AMIT P. MEHTA, JUDGE.
Plaintiff Drug Reform Coordination Network, Inc., brought this action against Defendant Grey House Publishing, Inc., alleging that Grey House sent it an unsolicited facsimile advertisement in violation of the Telephone Consumer Protection Act of 1991.
Defendant Grey House Publishing, Inc. ("Grey House"), is a New York-based corporation that publishes Hudson's Washington News Media Contact Directory, a reference source for media contacts in the District of Columbia area (the "Directory"). See Pl.'s Second Am. Compl., ECF No. 12 ¶ 6-7 [hereinafter Compl.]. Plaintiff Drug Reform Coordination Network, Inc. ("DRCN"), is a non-profit organization registered to do business in the District of Columbia that publishes a weekly electronic newsletter entitled "Drug War Chronicle." Id. ¶ 5. On or about February 12, 2014, Grey House sent DRCN a one-page facsimile (the "Fax"). See id. ¶ 9; see also Compl., Ex. A, ECF No. 12-1. The Fax read as follows:
ECF No. 12-1. Immediately below the quoted text, the Fax identified DRCN's directory listing information, including its "Contact Name," address, phone number, fax number, and website URL. Id. The bottom of the Fax included the notice:
Seven days after transmitting the Fax, on February 19, 2014, Grey House sent a colorful, multi-page email to DRCN's Executive Director, David Borden, featuring a picture of the Directory and offering it for sale. See ECF No. 12-2. The email touted the Directory as a "must-have resource" — "the perfect research tool for Public Relations, Marketing, Networking, and so much more" — and offered it at a discounted price. Id. The email also provided purchasing instructions for the Directory, including a link to a "Discount Order Form." Id. Grey House sent additional emails to Borden on April 15, 2014, and June 11, 2014. These emails, like the earlier one, heralded the Directory as "the most accurate, most up-to-date source for media contacts in our nation's capital," ECF No. 12-3 — "a gold mine of information [that] would be a welcome addition to any reference collection," ECF No. 12-4 — and similarly offered it for sale.
On July 3, 2014, DRCN filed a complaint against Grey House claiming that the Fax was an "unsolicited advertisement" in violation of the Telephone Consumer Protection Act of 1991 (TCPA). Compl. ¶ 1. DRCN alleged that the Fax "advertised the Defendant's products and/or services, and offered [it] a free listing in one of Defendant's directories." Id. ¶ 9. It further alleged that the three emails it received from Grey House "followed up" the Fax and were "part of an overall marketing campaign by the Defendant, both directly advertising one of the Defendant's directory publications, and also serving as a prelude to subsequent offers for the sale of that publication." Comp. ¶ 12. "Upon information and belief," DRCN averred, "part of Defendant's business practice is to market its directories by transmitting a facsimile advertisement, such as [the Fax], that advertises a free listing in one of Defendant's directories, to potential and existing customers, and to then follow up that facsimile advertisement with subsequent email, fax, telephone communications, and other methods that solicit the purchase of Defendant's directories from those who may have been offered a free listing." Id. ¶ 13.
In evaluating a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the court must accept Plaintiff's factual allegations as true and "construe the complaint `in favor of the plaintiff, who must be granted the benefit of all inferences that can be derived from the facts alleged.'" Hettinga v. United States, 677 F.3d 471, 476 (D.C.Cir.2012) (quoting Schuler v. U.S., 617 F.2d 605, 608 (D.C.Cir.1979). The Court need not accept as true, however, "a legal conclusion couched as a factual allegation," Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986), nor "inferences ... unsupported by the facts set out in the complaint," Kowal v. MCI Commc'ns Corp., 16 F.3d 1271, 1276 (D.C.Cir.1994).
To survive a motion to dismiss, a complaint must contain "sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). A claim is facially plausible when "the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955). The factual allegations in the complaint need not be "detailed"; however, the Federal
Grey House argues that the Fax is not an "unsolicited advertisement" under the TCPA. It contends that "there are no statements included in the content of the facsimile that promote the Directory" and thus the Fax is not an advertisement. Mem. of Law in Supp. of Def.'s Mot. to Dismiss, ECF 15-1 at 2 [hereinafter Def.'s Mem. in Supp.] (emphasis added). Grey House further asserts that it sent the Fax "for the sole and expressly stated purpose of requesting updated information from an existing listee in its Directory," id. at 14, and not as part of "an overall marketing campaign to promote the commercial availability" of the product, id. at 15.
In 1991, Congress enacted the TCPA in part to address the growing problem of unwanted facsimile advertising. See Telephone Consumer Protection Act, Pub.L. No. 102-243 (2001) ("Unrestricted telemarketing... can be an intrusive invasion of privacy...."). Under the TCPA, Congress prohibited any person from using "any telephone facsimile machine, computer or other device to send, to a telephone facsimile machine, an unsolicited advertisement." 47 U.S.C. § 227(b)(1)(c). The statute defines "unsolicited advertisement" as "any material advertising the commercial availability or quality of any property, goods, or services which is transmitted to any person without that person's express invitation or permission, in writing or otherwise." Id. § 277(a)(5).
Congress expressly delegated authority to the Federal Communications Commission ("FCC") to develop regulations implementing the TCPA. 47 U.S.C. § 227(b)(2) ("The [FCC] shall prescribe regulations to implement the requirements of this subsection."). The regulations provide guidance on what constitutes an "unsolicited advertisement" under the TCPA and illustrate the types of facsimile communications that violate the statute. See In the Matter of Rules & Regulations Implementing the Tel. Consumer Prot. Act of 1991 Junk Fax Prevention Act of 2005, 21 F.C.C.R. 3787, 3810-15 (2006) [hereinafter Rules & Regulations].
Taking the complaint's allegations as true and drawing all inferences in DRCN's favor, the court concludes that Plaintiff has sufficiently alleged that the Fax is an "unsolicited advertisement" because it is a "pretext to advertise commercial products and services" and is "part of an overall marketing campaign" to sell the Directory. Rules & Regulations at 3814. Standing alone, the Fax does not promote the Directory for sale. Rather, it apprised Plaintiff of the Directory's upcoming edition and offered the opportunity to update Plaintiff's "free listing" so that its contact information would be accurate. ECF No. 12-1. Thus, on its face the Fax is not an "unsolicited advertisement."
But a different conclusion obtains when the Fax is read together with the three direct solicitation emails that followed. Only seven days after it sent the Fax, on February 19, 2014, Grey House sent an email to DRCN's Executive Director promoting the Directory and offering it for sale for $289. See ECF No. 12-2 ("Order today and save 10%. Prepay your order and get FREE SHIPPING TOO! Call (800) 562-2139 or Download your DISCOUNT ORDER FORM NOW"). The April 15, 2015, email similarly publicized the commercial availability of the Directory. It included language akin to that contained in the February 19, 2014, email — "[d]on't miss the opportunity to have this important resource in your collection, and
Two recent FCC adjudications lend support to the court's conclusion.
2010 Notice ¶ 7. The above reasoning applies with equal force to the Fax at issue here. Like the Presidential Who's Who facsimiles, the Fax offered a free listing, which allegedly served as a prelude to later solicitations to purchase the Directory. It remains for discovery to determine whether the Fax was in fact "part of an overall campaign" to sell the Directory, as the FCC concluded in the Presidential Who's Who adjudications. But at this stage, Plaintiff has pled enough to allege a violation of the TCPA.
Grey House also argues that it is not subject to liability under the TCPA because its Fax falls within a statutory safe harbor to the general prohibition on "unsolicited advertisements" — the "established business relationship" exception. Def.'s Mem. in Supp. at 7. According to Defendant, that exception applies here because "Plaintiff is and has been listed in the Directory that Grey House Publishing publishes annually since at least 2006" and "[o]n prior occasions the listing information for Plaintiff has been updated." Id. at 2.
The TCPA exempts from liability "unsolicited advertisements" sent to recipients with whom the sender has an "an established business relationship." 47 U.S.C. § 227(b)(1)(C)(i). An "established business relationship" is "a prior or existing relationship formed by a voluntary two-way communication ... on the basis of an inquiry, application, purchase or transaction... regarding products or services..., which ... has not been previously terminated by either party." Rules & Regulations at 3797-98. Merely demonstrating an "established business relationship" between the sender and recipient, however, is insufficient to come within the safe harbor. To qualify, a facsimile also must contain a "notice," 47 U.S.C. § 227(b)(1)(C)(iii), that includes certain statutorily required elements, id. at § 227(b)(2)(D). Those elements include a specific written disclosure "that the recipient may make a request to the sender of the unsolicited advertisement not to send any future unsolicited advertisements ... and that failure to comply, within the shortest reasonable time, as determined by the [FCC], ... is unlawful." Id. at § 227(b)(2)(D)(ii) (emphasis added). The FCC has issued rules that define "shortest reasonable time" as 30 days and provide that "failure to comply [with a request to opt out], within 30 days ... is unlawful." 47 C.F.R. § 64.1200(a)(4)(iii)(B); see also City Select Auto Sales, Inc. v. David/ Randall Assocs., Inc., Civ. Action No. 11-2658, 96 F.Supp.3d 403, 418, 2015 WL 1421539, at *11 (D.N.J. Mar. 27, 2015) ("[T]he advertisement ... must state that the sender's failure to comply with a request
Grey House does not qualify for the "established business relationship" safe harbor because the Fax failed to include all of the statutorily mandated disclosures. The Fax stated only that the recipient is "entitled to opt out of future faxes" and provided instructions as to how the recipient could do so. ECF No. 12-1. It did not state, however, that Grey House must honor an opt-out within 30 days and that the failure to do so would be unlawful. Accordingly, even if Grey House could demonstrate that it had an "existing business relationship" with DRCN, its non-compliance with the TCPA's strict notice requirements disqualifies it from the safe harbor.
For the reasons stated above, Defendant's Motion to Dismiss is denied. The court will issue a separate order regarding further proceedings in this case.
