Summary
The U.S. District Court for the District of Columbia considers motions to dismiss claims arising from allegedly excessive inmate calling-service charges. The court holds that plaintiffs have standing to sue CoreCivic and Securus, but dismisses the claims against CoreCivic under the D.C. Consumer Protection Procedures Act and for unjust enrichment. The court also dismisses at least part of plaintiffs’ Federal Communications Act claims against Securus, while concluding that Securus waived its personal-jurisdiction objection.
Topics
Practice areas
Questions Presented
- Whether plaintiffs had Article III standing to sue CoreCivic based on allegedly excessive inmate-calling charges.
- Whether plaintiffs plausibly alleged a consumer-merchant relationship with CoreCivic under the D.C. Consumer Protection Procedures Act.
- Whether plaintiffs stated a claim for unjust enrichment against CoreCivic when the alleged payments flowed from Securus rather than directly from plaintiffs.
- Whether Securus waived its personal-jurisdiction defense by omitting it from its earlier motion to dismiss.
- Whether plaintiffs adequately pleaded a truth-in-billing claim under 47 C.F.R. § 64.2401.
- Whether plaintiffs could pursue a private Federal Communications Act claim under 47 U.S.C. § 201(b) without alleging violation of an FCC rule or regulation.
- Whether the § 201(b) claim was cognizable for alleged violations occurring before the FCC's interim order became effective.
- Whether the filed-rate doctrine barred Plaintiff Lamancusa's § 201(b) claim based on a rate filed with an Ohio regulator.
Holdings
- Plaintiffs sufficiently alleged injury in fact and causation because monetary losses from allegedly excessive inmate-calling charges were concrete and fairly traceable to CoreCivic's alleged exclusive contracts and commission arrangements with Securus.
- Plaintiffs failed to state a CPPA claim against CoreCivic because they did not allege that CoreCivic supplied the telecommunications services or exercised sufficient control over the ultimate sale to establish a consumer-merchant relationship.
- Plaintiffs failed to state an unjust-enrichment claim against CoreCivic because they did not allege that they conferred a benefit directly on CoreCivic.
- Securus waived its personal-jurisdiction objection as to claims brought by seven plaintiffs by failing to raise the defense in its 2000 motion to dismiss the original complaint.
- Plaintiffs failed to state a truth-in-billing claim because the amended complaint offered only conclusory allegations and did not identify the allegedly undisclosed fees, the disclosures made, how they were inadequate, or which plaintiffs were affected.
- To pursue a private claim under 47 U.S.C. § 207 for a violation of § 201(b), plaintiffs must allege that the carrier violated an FCC rule or regulation establishing the governing standard for just and reasonable conduct.
- Plaintiffs failed to state a § 201(b) claim for alleged violations occurring before February 11, 2014, because the FCC's Interim Order was not effective before that date.
- Securus did not establish that the filed-rate doctrine barred Lamancusa's § 201(b) claim because Securus identified no rate filed with a federal regulator, and the cited authorities involved federally filed rates.
Key quotations
“The injury-in-fact element of standing requires that the alleged injury be “concrete, particularized, and actual or imminent.”” (6)
“Thus, for Plaintiffs to bring suit under § 207 against Securus for a violation of § 201(b), they must “allege[] that a carrier has violated a rule or regulation promulgated by the FCC.”” (16-17)
Factual background
Plaintiffs are formerly incarcerated persons and their family members who used inmate-calling services at correctional facilities operated by CoreCivic or serviced by Securus. They alleged that Securus charged excessive rates and that CoreCivic enabled Securus's monopoly through exclusive contracts and received site commissions. Plaintiffs also alleged that Securus failed to provide adequate disclosures of rates and fees. The FCC later issued orders regulating interstate and intrastate inmate-calling rates, including an interim rate-cap order effective February 11, 2014.
Procedural history
Plaintiffs filed a putative class action in 2000 challenging allegedly excessive inmate-calling charges and exclusive dealing arrangements. The district court stayed the case and referred the rate issues to the FCC. After FCC rulemaking, D.C. Circuit review, congressional enactment of the Martha Wright-Reed Act, and further FCC rulemaking, the stay and primary-jurisdiction referral were terminated. Plaintiffs filed an amended complaint in 2016, and the remaining defendants moved to dismiss. The court dismissed all claims against CoreCivic and dismissed most claims against Securus, leaving part of the Federal Communications Act claim under 47 U.S.C. § 201(b) intact.