to remedy.” Frisby v. Schultz, 487 U.S. 474, 485 (1988). The Government

first focuses its argument on the ATDS restriction as a whole, asserting “[t]he autodialer

restriction’s prohibition on unwanted robocalls is narrowly tailored because it restricts a limited

method of communication—the use of certain technologies in placing calls—and only without

the consent of the called party, making it closely drawn to the unwanted intrusions it aims to

prevent.” Doc. 53, p. 12. However, this analysis does not incorporate the government-debt

exception at issue here. See Duguid, 926 F.3d at 1155 (“. . . [T]he government would have us

focus our analysis on the TCPA writ large rather than the debt-collection exception. It argues

that the post-amendment statute, viewed holistically, remains narrowly tailored to protect

personal and household privacy. This gloss-over approach is at odds with Reed, which directs

that the tailoring inquiry focus on the content-based differentiation—here, the debt-collection

exception.”).

The Government next asserts that the government-debt exception is “limited by the fact

that such calls would only be made to those who owe a debt to the federal government.” Doc.

53, p. 13 (quoting Brickman v. Facebook, Inc., 230 F. Supp. 3d 1036, 1047 (N.D. Cal. 2017)).

However, the terms of the government-debt exemption are not so limited. The exemption states

that the ATDS restriction does not apply to calls “made solely to collect a debt owed to or

guaranteed by the United States.” 47 U.S.C. § 227(b)(1)(A)(iii). It does not require these calls

to be made only to the debtors themselves. Presumably the calls could be made to any relevant

person so long as the purpose of the call was to collect a government debt. Moreover, the

statistics reviewed by other courts ruling on the government-debt exception draw into question

how limited of an exception this is given the substantial number of people owing debt to the

federal government. See, e.g., AAPC, 923 F.3d at 168 (“An FCC report [] revealed that more

than 41 million borrowers owed over one trillion dollars in federal student loans. Notably,

student loan debt . . . is but one category of debt that is guaranteed by or owed to the federal

government”).

Lastly, the Government argues the government-debt exception is limited because it “may

also be cabined by the TCPA’s express grant of authority to the FCC to ‘restrict or limit the

number and duration of calls made . . . to collect a debt owed to or guaranteed by the United

States.” Doc. 53, p. 13 (quoting 47 U.S.C. § 227(b)(2)(H)). That the FCC may in the future

further tailor the applicability of the government-debt exception does not make the current

content-based statute narrowly tailored. The language in the statute is permissive, (“In

implementing the requirements of [subsection (b)], the Commission may restrict or limit the

number and duration of calls made . . . to collect a debt owed to or guaranteed by the United

States,” 47 U.S.C. (b)(2)(H)), and the mere possibility of future narrow tailoring by the FCC

does not provide a sufficient basis to conclude the statute on its face is narrowly tailored.

Therefore, the government-debt exception fails strict scrutiny, and the Court must now

determine whether it is severable from the TCPA.

3. Whether the government-debt exception is severable from the

TCPA

Whether an unconstitutional provision can be separated to preserve the remainder of the

statute “is largely a question of legislative intent, but the presumption is in favor of severability.

‘Unless it is evident that the Legislature would not have enacted those provisions which are

within its power, independently of that which is not, the invalid part may be dropped if what is

left is fully operative as a law.’” Regan v. Time, Inc., 468 U.S. 641, 653 (1984) (quoting Buckley

v. Valeo, 424 U.S. 1, 108 (1976)). A severability clause in the statute “creates a presumption that

Congress did not intend the validity of the statute in question to depend on the validity of the

constitutionally offensive provision.” Alaska Airlines, Inc. v. Brock, 480 U.S. 678, 686 (1987).

Plaintiff and the Government contend the government-debt exception is severable,

relying largely on the recent Fourth Circuit and Ninth Circuit decisions finding the government-

debt exemption fails strict scrutiny but is nevertheless severable. Duguid, 926 F.3d at 1149;

AAPC, 923 F.3d at 171. The Government adds that both the severability provision and the

TCPA’s more than two decades of operation prior to the government-debt exception indicates

the exception is severable. Defendants respond10 that the Duguid and AAPC courts relied on a

dated severability clause, and that the legislative history of the TCPA and the timing of the

government-debt exception amendment indicate “Congress intended the restrictions to work in

tandem with the government-debt exemption, and thus it cannot be severed.” Doc. 54, p. 8.

Defendants further assert that the proper remedy is to strike down the entire ATDS restriction,

not enlarge their scope, in the interest of avoiding penalizing more speech to cure the defect.

10 The Defendants also argue that “Plaintiff is requesting that the constitutionally-repaired

version of the TCPA be applied retroactively to Defendants’ conduct. This violates principles of

retroactivity.” Doc. 51, p. 2. Generally retroactivity is implicated when a “new provision

attaches new legal consequences to events complete before its enactment.” Landgraf v. USI Film

Prod., 511 U.S. 244, 269 (1994). “Elementary considerations of fairness dictate that individuals

should have an opportunity to know what the law is and to conform their conduct accordingly.”

