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Family Medicine Pharmacy, LLC v. Impax Laboratories, Inc.

United States District Court, S.D. Alabama, Southern Division

September 29, 2017




         This matter comes before the Court on Plaintiff's Unopposed Motion for Preliminary Approval of Class Action Settlement and Certification of Settlement Class (doc. 48). The Motion has been briefed and is now ripe for disposition.

         I. Background.

         Plaintiff, Family Medicine Pharmacy, LLC, brought this putative class action against defendant, Impax Laboratories, Inc., alleging violations of the Telephone Consumer Protection Act of 1991, 47 U.S.C. § 227, as amended by the Junk Fax Prevention Act of 2005 (the “TCPA”). In particular, Family Medicine maintained that it had received an unsolicited “junk fax” advertising the commercial availability and qualities of Impax's epinephrine auto-injector device on December 21, 2016, in violation of the TCPA's prohibition on transmission of unsolicited advertisements by facsimile machine, computer, or other device. See 47 U.S.C. § 227(b)(1)(C). Plaintiff further alleged that this fax transmission violated the TCPA by failing to provide the recipient with a cost-free mechanism to opt out of receiving such transmissions in the future. See 47 U.S.C. § 227(b)(2)(D). By its terms, the TCPA provides for a private right of action, and authorizes recovery of the greater of actual damages or statutory damages of $500, or up to treble that amount for willful or knowing violations. See 47 U.S.C. § 227(b)(3).

         This action has been litigated vigorously, with substantial motion practice, amended pleadings, and both formal and informal sharing of discovery materials. A critical legal issue concerns Impax's assertion that the subject fax transmissions were outside the scope of the TCPA because they were not commercial advertisements, but were rather informational in nature. The parties negotiated extensively for several months, with such negotiations culminating in a mediation session on July 18, 2017 that yielded settlement of this dispute in its entirety. The agreement is memorialized in a 41-page Settlement Agreement and Release executed by the parties on August 23, 2017. (See doc. 49, Exh. 1.) In summary, the key settlement terms include the following: (i) Impax will pay the sum of $4, 815, 700 in cash into a settlement fund, to be distributed on a pro rata basis to class members making claims, such distributions not to exceed $500 per compensable fax transmission; (ii) Impax will pay an additional sum of $75, 000 toward the costs of notice and claims administration; (iii) plaintiff's attorney's fees and litigation expenses of up to one-third of the settlement fund less administration costs will be paid from the settlement fund, subject to court approval; and (iv) plaintiff, Family Medicine Pharmacy, LLC, will request a class representative incentive award of up to $20, 000, to be paid from the corpus of the settlement fund. Family Medicine, with the acquiescence of Impax, now petitions the Court for preliminary approval of the settlement agreement and conditional certification of a settlement class pursuant to Rule 23 of the Federal Rules of Civil Procedure.

         II. Motion for Conditional Certification of Settlement Class.

         Plaintiff seeks conditional certification of a settlement class (the “Settlement Class”) whose parameters would be defined as follows:

“All individuals and/or entities who[] or which received one or more unsolicited advertisements via facsimile from Defendant between December 1, 2013 and the date of entry of the Preliminary Approval Order.”

(Doc. 49, Exh. 1, § 8.3.) Through formal and informal discovery, including fax records supplied by the third party retained by Impax to send the subject facsimiles, the parties have identified approximately 48, 157 individuals and entities that fall within the boundaries of this Settlement Class definition.

         “A class action may be maintained only when it satisfies all the requirements of Fed.R.Civ.P. 23(a) and at least one of the alternative requirements of Rule 23(b).” Rutstein v. Avis Rent-A-Car Systems, Inc., 211 F.3d 1228, 1233 (11th Cir. 2000) (citation omitted). Here, Family Medicine seeks certification of a settlement class under Rules 23(a) and 23(b)(3). Before reaching the Rule 23 criteria, the Court must determine whether the proposed class is “adequately defined and clearly ascertainable.” Little v. T-Mobile USA, Inc., 691 F.3d 1302, 1304 (11th Cir. 2012) (citations omitted).[1] “In order to establish ascertainability, the plaintiff must propose an administratively feasible method by which class members can be identified.” Karhu v. Vital Pharmaceuticals, Inc., 621 Fed.Appx. 945, 947 (11th Cir. June 9, 2015). “Administrative feasibility means that identifying class members is a manageable process that does not require much, if any, individual inquiry.” Bussey v. Macon County Greyhound Park, Inc., 562 Fed.Appx. 782, 787 (11th Cir. Apr. 2, 2014) (citations and internal quotation marks omitted). Family Medicine has met this requirement by proposing a manageable, logistically straightforward means of identifying class members. In particular, Family Medicine explains that Impax used a third party to send facsimiles; that said third party has supplied fax records to Impax showing the names and fax numbers of the fax recipients; that Impax maintained certain additional records; and that using these records, defendant has compiled a list (the “Notice List”) containing the name of each recipient, along with that recipient's city, state, zip code, fax number, and frequency and dates of faxes transmitted. As such, the Notice List provides a readily available, administratively feasible means of identifying and locating all class members via a manageable process that will require little, if any, individual inquiry. The ascertainability prerequisite for class certification is thus satisfied here.

         Having determined that Family Medicine's proposed settlement class is adequately defined and clearly ascertainable, the Court moves on to consider the specifications of Rule 23(a). See Little, 691 F.3d at 1304 (“If the plaintiff's proposed class is adequately defined and clearly ascertainable, the plaintiff must then establish the four requirements listed in Federal Rule of Civil Procedure 23(a).”). The Rule 23(a) requirements for certification of any class action are that “(1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class.” Rule 23(a), Fed.R.Civ.P.; see also Calderone v. Scott, 838 F.3d 1101, 1104 (11th Cir. 2016) (“Rule 23(a) requires every putative class to satisfy the prerequisites of numerosity, commonality, typicality, and adequacy of representation.”).

         With respect to the Rule 23(a)(1) “numerosity” requirement, the parties have identified approximately 48, 157 class members within the scope of the proposed class definition. That volume of class members is plainly “so numerous that joinder of all members is impracticable, ” so as to satisfy Rule 23(a)(1).

         For purposes of the “commonality” requirement of Rule 23(a)(2), “even a single common question will do.” Carriuolo v. General Motors Co., 823 F.3d 977, 984 (11th Cir. 2016) (citation omitted). “That common contention … must be of such a nature that it is capable of classwide resolution - which means that determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.” Id. (citations omitted). Family Medicine identifies as common issues of fact or law the following, among others: whether Impax is subject to the TCPA, whether Impax's facsimile transmissions violated the TCPA, whether the subject faxes were informational or commercial in nature, whether class members consented to receive fax advertisements or were in an established business relationship with Impax, and whether class members are entitled to statutory damages and injunctive relief. Under the circumstances, the Court agrees with plaintiff that Rule 23(a)(2) commonality has been adequately established.

         The Rule 23(a)(3) “typicality” requirement turns on whether “the claims or defenses of the class and the class representative arise from the same event or pattern or practice and are based on the same legal theory.” Williams v. Mohawk Industries, Inc., 568 F.3d 1350, 1357 (11th Cir. 2009) (citation omitted). Here, Family Medicine and all proposed class members are alleged to have been harmed in the same manner (i.e., receipt of unsolicited junk faxes occupying their fax machines for a brief period of time) by the same course of conduct by the same defendant in the same time period, with the same legal remedy (i.e., statutory damages for violation of the TCPA). Family Medicine's claims appear unremarkable and facially indistinguishable from those of other putative class members; therefore, the “typicality” requirement of Rule 23(a)(3) is satisfied.

         The last of the Rule 23(a) factors is found at Rule 23(a)(4), which imposes an “adequacy of representation” requirement. “This adequacy of representation analysis encompasses two separate inquiries: (1) whether any substantial conflicts of interest exist between the representatives and the class; and (2) whether the representatives will adequately prosecute the action.” Valley Drug Co. v. Geneva Pharmaceuticals, Inc., 350 F.3d 1181, 1189 (11th Cir. 2003) (citation and internal quotation marks omitted). The record reveals no perceptible conflicts of interest between Family Medicine and class members; to the contrary, their economic interests and litigation objectives appear fully aligned. Moreover, plaintiff has shown that Family Medicine will adequately prosecute this action. Indeed, Family Medicine has established a proven track record in this case of prosecuting its claims vigorously, and there is no reason to believe it will not continue to do so on behalf of the class following conditional certification. The same holds true for Family Medicine's counsel of record, who are well qualified to represent classwide interests here. See Id. (observing that named representatives must “vigorously prosecute the interests of the class through qualified counsel” in order to satisfy Rule 23(a)(4)). On this showing, the Court concludes that Family Medicine will fairly and adequately protect the interests of the class, as required by Rule 23(a)(4). Thus, plaintiff has met its burden of establishing all four Rule 23(a) prerequisites. For class certification to be appropriate, however, Family Medicine must also satisfy one prong of Rule 23(b). Plaintiff has designated this case as fitting within the parameters of Rule 23(b)(3), so the analysis shifts to that subsection.

