Malka L. Fishman v. Subway Franchisee Advertising Fund Trust, Ltd.

[1] O [7] 8 United States District Court 9 Central District of California [10] 11 MALKA FISHMAN, Case No. 2:19-cv-02444-ODW (ASx) 12 Plaintiff, ORDER DENYING PLAINTIFF’S 13 v. MOTION FOR INTERLOCUTORY 14 SUBWAY FRANCHISEE APPEAL AND TO STAY ADVERTISING FUND TRUST, LTD., PROCEEDINGS [41] [15] Defendant. [16] 17 I. INTRODUCTION 18 Defendant Subway Franchisee Advertising Fund Trust (“Subway”) moves for an 19 order to certify an interlocutory appeal and stay proceedings under 28 U.S.C. § 1292 (b). 20 (Mot. for Interlocutory Appeal and to Stay Proceedings (“Mot.”) 1, ECF No. 41.) For 21 the reasons discussed below, the Court DENIES Subway’s Motion for Interlocutory 22 Appeal (“Motion”) and, therefore, DENIES as moot Subway’s Motion to Stay 23 Proceedings.1 24 II. FACTUAL BACKGROUND 25 Plaintiff Malka Fishman initiated this putative class action against Subway for 26 violations of the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227 , et [27] 1 After carefully considering the papers filed in support of and in opposition to the Motion, the Court 28 deemed the matter appropriate for decision without oral argument. Fed. R. Civ. P. 78; C.D. Cal. L.R. 7-15. 1 seq. (Compl., ECF No. 1.) Fishman alleges two causes of action due to a text message 2 promotion (“Text Message”) Subway allegedly sent to her cellular phone on September 3 3, 2016: (1) negligent violation of the TCPA, and (2) knowing and/or willful violation 4 of the TCPA. (Compl. ¶¶ 43–50.) Subway moved to dismiss Fishman’s Complaint for 5 lack of personal jurisdiction and failure to state a claim. (See Mot. to Dismiss, ECF 6 No. 20.) Specifically, Subway argues that: (1) Subway did not send the Text Message, 7 (2) Fishman failed to sufficiently allege that T-Mobile is an agent of Subway, 8 (3) Fishman failed to sufficiently allege that Subway used an automatic telephonic 9 dialing system to send the Text Message, and (4) the TCPA’s wireless carrier exemption 10 precludes the claim against Subway. (See Mot. to Dismiss.) This Court granted in part 11 and denied in part Subway’s Motion to Dismiss. (Order Granting in Part and Denying 12 in Part Def.’s Mot. to Dismiss (“Order”), ECF No. 37.) 13 Subway now moves to certify an interlocutory appeal of the portion of this 14 Court’s Order that held the TCPA’s wireless carrier exemption inapplicable to the Text 15 Message. (Mot. 1.) Additionally, Subway moves to stay proceedings pending the 16 decision on its appeal. 17 III. LEGAL STANDARD 18 Interlocutory appeal of an otherwise non-appealable order may be obtained, 19 pursuant to 29 U.S.C. § 1292 (b), “if conditions specified in the section are met, the 20 district court so certifies, and the court of appeals exercises its discretion to take up the 21 request for review.” Caterpillar Inc. v. Lewis, 519 U.S. 61 , 74 n.10 (1996); see 28 22 U.S.C. § 1292 (b). District courts may certify an interlocutory appeal if [1] the order 23 “involves a controlling question of law . . . [2] there is a substantial ground for 24 difference of opinion, and . . . [3] an immediate appeal . . . may materially advance the 25 ultimate termination of the litigation.” 28 U.S.C. § 1292 (b); see In re Cement Antitrust 26 Litig., 673 F.2d 1020, 1026 (9th Cir. 1981). However, interlocutory appeals are used 27 “only in exceptional situations in which allowing an interlocutory appeal would avoid 28 protracted and expensive litigation.” In re Cement Antitrust Litig., 673 F.2d at 1026. 1 The moving party carries the burden of persuading that such “exceptional circumstances 2 justify a departure from the basic policy of postponing appellate review until after the 3 entry of a final judgment.” Id. Finally, an “‘[i]nterlocutory appeal should not function 4 merely to provide review of difficult rulings in hard cases.’” Falco v. Nissan N. Am., 5 Inc., 108 F. Supp. 3d 889, 893 (C.D. Cal. 2015) (quoting U.S. Rubber Co. v. Wright, [6] 359 F.2d 784, 785 (9th Cir. 1966)). 7 IV. DISCUSSION 8 The Court first considers whether Fishman satisfies the requirements for an 9 interlocutory appeal, before turning to whether a stay of proceedings is appropriate. 