Id. at 265. Severance of the government-debt collection provision does not attach “new legal

consequences” to Defendants’ alleged activity. The exact TCPA provisions that Plaintiff has

alleged Defendants’ activities violated remain the same. Further, the class period alleged here

began before the government debt exception was enacted. Therefore, the Defendants’

retroactivity concerns are unfounded.

To support their argument, Defendants cite Rappa v. New Castle Ct., where the Third

Circuit struck down an entire statute restricting speech rather than the exception to the statute

because “eliminating the offending exception would mean that we would be requiring the State

to restrict more speech than it currently does.” 18 F.3d 1043, 1072–73 (3d Cir. 1994). The

Third Circuit found severance was not the proper remedy “absent quite specific evidence of

legislative preference for elimination of the exception.” Id. at 1073. Delaware’s severability

clause, which applied to its entire civil and criminal code, was not specific enough evidence. Id.

Here, however, evidence in favor of severability is not so vague. The applicable

severability clause enacted by Congress applies to the Telecommunications Title subchapter

regarding Wire or Radio Communication. 47 U.S.C. § 608 (“If any provision of this chapter

[containing the TCPA] . . . is held invalid, the remainder . . . shall not be affected thereby.”). It

does not apply to the entire U.S. Code, or even the entire Telecommunications Title. This

severability clause is sufficiently specific and “creates a presumption that Congress did not

intend the validity of the statute in question to depend on the validity of the constitutionally

offensive provision.” Alaska Airlines, 480 U.S. at 686. Moreover, the TCPA was enacted in

1991 and operated without the government-debt exception until 2015 when it was amended. If

the government-debt provision is severed, the TCPA remains “fully operative as law” as it did

prior to the amendment. “The newly enacted exception did not suddenly and silently become so

integral to the TCPA that the statute could not function without it.” Duguid, 926 F.3d at 1157.

Defendants are correct that, as with all statutory amendments, Congress likely intended

the ATDS restrictions to work in tandem with the exemptions. However, Congressional intent

that a statute’s provisions function in harmony with subsequent amendments does not compel the

conclusion that Congress intended those subsequent amendments to be unable to be severed.

Given the general presumption in favor of severability, the apparent Congressional intent that the

unconstitutional provision be severed, and the TCPA’s demonstrated ability to be fully operative

without the severed provision, the Court finds the government-debt exception is severable.

Other courts have found the same. See, e.g., Perrong, 2019 WL 4751936; Wilson v. PH Phase

One Operations L.P., No. CV DKC 18-3285, 2019 WL 4735483 (D. Md. Sept. 27, 2019); Katz

v. Liberty Power Corp., LLC, No. 18-CV-10506-ADB, 2019 WL 4645524 (D. Mass. Sept. 24,

2019); Duguid, 926 F.3d at 1157; AAPC, 923 F.3d at 171. Therefore, Defendants’ motion to

dismiss on the ground that the government-debt exception is unconstitutional and unseverable is

denied.

ii. ATDS Government-Speaker Exemption

Having severed the government-debt exception, the Court considers Defendants’

remaining arguments with respect to the ATDS restrictions. Defendants contend that the fact

that the statute does not include government entities within the definition of “person” and the

FCC’s subsequent ruling that “government agents communicating ‘authorized’ messages are also

exempt” indicates a “content-based preference for government messages, regardless of the

speaker’s identity and independently triggers strict scrutiny.” 11 Doc. 34, p. 12.

The TCPA provision prohibiting the use of ATDS applies to “any person within the

United States, or any person outside the United States if the recipient is within the United

States”. 47 U.S.C. §227(b)(1)(A)(iii). The TCPA itself does not define “person,” but the

11 As noted above, the Court does not have the subject matter jurisdiction to evaluate the

constitutionality of an FCC Order, and at oral argument Defendants clarified they do not wish to

challenge the constitutionality of the FCC’s rulings. Therefore the Court will not consider this

ruling for the purposes of its analysis. The remainder of Defendants’ argument rests on the

Communications Act’s definition of “person.”

Communications Act of 1932, which the TCPA amended, provides that “[t]he term ‘person’

includes an individual, partnership, association, joint-stock company, trust or corporation.” 47

U.S.C. § 153(39).

As an initial matter, although the Supreme Court has held the federal government and its

agencies are not subject to the TCPA provisions, see Campbell-Ewald Co. v. Gomez, 136 S.Ct.

