Landsman & Funk Pc v. Skinder-Strauss Associates

PRECEDENTIAL

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

Nos. 09-3105, 09-3532 and 09-3793
_____________

LANDSMAN & FUNK PC,
and all others similarly situated,
Appellant in 09-3105

v.

SKINDER-STRAUSS ASSOCIATES,
a New Jersey Partnership
_____________

GOODRICH MANAGEMENT CORP,
on behalf of itself and all others similarly situated,
Appellant in 09-3532

v.

AFGO MECHANICAL SERVICES INC
_____________

GOODRICH MANAGEMENT CORP,
on behalf of itself and all others similarly situated

v.
 FLIERWIRE INC
doing business as SCHEIN MEDIA

Goodrich Management Corp,
Appellant in 09-3793
_____________

Appeals from the United States District Court
for the District of New Jersey
(D.C. Civil Nos. 2-08-cv-03610,
2-09-cv-00043, and 2-08-cv-05818)
District Judges: Honorable Katharine Hayden,
Honorable William J. Martini, and
Honorable Peter G. Sheridan
_____________

Argued May 26, 2010

Before: McKEE, Chief Judge, RENDELL
and GARTH, Circuit Judges.

(Opinion Filed April 4, 2011)
_____________

Aytan Y. Bellin, Esq. [ARGUED]
Bellin & Associates
85 Miles Avenue
White Plains, NY 10606
Counsel for Appellants

2
Michael R. McDonald, Esq. [ARGUED]
Damian V. Santomauro, Esq.
Gibbons
One Gateway Center
Newark, NJ 07102-5310
Counsel for Appellee
Skinder Strauss Associates,
a New Jersey Partnership

Louis A. Bove, I, Esq.
Jay M. Green, Esq. [ARGUED]
Bodell, Bove Grace & Van Horn
30 South 15th Street
One Penn Square West, 6th Floor
Philadelphia, PA 19102

Kristin Hitsous, Esq.
Rosabianca & Associates
14 Wall Street, 20th Floor
New York, NY 10005
Counsel for Appellee
Afgo Mechanical Services Inc.

David J. Bloch, Esq. [ARGUED]
L‘Abbate, Balkan, Colavita & Contini
7 Regent Street
Suite 711
Livingston, NJ 07039
Counsel for Appellee
Flierwire Inc, doing business
as SCHEIN MEDIA

3
 _____________

OPINION OF THE COURT
_____________

RENDELL, Circuit Judge.

A.

This consolidated appeal encompasses three class
actions brought in the District Court for the District of New
Jersey under the Telephone Consumer Protection Act
(―TCPA‖), 47 U.S.C. § 227(b). The TCPA is a unique
federal statute that provides a private right of action for
recipients of unsolicited facsimiles, as well as statutory
damages of $500 per ―violation.‖ The plaintiffs in these suits
alleged that each respective defendant sent over 10,000
unsolicited fax advertisements to plaintiffs at their New York
or New Jersey offices, and to thousands of others throughout
the country, in violation of the TCPA.1 The plaintiffs in each

1
In each of the cases, the plaintiffs sought to represent three
classes: Class A, consisting of all persons in the United
States to whom defendant sent or caused to be sent a fax
advertisement without the recipient‘s express invitation or
permission between four years before the filing of the
complaint through July 8, 2005; Class B, consisting of all
persons to whom defendant sent or caused to be sent a fax
advertisement, which did not contain a notice as required by
47 U.S.C. § 227(b)(2)(D), between July 9, 2005 through July
30, 2006; and Class C, consisting of all persons to whom
defendant sent or caused to be sent a fax, which did not
contain a notice as required by 47 C.F.R. § 64.1200(a)(3)(iii),
between August 1, 2006 through the present.

4
case requested more than $5 million in damages for
themselves and the members of the classes they represented.
All three cases were dismissed by the District Courts on the
grounds that plaintiffs‘ claims did not fulfill the requirements
of diversity jurisdiction.2 Although the District Courts‘
specific reasons for dismissal varied slightly, a common
question arises in our review of each of the cases: whether,
notwithstanding our ruling in ErieNet, Inc. v. Velocity Net,

2
In Landsman & Funk, P.C. v. Skinder-Strauss Associates,
636 F. Supp. 2d 359 (D.N.J. 2009), the District Court
dismissed plaintiffs‘ complaint under Rule 12(b)(1) of the
Federal Rules of Civil Procedure for lack of jurisdiction; it
held that it lacked federal question jurisdiction under ErieNet
and diversity jurisdiction because, under New York law,
plaintiffs cannot bring class actions for statutory damages
and, thus, the plaintiffs here could not satisfy the $5 million
amount-in-controversy requirement under the Class Action
Fairness Act (―CAFA‖). In Goodrich Management Corp. v.
Afgo Mechanical Services, Inc., No. 09-00043, 2009 WL
2602200 (D.N.J. Aug. 24, 2009), the District Court dismissed
plaintiffs‘ complaint under Rule 12(b)(1) and Rule 12(b)(6);
it found that it lacked federal question jurisdiction under
ErieNet, Inc. v. Velocity Net, Inc., 156 F.3d 513 (3d Cir.
1998), and determined that, since plaintiffs could not show
that they were entitled to Rule 23 class certification, it lacked
diversity jurisdiction because CAFA‘s amount-in-controversy
requirement could not be met. The Goodrich Management
Corp. v. Flierwire, Inc. Court dismissed the case for lack of
subject matter jurisdiction pursuant to Rule 12(h)(3) based
entirely on the reasoning in Landsman and Afgo. No. 08-
5818, 2009 WL 3029758 (D.N.J. Sept. 22, 2009).

5
Inc., 156 F.3d 513 (3d Cir. 1998), that private TCPA claims
do not present a federal question, the federal courts can
exercise diversity jurisdiction over private suits brought under
the TCPA. On appeal, appellees contend that the three
District Courts that ruled on the issue of jurisdiction erred
because none held – as they should have – that there can be
no diversity jurisdiction over claims under the TCPA.3
Because this argument, if adopted, would be dispositive of all
three cases – in that dismissal would be appropriate in each
case if it is correct – we address this issue before considering
other issues raised as to the propriety of the District Courts‘
rulings in each case.

In ErieNet, we held that Congress intended to divest
federal courts of federal question jurisdiction over individual
TCPA claims. We are now called upon to decide whether our
reasoning in ErieNet extends to diversity jurisdiction. That is,
did Congress intend that these actions should be maintained
exclusively in state courts such that federal courts cannot
exercise diversity jurisdiction over them? We hold here that
Congress did not intend for exclusive state court jurisdiction.
The TCPA does not strip federal courts of diversity
jurisdiction over actions brought under § 227(b)(3). Given

3
Though this is not the focus of appellees‘ argument, it is
always our duty to assure ourselves of the existence of subject
matter jurisdiction. Keefe v. Prudential Prop. & Cas. Ins.
Co., 203 F.3d 218, 223 (3d Cir. 2000). See also Bender v.
Wiliamsport Area Sch. Dist., 475 U.S. 534, 541 (1986)
(―[E]very federal appellate court has a special obligation to
‗satisfy itself not only of its own jurisdiction, but also that of
the lower courts in a cause under review.‘‖ (internal citations
omitted)).

6
our ruling that each District Court has jurisdiction over its
respective plaintiffs‘ private TCPA class action claims
pursuant to 28 U.S.C. § 1332(d), we also must address the
Courts‘ class certification determinations, as discussed more
fully below.

We have jurisdiction under 28 U.S.C. § 1291 to review
the District Courts‘ orders dismissing these cases for lack of
subject matter jurisdiction. We exercise plenary review of a
district court‘s § 12(b)(1) dismissal for lack of jurisdiction
and a district court‘s § 12(b)(6) dismissal for failure to state a
claim. McGovern v. City of Phila., 554 F.3d 114, 115 (3d
Cir. 2009); Angelino v. N.Y. Times Co., 200 F.3d 73, 87 (3d
Cir. 1999). We also exercise plenary review of a district
court‘s resulting jurisdictional determination. Umland v.
PLANCO Fin. Serv., 542 F.3d 59, 63 (3d Cir. 2008). We
review a decision to certify or deny a class for abuse of
discretion. Holmes v. Pension Plan of Bethlehem Steel Corp.,
213 F.3d 124, 136 (3d Cir. 2000) (citing In re Prudential Ins.
Co. of Am. Sales Litig., 148 F.3d 283, 299 (3d Cir. 1998)).

B.

The TCPA, which was passed in 1991 as part of an
amendment to the Communications Act of 1934, declares it
unlawful under federal law ―to use any telephone facsimile
machine, computer, or other device to send, to a telephone
facsimile machine, an unsolicited advertisement,‖ unless
certain statutory exceptions apply. 47 U.S.C. § 227(b)(1)(C).
It contains distinct provisions for private parties on the one
hand, and state attorneys general on the other, to enforce this
prohibition by litigation. § 227(b)(3), (f). Section 227(b)(3),
entitled ―Private right of action,‖ provides that:

7
 A person or entity may, if otherwise
permitted by the laws or rules of court
of a State, bring in an appropriate court
of that State—

(A) an action based on a violation of
this subsection or the regulations
prescribed under this subsection
to enjoin such violation,

(B) an action to recover for actual
monetary loss from such a
violation, or to receive $500 in
damages for each such violation,
whichever is greater, or

(C) both such actions.

If the court finds that the defendant
willfully or knowingly violated this
subsection or the regulations prescribed
under this subsection, the court may, in
its discretion, increase the amount of
the award to an amount equal to not
more than 3 times the amount available
under subparagraph (B) of this
paragraph.

47 U.S.C. § 227(b)(3). Thus, this private right of action
allows a person, ―if otherwise permitted by the laws or rules
of court of a State, [to] bring in an appropriate court of that
State‖ a private action for damages or injunctive relief, and
entitles a successful plaintiff to recover damages of at least
$500 per unsolicited fax. Another provision, whereby state

8
attorneys general can bring civil actions for damages and
injunctive relief, provides that the federal courts ―shall have
exclusive jurisdiction‖ over all such actions. § 227(f)(1), (2).
It also provides that the TCPA does not prevent state officials
from bringing similar actions in state court or otherwise
exercising their powers under state law. § 227(f)(5), (6).

In enacting this legislation, Congress explained that it
sought ―to facilitate interstate commerce by restricting certain
uses of facsimile ([f]ax) machines and automatic dialers.‖ S.
Rep. No. 102-178, at 1 (1991), reprinted in 1991
U.S.S.C.A.N. 1968, 1968. It noted that ―unsolicited calls
placed to fax machines . . . often impose a cost on the called
party (fax messages require the called party to pay for the
paper used . . . ).‖ Id. at 1969. In addition, a so-called ―junk
fax‖ ―occupies the recipient‘s facsimile machine so that it is
unavailable for legitimate business messages while
processing and printing the junk fax.‖ H.R. Rep. No. 102-
317, at 10 (1991). Congress also noted the need for federal
regulation to fill the gaps between individual states‘
regulatory efforts, since ―[s]tates do not have the jurisdiction
to protect their citizens against those who use [automated
dialing] machines to place interstate telephone calls.‖ S. Rep.
No. 102-178, at 5. That is, although ―[m]any States have
passed laws that seek to regulate telemarketing,‖
―telemarketers can easily avoid the restrictions of State law,
simply by locating their phone centers out of state.‖ H.R.
Rep. No. 102-317, at 9-1. This history suggests that Congress
intended both to ―fill the gaps‖ in state regulation and to give
consumers the right to file TCPA actions in state court. The
TCPA, and its private right of action, were thus designed to
put ―teeth‖ into state regulation, rather than to establish a
distinctly federal policy. Essentially, Congress ―sought to put

9
the TCPA on the same footing as state law . . . ,
supplementing state law where there were perceived
jurisdictional gaps.‖ Gottlieb v. Carnival Corp., 436 F.3d
335, 342 (2d Cir. 2006).

