Susan Drazen v. Godaddy.com, LLC

41 F.4th 1354
CourtCourt of Appeals for the Eleventh Circuit
DecidedJuly 27, 2022
Docket21-10199
StatusPublished
Cited by18 cases

This text of 41 F.4th 1354 (Susan Drazen v. Godaddy.com, LLC) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eleventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Susan Drazen v. Godaddy.com, LLC, 41 F.4th 1354 (11th Cir. 2022).

Opinion

USCA11 Case: 21-10199 Date Filed: 07/27/2022 Page: 1 of 20

[PUBLISH] In the United States Court of Appeals For the Eleventh Circuit

____________________

No. 21-10199 ____________________

SUSAN DRAZEN, on behalf of herself and other persons similarly situated, Plaintiff-Appellee, Godaddy.com, LLC, a Delaware Limited Liability Company, Defendant-Appellee, versus MR. JUAN ENRIQUE PINTO,

Movant-Appellant. USCA11 Case: 21-10199 Date Filed: 07/27/2022 Page: 2 of 20

2 Opinion of the Court 21-10199

Appeal from the United States District Court for the Southern District of Alabama D.C. Docket No. 1:19-cv-00563-KD-B ____________________

Before WILSON, BRANCH, and TJOFLAT, Circuit Judges. TJOFLAT, Circuit Judge: We have in this case an argument over the meaning of cou- pon settlements. But, because there is an Article III standing prob- lem with the class, we must vacate the District Court’s approval of class certification and settlement in this case and remand for the opportunity to revise the class definition. I. In August 2019, Susan Drazen filed a complaint against Go- Daddy.com, LLC (“GoDaddy”) in the Southern District of Ala- bama alleging that GoDaddy had violated the Telephone Con- sumer Protection Act of 1991 (“TCPA”) when it allegedly called and texted Drazen solely to market its services and products through a prohibited automatic telephone dialing system. See 47 U.S.C. § 227(a)(1), (b)(1)(A). Her case was consolidated with an- other case that had been litigated by Jason Bennett in the District USCA11 Case: 21-10199 Date Filed: 07/27/2022 Page: 3 of 20

21-10199 Opinion of the Court 3

of Arizona, 1 Case No. 2:16-cv-03908 (D. Ariz. 2016), and a third re- lated action filed by John Herrick was “incorporated into and re- solved” by the resolution of this case, Case No. 2:16-cv-00254 (D. Ariz. 2016). 2 Drazen and the plaintiffs in the two other related cases, Ben- nett and Herrick, purported to bring a class action on behalf of sim- ilarly situated individuals. After negotiating with GoDaddy, the three plaintiffs submitted a proposed class settlement agreement to the District Court. The class was defined as follows: (a) All persons within the United States who received a call or text message to his or her cellular tele- phone from Defendant from November 4, 2014 through December 31, 2016.

(b) Excluded from the term “Settlement Class” are: (1) the trial judges presiding over the Actions; (2) Defendant, as well as any parent, subsidiary, affili- ate or control person of Defendant, and the offic- ers, directors, agents, servants or employees of Defendant; (3) the immediate family of any such person(s); (4) any Settlement Class Member who

1 Bennett and Drazen filed a joint motion to transfer venue for Bennett’s case to the Southern District of Alabama and to consolidate their cases. The Dis- trict Court granted that motion. 2 Bennett alleged that he received unsolicited calls from GoDaddy on his cell- phone. Herrick alleged that he received promotional text messaging from Go- Daddy on his cellphone. USCA11 Case: 21-10199 Date Filed: 07/27/2022 Page: 4 of 20

4 Opinion of the Court 21-10199

timely and properly opts out of the settlement; and (5) Class Counsel, their employees, and their immediate family.

The proposed settlement was structured so that GoDaddy would make available $35 million in settlement funds for claims that were approved and for settlement costs. There were two compensation options for class members, both subject to pro rata reduction in the event that too many class members opted into the class. Class members could either receive $35 in cash or a $150 voucher to be used exclusively at GoDaddy. Based on the proposed settlement, class counsel agreed to ask for no more than 30% in attorneys’ fees in addition to reimbursement of reasonable litigation costs and ex- penses. Class counsel also agreed to ask the District Court to award each named plaintiff $5,000, which GoDaddy did not oppose. In response to this motion, the District Court ordered brief- ing on the application of Salcedo v. Hanna, 936 F.3d 1162, 1168 (11th Cir. 2019), to the class as proposed in the settlement agree- ment. We held in Salcedo that receipt of a single unwanted text message was not a sufficiently concrete injury to give rise to Article III standing, Salcedo, 936 F.3d at 1168, and the proposed class defi- nition included individuals who received only one text message from GoDaddy. In their briefing, the parties put forth a new class definition: (a) All persons within the United States to whom, from November 4, 2014 through December 31, 2016, De- fendant placed a voice or text message call to their USCA11 Case: 21-10199 Date Filed: 07/27/2022 Page: 5 of 20

21-10199 Opinion of the Court 5

cellular telephone pursuant to an outbound cam- paign facilitated by the web-based software applica- tion used by 3Seventy, Inc., or the software pro- grams and platforms that comprise the Cisco Uni- fied Communications Manager.

(b) Excluded from the term “Settlement Class” are (1) the trial judges presiding over the Actions; (2) De- fendant, as well as any parent, subsidiary, affiliate or control person of Defendant, and the officers, direc- tors, agents, servants or employees of Defendant; (3) the immediate family of any such person(s); (4) any Settlement Class Member who timely and properly opts out of the settlement; and (5) Class Counsel, their employees, and their immediate family.

After considering the briefing of the parties, the District Court, citing our decision in Cordoba v. DIRECTV, LLC, 942 F.3d 1259, 1273 (11th Cir. 2019), determined that only the named plain- tiffs must have standing. So, according to the District Court, the standing problem could be resolved by removing Herrick, the text- message only recipient, from being a named plaintiff. As to “absent class members,” who may have only received a single text message, the District Court noted that these individuals would only make up USCA11 Case: 21-10199 Date Filed: 07/27/2022 Page: 6 of 20

6 Opinion of the Court 21-10199

about seven percent of the class based on GoDaddy’s representa- tions. 3 The District Court determined that “even though some of the included class members would not have a viable claim in the Eleventh Circuit, they do have a viable claim in their respective Circuit [because of a circuit split]. Thus, GoDaddy is entitled to set- tle those claims in this class action although this Court would find them meritless had they been brought individually in the Eleventh Circuit.” In other words, the District Court allowed text-message only recipients to remain in the class, even though they lacked Ar- ticle III standing under our standards. After conducting a Rule 23(a) analysis for numerosity, com- monality, typicality, and adequacy, and a Rule 23(b)(3) analysis for predominance, the District Court approved certification of the class for purposes of settlement in accordance with the proposed settlement agreement, on the condition that Herrick be removed as a named plaintiff.4 In response, the parties submitted an amended proposed settlement agreement removing Herrick as a class representative. On June 9, 2020, the District Court then

3 Based on GoDaddy’s analysis, 91,000 individuals out of the approximately 1.26 million class members received only a single text message from Go- Daddy. 4 The District Court did not conduct an analysis of the Rule 23(e)(2) factors, which is mandatory when “a class [is] proposed to be certified for purposes of settlement.” Fed. R. Civ. P.

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41 F.4th 1354, Counsel Stack Legal Research, https://law.counselstack.com/opinion/susan-drazen-v-godaddycom-llc-ca11-2022.