663 (2016), as revised (Feb. 9, 2016), it is not clear that the Defendants are correct in their

assertion that the statute excludes all government entities from the definition of a person. The

language of § 153(39) provides that the term ‘person’ includes an individual, partnership,

association, joint-stock company, trust or corporation, but the text itself does not strictly limit

‘person’ to those terms. When used in a statutory definition, “the word ‘includes’ . . . ‘is usually

a term of enlargement, and not of limitation.’” Pattison Sand Co., LLC v. Fed. Mine Safety &

Health Review Comm'n, 688 F.3d 507, 513 (8th Cir. 2012) (quoting Burgess v. United States,

553 U.S. 124, 131 n.3 (2008)). See also Greenley v. Laborers' Int'l Union of N. Am., 271 F.

Supp. 3d 1128, 1141–42 (D. Minn. 2017) (quoting In re Union Pac. R.R. Emp't Practices Litig.,

479 F.3d 936, 946 (8th Cir. 2007)) (concluding that “the TCPA's definition of ‘person’ prefaces

its list with the word ‘includes.’ This term ‘suggests Congress was being illustrative rather than

exclusive with the list following the phrase’”). Moreover, the majority of the almost sixty other

definitions listed in § 153 use the phrasing “means” rather than “includes,” suggesting that if

Congress had wanted the terms listed in the definition of ‘person’ to be a limitation, it would

have phrased it accordingly. See, e.g., 47 U.S.C. § 153(42) (“The term ‘radio station’ or ‘station’

means a station equipped to engage in radio communication or radio transmission of energy”).

There are also conflicting interpretations among other courts. See, e.g., Schuppe v.

Harris & Harris, Ltd., No. 18 C 8221, 2019 WL 2473832, at *2 (N.D. Ill. June 13, 2019)

(temporarily declining to address the interpretation of the definition of “person” where a local

government contractor contended it was not a ‘person’ under the TCPA, because it was “hesitant

to make a definitive ruling on the issue prior to receiving direction from the FCC”); Lambert v.

Seminole Cty. Sch. Bd., No. 6:15-CV-78-ORL-18DAB, 2016 WL 9453806, at *3 (M.D. Fla. Jan.

21, 2016) (finding that a Plaintiff could not sustain a TCPA action against a local school board

because “conspicuously absent” from the definition of “person” was “any mention of

governmental entities, let alone a phrase that may reasonably construed as encapsulating a

sovereign”).

Even assuming the 47 U.S.C. § 153(39) definition as used in the TCPA does exclude

government entities, there is no evidence that this is a content-based preference under the Reed

analysis. Under Reed’s first step, § 153(39) on its face is not content-based. The provision lists

parties who are defined as “person” under the Communications Act. It says nothing about the

content of their communication. Defendants assert that this speaker preference reflects a content

preference for certain types of speech. “[L]aws favoring some speakers over others demand strict

scrutiny when the legislature's speaker preference reflects a content preference.” Turner

Broadcasting System, Inc. v. FCC, 512 U.S. 622, 658 (1994). However, there is no evidence that

failure to include government speakers in the definition of “person” reflected an effort by

Congress to favor its own message or those of other government entities. Therefore the alleged

government-speaker exemption is not subject to strict scrutiny.

Assuming the 47 U.S.C. § 153(39) definition of “person” as used in the TCPA does

exclude government entities, it is constitutional as a reasonable time, place, and manner

restriction under intermediate scrutiny. A content-neutral law that regulates speech is valid if the

restrictions “are justified without reference to the content of the regulated speech, [] narrowly

tailored to serve a significant governmental interest, and [] leave open ample alternative channels

for communication of the information.” Ward v. Rock Against Racism, 491 U.S. 781, 791

(1989).

First, the ATDS restriction and its alleged government-speaker exemption can be justified

without reference to the content of the speech. Congress has chosen to regulate the

telemarketing practices that the record reflected were the most intrusive due to their unexpected

and frequent nature. H.R. Rep. No. 102-317, at 16 (1991) (stating that the committee reviewed

data from states demonstrating that “consumer complaints about unsolicited telemarketing

involved calls that were mostly commercial in nature.”) The record does not indicate calls from

government sources were necessarily among the nuisance calls that consumers were concerned

about.

Moreover, the Government offers a broader justification as to why the government would

be exempt. First, that the TCPA’s definition does not explicitly include the federal government

is not a speaker-preference but rather a reflection of its inherent sovereign immunity. Campbell-

Ewald Co., 136 S.Ct. at 673 (“The United States and its agencies, it is undisputed, are not subject

to the TCPA’s prohibitions because no statute lifts their immunity.”).

Further, the Government argues that the Government is permitted to subject its own

speech to differing requirements and it has “never been thought to raise First Amendment

concerns.” Doc. 53, p. 8. “The Free Speech Clause restricts government regulation of private

speech; it does not regulate government speech. A government entity has the right to speak for

itself. It is entitled to say what it wishes, and to select the views it wants to express.” Pleasant

Grove City, Utah v. Summum, 555 U.S. 460 (2009) (internal citations and quotations omitted).

See also Walker v. Texas Div., Sons of Confederate Veterans, Inc., 135 S. Ct. 2239, 2246 (2015)

(“[A]s a general matter, when the government speaks it is entitled to promote a program, to

espouse a policy, or to take a position. In doing so, it represents its citizens and it carries out its

duties on their behalf.”) Even assuming the TCPA does not apply to government entities, the

fact that Congress chose not to include a restriction on government’s speech is consistent with

this principle. See also Mejia, 2017 WL 3278926, at *15 (holding that “the mere absence of

liability for government speakers [under the TCPA] does not raise a First Amendment problem,”

relying in part on sovereign immunity grounds). The Government has justified the alleged

exemption without reference to the content of the speech.

Second, the Eighth Circuit has concluded “residential privacy” is a substantial

governmental interest, Kirkeby, 92 F.3d at 659, and the history of the TCPA indicates its goal in

enacting the restrictions was to regulate “intrusive, nuisance calls to [consumers’] homes from

telemarketers,” Pub. L. No. 102-243, 105 Stat. 2394 (1991). By targeting such telephone

solicitations, Congress has narrowly tailored the restriction to this privacy interest. See Van

Bergen, 59 F.3d at 1555 (finding Minnesota’s TCPA analogue was narrowly tailored to reach the

substantial interest in limiting the use of unsolicited, unconsented-to autodialed calls because

“the statute does not foreclose an entire medium of expression, and the limits on [autodialed]

calls are designed to remedy the problems perceived the liberal use of [autodialer] technology.”

(internal citation omitted)).

Finally, the restrictions leave open ample alternative channels for communication. The

Government contends, “should Defendants wish to contact prospective customers, they may use

an autodialer to do so after obtaining the person’s consent, or may contact the person without

using an autodialer.” Doc. 53, p. 12. These alternative channels for communication are

sufficient. See Moser v. F.C.C., 46 F.3d 970, 975 (9th Cir. 1995) (“The restrictions in the

[TCPA] leave open many alternative channels of communication, including the use of taped

messages introduced by live speakers or taped messages to which consumers have consented, as

well as all live solicitation calls. That some companies prefer the cost and efficiency of

automated telemarketing does not prevent Congress from restricting the practice.”).

Defendants’ underinclusivity arguments fail with respect to this alleged exemption. It is

well established that legislatures are not required to regulate all speech or no speech. The

Supreme Court has rejected the argument “that failure to regulate all speech renders the statute

fatally underinclusive.” Burson v. Freeman, 504 U.S. 191 (1992) (holding that a Tennessee

statute restricting vote solicitation but not charitable or commercial solicitation did not violate

the First Amendment, because the state had evidence that vote solicitation on election day was

the predominant issue, and “States adopt laws to address the problems that confront them. The

First Amendment does not require States to regulate for problems that do not exist”). See also

City of New Orleans v. Dukes, 427 U.S. 297, 303 (1976) (“Legislatures may implement their

program step by step . . . adopting regulations that only partially ameliorate a perceived evil and

deferring complete elimination of the evil to future regulations.”); Nat'l Fed'n of the Blind v.

F.T.C., 420 F.3d 331, 349 (4th Cir. 2005) (“We have no warrant to prevent the government from

addressing a problem one step at a time . . . We thus need not prevent the government from

confronting problems incrementally; to do so would ignore the warning that the government is

not required to make progress on every front before it can make progress on any front.”)

Underinclusiveness is objectionable where “it renders implausible the government’s

claim that the regulation making this distinction is narrowly tailored to address a certain

interest.” Nat'l Fed'n of the Blind, 420 F.3d at 345. As discussed, the regulation is narrowly

tailored to the Government’s substantial interest in residential privacy, and the fact that it may

not apply to government entities does not render this interest implausible.

Therefore, even assuming ATDS restrictions do not apply to government entities, it is a

valid time, place, and manner restriction on speech. See Duguid v. Facebook, Inc., 926 F.3d

1146, 1153 (9th Cir. 2019) (“We have repeatedly affirmed that the pre-[government-debt]

amendment TCPA was content-neutral and consistent with the First Amendment” under the

intermediate scrutiny standard). Defendants’ motion to dismiss on this ground is denied.

iii. Non-Profit Exemption

Defendants also challenge the TCPA’s exemption of non-profits from its definition of

“telephone solicitation,” as incorporated in the national-do-not-call registry provision, and from

the prohibition on calls placed for telemarketing purposes. Defendants assert that “[b]ecause the

statutory and regulatory definitions of ‘telephone solicitation’ exempt non-profit organizations,

the NDNCR provisions contain speaker-based exemptions” that should be subject to strict

scrutiny. 12 Doc. 34, p. 2.