10 A. Controlling Question of Law 11 To meet the threshold for a controlling question of law, the moving party must 12 show that resolving the issue on appeal could “materially affect the outcome of 13 litigation.” In re Cement Antirust Litig., 673 F.2d at 1026. The question should be a 14 “‘pure question of law rather than merely [ ] an issue that might be free from a factual 15 contest . . . something the court of appeal could decide quickly and cleanly without 16 having to study the record.’” Rieve v. Coventry Health Care, Inc., 870 F. Supp. 2d 856 , 17 879 (C.D. Cal. 2012) (quoting Ahrenholz v. Bd. of Trs. of Univ. of Ill., 219 F.3d 674 , 18 677 (7th Cir. 2000)); see McFarlin v. Conseco Servs., LLC, 381 F.3d 1251, 1259 (11th 19 Cir. 2004) (“[Section] 1292(b) appeals were intended, and should be reserved, for 20 situations in which the court of appeals can rule on a pure, controlling question of law 21 without having to delve beyond the surface of the record in order to determine the 22 facts.”) “[A question of law is] a ‘pure question of law’ rather than a mixed question 23 of law and fact or the application of law to a particular set of facts.” Haw. ex rel. Louie 24 v. J.P. Morgan Chase & Co., 921 F. Supp. 2d 1059, 1065 (D. Haw. 2013) (quoting 25 Chehalem Physical Therapy, Inc. v. Coventry Health Care, Inc., No. 09-cv-320-HU, [26] 2010 WL 952273 , at *3 (D. Or. Mar. 10, 2010)). Examples of controlling questions 27 include: “determination[s] of who are necessary and proper parties, whether a court to [28] 1 which a cause has been transferred has jurisdiction, or whether state or federal law 2 should be applied.” In re Cement Antirust Litig., 673 F.2d at 1026–27. 3 Subway first argues that determining whether the Text Message falls under the 4 wireless carrier exemption is a controlling question of law because it is a “pure question 5 of law.” (Mot. 3–4.) Specifically, Subway contends that the issue is one that does not 6 require searching extensively through the record for facts. (Mot. 3.) This is not the 7 case. Subway seeks a determination of whether the wireless carrier exemption “applies 8 to the [T]ext [M]essage.” (Mot. 3.) However, the Court cannot resolve whether the 9 wireless carrier exemption applies to the Text Message without first determining 10 whether the “sender” is a wireless carrier. In determining which party is the sender, the 11 Court must ascertain whether Subway was a principle directing T-Mobile to send the 12 Text Message. Such inquiry would require an extensive evaluation of the record and 13 careful application of fact to law. Furthermore, even if Subway was the undisputed 14 sender of the Text Message, Subway itself concedes that the issue must be decided 15 based on allegations in the Complaint, “which include the content of the [T]ext 16 [M]essage.” (Mot. 3.) As this would require an analysis of the content of the message 17 as applied to the wireless carrier exemption, this too requires application of fact to law. 18 In sum, Subway seeks to appeal an issue that cannot be decided without applying facts 19 from the record to the law. Therefore, Subway’s proposed appeal is not a pure question 20 of law. 21 Subway further argues that the issue is a controlling question of law because a 22 reversal of this Court’s ruling “should end” litigation. (Mot. 4.) Specifically, as 23 Fishman’s remaining claims are contingent on the Text Message being prohibited by 24 the TCPA, a ruling that the TCPA’s wireless carrier exemption applies to the Text 25 Message would preclude her from pursuing the claims. (Mot. 6.) Indeed, litigation 26 would likely conclude if the Text Message is exempted from TCPA liability. However, 27 this inquiry likewise first requires the Court to determine whether the wireless carrier 28 exemption applies to Subway via an alleged principle-agent relationship between 1 Subway and T-Mobile. As the Court has yet to rule on this inquiry, it would be 2 premature to determine that a reversal of this Court’s ruling would be appropriate. 3 Additionally, this inquiry departs from prior examples of fundamental controlling 4 questions of law that could materially affect the outcome of litigation, such as 5 determining necessary and proper parties, jurisdiction, or conflict of law issues. See In 6 re Cement Antirust Litig., 673 F.2d at 1026. 7 As Subway’s proposed appeal requires application of fact to law, it is not a pure 8 question of law. Nor is it consistent with what courts have suggested to be fundamental 9 controlling questions of law. Thus, this factor weighs against certifying Subway’s 10 proposed interlocutory appeal. 11 B. Substantial Ground for Differences of Opinion 12 “To determine if a substantial ground for difference of opinion exists under 13 § 1292(b), courts must examine to what extent the controlling law is unclear.” Couch 14 v. Telescope Inc., 611 F.3d 629, 633 (9th Cir. 2010) (internal quotation marks omitted). 