         In order to satisfy Rule 23(b)(3), the plaintiff must show (in addition to the Rule 23(a) factors discussed previously) “(1) that common questions of law or fact predominate over questions affecting only individual class members (‘predominance'); and (2) that a class action is superior to other available methods for adjudicating the controversy (‘superiority').” Calderone, 838 F.3d at 1105 (citations omitted); see also Vega v. T-Mobile USA, Inc., 564 F.3d 1256, 1265 (11th Cir. 2009) (same). As to the Rule 23(b)(3) predominance requirement, the test is whether common issues “have a direct impact on every class member's effort to establish liability and on every class member's entitlement to injunctive and monetary relief.” Carriuolo, 823 F.3d at 985 (citation omitted). The predominance requirement is not met if, “as a practical matter, the resolution of an overarching common issue breaks down into an unmanageable variety of individual legal and factual issues.” Id. Here, the Court finds that common issues of law and fact predominate. Common fact questions include whether Impax sent the subject faxes and whether those faxes were unsolicited. Common legal questions include whether Impax is subject to the TCPA and whether the fax transmissions in question violate the TCPA (which subsumes such questions as whether they are commercial or informational). Resolution of those common questions will directly impact every class member's effort to establish liability and a right to relief. Thus, Rule 23(b)(3) predominance is properly found here.[2] Moreover, class treatment is superior to other available means of adjudicating the controversy given the sheer volume of potential class members, the identity or near-identity of factual and legal issues implicated by their claims, and the administrative simplicity of identifying and notifying potential class members using available fax records. Plaintiff has thus met its burden of showing that conditional certification is appropriate pursuant to Rules 23(a) and 23(b)(3).

         For all of the foregoing reasons, and for purposes of settlement only, the Court preliminarily grants Plaintiff's Motion for Certification of Settlement Class. The TCPA claims presented in Counts I, II and III of the Amended Class Action Complaint are conditionally certified as a class action that Family Medicine (as class representative) may pursue on behalf of the following settlement class:

“All individuals and/or entities who[] or which received one or more unsolicited advertisements via facsimile from Defendant between December 1, 2013 and the date of entry of the Preliminary Approval Order.”

         Named plaintiff, Family Medicine Pharmacy, LLC, is preliminarily appointed as the representative of the settlement class.

         A remaining aspect of the conditional certification portion of plaintiff's Motion is plaintiff's request for appointment of class counsel. See Rule 23(c)(1)(B), Fed.R.Civ.P. (“An order that certifies a class action must define the class and the class claims, issues, or defenses, and must appoint class counsel under Rule 23(g).”). Based on its determinations that they are qualified, capable and willing to provide competent, zealous, and conflict-free representation to the class, the Court provisionally appoints Diandra S. Debrosse Zimmermann and James H. McFerrin as class counsel to represent the settlement class, pursuant to Rule 23(g)(1)-(2), Fed.R.Civ.P.[3]

         III. Motion for Preliminary Approval of Class Action Settlement.

         In its Motion, Family Medicine also seeks preliminary approval of the parties' proposed classwide settlement. Of course, any such settlement requires judicial approval. See Rule 23(e), Fed.R.Civ.P. (“The claims, issues, or defenses of a certified class may be settled, voluntarily dismissed, or compromised only with the court's approval.”). “Preliminary approval of a proposed class action settlement does not involve a determination of the merits of the proposed settlement or affect the substantive rights of any class member.” Figueroa v. Sharper Image Corp., 517 F.Supp.2d 1292, 1299 (S.D. Fla. 2007). During the preliminary approval process, “the court simply determines whether the proposed settlement falls within the range of possible approval.” Id. at 1298 (citations omitted); see also In re Checking Account Overdraft Litigation, 275 F.R.D. 654, 661 (S.D. Fla. 2011) (‚ÄúPreliminary approval is appropriate where the proposed settlement is the result of the parties' good faith negotiations, there are no obvious deficiencies and the settlement falls within the range of ...

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