Defendants assert that the “Section 227(c)(5) of the TCPA imposes liability for placing

more than one ‘telephone solicitation’ in a twelve-month period to a number on the NDNCR.”

Doc. 34, p. 2. It is unclear whether the TCPA standing alone imposes such a restriction on

speech by defining “telephone solicitation” without a corresponding prohibition and by

providing a private right of action for violation of the regulations, but not the statute. However,

12 As discussed above, the Court does not have subject matter jurisdiction to determine the

validity of the FCC’s regulations. The remainder of Defendants’ claim that the non-profit

exemption is unconstitutional is rooted in the TCPA’s definition of “telephone solicitation” and

its private right of action for violations of regulations promulgated pursuant to § 227(c).

to the extent that the statute’s definition of telephone solicitation, directives to the FCC to

implement regulations concerning telephone solicitations, and private right of action imposing

liability for violations of the regulations may evince a preference for certain speech, the Court

finds it to be constitutional.

Defendants contend that the exemption of non-profits is a speaker preference that reflects

a content preference, and therefore it should be subject to strict scrutiny under Reed. Under the

first step in the Reed analysis, the non-profit exemption is content-neutral on its face. The text of

the statute provides that “telephone solicitation . . does not include a call or message . . . by a tax

exempt nonprofit organization.” 47 U.S.C. §227(a)(4). It makes no reference to the content of

the calls tax exempt non-profits are permitted to make. A non-profit could place the exact same

call as a party making a commercial telephone solicitation, and its status as a non-profit would

exempt it from the statute.

Defendants contend that the nonprofit exemption is nevertheless subject to strict scrutiny

because it cannot be justified without reference to the content of the speech. They assert that

“[f]or-profit and non-profit entities are distinguished by law and, by definition, pursue differing

objectives. That the content of the communications or the viewpoints they advocate for would

differ is apparent.” Doc. 54, p. 11. However, when confronted with a similar argument in

Turner Broadcasting System, Inc., v. F.C.C., the Supreme Court rejected the argument that a

regulation that differentially regulated broadcast and cable programming was content-based

because “the preference for broadcast stations automatically entails content requirements.”

Turner Broad. Sys., Inc. v. F.C.C., 512 U.S. 622, 649 (1994) (emphasis in original) (internal

quotations omitted). The Supreme Court found that even though the external regulation of

broadcast programming versus cable programming meant the content between the two inevitably

differed, “it does not follow that Congress mandated cable carriage of broadcast television

stations as a means of ensuring that particular programs will be shown, or not shown, on cable

systems.” Id. at 649–50.

Moreover, the Congressional record here is clear that the TCPA was enacted to target

unexpected, frequent solicitations, and that non-profits were exempted because the record

reflected that calls from non-profits were more expected and less frequent. H.R. Rep. No. 102-

317, at 16 (1991) (“In addition to the relative low volume of non-commercial calls, the

Committee also reached the conclusion, based on the evidence, that such calls are less intrusive

to consumers because they are more expected. Consequently, the two main sources of consumer

problems—high volume of solicitations and unexpected solicitations—are not present in

solicitations by nonprofit organizations”) (The record “does not contain sufficient evidence to

demonstrate that calls from these tax exempt nonprofit organizations should be subject to the

restrictions . . . Complaint statistics show that unwanted commercial calls are a far bigger

problem than unsolicited calls from political or charitable organizations.”) The statute and the

Congressional record make no reference to the subjects of the calls non-profits are permitted to

make. The Court finds the non-profit exemption is content-neutral and therefore not subject to

strict scrutiny.

Plaintiff and the Government argue that the applicable standard of review is either

intermediate scrutiny, which is applied to content-neutral time, place, and manner restrictions, or

the Central Hudson commercial speech analysis. In Central Hudson, the Supreme Court

established a four-part test to review challenges to restrictions on commercial speech, defined as

“expression related solely to the economic interests of the speaker and its audience.” Central

Hudson Gas & Electric Corp. v. Public Serv. Comm’n of NY, 447 U.S. 557, 561 (1980). The

Central Hudson test requires this Court to determine:

(1) whether the commercial speech at issue concerns unlawful activity or is misleading;

(2) whether the governmental interest is substantial; (3) whether the challenged

regulation directly advances the government's asserted interest; and (4) whether the

regulation is no more extensive than necessary to further the government's interest.

1-800-411-Pain Referral Serv., LLC v. Otto, 744 F.3d 1045, 1055 (8th Cir. 2014). The TCPA

defines “telephone solicitation” as:

the initiation of a telephone call or message for the purpose of encouraging the purchase

or rental of, or investment in, property, goods, or services, which is transmitted to any

person, but such term does not include a call or message (A) to any person with that

person's prior express invitation or permission, (B) to any person with whom the caller

has an established business relationship, or (C) by a tax exempt nonprofit organization.