15 “Courts traditionally [] find that a substantial ground for difference of opinion exists 16 where [1] circuits are in dispute . . . and the court of appeals of the circuit has not spoken 17 on the point, [2] if complicated questions arise under foreign law, or [3] if novel and 18 difficult questions of first impression are presented.” Id. (internal quotation marks 19 omitted) (quoting 3 Federal Procedure, Lawyers Edition § 3:212 (2010)). Moreover, 20 substantial ground for differences of opinion “exists where reasonable jurists might 21 disagree on an issue’s resolution.” Reese v. BP Expl. (Ala.), Inc., 643 F.3d 681 , 688 22 (9th Cir. 2011). However, the “mere presence of a disputed issue that is a question of 23 first impression . . . is insufficient.” Couch, 611 F.3d 634 (9th Cir. 2010) (internal 24 quotation marks omitted). Neither is “a party’s strong disagreement with the Court’s 25 ruling.” Id. at 633 . 26 Subway argues that there is a substantial ground for differences of opinion 27 because this Court’s ruling on the application of the wireless carrier exemption differs 28 from the ruling in Warciak v. Subway Rests., Inc., a case concerning the identical 1 message as the Text Message at issue. No. 1:16-cv-08694, 2019 WL 978666 , at *2 2 (N.D. Ill. Feb. 28, 2019) aff’d 949 F.3d 354 , 357–58 (7th Cir. 2020) (“Warciak’s claims 3 are barred by the TCPA’s wireless carrier exemption.”); (Mot. 5–6.) As this Court and 4 the Seventh Circuit have come to contrary conclusions regarding the applicability of the 5 wireless carrier exemption to the Text Message, there exists a ground on which 6 “reasonable jurists might disagree.” See Reese, 643 F.3d at 688 . Furthermore, these 7 conflicting holdings present a disputed issue that is a novel question of first impression 8 for the Ninth Circuit. Thus, the Court finds that this factor weighs in favor of certifying 9 an interlocutory appeal. 10 C. Materially Advance the Ultimate Termination of Litigation 11 An interlocutory appeal must materially advance the ultimate termination of 12 litigation to “facilitate disposition of the action by getting a final decision on a 13 controlling legal issue sooner, rather than later in order to save the courts and the 14 litigants unnecessary trouble and expense.” U.S. v. Adam Bros. Farming, Inc., 369 F. 15 Supp. 2d. 1180, 1182 (C.D. Cal. 2004) (internal quotation marks omitted) (citing John 16 v. U.S., 247 F.3d 1032 , 1051 (9th Cir. 2001) (Rymer, J., separate statement)); see In re 17 Cement Antitrust Litig., 673 F.2d at 1026. Where an interlocutory appeal could delay 18 the resolution of a case, the appeal “does not materially advance the litigation.” 19 Craftwood II, Inc. v. Tomy Int’l, Inc., No. SACV 12-1710 DOC (ANx), 2013 WL 20 12140946, at *5 (C.D. Cal. Nov. 15, 2013) (citing Shurance v. Planning Control Int’l, 21 Inc., 839 F.2d 1347, 1348 (9th Cir. 1988). Furthermore, an interlocutory appeal may 22 be appropriate where resolution of the issue would advance the litigation not only in the 23 current case, but also in other pending cases. Heaton v. Social Finance, Inc., No. 1424 cv-05191-THE, 2016 WL 232433 , at *6 (N.D. Cal. 2016) (citing Klinghoffer v. S.N.C. 25 Achille Lauro Ed Altri-Gestione Motonave Achlle Lauro in Amministrazione 26 Straodinaria, 921 F.2d 21 , 24 (2d Cir. 1990) (“[T]he impact that an [interlocutory] 27 appeal will have on other cases is a factor that [circuit courts] may take into account in [28] 1 | deciding whether to accept an appeal that has been properly certified by the district 2 | court.”)). 3 In discussing this factor, Subway again argues that if the wireless carrier 4 || exemption applies to the Text Message, Fishman would be unable to pursue her TCPA 5 || claims and litigation would conclude. (Mot. 6.) While it may be true that litigation 6 || would conclude if the wireless exemption applies, this again requires a determination 7 || of an inquiry on which this Court has yet to rule—the existence of a principle-agent 8 || relationship between Subway and T-Mobile. Thus, the Court does not determine that a 9 || decision would materially advance the ultimate termination of litigation. Moreover, 10 | Subway has not indicated that a decision on this issue would impact other pending cases. 11 | Thus, this factor weighs against certifying the question for interlocutory appeal. 12 Vv. CONCLUSION 13 While Subway has presented evidence that the issue proposed for appeal poses a 14 | substantial ground for differences of opinion, it nonetheless has failed to show that it 1s 15 || a controlling issue of law or that it would materially advance the ultimate termination 16 || of litigation. Taken together, and in light of Ninth Circuit Precedent requiring that 17 || interlocutory appeal bring an “exceptional situation,” the Court finds that the factors 18 || weigh against Subway’s request for certification of an interlocutory appeal. 19 Therefore, the Court DENIES Subway’s Motion for an order certifying 20 || interlocutory appeal. The Court likewise DENIES as moot Subway’s Motion to stay 21 || proceedings. (ECF No. 41.) [22] 23 IT IS SO ORDERED. [24] 25 April 6, 2020 26 . ig Giedliod 28 OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE