18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 723 be bound by a statutory mandate requiring it to contact hundreds of thousands, if not millions, of people, but that its employees would face staggering liability if they did so. The Fourth Circuit opined that this would prevent the CMS from using cost-effective communications technology that many government agencies already used to comply with other congressional mandates and contractual partnerships that would allow the government to leverage the advanced capacities and expertise of the private sector. Id . at 367. Further, the Fourth Circuit reasoned that the public-private partnerships that agencies commonly relied on to meet their statutory mandates would become vulnerable to attack by litigation. The Fourth Circuit therefore concluded that because Defendants were acting in the course of their official duties and because the United States was the real party in interest, it affirmed the District Court’s ruling dismissing the case on sovereign immunity grounds. Dr. Robert L. Meinders, Ltd, et al. v. United Healthcare Services, 7 F.4th 555 (7th Cir. 2021). Plaintiff, a chiropractic services provider, filed a class action alleging that Defendant sent fax messages that violated the Telephone Consumer Protection Act (“TCPA”). Defendant filed a motion to compel arbitration on the grounds that Plaintiff’s claims were subject to arbitration under a provider agreement with a wholly owned subsidiary named American Chiropractic Network Inc. (“ACN”). The District Court granted the motion. On appeal, the Seventh Circuit affirmed the District Court’s ruling. Plaintiff argued that Defendant was a non-signatory to the agreement between himself and ACN, and thus could not be bound by its terms. The agreement between Plaintiff and ACN allowed Plaintiff to access and provide care for Defendant’s network of patients. Under the terms of the agreement, Plaintiff submitted claims to Defendant, which paid the claims directly to Plaintiffs. Defendant’s master services agreement with ACN stated the insurer would perform ACN’s provider agreement obligations. The Seventh Circuit ruled that Defendant’s conduct over the course of its relationship with Plaintiff demonstrated that, despite being a non-signatory to the provider agreement, it assumed ACN’s obligations under that agreement. The Seventh Circuit determined that since Defendant performed a variety of services and duties for Plaintiff though his agreement with ACN, the arbitration agreement extended to Defendant. The Seventh Circuit further explained that the master services agreement did not prohibit assumption, Defendant’s performance of ACN’s provider agreement obligations should not be construed as an assumption, or that Defendant’s performance of those obligations was solely pursuant to its promises under the master services agreement. Id . at 563. The Seventh Circuit therefore found that the District Court did not err in granting Defendant’s motion to compel arbitration, and it affirmed the decision. Gorss Motels Inc., et al. v. A.V.M. Enterprises, 2021 U.S. Dist. LEXIS 57970 (D. Conn. March 26, 2021). Plaintiff, a hotel franchise, filed a class action alleging that Defendant, a supplier, sent six unsolicited faxes without prior authorization in violation of the Telephone Consumer Protection Act (“TCPA”). The Court previously had denied Plaintiff’s motion for class certification. After discovery, the parties filed cross-motions for summary judgment. The Court denied Plaintiff’s motion and granted Defendant’s motion. The parties disagreed as to whether the six faxes were sent without "prior express invitation or permission" as required under 47 U.S.C. § 227(a)(5). Defendant contended that Plaintiff provided its express prior consent to send the faxes when it signed a Franchise Agreement and the Property Improvement Plan (“PIP”) in 2014, in which it consented to receiving fax advertisements from a list of approved suppliers in order to meet certain property improvement guidelines. Plaintiff argued that it never consented to the faxes. The Court determined that the 2014 Franchise Agreement stated that Plaintiff’s contact information might be provided to facilitate required hotel improvements, and indicated that “by signing this PIP, I acknowledge and agree that select pieces of this PIP may be provided to our approved vendors for purposes of offering you products and services that are required to complete this PIP. Only information necessary for the vendor to offer their products and services will be provided, including contact information, property address, number of rooms, brand converting to, and a list of items related to necessary or required products and services.” Id . at *22-23. The Court determined that the goods required by the PIP were the exact types of goods sold by Defendant and advertised in the six faxes at issue. Id . at *23. Accordingly, the Court found that Plaintiff gave its consent to provide its contact information to vendors that might help it meet the requirements in the PIP, and Plaintiff received "precisely the type of communication" to which it had consented: fax advertisements about products that would help the company meet the requirements of the PIP. Id . at *24. The Court thus denied Plaintiff’s motion for summary judgment and granted Defendant’s motion.