47 U.S.C. § 227(a)(4). The definition limits its applicability to callers with an economic motive,

which is “expression related solely to the economic interests of the speaker and its audience.”

Central Hudson, 447 U.S. at 461. Moreover, though the Eighth Circuit has not considered the

constitutionality of the telephone solicitation definition, it has considered and upheld the TCPA’s

ban on unsolicited fax advertisements after applying the Central Hudson commercial speech test.

See Missouri ex rel. Nixon v. Am. Blast Fax, Inc., 323 F.3d 649, 658 (8th Cir. 2003). Therefore,

the Court will apply the Central Hudson inquiry to the telephone solicitation definition.13 See

13 Other courts have analyzed the TCPA as a whole as a content-neutral time, place, and manner

restriction subject to intermediate scrutiny. See, e.g., Moser v. F.C.C., 46 F.3d 970, 973 (9th Cir.

1995) (upholding the TCPA provision restricting automated telemarketing calls as a content-

neutral time, place, and manner restriction). These standards, however, are quite similar and

therefore applying the time, place, and manner intermediate scrutiny analysis would not produce

a different outcome here. See Bd. of Trustees of State Univ. of New York v. Fox, 492 U.S. 469,

477 (1989) (stating that “the application of the Central Hudson test was ‘substantially similar’ to

the application of the test for validity of time, place, and manner restrictions upon protected

speech”); Passions Video, Inc. v. Nixon, 458 F.3d 837, 841–42 (8th Cir. 2006) (“Regulations on

commercial speech are subject to intermediate scrutiny under the framework set forth in Central

Hudson”); Moser v. F.C.C., 46 F.3d 970, 973 (9th Cir. 1995) (“[T]he tests for time, place, and

also Mainstream Mktg. Servs., Inc. v. F.T.C., 358 F.3d 1228, 1236 (10th Cir. 2004) (upholding

the national-do-not-call registry under the Central Hudson test after finding “[t]he national do-

not-call registry's telemarketing restrictions apply only to commercial speech.”)

First, the definition of telephone solicitation does not solely pertain to unlawful or

misleading activity, therefore the regulated speech is protected by the First Amendment. Second,

the Eighth Circuit has conclusively held that “[r]esidential privacy is a significant government

interest.” Van Bergen v. State of Minn., 59 F.3d 1541, 1554 (8th Cir. 1995) (upholding a state

analogue of the TCPA as a content-neutral time, place, or manner restriction); Fraternal Order

of Police, N.D. State Lodge v. Stenehjem, 431 F.3d 591, 597 (8th Cir. 2005) (“[R]esidential

privacy is a significant government interest, particularly when telemarketing calls are

flourishing, and becoming a recurring nuisance by virtue of their quantity” (internal quotations

omitted)).

Third, the restriction must directly advance the state’s asserted interest. “This step

concerns the relationship between the harm that underlies the State's interest and the means

identified by the State to advance that interest.” Passions Video, Inc. v. Nixon, 458 F.3d 837,

842 (8th Cir. 2006). The harm Congress identified when enacting the TCPA was frequent and

unexpected commercial solicitations, and the legislative history reviewed above indicates “the

two main sources of consumer problems—high volume of solicitations and unexpected

solicitations—are not present in solicitations by nonprofit organizations.” H.R. Rep. No. 102-

317, at 16 (1991). Further, the use of telephone solicitation in the statute applies to the potential

creation of a national do-not-call registry, wherein users affirmatively represent that an

manner restrictions for content-neutral speech and regulations for commercial speech regulations

are essentially identical”).

unconsented telephone solicitation is unwanted. Therefore, the legislative history and the means

adopted by Congress to further the interests of preventing unwanted calls directly advances the

goal of reducing the prevalence of unwanted calls. See Missouri ex rel. Nixon, 323 F.3d at 658

(quoting United States v. Edge Broad. Co., 509 U.S. 418, 432–34 (1993)) (“By placing

restrictions on those responsible for a large portion of the problem, TCPA directly and materially

advances the congressional goal of limiting the harm arising from unsolicited fax advertisements.

Congress is not required to ‘make progress on every front before it can make progress on any

front.’”); Mainstream Mktg. Servs., 358 F.3d at 1245 (reviewing the non-profit exemption in the

national-do-not-call registry and finding it was “narrowly tailored to restrict only speech that

contributes to the problems the government seeks to redress, namely the intrusion into personal

privacy and the risk of fraud and abuse caused by telephone calls that consumers do not welcome

into their homes.”).

Finally, the definition of telephone solicitation does not burden more speech than is

necessary to further the State’s interest in residential privacy. Congress identified unwanted,

frequent commercial solicitations to be the predominant harm targeted by the TCPA and crafted

this statutory provision to directly address that. Further, “a content-neutral and viewpoint-neutral

opt-in provision like the one here limits the degree of government interference with First

Amendment interests.” Fraternal Order of Police, N.D. State Lodge v. Stenehjem, 431 F.3d 591,

599 (8th Cir. 2005) (upholding the North Dakota statute prohibiting solicitation of “do not call”

registrants under an intermediate scrutiny review).

Therefore, the non-profit exemption from the definition of “telephone solicitation”

survives Central Hudson’s commercial speech test and is constitutional. Defendant’s motion to

dismiss on this ground is denied.

b. Equal Protection

Defendants also claim the TCPA violates the Equal Protection Clause, arguing Plaintiff

cannot show the “differential treatment” of different types of speech survives equal protection

scrutiny, because “[t]he Equal Protection Clause requires that statutes affecting First Amendment

interests be narrowly tailored to their legitimate objectives” and “for the same reasons stated

above, the restrictions are not narrowly tailored to their intended interest.” Doc. 34, p. 14.

Because Defendants do not advance any new arguments with respect to the alleged equal

protection violation and the Court has fully addressed their First Amendment claims above, it

need not decide the issue. “‘It is generally unnecessary to analyze laws which burden the

exercise of First Amendment rights by a class of persons under the equal protection guarantee,

because the substantive guarantees of the Amendment serve as the strongest protection against

the limitation of these rights.’” Hill v. City of Scranton, 411 F.3d 118, 126 (3d Cir. 2005)

(quoting Ronald Rotunda & John Nowak, 3 Treatise on Constitutional Law: Substance and

Procedure § 18.40, at 796 (3d ed.1999)) (holding that because Plaintiffs’ “First Amendment and

Equal Protection claims are functionally identical [] it would be redundant to treat them

separately . . . We will examine the [plaintiffs’] First Amendment retaliation claim directly rather

than as a component of their derivative equal protection claim”); see also Sherbert v. Verner, 374

U.S. 398, 409 (1963) (finding that after holding the plaintiff’s First and Fourteenth Amendment

guarantee of free exercise of religion had been violated by a state’s denial of unemployment

benefits, it need not consider whether the state’s action had also deprived her of equal

protection).

Further, the only case cited by Defendants to support their equal protection argument is

distinguishable. The speech restriction in Police Department of the City of Chicago v. Mosley

concerned what the Supreme Court had determined was a content-based restriction on speech.

408 U.S. 92, 96 (“[U]nder the Equal Protection Clause, not to mention the First Amendment

itself, government may not grant the use of a forum to people whose views it finds acceptable,

but deny use to those wishing to express less favored or more controversial views.”) Here, the

Court has already determined the alleged government-speaker exemption and non-profit

exemption are content-neutral, and thus Mosley’s analysis is inapplicable. Therefore, the Court

does not decide the Equal Protection question.

c. Fifth Amendment Due Process Clause

Lastly, Defendants assert that the TCPA ATDS provisions are unconstitutionally vague

because the ATDS definition “fail[s] to give a person of ordinary intelligence adequate notice of

what constitutes an ATDS.” Doc. 34, p. 15. The Government responds that Defendants’ claim

“amounts to a complaint that the TCPA does not precisely identify all devices that qualify as an

ATDS,” which should fail because the TCPA “uses words of common understanding” that courts

have been able to apply with standard statutory interpretation, including for the eleven years after

the statute was enacted but before any regulations elaborating on the ATDS definition were

adopted. Doc. 53, p. 15.

The TCPA defines an ATDS as “equipment which has the capacity— (A) To store or

produce telephone numbers to be called, using a random or sequential number generator; and (B)

To dial such numbers.” 47 U.S.C. § 227(a)(1).

“It is a basic principle of due process that an enactment is void for vagueness if its

prohibitions are not clearly defined.” Grayned v. City of Rockford, 408 U.S. 104, 108 (1972).

“Under the void-for-vagueness doctrine, a law is unconstitutional if it fails to provide a person of

ordinary intelligence fair notice of what is prohibited, or is so standardless that it authorizes or

encourages seriously discriminatory enforcement.” Musser v. Mapes, 718 F.3d 996, 1000 (8th

Cir. 2013) (internal quotations omitted). “[P]erfect clarity and precise guidance have never been

required even of regulations that restrict expressive activity.” Ward v. Rock Against Racism, 491

U.S. 781, 794 (1989).

