Champion v. Sethi

District Court, D. Arizona·Decided September 6, 2023·No. 2:22-cv-01355·Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 10 Joshua Champion; and Trent Alvord, No. CV-22-01355-PHX-DGC 11 Plaintiffs, ORDER AND DEFAULT JUDGMENT

12 v. 13 Hameet Sethi; Jon Reyes; DeShawn Tavilla; Jessie Sotomayor; and Andrew 14 Zamora, 15 Defendants.

17 18 Plaintiffs Joshua Champion and Trent Alvord allege that Defendants sent numerous 19 text messages to Plaintiffs in violation of the Telephone Consumer Protection Act 20 (“TCPA”). Doc. 1. Plaintiffs moved for default judgment against Defendants Hameet 21 Sethi, Jessie Sotomayor, and Andrew Zamora. Doc. 30.1 The Court granted the motion 22 with respect to Defendants’ liability on the TCPA claims and directed Plaintiffs to submit 23 evidence to support their requests for damages and injunctive relief. Doc. 44. Plaintiffs 24 have now presented that evidence. Doc. 49. For reasons stated below, the Court will enter 25 default judgment against Defendants in the amount of $163,500 for Champion and $39,000 26 for Alvord.

27 1 Plaintiffs dismissed their claims against Defendants Jon Reyes and DeShawn 28 Tavilla. See Docs. 41, 42; Fed. R. Civ. P. 41(a)(1)(i). 1 I. Background. 2 According to Plaintiffs’ complaint, Defendants created and controlled a massive text 3 message spamming operation, APEX SMS (“APEX”). Doc. 1 ¶¶ 1, 4, 18-25, 61-66. Since 4 at least 2018, APEX has been operated in Arizona under various names. Id. ¶¶ 2, 18, 32. 5 When the spamming operation was exposed in May 2019, APEX had the randomly 6 generated telephone numbers of more than 80 million people stored in its database and had 7 used them to send millions of text messages to nonconsenting recipients through an 8 automatic telephone dialing system (“ATDS”). Id. ¶¶ 1, 19, 34, 64, 82. 9 Plaintiffs received hundreds of those messages without their consent and despite 10 having registered their cell phone numbers on the national Do Not Call Registry 11 (“DNCR”). Id. ¶ 5-6, 35-58. Champion received 540 messages and Alvord received 269 12 (809 total). Id. ¶¶ 38, 54-58. The messages came from various phone numbers and 13 contained random domain names. Id. ¶¶ 45-46. None of the messages disclosed the 14 identity of the caller or the entity from which they were sent. Id. ¶ 60. 15 Defendants Sethi, Sotomayor, and Zamora were served with process in September 16 2022 (Docs. 17-19), but failed to answer or otherwise respond to the complaint. See Fed. 17 R. Civ. P. 12. The Clerk entered default against these Defendants on December 28, 2022. 18 Doc. 28. Plaintiffs sought default judgment two days later. Doc. 30.2 19 II. Default Judgment on Liability. 20 “In 1991, when telemarketing became common, Congress enacted the TCPA to 21 ‘protect the privacy interests of . . . telephone subscribers by placing restrictions on 22 unsolicited, automated telephone calls.’” Trim v. Reward Zone USA LLC, --- F.4th ----, 23 2023 WL 5025264, at *2 (9th Cir. Aug. 8, 2023) (quoting S. Rep. No. 102-178, at 1 24 (1991)); see Satterfield v. Simon & Schuster, Inc., 569 F.3d 946, 954 (9th Cir. 2009) (“The 25 purpose and history of the TCPA indicate that Congress was trying to prohibit the use of 26

27 2 Sethi moved to set aside his default under Rule 55(c). Doc. 35. The Court denied the motion because Sethi failed to make some showing of a meritorious defense. Doc. 44 28 at 3-7. 1 ATDSs to communicate with others by telephone in a manner that would be an invasion of 2 privacy.”). The TCPA makes it unlawful to make any call using an ATDS unless the call 3 is made for emergency purposes or with the consent of the called party. 47 U.S.C. 4 § 227(b)(1)(A); 47 C.F.R. § 64.1200(a)(1); see Van Patten v. Vertical Fitness Grp., LLC, 5 847 F.3d 1037, 1043 (9th Cir. 2017) (“[I]n enacting the TCPA, . . . Congress sought to 6 protect consumers from the unwanted intrusion and nuisance of unsolicited telemarketing 7 phone calls . . . . The TCPA establishes the substantive right to be free from certain types 8 of phone calls and texts absent consumer consent.”). The TCPA is also violated when an 9 automated telemarketing call is made (1) to a telephone subscriber who has registered his 10 telephone number on the DNCR, or (2) without disclosing the caller’s identity. 47 U.S.C. 11 § 227(c); 47 C.F.R. §§ 64.1200(2)(c)(2), (d)(4); see Hall v. Smosh Dot Com, Inc., 72 F.4th 12 983, 986 (9th Cir. 2023) (“In instructing the Federal Communications Commission . . . to 13 adopt a [DNCR], Congress granted residential phone subscribers the right to create a 14 private line, free from unsolicited calls and intrusive texts.”); Drew v. Lexington Consumer 15 Advoc., No. 16-CV-00200-LB, 2016 WL 9185292, at *7 (N.D. Cal. Aug. 11, 2016) 16 (“Drew’s allegations support his claims under § 64.1200(d). . . . [A]lthough each message 17 provided a return phone number, none of them identified the sender of the message or the 18 entity on whose behalf the messages were sent. Taken as true, this violates 19 § 64.1200(d)(4).”) (cleaned up). 20 Plaintiffs assert three claims under the TCPA and its implementing regulations: 21 (1) calls made to phone numbers using an ATDS in violation of §§ 227(b)(1) and 22 64.1200(a)(1); (2) telemarketing calls made to phone numbers registered on the DNCR in 23 violation of §§ 227(c) and 64.1200(c)(2); and (3) telemarketing calls made without 24 disclosing the caller’s identity in violation of §§ 227(c) and 64.1200(d)(4). Doc. 1 25 ¶¶ 68-72, 87-104. 26 Plaintiffs moved for default judgment on each claim under Federal Rule of Civil 27 Procedure 55(b). Doc. 30. The Court’s decision whether to grant default judgment is 28 discretionary. See Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). The Court 1 evaluated the relevant factors, see Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986), 2 and determined that they clearly favored default judgment with respect to Defendants’ 3 liability under the TCPA. Doc. 44 at 7-14. The Court found that Plaintiffs had adequately 4 alleged that Defendants sent text messages to Plaintiffs in violation of the TCPA. Id. at 5 8-11. The Court further found that Defendants had done nothing to raise potential factual 6 disputes and had provided no basis for concluding that they have a meritorious defense. 7 Id. at 12-13. The Court granted Plaintiffs’ motion with respect to Defendants’ liability on 8 each claim. Id. at 16.3 9 III. Plaintiffs’ Request for Default Judgment Damages. 10 “The TCPA provides for a statutory minimum of $500 per violation.” Drew, 2016 11 WL 9185292, at *11 (citing 47 U.S.C. §§ 227(b)(3), (c)(5)); see Wakefield v. ViSalus, Inc., 12 51 F.4th 1109, 1124 (9th Cir. 2022) (“Congress . . . set a floor of statutory damages at $500 13 for each violation of the TCPA but no ceiling for cumulative damages[.]”). The Court has 14 discretion to increase this amount to $1,500 if it finds that the defendant committed the 15 violation willfully or knowingly. 47 U.S.C.

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