The ATDS definition is not unconstitutionally vague. The statute uses common words

that give a person of ordinary intelligence a reasonable opportunity to know the types of dialing

systems the TCPA prohibits. When deciding whether a statute is unconstitutionally vague,

“[c]ommon sense must not be and should not be suspended.” Anderson v. Milwaukee County,

433 F.3d 975, 978 (7th Cir. 2006). A caller of ordinary intelligence is on notice that if they use a

system that is storing or producing numbers using a random or sequential number generator, and

then dialing those numbers, they may come within the scope of the statute’s prohibition. That

Congress may, “without difficulty, have chosen clearer and more precise language equally

capable of achieving the end which it sought does not mean that the statute which it in fact

drafted is unconstitutionally vague.” United States v. Powell, 423 U.S. 87, 94 (1975) (internal

quotations and alterations omitted). See Van Bergen, 59 F.3d at n. 6 (rejecting a vagueness

challenge to the Minnesota TCPA analogue which the court determined was “virtually identical”

to the TCPA with two exceptions); Wilson, 2019 WL 4735483, at *7 (“Thus, although technical,

the TCPA’s definition of an ATDS is set out in terms that an ordinary person exercising ordinary

common sense can understand sufficiently and comply with.”).

To demonstrate the statute’s vagueness, Defendants rely in part on a D.C. Circuit

decision finding the FCC’s interpretation of what constitutes an ATDS to be overbroad, asserting

this “underscores the lack of clarity concerning conduct that is—and is not—unlawful.” Doc.

51, p. 3. In 2018 the D.C. Circuit reviewed and struck down the FCC’s most recent

interpretation of ATDS, finding the FCC’s ruling, which seemingly would include all

smartphones as autodialers, was an “unreasonably, and impermissibly, expansive one” that in

“describing the functions a device must perform to qualify as an autodialer, fails to satisfy the

requirement of reasoned decisionmaking.” ACA Int’l v. F.C.C., 885 F.3d 687, 700, 703 (D.C.

Cir. 2018). The case did not raise the issue of whether the statute was unconstitutionally vague,

and therefore the D.C. Circuit’s determination that the FCC’s overbroad rulings that have since

been struck down left the public in a “significant fog of uncertainty” is not determinative.

Defendants also point to the fact that after ACA International, courts have come to

different conclusions about the scope of what constitutes an ATDS, “further demonstrating that

the ATDS restrictions are void for vagueness.” Doc. 51, p. 3. However, “[a]lthough there may

be issues of interpretation regarding the meaning of a statute, that in itself does not give rise to a

finding of unconstitutional vagueness.” Farkas v. Miller, 151 F.3d 900, 906 (8th Cir. 1998). “A

statute is not necessarily void for vagueness simply because it may be ambiguous or open to two

constructions.” Williams v. Brewer, 442 F.2d 657, 660 (8th Cir. 1971). See also Henry v.

Radius Glob. Sols., LLC, 357 F. Supp. 3d 446, 459 (E.D. Pa. 2019) (“Mere disagreement

amongst courts over the interpretation of a statute does not render the statute unconstitutionally

vague.”). Courts after ACA International have been able to apply standard tools of statutory

interpretation to come to and apply a workable definition of an ATDS. That courts have come to

different conclusions in their interpretations does not render the statute unconstitutionally vague.

See, e.g., Marks v. Crunch San Diego, LLC, 904 F.3d 1041 (9th Cir. 2018); Dominguez on

Behalf of Himself v. Yahoo, Inc., 894 F.3d 116 (3d Cir. 2018); Thompson-Harbach v. USAA

Fed. Sav. Bank, 359 F. Supp. 3d 606 (N.D. Iowa 2019). Here, whatever ambiguity the ATDS

definition may exhibit, it does not rise to the level of unconstitutional vagueness.

Defendants further argue that “as applied here . . . nothing in the statute’s language

indicated that it applied broadly to a web-based platform that could not send text messages

without human intervention at every phase of the process.” Doc. 34, p. 15. However, as the

Plaintiff notes, “[t]he systems described in the Complaint dial numbers from a stored list—

precisely what is prohibited by statute and something years of case law and regulation should

have put Defendants on notice of.” Doc. 49, p. 15. Further, Plaintiff’s first amended Complaint

alleges that the text messages at issue are sent without human intervention. See Doc. 20, ¶ 52.

Accepting Plaintiff’s factual allegations as true as the Court must at this stage, Zink v. Lombardi,

783 F.3d 1089, 1098 (8th Cir. 2015), the ATDS definition is not unconstitutionally vague as

applied to the system alleged here. See Wilson, 2019 WL 4735483, at *8 (rejecting an identical

vagueness challenge to the ATDS definition because “[t]he statute prohibits calls made by

software with the capacity to store or produce telephone numbers to be called, using a random or

sequential number generator. Plaintiff alleges that Txt Live! is such a device in the complaint.

Accordingly, the TCPA’s definition of an ATDS is not unconstitutionally vague.”). Defendants’

motion to dismiss on vagueness grounds is denied.

IV. CONCLUSION

For the reasons discussed above, the motion to dismiss by Defendants is DENIED.

s/ Nanette K. Laughrey

NANETTE K. LAUGHREY

United States District Judge

Dated: December 3, 2019

Jefferson City, Missouri