In introducing the bill, its sponsor, Senator Ernest
Hollings, described the private right of action as follows:

The . . . bill contains a private
right-of-action provision that will
make it easier for consumers to
recover damages from receiving
these computerized calls. The
provision would allow consumers
to bring an action in State court
against any entity that violates the
bill. The bill does not, because of
constitutional constraints, dictate
to the States which court in each
State shall be the proper venue for
such an action, as this is a matter
for State legislators to determine.
Nevertheless, it is my hope that
States will make it as easy as
possible for consumers to bring
such actions, preferably in small
claims court. The consumer
outrage at receiving these calls is
clear. Unless Congress makes it
easier for consumers to obtain
damages from those who violate
this bill, these abuses will
undoubtedly continue.

10
 Small claims court or a
similar court would allow the
consumer to appear before the
court without an attorney. The
amount of damages in this
legislation is set to be fair to both
the consumer and the
telemarketer. However, it would
defeat the purposes of the bill if
the attorneys‘ costs to consumers
of bringing an action were greater
than the potential damages. I thus
expect that the States will act
reasonably in permitting their
citizens to go to court to enforce
this bill.

137 Cong. Rec. S16204 (daily ed. Nov. 7, 1991) (statement of
Sen. Hollings).

C.

The TCPA ―presents an unusual constellation of
statutory features‖: ―the express creation of a private right of
action, an express jurisdictional grant to state courts to
entertain them, and silence as to federal court jurisdiction of
private actions.‖ Chair King, Inc. v. Houston Cellular Corp.,
131 F.3d 507, 512 (5th Cir. 1997). As noted above, we
concluded in ErieNet that, based on the language, structure,
and legislative history of the statute, there is no federal
question jurisdiction over private actions brought under the
TCPA. 156 F.3d at 516-19. In ErieNet, we interpreted the
permissive language of § 227(b)(3) providing that a person
―may‖ bring an action in state court to suggest that ―Congress

11
intended to authorize private causes of action only in state
courts, and to withhold federal [question] jurisdiction.‖ Id. at
516 (emphasis in original). We focused on the distinction
between the general jurisdiction of state courts and the limited
jurisdiction of federal courts. See id. (―[T]here is no
presumption of jurisdiction in the federal courts.‖). It was
significant, we said, that the statute‘s permissive authorization
referred only to state courts of general jurisdiction; ―‗that
authorization cannot confer jurisdiction on a federal court
because federal courts are competent to hear only those cases
specifically authorized.‘‖ Id. (quoting Int’l Sci. & Tech. Inst.,
Inc. v. Inacom Commc’ns, Inc., 106 F.3d 1146, 1151 (4th Cir.
1997)). We noted that subject matter jurisdiction must be
conferred by statute and that the TCPA did not expressly do
that. Id.

The majority of courts of appeals to consider the
question have similarly concluded that federal courts lack
federal question jurisdiction over private TCPA claims.
Citing § 227(b)(3)‘s explicit authorization of jurisdiction over
private actions in state courts and the absence of any
reference to federal court, these courts have concluded that
Congress did not intend to grant the federal courts federal
question jurisdiction over private TCPA claims. See Murphey
v. Lanier, 204 F.3d 911, 915 (9th Cir. 2000); Foxhall Realty
Law Offices, Inc. v. Telecomms. Premium Servs., Ltd., 156
F.3d 432, 435 (2d Cir. 1998); Nicholson v. Hooters of
Augusta, Inc., 135 F.3d 1287, 1289 (11th Cir. 1998); Chair
King, Inc. v. Houston Cellular Corp., 131 F.3d 507, 514 (5th
Cir. 1997); Int’l Sci. & Tech. Inst., Inc. v. Inacom Commc’ns,
Inc., 106 F.3d 1146, 1156 (4th Cir. 1997). Only two
courts of appeals have held otherwise. See Charvat v.
EchoStar Satellite, LLC, 630 F.3d 459, 463-65 (6th Cir. 2010)

12
(finding federal question jurisdiction under the TCPA based
on § 227(f)(2)‘s explicit provision for exclusive federal
jurisdiction, 28 U.S.C. § 1441(a)‘s authorization of removal
to federal court unless expressly provided by Congress, and
on its reading of Grable & Sons Metal Products, Inc. v.
Darue Engineering & Manufacturing, 545 U.S. 308 (2005));
Brill v. Countrywide Home Loans, Inc., 427 F.3d 446, 450-51
(7th Cir. 2005) (similarly finding federal question jurisdiction
under the TCPA based on § 227(f)(2) and Grable).

Though we addressed federal question jurisdiction
extensively in ErieNet, we had no occasion to consider
whether there can be diversity jurisdiction over TCPA
claims.4 156 F.3d at 520. The issue presently before us is

4
We acknowledge that ErieNet referred, somewhat
imprecisely, to ―federal court jurisdiction‖ and ―federal
jurisdiction.‖ However, notwithstanding Judge Garth‘s view,
our analysis and holding were limited to federal question
jurisdiction. Our opinion in ErieNet begins by referring to ―a
district court‘s federal question jurisdiction‖ and Article III‘s
authorization of ―arising under‖ (i.e., federal question)
jurisdiction, and then refers repeatedly to jurisdiction under
28 U.S.C. § 1331. 156 F.3d at 515, 518-20. By contrast,
neither diversity jurisdiction nor the statute that authorizes it,
28 U.S.C. § 1332, is mentioned in the opinion at all. See
Watson v. NCO Grp., Inc., 462 F. Supp. 2d 641, 646 n.2 (E.D.
Pa. 2006) (―[O]riginal jurisdiction pursuant to sections 1331
and 1337 were the only types of jurisdiction at issue in
ErieNet. The court did not discuss the effects of its holding
on supplemental or diversity jurisdiction.‖) (internal citation
omitted)). Nor do the other Courts of Appeals cases finding
that federal courts lack § 1331 jurisdiction under the TCPA

13
whether diversity jurisdiction exists in the federal courts,
notwithstanding our conclusion in ErieNet that Congress
intended for private litigants to seek recourse in state courts
for TCPA violations. In ErieNet we asked whether Congress
conferred subject-matter jurisdiction in the TCPA;5 here we
ask whether Congress intended state courts to have exclusive
jurisdiction over TCPA claims and, thus, stripped away
diversity jurisdiction. For the reasons set forth below, we
hold that Congress did not divest the federal courts of
diversity jurisdiction over private causes of action under the

compel the conclusion that they also lack diversity
jurisdiction. See Accounting Outsourcing, LLC v. Verizon
Wireless Pers. Commc’ns, LP, 294 F. Supp. 2d 834, 839-40
(M.D. La. 2003) (―Nothing in the reasoning of any of the
courts‘ [§1331 TCPA] opinions, however, suggests it would
be logical to extend that reasoning to diversity jurisdiction.‖).
5
Our references to ―exclusivity‖ of jurisdiction and
jurisdiction ―only‖ in state courts in ErieNet must, as then-
Judge (now Justice) Sotomayor stated about similar
references in Foxhall, ―be read in context.‖ Gottlieb, 436
F.3d at 337. ErieNet addressed only federal question
jurisdiction, not diversity jurisdiction, so our references to
―exclusive‖ state jurisdiction there must be read to describe
only ―exclusive substance-based jurisdiction‖ over TCPA
claims in the state courts, not truly exclusive state court
jurisdiction. Notwithstanding Judge Garth‘s reference to
Congress‘s having ―provided‖ and ―decreed‖ that ―all‖ cases
be brought ―only‖ in state court, the TCPA does not so state.
(If it did, I would share Judge Garth‘s view on the issue
before us).

14
TCPA. Finding that we have diversity jurisdiction over
TCPA claims does not disturb the concepts we set down in
ErieNet; the TCPA has neither divested federal courts of
diversity jurisdiction over private causes of action nor
conferred on them federal question jurisdiction.6

6
Chief Judge McKee takes issue with our opinion in ErieNet,
urging that three recent Supreme Court opinions have
undermined the reasoning and result in that case. ErieNet is a
precedential opinion of our Court that is not before us on this
appeal. Even if it were, however, the Supreme Court cases
referred to did not involve a federal statute that set forth a
private right of action for litigants to proceed in state court.
The statute in Verizon Maryland, Inc. v. Public Service
Commission of Maryland, 535 U.S. 635, 641 (2002), the
Telecommunications Act of 1996, explicitly provided that an
action could be brought ―in an appropriate Federal district
court,‖ and in Breuer v. Jim’s Concrete of Brevard, 538 U.S.
691 (2003), the statute at issue provided that an action to
recover liability may be maintained ―‗in any federal or state
court of competent jurisdiction.‘‖ Id. at 693 (quoting 29
U.S.C. § 216(b)). Unlike the TCPA, neither statute evinces
any congressional intent to keep causes of action in state
court in the absence in diversity. Neither statute specifically
directs private rights of action to state court. Finally, in
Whitman v. Department of Transportation, 547 U.S. 512
(2006) (per curiam), the Court noted that the district court, in
considering the question of whether it has jurisdiction under 5
U.S.C. § 7121, should look to the statute itself and the overall
Act in which it appears to discern whether Congress intended
for jurisdiction to lie elsewhere. Id. at 513-14. In Erienet, we
did exactly that and found that the TCPA removed the

15
 D.

Here, the specific provision granting subject matter
jurisdiction to the federal courts is 28 U.S.C. § 1332(d), an
amendment added to § 1332 pursuant to the Class Action
Fairness Act (―CAFA‖) of 2005. Under CAFA, federal
courts have original jurisdiction over class actions where
there is minimal diversity and the aggregate amount in
controversy exceeds $5 million, exclusive of interests and
costs. §1332(d)(2), (6). In each of these cases, minimal
diversity is present and, given defendants‘ alleged
transmission of over 10,000 unsolicited faxes and the
possibility of treble damages under the TCPA, the aggregate
amount in controversy exceeds $5 million CAFA requires.
Thus, in light of our ruling that federal courts can exercise
diversity jurisdiction over TCPA claims when the
requirements of diversity are otherwise fulfilled, the New
Jersey District Courts here had subject-matter jurisdiction
under § 1332(d).

In holding that there is diversity jurisdiction under the
TCPA, we rely heavily on then-Judge (now Justice)
Sotomayor‘s opinion in Gottlieb v. Carnival Corp., where the
Second Circuit persuasively applied two canons of statutory
interpretation to the TCPA – the ―whole act rule,‖ which
instructs that parts of a statute should be placed in the context
of the entire statutory scheme and the principle that reliance
on background principles of law inform a statute‘s
interpretation – to conclude that federal courts should have
diversity jurisdiction over § 227(b)(3) claims. 436 F.3d at

jurisdiction that § 1331 often confers on federally created
causes of action. Accordingly, these cases are inapposite.

16
338-343. Though we do not adopt Gottlieb‘s reasoning
wholesale, we note the soundness of the Second Circuit‘s
approach and draw on it considerably.

Our starting point is the historic grant of diversity
jurisdiction to the federal courts, first under the Judiciary Act
of 1789, then as codified at 18 U.S.C. § 1332. As did the
Gottlieb court, we understand § 1332 as ―an independent
grant of federal jurisdiction intended to prevent
discrimination against non-citizen parties regardless of
whether state or federal substantive law is involved.‖ 437
F.3d at 340. As such, diversity jurisdiction is ―presumed to
exist for all causes of action so long as the statutory
requirements are satisfied.‖ Id. Indeed, the language of §
1332 provides that district courts ―shall have jurisdiction of
all civil actions where‖ the matter in controversy exceeds
$75,000 and where the parties are diverse. 18 U.S.C. § 1332
(emphasis added). Federal courts only lack diversity
jurisdiction where Congress has explicitly expressed an intent
to strip federal courts of this jurisdiction, Gottlieb, 436 F.3d at
338, or where such jurisdiction is found to be irreconcilable
with a congressional statute. U.S. Fax Law Ctr., Inc. v. iHire,
Inc., 476 F.3d 1112, 1117 (10th Cir. 2007) (citing Colo. River
Water Conserv. Dist. v. United States, 424 U.S. 800, 808
(1976)). See also id. at 1117 (―[A]bsent an explicit indication
that Congress intended to create an exception to diversity
jurisdiction, one may not be created by implication.‖) (citing
Ankenbrandt v. Richards, 504 U.S. 689, 700 (1992)).

It is useful to begin with the origins of the two
traditional bases for subject matter jurisdiction. Federal
courts did not have general federal question jurisdiction until
1875. Idaho v. Couer d’Alene Tribe of Idaho, 521 U.S. 261
(1997). Before then, federal courts had jurisdiction over

17
substantive law claims either when the federal statute sought
to be enforced contained a specific grant of federal court
jurisdiction or when diversity of citizenship was present.
Diversity jurisdiction, by contrast, was ―expressly
contemplated by Article III of the United States Constitution‖
and has provided a jurisdictional basis for entry into the
federal courts since the very inception of our judicial system
in the Judiciary Act of 1789. Kopff v. World Research Grp.,
LLC, 298 F. Supp. 2d 50, 55 (D.D.C. 2003). See also Hertz
Corp. v. Friend, --- U.S. ---, 130 S. Ct. 1181, 1188 (2010)
(noting the First Judiciary‘s Act‘s grant of authority to federal
courts to hear suits ―‗between a citizen of the State where the
suit is brought, and a citizen of another State‘‖) (quoting § 11,
1 Stat. 78)).

Today, diversity jurisdiction is ―based on a grant of
jurisdictional authority from Congress‖ in the form of 28
U.S.C. § 1332. U.S. Fax Law Ctr., 476 F.3d at 1117 (citing
Neirbo Co. v. Bethlehem Shipbuilding Corp., 308 U.S. 165,
171 (1939)). ―As to diversity cases, Congress has given the
federal courts cognizance, concurrent with the courts of the
several states. [A party‘s] consent [to be sued in the courts of
a state], therefore, extends to any court sitting in the state
which applies the laws of the state.‖ Id. (internal citations
and quotation marks omitted) (emphasis added). Diversity
jurisdiction‘s purpose – of ―prevent[ing] apprehended
discrimination in state courts against those not citizens of the
state,‖ Erie R.R. Co. v. Tompkins, 304 U.S. 64, 74 (1938) –
exists independently of other considerations like the subject
matter of the lawsuit or the nature of the law under which the
suit is filed. See Accounting Outsourcing, 294 F. Supp. 2d at
838 (―[N]o matter how one may label the diversity statute, it
exists for an independent and important reason, unrelated to

18
the subject matter of the lawsuit.‖). Indeed, the
―presupposition of diversity jurisdiction,‖ a concern with
local bias, is usually not affected by other aspects of the cause
of action. Jerome G. Grubart, Inc. v. Great Lakes Dredge &
Dock Co., 513 U.S. 527, 546 n.6 (1995). Consequently, as a
general matter, where parties are diverse and the amount in
controversy meets the statutory bar, § 1332 operates as a
threshold grant of jurisdiction.7 Other bases for federal
jurisdiction may be expressly or impliedly proscribed, but
such proscriptions are typically responsive to concerns that
are either irrelevant or outweighed when the requirements for
diversity jurisdiction are met.

Courts have long recognized the presumption of
diversity jurisdiction regardless of the type of law under
which a lawsuit arises. In Dodge v. Woolsey, 59 U.S. 331
(1855), for example, plaintiff, a Connecticut citizen and an
investor in an Ohio corporation, sued, among others, an Ohio
tax collector who was trying to collect taxes from the
corporation. Plaintiff claimed that the taxes, which resulted

7
Perhaps due to the mechanical nature of diversity
jurisdiction‘s requirements, commentators have noted that,
even after federal question jurisdiction was codified, litigants
relied on diversity jurisdiction as a basis for entering federal
court even where federal question jurisdiction existed. See
Ann Woolhandler, The Common Law Origins of
Constitutionally Compelled Remedies, 107 Yale L.J. 77, 85,
134 (1997) (―In seeking injunctions against taxes alleged to
violate the Constitution, federal court litigants continued to
rely heavily on diversity jurisdiction well into th[e]
[twentieth] century, long after the federal question statute had
become available.‖).

19
from the passage of a new state law and state constitution in
Ohio, violated the Contracts Clause of the U.S. Constitution
because they abrogated the terms of the corporate charter the
corporation had received from Ohio. Id. at 335-40. Today,
this claim would fall squarely under a federal court‘s federal
question jurisdiction, but the Court‘s emphasis here was on
the jurisdictional baseline that existed by virtue of the parties‘
diversity of citizenship. The Court rejected defendant‘s
argument that the suit was within the exclusive jurisdiction of
the state courts and noted ―that the courts of the United States
and the courts of the States have concurrent jurisdiction in all
cases between citizens of different States, whatever may be
the matter in controversy, if it be one for judicial cognizance .
. . and that it is no objection to this jurisdiction, that there is a
remedy under the local law.‖ Id. at 347 (emphasis added). It
is the parties being from different states, not the subject
matter, that is determinative.

The presumptive existence of federal courts‘ diversity
jurisdiction over all causes of action that meet § 1332‘s
requirements is bolstered by the ―well-established principle of
statutory construction that repeal or amendment by
implication is disfavored.‖ Gottlieb, 436 F.3d 335 (citing
Colo. River, 424 U.S. at 808; Rosencrans v. United States,
165 U.S. 257, 262 (1897)). As the Supreme Court has
emphasized, ―[w]hen there are statutes,‖ like § 1332, ―clearly
defining the jurisdiction of the courts, the force and effect of
such provisions should not be disturbed by a mere
implication.‖ 165 U.S. at 262. See also Kopff, 298 F. Supp.
2d at 55 (―A federal court‘s original jurisdiction in diversity
cases is not subject to implied exceptions.‖). In Colorado
River, the Supreme Court stated that, ―[i]n the absence of
some affirmative showing of an intent to repeal, the only

20
permissible justification for a repeal by implication is when
the earlier and later statutes are irreconcilable.‖ 424 U.S. at
808. Clearly, § 227(b)(3) does not evince an intent to repeal
§ 1332 and is in no way irreconcilable with § 1332.

Federal question jurisdiction, by contrast, lacks
diversity jurisdiction‘s expansive nature and straightforward
applicability. Where a federal question clearly exists, district
courts have original jurisdiction unless a specific statute
places jurisdiction elsewhere, U.S. Fax Law Ctr., 476 F.3d at
1117 (citing Int’l Sci., 106 F.3d at 1154), and if a federal
question is not as clearly presented, determining whether
―arising under‖ jurisdiction exists requires a multi-factorial
analysis of how federal the claim really is; the process is more
nuanced than the easily applied two-factor test for diversity
jurisdiction, and the purposes served by allowing access to
the federal courts under each statute are quite distinct. As the
Fifth Circuit explained in finding that federal courts lack
federal question jurisdiction under the TCPA, ―[t]here is no
‗single, precise definition‘ of when a case falls within the
original ‗federal question‘ jurisdiction of federal courts;
‗rather, the phrase ―arising under‖ masks a welter of issues
regarding the interpretation of federal and state authority and
proper management of the federal jurisdictional system.‘‖
Chair King, 131 F.3d at 510 (quoting Merrell Dow Pharms.
v. Thompson, 478 U.S. 804, 808 (1986) (internal citations
omitted)).8 Assessing whether a federal court has diversity

8
Indeed, § 1331‘s ―all civil actions arising under‖ language
has been interpreted to ensure that only cases ―in which a
well-pleaded complaint establishes either [1] that federal law
creates the cause of action or [2] that the plaintiff‘s right to
relief necessarily depends on resolution of a substantial

21
jurisdiction generally avoids such thorny analysis. Thus,
collapsing federal question and diversity jurisdiction together
in the context of the TCPA ignores the meaningful difference
between federal question jurisdiction, a constrained basis for
jurisdiction that applies in a ―narrow class‖ of federally-
oriented cases, and diversity jurisdiction, which has
traditionally been open to claims based on any cause of action
out of concern for avoiding bias against out-of-state parties.9

question of federal law‖ come into federal court under the
court‘s federal question jurisdiction. Franchise Tax Bd. v.
Constr. Laborers Vacation Trust, 463 U.S. 1, 28 (1983). The
federal question statute has not been read to confer upon
federal courts ―the full breadth‖ of federal question
jurisdiction but instead has ―been construed more narrowly
than its constitutional counterpart.‖ Chair King, 1311 F.3d at
510 (citing Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S.
480, 494-95 (1983)); Romero v. Int’l Terminal Operating Co.,
358 U.S. 354, 379-80 (1959)). By contrast, § 1332(a)‘s ―all
civil actions where‖ language has, in the absence of a specific
directive otherwise, been interpreted to mean just what it
says: when the conditions following ―where‖ – sufficient
amount in controversy and diversity of citizenship – are met,
the suit can come into federal court.
9
In Brill, the Seventh Circuit, in dicta, conflated the two
traditional bases for jurisdiction without explanation or
citation – ―if state jurisdiction really is ‗exclusive,‘ then it
knocks out § 1332 as well as § 1331.‖ 427 F.3d at 450. This
is the only instance where a Court of Appeals, albeit without
providing any reasoning, has concluded that the existence or
absence of federal question jurisdiction under the TCPA

22
Bryan v. BellSouth Commc’n, Inc., 377 F.3d 424, 434 (4th
Cir. 2004).

Nor does the fact that the TCPA is a federally created
cause of action compel us to put diversity jurisdiction and
federal question jurisdiction under the TCPA on equal
footing. Though it is indeed ―rare [for a] federal statute . . .
[to] create[] a cause of action that gives rise to jurisdiction
under § 1332, but not under § 1331,‖ Gottlieb, 436 F.3d at
342 n.8, it is not logically inconsistent. First, diversity
jurisdiction is not by its statutory terms limited to state-law
claims. As Judge Sotomayor observed in Gottlieb, ―nothing
in § 1332 indicates that diversity jurisdiction does not exist
where federally-created causes of action are concerned.‖ 436
F.3d at 335.10 Moreover, in the instances where federal

dictates the same for diversity jurisdiction. For the reasons
discussed herein, we reject this conclusion.
10
A federal court‘s exercise of diversity jurisdiction over a
federally-created cause of action will put the court in the
―odd‖ position of ―apply[ing] federal substantive and
procedural law,‖ Gottlieb, 436 F.3d at 342 n.8 (emphasis
added). This in no way suggests that diversity jurisdiction is
improper; it merely ―emphasizes the sui generis nature of the
[TCPA].‖ Id. The Sixth Circuit has also recognized and
approved of this departure from Erie‘s directive to apply state
substantive law and federal procedural law in diversity cases
– a directive that is only applicable where state law causes of
action are at issue. See Charvat v. GVN Mich., Inc., 561 F.3d
623, 630 n.6 (6th Cir. 2009). In Charvat, the Sixth Circuit
rejected the district court‘s application of Ohio law in
interpreting the federal TCPA and explained that, although

23
statutes do not give rise to § 1331 jurisdiction, there is no
indication that the rationale behind the absence of federal
question jurisdiction also wipes out diversity jurisdiction.

Though the ―vast majority‖ of cases that fall under §
1331 are ―described by Justice Holmes‘ adage that ‗a suit
arises under the law that creates the cause of action,‘‖ Merrell
Dow, 478 U.S. at 819 (quoting Am. Well Works Co v. Layne
& Bowler Co., 241 U.S. 257, 260 (1916)), it is not the case
that every private cause of action under a federal statute
begets federal question jurisdiction. Rather, ―[i]nferior
federal courts‘ ‗federal question‘ jurisdiction ultimately
depends on Congress‘s intent as manifested by the federal
statute creating the cause of action.‖ Chair King, 131 F.3d at
510 (citing Sheldon v. Sill, 49 U.S. (8 How.) 441, 448
(1850)). See also Int’l Sci., 106 F.3d at 1154 (―Because
federal-question jurisdiction ultimately depends on an act of
Congress, the scope of the district courts‘ jurisdiction depends
on that congressional intent manifested in [the] statute.‖).

federal courts sitting in diversity usually ―apply state
substantive law to state-law claims, this case presents a very
different situation, because the statute on which the claims are
based is itself a federal statute. As we have noted, ‗the
applicability of state law depends on the nature of the issue
before the federal court and not on the basis for its
jurisdiction.‘‖ Id. (quoting Gentek Bldg. Prods., Inc. v.
Sherwin-Williams Co., 491 F.3d 320, 333-34 (6th Cir. 2007)
(internal quotation omitted)). Because the issue before it was
―the interpretation of a federal statute,‖ the Charvat court
reasoned that it was ―not bound by decisions of the state
courts of Ohio interpreting the federal TCPA.‖ Id. (citing
Gottlieb, 436 F.3d at 348 n.8).

24
Indeed, as our focus in ErieNet demonstrates, congressional
intent is a touchstone of federal question jurisdiction analysis.
See Merrell Dow, 478 U.S. at 812 (noting that it has
―consistently emphasized, in exploring the outer reaches of §
1331,‖ that the determination of whether federal question
jurisdiction exists over nonfederal causes of action ―require[s]
sensitive judgments about congressional intent, judicial
power, and the federal system‖). With diversity jurisdiction,
however, unless Congress has been explicit in mandating
exclusive state court jurisdiction or in precluding diversity
jurisdiction, congressional intent is largely irrelevant to
determining whether a federal court has diversity jurisdiction
over a given cause of action.

Suits authorized by the federal statute at issue in
Shoshone Mining Co. v. Rutter, 177 U.S. 505 (1900), present
an example of causes of action which, though created by
federal law, do not fall under federal courts‘ federal question
jurisdiction. In Shoshone, the Court considered whether a
federal statute expressly authorizing ―adverse suits‖ to
determine title to land established federal question
jurisdiction. Id. at 506. The statute provided that claims were
to be determined ―by local customs or rules of miners in the
several mining districts, so far as the same are applicable and
not inconsistent with the laws of the United States; or by the
statute of limitations for mining claims of the State or
Territory where the same may be situated.‖ Id. at 508. The
mere fact that a suit ―takes its origin in the laws of the United
States‖ does not, the Court reasoned, necessarily make it ―one
arising under the Constitution or laws of the United States,‖
lest virtually every dispute over title to land ―in the newer

25
States‖ raise a federal question. Id. at 507.11 Accordingly,
the Court held that the federal cause of action created by the
mining statute did not confer federal question jurisdiction
over claims that turned entirely on state law. Id.

However, in noting the ―conceded fact that, unless the
amount in controversy is over $2,000, no jurisdiction attaches
to the Federal court,‖ id. at 511, the Court suggested that
federal courts could exercise diversity jurisdiction over claims
brought under the mining statute. Indeed, in International
Science, the Fourth Circuit pointed to Shoshone as an
example of a case where the Court found that,
―notwithstanding the federal statutory basis, Congress
intended that because of the predominance of state issues that
cases be litigated in state courts unless there was diversity of
citizenship.‖ 106 F.3d at 1154 (emphasis added). Even in
Shoshone, where the statute at issue dealt with subject matter
of the most local variety, land title, and specifically required
the application of local laws and rules,12 it was not interpreted

11
See also Shultis v. McDougal, 225 U.S. 561, 569 (1912) (―A
suit to enforce a right which takes its origins in the laws of the
United States is not necessarily, or for that reason alone, one
arising under those laws, for a suit does not so arise unless it
really and substantially involves a dispute or controversy
respecting the validity, construction, or effect of such a law,
upon the determination of which the result depends.‖).
12
Granted, the mining statute did not refer to the venue in
which suits should or may be brought, whereas the TCPA
specifically states that causes of action ―may be brought‖ in
―an appropriate court of that state.‖ 27 U.S.C. § 227(b)(3).

26
to create exclusive state court jurisdiction. The Shoshone
Court‘s justification for removing certain federally created
causes of action from federal courts‘ § 1331 jurisdiction
where state law issues dominate or state rules govern does not
apply to diversity jurisdiction, which, as we have described,
―derives its basis not on the presence of a federal question,
but rather on an independent anti-discrimination rationale.‖
Biggerstaff v. Voice Power Telecomms., Inc., 221 F. Supp. 2d
652, 657 (D.S.C. 2002).13 Both the mining statute and the

13
Similarly, in Bay Shore Union Free School District v. Kain,
485 F.3d 730, 733-36 (2d Cir. 2007), the Second Circuit
found that federal courts did not have federal question
jurisdiction over claims under the Individuals with
Disabilities Education Act (IDEA) where those claims turned
entirely on state law and where diversity of citizenship was
absent. IDEA required school districts to provide
individualized education programs for disabled
schoolchildren and provided that parties ―aggrieved by‖ the
state or local agency‘s review of those programs ―shall have
the right to bring a civil action‖ challenging the agency‘s
decision ―in any State court of competent jurisdiction or in a
district court of the United States.‖ Id. at 735 (quoting 20
U.S.C. § 1415(i)(2)(A)). The Second Circuit found that,
despite the reference in IDEA‘s jurisdictional provision to
―district courts,‖ district courts lacked § 1331 jurisdiction
over IDEA claims where the resolution turned entirely on
state law, like the school district‘s challenge here to the local
education agency‘s determination that the district was obliged
to provide a student with a one-to-one aide during class. A
federal court, Bay Shore said, ―may not exercise jurisdiction
over a civil action brought under § 1415(i)(2)(A) if the claims
asserted turn exclusively on matters of state law and diversity

27
TCPA are examples of federal causes of action that
essentially enable state enforcement; as such, neither confers
federal question jurisdiction in the federal courts, but neither,
without more, disrupts the baseline framework of federal
diversity jurisdiction over large claims between diverse
parties.14

E.

With this understanding of diversity jurisdiction in
mind, we turn now to the TCPA itself. Due to the nature of
diversity jurisdiction, it would take a ―clear and definitive‖

of citizenship is absent.‖ Id. at 736 (emphasis added). As in
Shoshone, the court‘s conclusion regarding federal courts‘
lack of § 1331 jurisdiction under a federally created cause of
action did not bear on the independent question of whether
federal courts could have diversity jurisdiction under the
statute.
14
Plaintiffs‘ claims under the mining statute in Shoshone and
IDEA in Bay Shore turned entirely on the interpretation of
state law. By contrast, the sources of law applicable in
adjudicating TCPA claims are not so clearly limited, thus
complicating our § 1331 jurisdictional inquiry – i.e.
Shoshone‘s exception to the rule that ―a suit arises under the
law that creates the cause of action‖ does not squarely apply
to private causes of action under the TCPA. The presumption
of diversity jurisdiction in both cases despite the state-law
focus of the mining and IDEA statutes, however, underscores
both diversity jurisdiction‘s independence from the § 1331
inquiry and its baseline presence where it has not been
explicitly divested.

28
directive from Congress to persuade us ―to remove a party‘s
entitlement to a federal forum based on diversity.‖
Accounting Outsourcing, 294 F. Supp. 2d at 838. As the
Second Circuit did, we ―proceed according to the rule that §
1332 applies to all causes of action, whether created by state
or federal law, unless Congress expresses a clear intent to the
contrary.‖ Gottlieb, 436 F.3d at 340. Our demand for a clear
statement comports with our general view that ―‗repeals by
implication are not favored and will not be presumed unless
the intention of the legislature is clear and manifest.‘‖ Hagan
v. Rogers, 570 F.3d 146, 154-55 (3d Cir. 2009) (quoting Nat’l
Ass’n of Home Builders v. Defenders of Wildlife, 551 U.S.
644 (2007) (internal quotation marks and brackets omitted)).

We do not find the TCPA‘s language sufficiently clear
or forceful enough to deprive federal courts of diversity
jurisdiction over TCPA claims. Nothing in § 227(b)(3) or the
overall statute indicates that Congress intended for individual
claims brought under the TCPA to operate any differently
than other suits between diverse parties where the amount in
controversy meets § 1332‘s requirements.

First, § 227(b)(3) itself, which states that ―[a] person or
entity may, if otherwise permitted by the laws or rules of
court of a State, bring in an appropriate court of that State‖ an
action for damages against defendants who have violated the
TCPA, does not expressly remove federal courts‘ diversity
jurisdiction over TCPA claims. As the Tenth Circuit has
noted, ―[t]his fact alone is probably sufficient to demonstrate
the presence of diversity jurisdiction because ‗[diversity
jurisdiction] is an independent grant of federal jurisdiction . . .
[that] is presumed to exist for all causes of action so long as

29
statutory requirements are satisfied.‘‖ U.S. Fax Law Ctr., 476
F.3d at 1117 (quoting Gottlieb, 436 F.3d at 340).15

15
We note, as Gottlieb did, the contrast between the absence
of any reference to diversity jurisdiction in the TCPA and the
overt elimination of such jurisdiction in at least two other
federal statutes. See 436 F.3d at 340 n.6. The Johnson Act
states:
The district courts shall not enjoin, suspend or restrain
the operation of, or compliance with, any order
affecting rates chargeable by a public utility and made
by a State administrative agency or a rate-making body
of a State political subdivision, where: (1) Jurisdiction
is based solely on diversity of citizenship or
repugnance of the order to the Federal Constitution;
and, (2) The order does not interfere with interstate
commerce; and, (3) The order has been made after
reasonable notice and hearing; and, (4) A plain, speedy
and efficient remedy may be had in the courts of such
State.
28 U.S.C. § 1342 (emphasis added). In the Johnson Act,
Congress made explicit its intention to preclude subject
matter jurisdiction based on diversity. In addition, the
legislative history of the Act makes it plain that Congress‘s
purpose in passing the Act was to ―prevent out-of state
utilities from challenging state administrative orders in
federal court,‖ Accounting Outsourcing, 294 F. Supp. 2d at
839 (citing California v. Grace, 457 U.S. 393, 410 n.22), a
purpose that aligns with divesting the federal courts of
diversity jurisdiction.
The Tax Injunction Act provides:
The district courts shall not enjoin, suspend or restrain
the assessment, levy or collection of any tax under

30
 Moreover, the statute‘s ―permissive grant of
jurisdiction to state courts,‖ ErieNet, 156 F.3d at 523 (Alito,
J., dissenting) – its provision that litigants ―may‖ bring
private actions in state courts – does not indicate that suits are
required to be brought in state court; it suggests only that, as

State law where a plain, speedy and efficient remedy
may be had in the courts of such State.
28 U.S.C. § 1341 (emphasis added). Though the text of the
TIA does not specifically address diversity jurisdiction, the
legislative history indicates that Congress intended to ―stop
out-of-state corporations from using diversity jurisdiction to
gain injunctive relief against a state tax in federal court . . . .‖
Jefferson County, Ala. v. Acker, 527 U.S. 423, 435 (1999).
Both the Johnson Act and the TIA ―were designed to
eliminate disparities between taxpayers who could obtain
injunctive relief in federal court – namely out-of-state
corporations asserting diversity jurisdiction – and local
taxpayers who were left to litigate in state courts where
taxpayers often had to pay first and litigate later.‖ Accounting
Outsourcing, 294 F. Supp. 2d at 839. In these contexts, the
usual justification for diversity jurisdiction – preventing
discrimination against out-of-state defendants – is absent; in
fact, Congress wished to address the converse concern –
eliminating any preference for out-of-state defendants. With
the TCPA, Congress has evinced no such countervailing
concern. Neither the TCPA‘s text nor legislative history
suggests any reason for barring federal subject matter
jurisdiction where the parties are diverse and the amount in
controversy meets the jurisdictional bar.

31
the text says, they may be brought in state courts.16 As we
observed in ErieNet, Congress, with this permissive language,
―referred . . . [TCPA] claims to state court as forcefully as it
could‖ given possible constitutional difficulties with
mandating a resort to state courts. 156 F.3d at 516 (emphasis
added). We found Congress‘s direction emphatic enough and
adequately indicative of a lack of federal concern to remove
federal courts‘ § 1331 jurisdiction over TCPA claims. The
direction, however, is not the kind of precise, unambiguous
statement of congressional intent to confer exclusive state
court jurisdiction that is required to divest a court of its
diversity jurisdiction. The language in the Johnson Act and
the TIA, see supra n.15, demonstrates that when Congress
wishes to strip federal courts of diversity jurisdiction, it does
so clearly, and usually in a context where the policy concerns
underlying diversity jurisdiction are absent. In these
instances, a congressional directive to strip courts of diversity
jurisdiction need not be inferred from statutory text and
legislative history that speak more directly to questions of
federal interest, state/federal balance and other barometers of
federal question jurisdiction; instead, the abrogation is clearly
stated.

The TCPA‘s statutory structure further supports our
interpretation. See United States v. CDMG Realty Co., 96
F.3d 706, 714 (3d Cir. 1996) (noting that, in statutory
construction, ―[m]eaning derives from context‖). Courts of

16
See ErieNet, 156 F.3d at 522 (Alito, J., dissenting) (noting
that the TCPA was designed to ―‗allow consumers to bring an
action in state court.‘‖) (quoting 137 Cong. Rec. S16205
(daily ed. Nov. 7, 1991)) .

32
appeals addressing federal question jurisdiction under the
TCPA have pointed out that Congress‘s drawing of
jurisdictional distinctions in other parts of the TCPA made its
failure to do so in § 227(b)(3) more significant. The Second
Circuit in Foxhall and the Fourth Circuit in International
Science cited § 227(f)(2)‘s explicit mandate that federal
courts have exclusive jurisdiction over TCPA claims brought
by states‘ attorneys17 as evidence that where Congress
affirmatively intended for federal court jurisdiction, it so
stated. In addition, as Gottlieb recognized, § 227(f)(2)‘s
exclusive jurisdiction language further suggests that
Congress, in the very same act, knew how to explicitly assign
exclusive jurisdiction to one set of courts. Thus, when in §
227(b)(3) it ―did not similarly vest categorical, ‗exclusive‘
jurisdiction in state courts for private TCPA claims,‖ it
therefore ―did not divest federal courts of both federal
question and diversity jurisdiction.‖ Gottlieb, 436 F.3d at 338
(emphasis added). Regarding the overall statutory structure,
the Second Circuit concluded, and we agree, that ―[j]ust as
nothing in the language of § 227(b)(3) expresses a
congressional intent to divest the federal courts of jurisdiction
under the TCPA, nothing in the statutory structure indicates
that intent.‖ Id. at 339.

Our interpretation is also consistent with the TCPA‘s
statutory purposes, as revealed in the statute‘s legislative
history. See Klein v. Vision Lab Telecomm., Inc., 399 F.
Supp. 528, 534 (S.D.N.Y. 2005) (―This interpretation [that

17
Section 227(f)(2) provides, in relevant part, that ―[t]he
district courts of the United States . . . shall have exclusive
jurisdiction over all civil actions brought under this
subsection.‖ 47 U.S.C. § 227(f)(2).

33
federal courts have § 1332 jurisdiction under the TCPA] is
consistent with the purposes of the TCPA, as reflected in the
Act‘s legislative history.‖). In reading the TCPA to exclude
federal question jurisdiction, several courts of appeals have
looked to Senator Hollings‘s suggestion that ―state courts
provide a more appropriate forum for small value claims and
plaintiffs appearing on their own behalf.‖ Accounting
Outsourcing, 294 F. Supp. 2d at 837 (citing Int’l Sci., 106
F.3d at 1152-53 (internal citations omitted)). See also, e.g.,
ErieNet, 156 F.3d at 518 (citing the congressional record and
Senator Hollings‘s statement); Int’l Sci, 106 F.3d at 1152-53
(same). Congress‘s preference for resolving small TCPA
claims in state courts designed to handle them, significant to §
1331 analysis, has little relevance and ―little force in a
diversity suit, which by definition involves an amount in
controversy exceeding $75,000.‖ U.S. Fax Law Ctr., 476
F.3d at 1117 (citing Accounting Outsourcing, 294 F. Supp. 2d
at 840). As then-Judge (now Justice) Alito noted in his
ErieNet dissent, ―the Senator said nothing about preventing
corporate adversaries who are battling over large sums of
money from . . . go[ing] to federal court.‖ 156 F.3d at 522.18
Nothing in the Senator‘s statements contradicts or even
speaks to the basic rationale underlying diversity jurisdiction

18
Judge Alito, who argued that federal courts do have federal
question jurisdiction under the TCPA, suggested that such
battling corporate adversaries could choose to go to federal
court, even in the absence of diversity. We disagree with his
overall conclusion but concur with his reading of the statute‘s
legislative history – that it ―confirm[s] the permissive grant of
state jurisdiction found in the statute‘s text‖ and does not
indicate that Congress intended for exclusive state
jurisdiction. 156 F.3d at 522.

34
– protecting out-of-state defendants from pro-citizen bias in
the state courts. Indeed, our holding that federal courts have
diversity jurisdiction over TCPA claims where § 1332‘s
conditions are met – for the same protectionist reasons they
always have diversity jurisdiction over larger claims between
diverse parties – in no way conflicts with Congress‘s wish
that individual low-value claims regarding unsolicited faxes
be litigated in state courts.19

As we have explained, nothing in the statutory text or
legislative history of the TCPA expressly indicates that
Congress intended to strip federal courts of their diversity

19
In examining the TCPA‘s statutory purpose, we also note
what Congress clearly was not contemplating or targeting
with passage of the TCPA. Private suits under the TCPA do
not fall into the narrow ambit of causes of action over which
state courts have exclusive jurisdiction even if the
requirements of diversity are met. Cf. Colo. River, 424 U.S.
at 817 (noting the ―virtually unflagging obligation of the
federal courts to exercise the jurisdiction given them‖).
These suits concern domestic relations – divorce, alimony,
and child custody – and are confined to the state courts
because of their highly localized nature and because of the
primacy of states‘ interest in these matters. The TCPA, by
contrast, does not regulate an area of the law characterized by
deep-seated historical deference to state courts and state
policy. Cf. Ankenbrandt, 504 U.S. at 704 (―[S]tate courts are
more eminently suited to work of this type than are federal
courts, which lack the close association with state and local
government organizations dedicated to handling issues that
arise out of conflicts over divorce, alimony, and child custody
decrees.‖).

35
jurisdiction under § 1332 over TCPA claims. Since diversity
jurisdiction is not explicitly abrogated, it will only be found
lacking if the ―diversity jurisdiction statute and the TCPA are
‗irreconcilable.‘‖ U.S. Fax Law Ctr., 476 F.3d at 1117 (citing
Colo. River, 424 U.S. at 808). See also Hagan, 570 F.3d at
155 (―‗An implied repeal will only be found where provisions
in two statutes are in irreconcilable conflict, or where the
latter act covers the whole subject area of the earlier one and
is clearly intended as a substitute.‘‖) (quoting Branch v.
Smith, 538 U.S. 254 (2003) (internal citations and quotation
marks omitted)).

The diversity jurisdiction statute and the TCPA are not
irreconcilable. Though federally established, the TCPA
essentially operates like a state law. By providing a federal
law to counteract evasion of state law across state lines,
Congress ―sought to put the TCPA on the same footing as
state law, essentially supplementing state law where there
were perceived jurisdictional gaps.‖ Gottlieb, 436 F.3d at
342. In ErieNet, we noted that the ―mere need for federal
legislation and provision of remedies does not give a right of
access to a federal forum,‖ 156 F.3d at 517;20 nor does a

20
Though the interstitial role of the TCPA does not suggest a
clearly identifiable federal interest that would provide a basis
for federal question jurisdiction, the TCPA‘s text and history
also do not reflect the kind of clearly exclusive, localized
concerns that are at the heart of domestic relations statutes or
statutes like the TIA and the Johnson Act, see supra, which
do not allow for diversity jurisdiction. See Accounting
Outsourcing, 294 F. Supp. 2d at 840 (―Unlike matters
involving taxes and public utilities, matters involving fax
transmission can hardly be deemed ‗traditionally regulated‘

36
federal law‘s gap-filling function or its operation alongside
state law remove the action from federal court entirely. We
agree with the Second Circuit that, ―[i]nsofar as Congress
sought, via the TCPA, to enact the functional equivalent of
state law that was beyond the jurisdiction of a state to enact, it
would be odd to conclude that Congress intended that statute
to be treated differently, for purposes of diversity jurisdiction,
than any other state statute.‖ 436 F.3d at 342.

Not only are the TCPA and the diversity statute
compatible, but it is actually the ―eliminat[ion] [of] diversity
jurisdiction over TCPA claims‖ that would produce
anomalous results. U.S. Fax Law Ctr., 476 F.3d at 1117
(emphasis in original). Indeed, interpreting the TCPA to vest
exclusive jurisdiction in state courts would mean that ―‗state
law claims based on unlawful telephone calls could be
brought in federal court, while federal TCPA claims based on
those same calls could be heard only in state court.‘‖ Id.
(quoting Kinder v. Citibank, No. 99-CV-2500, 2000 WL
1409762, at *4 (S.D. Cal. Sept. 14, 2000)). See also Gottlieb,
436 F.3d at 342 (―The reasoning of those district courts that
have noted the anomaly that would result if a plaintiff
alleging a state-law cause of action for unauthorized
telemarketing could sue in federal court on the basis of
diversity jurisdiction but a TCPA plaintiff could not do so is .
. . persuasive.‖) (citing Kinder, 2000 WL 1409762, at *4).
Bifurcating related cases would ―promote a needless waste of
resources through duplicative discovery and motion practice,
and would create the possibility of conflicting factual findings

by the states.‖). It is thus coherent to conclude that the TCPA
produces neither federal question jurisdiction nor exclusive
state court jurisdiction.

37
and legal holdings.‖ Watson, 462 F. Supp. 2d at 646. In
addition, finding exclusive state court jurisdiction under the
TCPA would bar the federal courts from exercising
supplemental jurisdiction under 28 U.S.C. § 1367 over TCPA
claims: ―[W]here a federal court exercised federal question
jurisdiction over a claim involving other provisions of the
Communications Act or diversity jurisdiction over a claim
under a parallel state statute, it could not hear a related TCPA
claim.‖ 436 F.3d at 342. Without a clear statement from
Congress precluding the exercise of supplemental jurisdiction
over TCPA claims we are unwilling to so interfere with this
established and independent basis of jurisdiction. See
Watson, 462 F. Supp. 2d at 646 (―To interpret ErieNet to
foreclose supplemental jurisdiction would produce a result
that is unsupported by the language and the intent of the
TCPA, and is inconsistent with the purpose of supplemental
jurisdiction.‖).

Other impermissible consequences could also flow
from the elimination of diversity jurisdiction. We note the
possibility that, in the absence of diversity jurisdiction under
§ 1332, a plaintiff who had received unsolicited faxes could
entirely lose his right to file a private TCPA claim. The
language in the TCPA providing that a plaintiff may bring
suit in state court ―if otherwise permitted by the laws or rules
of a State‖ suggests that, without diversity jurisdiction in
federal courts, a plaintiff ―could be without any venue to file
his claim if a state opted out of the TCPA.‖ U.S. Fax Law
Ctr., 476 F.3d at 1117 (―‗[I]f otherwise permitted by the laws
or rules of a court of a State‘ implies that federal [question or
diversity] jurisdiction . . . is available; otherwise where would
victims go if a state elected not to entertain these suits?‖)
(citing Brill, 427 F.3d at 751)).

38
 Finally, we recognize that, on a practical level,
Congress probably did not anticipate a circumstance in which
a conflict between § 1332 and § 227(b)(3) would arise.
Indeed, Congress set the statutory damages for individual
TCPA claims at $500, a figure substantially lower than the
$75,000 diversity jurisdiction bar. We have little doubt that
in designing a statute to provide relief to aggrieved recipients
of unsolicited faxes, Congress expected that these individuals
would sue in state court and did not want federal court to be
bothered with their claims. However, as the Second Circuit
concluded, ―Congress‘s failure to foresee a circumstance in
which diversity jurisdiction could be invoked does not serve
as a barrier to federal jurisdiction in the absence of a clear
statement to divest the federal courts of diversity
jurisdiction.‖ Gottlieb, 436 F.3d at 343.21 Congress has
given no indication that when litigants can aggregate their
claims to add up to $75,000, or file as a class to reach
CAFA‘s $5 million requirement, it intended that these claims
be barred from federal court.22 Its failure to anticipate this

21
See also Charvat, 630 F.3d at 464 (interpreting § 227(b)(3)
to ―suggest that Congress anticipated that the Act would be
privately enforced primarily in state court‖ but concluding
that this does not ―establish that such claims may proceed
only in state court – that state court jurisdiction is exclusive‖).
22
The availability under § 227(f) of a cause of action brought
by the state in federal court on behalf of its citizens does not
act as a substitute for these aggregated claims; firstly, a
parens patriae case brought by a state under § 227(f) does not
provide the individual compensation provided for by §
227(b)(3)‘s private cause of action and, secondly, as we noted

39
circumstance does not signal or predict its intent now that the
circumstance has arisen. To conclude otherwise is to enter
the realm of speculation. We would prefer to let Congress
speak for itself. As it stands, the TCPA does not direct us to
treat diversity jurisdiction any differently than we normally
would, and the litigants present no argument for why we
should disrupt the standard premise that a federal forum is
available for completely diverse parties where the amount in
controversy is $75,000 or more and for minimally diverse
parties where the amount is $5 million or more.

In holding that we have diversity jurisdiction over
individual TCPA claims, we join a majority of courts of
appeals and district courts that have considered or addressed
the issue. See Gottlieb, 436 F.3d 335; U.S. Fax Law Ctr., 476
F.3d at 1117 (following Gottlieb in concluding that, ―absent
an explicit indication that Congress intended to create an
exception to diversity jurisdiction, one may not be created by
implication‖ and finding no such explicit indication in the
TCPA); Gene & Gene LLC v. Biopay LLC, 541 F.3d 318,
324-25 (5th Cir. 2008) (concluding without specific analysis
of the diversity jurisdiction question that, because the
requirements of CAFA were met, it has diversity jurisdiction
over aggregated CAFA claims: ―[Regardless of federal
question jurisdiction,] subject-matter jurisdiction, in any
event, is proper under provisions of CAFA.‖); Klein, 399 F.
Supp. 2d at 533-34; Watson, 462 F. Supp. 2d at 647; Kopff,
298 F. Supp. 2d at 55; Charvat, 703 F. Supp. 2d at 739 n.1;

in ErieNet, ―the sheer number of calls made each day-more
than 18,000,000-would make it impossible for government
entities alone to completely or effectively supervise this
activity.‖ 156 F.3d at 515.

40
Accounting Outsourcing, 294 F. Supp. 2d at 839-40. We
conclude that neither the TCPA itself nor our decision in
ErieNet precludes district courts from hearing TCPA claims
where an independent basis for federal jurisdiction, like
diversity or supplemental jurisdiction, exists. Federal
question and diversity are distinct jurisdictional bases; at least
in the context of the TCPA, the existence or non-existence of
one jurisdictional basis does not affect the existence of the
other. As we read the TCPA, there is nothing in the statute
itself – or suggested by its legislative history – that provides a
basis for federal jurisdiction and, at the same time, there is
nothing in it that deprives federal courts from hearing TCPA
claims where independent grounds for jurisdiction exist. A
federal cause of action that gives rise to § 1332, but not §
1331, jurisdiction is indeed rare, Gottlieb, 346 F.3d at 342 n.
8, but it would defy congressional intent as expressed in the
TCPA‘s text and statutory scheme not to endorse this unique
jurisdictional framework.

F.

The Landsman District Court did not base its dismissal
on the unavailability of diversity jurisdiction over private
TCPA claims. It correctly noted that there could be diversity
jurisdiction under the TCPA, largely based on its
understanding that our ruling in ErieNet was confined to
federal question jurisdiction.23 However, the District Court

23
Landsman also acknowledged that plaintiffs satisfied the
three basic requirements of § 1332(d): that the class have at
least 100 members, that there exist minimal diversity between
the parties (Landsman is a New York citizen, and Skinder-
Strauss a New Jersey citizen), and that the amount in

41
then went on to examine state law, deeming state law ―with
respect to the TCPA‖ to be ―substantive‖ under Erie and
conducting a choice-of-law analysis between New York and
New Jersey law.24 See Erie, 304 U.S. 64. The Court
appeared to believe that Erie controlled – and required a
choice-of-law analysis – since the issue before the court in a
diversity case necessarily involves a choice among state laws.
The Court reached the conclusion that New York law would
apply, and because New York does not permit class claims
seeking aggregated statutory damages,25 plaintiffs could not

controversy be at least $5 million (the complaint alleged that
defendant sent over 10,000 faxes, and the damages for each
fax are $500).
24
Citing our decision in Chin v. Chrysler LLC, 538 F.3d 272,
278 (3d Cir. 2008), the Landsman Court decided that, in
diversity cases, it must first determine whether a ―matter‖ is
procedural or substantive; substantive ―matters‖ require a
choice-of-law analysis. Concluding that ―no law could be
more substantive than‖ CPLR § 901(b), since it ―would
foreclose the possibility of this Court having jurisdiction,‖
636 F. Supp. 2d at 364, it performed a choice-of-law analysis
to decide whether the substantive law of New Jersey or New
York should apply.
25
New York‘s Civil Practice Law and Rules (―CPLR‖)
§ 901(b) states the following:
Unless a statute creating or imposing a
penalty, or a minimum measure of
recovery specifically authorizes the
recovery thereof in a class action, an
action to recover a penalty, or minimum

42
possibly have damages that would satisfy the $5 million
amount-in-controversy requirement under CAFA.
Accordingly, the District Court found that it could not
exercise diversity jurisdiction over the case and granted
defendant‘s motion to dismiss.

We conclude that the Landsman Court‘s reasoning
missed the mark. Because plaintiffs were proceeding under
federal, not state, law – namely, the federal TCPA – there was
no need for choice-of-law analysis under Erie.26
Furthermore, even if the fact that the TCPA is a federal
statute were not determinative, under Shady Grove
Orthopedic Ass’n, P.A. v. Allstate Insurance Co., --- U.S. ---,
130 S. Ct. 1431 (2010), federal law regarding class actions
would be applied in federal courts, not state law. Rule 23, not
§ 901(b), controls this TCPA class action, and plaintiff is thus
authorized to maintain a class action as long as Rule 23‘s

measure of recovery created or imposed
by statute may not be maintained as a
class action.
C.P.L.R. § 901(b) (emphasis added).
26
See Erie, 304 U.S. at 78 (―Except in matters governed by
the Federal Constitution or by acts of Congress, the law to be
applied in any case is the law of the state.‖) (emphasis
added); supra n.10 (noting that Erie‘s directive to apply state
substantive law and federal procedural law in diversity cases
is only applicable where state law causes of action are at
issue).

43
prerequisites are met.27 The Landsman District Court and the
Flierware District Court, which adopted Landsman‘s

27
In Shady Grove, the Supreme Court held that § 901(b)
―cannot apply in diversity suits‖ in federal court; rather, Rule
23 controls. 130 S. Ct. at 1437. The only exception is when
Congress has explicitly ―carved out . . . federal claims . . .
from Rule 23‘s reach,‖ id. at 1428, which is not the case here.
Indeed, we do not interpret § 227(b)(3)‘s ―if otherwise
permitted by laws or rules of court of a State‖ language to
carve out TCPA claims from Rule 23‘s ambit; we agree with
Justice Scalia that reading § 227(b)(3) to require deference to
state class action law would mean that the TCPA ―effect[ed]
an implied partial repeal of the Rules Enabling Act,‖ and
―would require federal courts to enforce any prerequisite to
suit state law makes mandatory—a state rule limiting the
length of the complaint, for example.‖ Holster v. Gatco, Inc.,
130 S. Ct. 1575, 1575-76 (2010) (Mem. granting petition for
writ of certiorari, vacating judgment and remanding to the
Second Circuit) (Scalia, J., concurring). ―A more probable‖
reading of this language ―is that when a State closes its doors
to claims under the Act § 227(b)(3) requires federal courts in
the State to do so as well.‖ Id. at 1576. This language deals
with the threshold requirement of where and when TCPA
suits can be brought. It basically authorizes a state to keep
these claims out of state court, see Brill, 427 F.3d at 451; Int’l
Sci., 105 F.3d at 1156, but it does not explicitly require the
application of state law or direct federal courts to defer to
state law in deciding whether a class action can be
maintained. Such a clear statement from Congress would be
needed for TCPA claims to fall under the exception
articulated in Shady Grove. Further, the Shady Grove
plurality objected to treating § 901(b) as a substantive law,

44
reasoning on this point, erred in finding that New York‘s §
901(b) applies here to preclude a TCPA class action. Since
plaintiffs have met § 1332(d)‘s requirements, the District
Courts can exercise diversity jurisdiction over their claims.
The only remaining question, then, is whether Rule 23 was
satisfied.

G.

The Afgo District Court took a different tack than the
Landsman Court, but we also disagree with its approach. As
was the case in Landsman, the Afgo court presumed the case
could proceed based on diversity, but reasoned that if a class
could not be certified, then § 1332(d)‘s amount in controversy
could not be met. Accordingly, the Court set forth Rule 23‘s
class certification requirements and determined that they were
not fulfilled here.28 As we have noted, see supra, Rule 23

since ―it is not the substantive or procedural nature or purpose
of the affected state law that matters, but the substantive or
procedural nature of the Federal Rule.‖ Id. at 1444. Because
Rule 23 ―regulates procedure,‖ ―it is authorized by [the Rules
Enabling Act] and is valid in all jurisdictions, with respect to
all claims, regardless of its incidental effect upon state-
created rights.‖ Id.
28
Rule 23(a) requires that a plaintiff seeking class certification
must establish four requirements: numerosity, commonality,
typicality and adequacy of representation. Fed. R. Civ. P.
23(a). In addition, plaintiffs must meet one of the
requirements of Rule 23(b). Rule 23(b) requires that one of
the following conditions is met:

45
(1) prosecuting separate actions by or against
individual class members would create a risk of:
(A) inconsistent or varying adjudications with
respect to individual class members that would
establish incompatible standards of conduct for
the party opposing the class; or
(B) adjudications with respect to individual
class members that, as a practical matter, would
be dispositive of the interests of the other
members not parties to the individual
adjudications or would substantially impair or
impede their ability to protect their interests;
(2) the party opposing the class has acted or refused to
act on grounds that apply generally to the class, so that
final injunctive relief or corresponding declaratory
relief is appropriate respecting the class as a whole; or
(3) the court finds that the questions of law or fact
common to class members predominate over any
questions affecting only individual members, and that
a class action is superior to other available methods for
fairly and efficiently adjudicating the controversy. The
matters pertinent to these findings include:
(A) the class members' interests in individually
controlling the prosecution or defense of
separate actions;
(B) the extent and nature of any litigation
concerning the controversy already begun by or
against class members;
(C) the desirability or undesirability of
concentrating the litigation of the claims in the
particular forum; and

46
does apply here. However, delving into the propriety of class
certification was the wrong focus at that early stage of the
proceeding.

The Afgo Court held that, even with additional
discovery, plaintiffs would not be able to fulfill Rule
23(a)(3)‘s typicality requirement or any of Rule 23(b)‘s
requirements.29 Regarding both typicality and predominance,
it explained that there were too many ―crucial factual
determinations to be made with respect to claims and
defenses that will vary from party to party,‖ in particular,
consent to receive faxes and the existence of a prior business
relationship with defendant. 2009 WL 2602200, at *5. With
respect to Rule 23(b)(1), the Court concluded that the claims
of all potential plaintiffs were factually distinct enough that
there would be no risk of inconsistent adjudications. Id.
Finally, it concluded that a class action was not a superior
means of adjudicating this kind of controversy because the

(D) the likely difficulties in managing a class
action.
Fed. R. Civ. P. 23(b). Goodrich alleged in its complaint that
it meets Rule 23(b)(3)‘s predominance and superiority
requirements, under which a plaintiff must show that
―questions of law or fact common to the members of the class
predominate‖ over questions affecting only individual
members and that a class action is ―superior to other available
methods for the fair and efficient adjudication of the
controversy.‖ Fed. R. Civ. P. 23(b)(3).
29
The Flierware Court did not conduct an independent
analysis on the class certification question; it wholly adopted
Afgo‘s reasoning on this point.

47
individual recovery scheme contemplated by the TCPA –
which allows individuals to recover $500 to $1500 per
violation when their actual losses from receiving unwanted
faxes are slight by comparison – already contains a punitive
element that both deters potential violators and motivates
individuals to file claims. Id. In fact, the Afgo Court
reasoned, a class action would be an inferior means; an
individual plaintiff who could have received damages quickly
and without attorney‘s fees on her own would instead have to
engage in protracted litigation and incur substantial legal fees
that would reduce her recovery. Id.

Afgo‘s class certification analysis – and Flierware‘s
adoption of it – are conclusory at best.30 When the District
Courts decided the class certification issue, there had been no
motion for class certification and no discovery; whether the
class could potentially fit within Rule 23 was determined on a
motion to dismiss. This ruling was premature. To determine
if the requirements of Rule 23 have been satisfied, a district
court must conduct a ―rigorous analysis.‖ In re Hydrogen
Peroxide Antitrust Litigation, 552 F.3d 305, 309 (3d Cir.
2008). In doing so, a ―court may ‗delve beyond the pleadings
to determine whether the requirements for class certification
are satisfied.‘‖ Id. at 316 (quoting Newton v. Merrill Lynch,
Pierce, Fenner & Smith, Inc., 259 F.3d 154, 167 (3d Cir.
2001)). Particularly when a court considers predominance, it

30
We note at the outset our agreement with plaintiff
Landsman that this case is not among the rare few where the
complaint itself demonstrates that the requirements for
maintaining a class action cannot be met. See Rios v. State
Farm Fire & Cas. Co., 469 F. Supp. 2d 727, 740 (S.D. Iowa
2007).

48
may have to venture into the territory of a claim‘s merits and
evaluate the nature of the evidence. Id. at 310-11. In most
cases, some level of discovery is essential to such an
evaluation. In Weiss v. Regal Collections, 385 F.3d 337 (3d
Cir. 2004), we emphasized the importance of discovery as
part of the class certification process. ―It seems appropriate,‖
we said, ―that the class action process should be able to ‗play
out‘ according to the directives of Rule 23 and should permit
due deliberation by the parties and the court on the class
certification issues.‖ Weiss, 385 F.3d at 347-48 (footnote
omitted). Accordingly, ―[a]llowing time for limited discovery
supporting certification motions may . . . be necessary for
sound judicial administration.‖ Id. at 347 n.17. These
concerns were the basis for setting down a ―rigorous analysis‖
requirement in Hydrogen Peroxide, where we recognized that
changes in Rule 23 reflected the need ―for a thorough
evaluation of the Rule 23 factors.‖ Hydrogen Peroxide, 552
F.3d at 318.

Further, in the specific context of claims filed under
the TCPA statute, it is difficult to resolve without discovery
whether there are factual issues regarding class members‘
business relationships with defendants or whether they
consented to the receipt of faxes. See Gene & Gene LLC v.
BioPay LLC, 541 F.3d 318, 327-28 (5th Cir. 2008) (in
discussing issues of commonality regarding consent, noting
that ―there are no invariable rules regarding the suitability of
a particular case filed under [§ 227(b)(3)] of the TCPA for
class treatment; the unique facts of each case generally will
determine whether certification is proper‖). Without
discovery, the ―unique facts‖ of this case, or any other, will
not really be exposed. As the Fifth Circuit noted, differences
among plaintiffs‘ consent may be defeated by common proof

49
developed in discovery. See id. at 327-28 (noting the
possibility of presenting a ―novel, class-wide means of
establishing . . . lack of consent‖ on discovery – where the
common question was whether inclusion of the recipients‘ fax
numbers in a purchased database indicated their consent to
receive faxes). The parties should have the opportunity to
develop the record on this issue.

Furthermore, we believe that the Afgo Court‘s
reasoning on many of the aspects of how the class might or
might not pass muster under Rule 23 were conclusory and
subject to debate. First, it is not clear that, as a matter of law,
differences regarding consent are sufficient to defeat class
certification. In Hinman v. M & M Rental Center, Inc., 545
F. Supp. 2d 802 (N.D. Ill. 2008), the district court rejected the
defendant‘s argument that considerations of consent and
receipt of faxes are individualized questions so as to defeat
class certification and noted that ―commonality and typicality
are generally met where, as here, a defendant engages in a
standardized course of conduct vis-à-vis the class members,
and plaintiffs‘ alleged injury arises out of the conduct.‖ 545
F. Supp. 2d at 806-07 (citing Keele v. Wexler, 149 F.3d 589,
594 (7th Cir. 1998)). The defendant had argued that, because
the TCPA applies only to unsolicited faxes, individual
analysis is required to determine whether each class member
consented to transmission of the faxes in question. The court
nonetheless found that the class members met Rule 23‘s
commonality requirement. It pointed out that the defendant‘s
fax broadcasts were transmitted en masse based on a ―leads‖
list compiled several years earlier and that, under these
circumstances, the consent question could be understood as a
common question. ―The possibility that some of the
individuals on the list may separately have consented to the

50
transmissions at issue is an insufficient basis for denying
certification.‖ Id. at 807. But see Forman v. Data Transfer,
Inc., 164 F.R.D. 400, 404 (E.D. Pa. 1995) (denying
certification of TCPA claim based on ―inherently
individualized‖ question of consent).

Second, the Afgo Court stated that a class action would
not be a superior method of handling claims under the TCPA.
We are not so sure this is correct.31 The Afgo Court‘s
suggestion that the individual statutory damages of $500 to
$1500 are enough to both punish offenders and spur victims
substitutes its judgment for that of Congress and makes
unmerited presumptions regarding deterrence and the
motivation to litigate. Had Congress wanted to preclude
aggregation of individual TCPA claims, it could have so
provided in the TCPA itself or in CAFA, which specifically
lists certain types of statutory claims that could not be
brought as class actions. 28 U.S.C. § 1332(d). CAFA lists
various other statutes, but not the TCPA. Moreover, although
nuisance faxes are not the most egregious of wrongs policed
by Congress, the District Court was speculating when it
assumed that individual suits would deter large commercial
entities as effectively as aggregated class actions and that
individuals would be as motivated – or even more motivated
– to sue in the absence of the class action vehicle. The
District Court should not have dismissed out of hand the
possibility that a class action could provide a superior method

31
The Afgo Court also states, without citation, that New Jersey
law would govern the substantive aspects of a TCPA case
brought under a federal court‘s diversity jurisdiction and that
New Jersey would not permit class actions in a case such as
this. As we noted above, this is neither relevant nor correct.

51
of ―fairly and efficiently adjudicating the controversy,‖ as
required by Rule 23(b)(3). Although individual actions under
the TCPA may be easier to bring in small claims court than
other types of cases, that does not necessarily undermine the
greater efficiency of adjudicating disputes involving 10,000
faxes as a single class action. Indeed, as plaintiffs point out,
we have little reason to believe that individual actions are
automatically efficient; plaintiffs can still face protracted
litigation when they sue individually.

Finally, where common issues certainly exist, a district
court might consider subclassing in lieu of decertification.
The Hinman court, for example, noted the viability of
defining the class to include only individuals who did not
consent. ―[B]y certifying a class of individuals who received
unsolicited faxes,‖ the court explained, it was ―‗merely
setting the boundaries of the class‘ not resolving the
substantive issues.‘‖ Hinman, 545 F. Supp. at 807 (internal
quotation marks and citation omitted). See Chiang v.
Veneman, 385 F.3d 256, 268-69 (3d Cir. 2004) (rather than
decertifying a class, choosing the ―less drastic course‖ of
―simply modify[ing] the class definition‖); Simer v. Rios, 661
F.2d 655, 672 n.29 (7th Cir. 1981) (―[Decertification] ignores
the possibility of subclassing, a viable alternative in resolving
such problems.‖).

Discovery is necessary for the district court to conduct
the ―rigorous analysis‖ it is tasked with at this stage, and
more than speculation and supposition is needed to say that
any vehicle is really superior. A more robust record must be
developed here as to the precise nature of the class claims.
Accordingly, we will vacate the orders of the District Court

52
dismissing these three cases and remand for further
proceedings consistent with this opinion.

53
Landsman & Funk, P.C. v. Skinder-Strauss Associates et
al.
Nos. 09-3105, 09-3532 & 09-3793

McKEE, C.J., concurring:

The lead opinion persuasively explains why federal
courts have diversity jurisdiction over claims arising from the
private cause of action created under the Telephone
Consumer Protection Act (“TCPA”), 47 U.S.C. § 227(b), and
it relies on our prior decision in ErieNet v. Velocity Net Inc.,
156 F.3d 513 (3d Cir. 1998), to explain why the same is not
true for federal question jurisdiction. I write separately
because, although I agree that we have diversity jurisdiction
to decide § 227(b) claims, I believe the very same rationale
that leads to that result should lead us to conclude that we
also have federal question jurisdiction over TCPA claims. See
Lead Op. 28-41.

The ErieNet majority concluded that we do not have
federal question jurisdiction over the private cause of action
in § 227(b). Our former colleague, now-Justice Alito,1
dissented. He argued that the text of the TCPA is insufficient
to support the conclusion that Congress intended to deprive us
of the federal question jurisdiction over the TCPA‟s private
cause of action that we would otherwise have pursuant to 28
U.S.C. § 1331. He explained:

[S]ection 227(b)(3) says nothing
about the jurisdiction of the
federal district courts; instead, it
says merely that an action under
that provision “may” be brought
in an appropriate state court “if
otherwise permitted by the laws
or rules of a court of” that state.
More than this . . . is needed to

1
Inasmuch as he wrote his dissent in ErieNet while a member of
this court, I will refer to Justice Alito as “Judge Alito” throughout
my discussion of his analysis in ErieNet.
1
 divest a federal district court of its
jurisdiction under section 1331.

ErieNet, 156 F.3d at 521 (Alito, J., dissenting).

Judge Alito believed that the ErieNet majority erred by
focusing on whether the text of the TCPA reflected an intent
to allow federal courts to exercise federal question
jurisdiction over suits brought under that statute. He reasoned
that the proper inquiry must start with the preexisting grant of
federal question jurisdiction in § 1331 and then proceed to an
examination of the pertinent text of the TCPA. Then, and
only then, can we determine if that text is sufficiently explicit
to negate the longstanding grant of jurisdiction contained in §
1331.

The Supreme Court has since vindicated Judge Alito‟s
analytical approach. The Court has clarified that the
jurisdictional inquiry must begin and end by examining
whether the statutory text at issue is sufficient to reflect
Congress‟s intent to abrogate § 1331‟s broad grant of federal
question jurisdiction. The inquiry cannot begin by focusing
on whether the Act in question confers federal jurisdiction.
The lead opinion here notes that in ErieNet, “[w]e noted that
subject matter jurisdiction must be conferred by statute and
that the TCPA did not expressly do that.” Lead Op. at 12. I
agree that the TCPA does not confer jurisdiction. However,
28 U.S.C. § 1331 clearly does.

Today, we adopt Judge Alito‟s approach in inquiring
into our diversity jurisdiction, but we leave ErieNet‟s holding
as to federal question jurisdiction in place. The lead opinion
reminds us that, “[i]n ErieNet we asked whether Congress
conferred subject-matter jurisdiction in the TCPA; here we
ask whether Congress intended state courts to have exclusive
jurisdiction over TCPA claims and, thus, stripped away
diversity jurisdiction.” See Lead Op. at 14.

I see no way we can ask that latter question when
inquiring into our diversity jurisdiction while asking a very
different question when inquiring into federal question

2
jurisdiction. The issue remains the same, subject matter
jurisdiction, and the same question should be asked regarding
federal question jurisdiction that we are asking about our
diversity jurisdiction.

When the ErieNet majority posed the jurisdictional
question there, it did not have the advantage of several
subsequent Supreme Court decisions that undermine the
majority‟s analysis. We now have the benefit of those
decisions and they undermine the holding of ErieNet.
A.

Since ErieNet, the Supreme Court has decided three
cases that illuminate the appropriate inquiry for determining
when federal courts have jurisdiction.

In Verizon Md., Inc. v. PSC, 535 U.S. 635 (2002), the
Supreme Court held that the Telecommunications Act of
1996 (the “TCA”) did not remove federal question
jurisdiction conferred under § 1331. A provision of the TCA
required internet service providers (“ISPs”) to enter into
reciprocal compensation agreements by which their networks
were open to competing ISPs. The regulatory scheme
required state utility commissions to approve the terms of the
agreements and contemplated that the agreements would
require compensation being paid for non local or out-of-
network calls. However, an issue arose over whether a new
entrant into the market (WorldCom) had to pay reciprocal
compensation to Verizon for local telephone calls that
Verizon‟s customers placed to access the internet. Verizon
claimed that WorldCom had to pay compensation because
calls that connected a local customer to the internet were not
“local” calls under the TCA. WorldCom disputed Verizon‟s
claim and filed a complaint with the state utilities commission
claiming that it was not obligated to compensate Verizon
because the disputed calls were “nonlocal for purposes of
reciprocal compensation,” Id. at 640, and therefore not
subject to the reciprocal compensation agreement between the
two ISPs. The state commission ruled in favor of WorldCom
and ordered Verizon to pay WorldCom the reciprocal

3
compensation owed under its reciprocal compensation
agreement with Verizon.

Thereafter, Verizon brought an action in district court
against the state commission, WorldCom, and other
telecommunications carriers, arguing that the state
commission‟s ruling that it must pay reciprocal compensation
to World Com violated the TCA and a ruling of the FCC.2
Verizon cited 47 U.S.C. § 252(e)(6) and 28 U.S.C. § 1331 as
the basis of the court‟s jurisdiction.

Section 252(e)(6) of the TCA provides in part: “[i]n
any case in which a State commission makes a determination
under this section, any party aggrieved . . . may bring an
action in an appropriate Federal district court to determine
whether the agreement . . meets the requirements of . . . this
[Act].” 47 U.S.C. § 252(e)(6). However, Verizon‟s suit
involved “neither the approval or disapproval of a[n
agreement] nor the approval or disapproval of . . . terms.” Id.
Accordingly, the district court dismissed the case for lack of
federal jurisdiction, and a divided Court of Appeals for the
Fourth Circuit affirmed.

The Supreme Court reversed, holding “even if §
252(e)(6) does not confer jurisdiction, it at least does not
divest the district courts of their authority under 28 U.S.C. §
1331 to review the Commission's order for compliance with
federal law.” Id. at 642 (emphasis in original). The Court
began its analysis by determining that “Verizon‟s claim [of
federal preemption] . . . falls within 28 U.S.C. § 1331‟s
general grant of jurisdiction . . . .” Id. at 643. It then
determined that “nothing in 47 U.S.C. § 252 (e)(6) purports to
strip this jurisdiction.” Id. Rather, the Court found that §
252(e)(6) “merely makes some other actions by state
commissions reviewable in federal court. This is not enough
to eliminate jurisdiction under § 1331.” Id. (emphasis in
2
The FCC had ruled that the disputed calls were nonlocal “for
purposes of reciprocal compensation but concluded that, absent a
federal compensation mechanism for those calls state commissions
could construe interconnection agreements as requiring
compensation.” Id. at 640
4
original). The Court also found “none of the other provisions
of the Act evince any intent to preclude federal review of a
commission determination. If anything, they reinforce the
conclusion that § 252(e)(6)’s silence on the subject leaves the
jurisdictional grant of § 1331 untouched.” Id. at 644
(emphasis added).
The Court‟s decision in Bruer v. Jim’s Concrete of
Brevard, Inc., 538 U.S. 691 (2003), is even more to the point.
There, Bruer sued his former employer, Jim‟s Concrete, under
the Fair Labor Standards Act of 1938. A section of that Act
states that a suit under the Act “may be maintain[ed] . . . in
any Federal or State court of competent jurisdiction.” 29
U.S.C. § 216(b). Bruer originally filed the case in state court,
but Jim‟s Concrete attempted to remove the case to federal
court. Bruer objected, arguing that the Act‟s provision that
the suit “may be . . . maintain[ed] . . . in any federal or State
court” deprived federal courts of removal jurisdiction.

A unanimous Supreme Court rejected the notion that
removal was improper under the text of the statute. The Court
again began by assuming federal removal jurisdiction existed
and noting that “[n]othing on the face of [29 U.S.C.] § 216(b)
looks like an express prohibition of removal [jurisdiction] . . .
.” Bruer, 538 U.S. at 694. It noted that Congress‟s use of
“maintain” was ambiguous and the fact that Congress stated
that an action under the Act could be maintained in either
federal or state court was therefore not sufficient to
unambiguously establish congressional intent to divest federal
removal jurisdiction. See id. at 695-96.

Most recently, in Whitman v. Dept. of Transportation,
547 U.S. 512 (2006), the Supreme Court, in a per curium
opinion, explicitly rejected the Ninth Circuit Court of
Appeal‟s approach to determining whether federal courts
have jurisdiction over cases arising from the Civil Service
Reform Act (“CSRA”). The Court noted that “[t]he Court of
Appeals was correct in concluding that 5 U.S.C. § 7121(a)(1)
does not confer jurisdiction.” However, that fact was not
determinative because “[a]nother statute, . . . - a very familiar
one - grants jurisdiction to the federal courts over „all civil
actions arising under the Constitution, laws, or treaties of the

5
United States.‟” Id. at 513-514 (quoting 28 U.S.C. § 1331).
The Court continued: “The question, then, is not whether 5
U.S.C. § 7121(a)(1) confers jurisdiction, but whether 5 U.S.C.
§ 7121 (or the CSRA as a whole) removes the jurisdiction
given to the federal courts.” Id. (citing Verizon Md., Inc., 535
U.S at 642).

Although these cases do not directly overturn ErieNet,
they do clearly explain that our jurisdictional inquiry must
begin with the general grant of federal jurisdiction found in
Title 28 and then proceed to determining whether Congress
has used language sufficiently specific to express an intent to
divest federal courts of that pre-existing jurisdiction.
B.

In examining our diversity jurisdiction here, the lead
opinion quite correctly notes, “Here, the specific provision
granting subject matter jurisdiction to the federal courts is 28
U.S.C. § 1332(d) . . . .” Lead Op. at 16. It then proceeds to
find that “[f]ederal courts only lack diversity jurisdiction
where Congress has explicitly expressed an intent to strip
federal courts of this jurisdiction . . . or where such
jurisdiction is found to be irreconcilable with a congressional
statute . . . .” Id. (citations omitted).3 Then, because the lead
opinion finds that the TCPA is completely silent on the issue
of federal jurisdiction, it quite correctly concludes that
diversity jurisdiction must exist. I agree.

3
Judge Garth relies on statements of Senator Hollings to
support his conclusion that Congress intended TCPA claims
to be brought only in state courts. See Dissent at 4 & n2. I
believe that the statements made by the bill‟s sponsor were
best addressed by Judge Alto in his dissent in ErieNet. See
ErieNet, 156 F.3d at 522 (“I do not believe that one speech
given by one senator is sufficient to demonstrate the
'unmistakable' intent of Congress. Moreover, even if Senator
Hollings‟s statement were given controlling weight, it merely
indicates that the TCPA was designed to „allow consumers to
bring an action in State court.‟” (emphasis in original).

6
 However, I depart from the lead opinion‟s decision to
reaffirm the holding of ErieNet. The lead opinion concludes
that the TCPA is one of those “rare” congressional acts that
deprives federal courts of federal question jurisdiction but not
federal diversity jurisdiction. Lead Op. at 23. (citing Gottlieb,
436 F.3d at 342 n.8). Indeed, the Supreme Court has recently
noted that federally created causes of actions that do not
result in federal question jurisdiction are “extremely rare,”
citing a more than 110-year-old case as an example. Grable &
Sons Metal Products, Inc. v. Darue Engineering & Mfg., 545
U.S. 308, 317 n.5, 125 S.Ct. 2363, 2370 n.5 (2005) (citing
Shoshone Mining Co. v. Rutter, 177 U.S. 505, 20 S.Ct. 726
(1900)).4

In justifying its differing analysis here and reaffirming
the holding in ErieNet, the lead opinion attempts to
distinguish federal question jurisdiction from diversity
jurisdiction by insisting that “as our focus in ErieNet
demonstrates, congressional intent is a touchstone of federal
question jurisdiction analysis.” Lead Op. at 25. Indeed it is,
but it is the touchstone for determining both our diversity
jurisdiction and federal question jurisdiction.

4
Shoshone was a 1900 suit involving disputed title to a mine. 177
U.S. 505. The Court held that there was no federal question
jurisdiction even though the suit in support of an adverse claim to a
mine arose out of a federal statute. The Court reasoned that
Congress designed the federal system in such a way that “the great
bulk of litigation respecting rights to property, although those
rights may . . . go back to some law of the United States, is in fact
carried on in the courts of the several states.” Id. at 507.

However, suits under the TCPA do not involve the kind of
local interests that have historically been left to the states. Rather,
the TCPA is an attempt to regulate an instrumentality of interstate
commerce. As the lead opinion notes, the legislative history of that
Act refers to “the need for federal regulation to fill the gaps
between individual states‟ regulatory efforts, since [s]tates do not
have the jurisdiction to protect their citizens against those who use
[automated dialing] machines to place interstate telephone calls.”
Lead Op. at 9 (quoting S. Re. No. 102-178, at 5) (internal
quotation marks omitted, brackets in original).
7
 The real reason that the lead opinion finds that we
have diversity jurisdiction here while preserving ErieNet‟s
conclusion that we lack subject matter jurisdiction is its
analysis of diversity jurisdiction rests upon a very different
foundation than the ErieNet conclusion regarding federal
question jurisdiction. Here, the lead opinion correctly asks
whether the TCPA abrogates jurisdiction already conferred by
§ 1332, yet it preserves ErieNet, which improperly asked
whether the TCPA confers jurisdiction itself, ignoring the
grant of jurisdiction under § 1331. The opposing analytical
approaches are outcome determinative, just as Judge Alito
suggested in his ErieNet dissent. See 156 F.3d at 521-22.
Moreover, “„[i]t is true . . . of journeys in the law that the
place you reach depends on the direction you are taking. And
so, where one comes out on a case depends on where one
goes in.‟” United States v. Sigal, 341 F.2d 837, 844 & n.24
(3d Cir. 1965) (quoting United States v. Rabinowitz, 339 U.S.
56, 69 (1950) (Frankfurter, J. dissenting)).

If we begin our analysis at the correct starting point,
we would come out exactly where Judge Alito argued that we
should in his ErieNet dissent. The private right of action
under the TCPA unquestionably falls within § 1331‟s general
grant of federal question jurisdiction. There is nothing in the
TCPA that purports to strip that jurisdiction away, and the
lead opinion here alludes to nothing that would accomplish
that result. As the ErieNet majority recognized, neither the
text of the statute nor the legislative history of the TCPA
refers to federal courts at all. 156 F.3d at 516. This
complete absence of expression simply cannot be woven into
the clear expression of congressional intent required to
entirely remove federal jurisdiction. See Verizon, 535 U.S. at
644.
C.

I am not alone in concluding that intervening Supreme
Court decisions have undermined ErieNet‟s analytical
framework. The Court of Appeals for the Seventh Circuit has
noted that ErieNet and other decisions in the other Courts of
Appeals that have found that federal courts do not have
jurisdiction over cases involving the TCPA, “cannot be

8
reconciled with” recent Supreme Court decisions, including
Bruer. Brill, 427 F.3d at 450.

More recently, in Charvat v. Echostar Satellite, LLC,
630 F.3d 459 (6th Cir. 2010), the Court of Appeals for the
Sixth Circuit reversed its previous stance that there was no
federal question jurisdiction under the TCPA, and concluded
that intervening Supreme Court decisions undermined its
previous analysis. The court noted that Congress had
elsewhere in the TCPA created “exclusive federal jurisdiction
over Telephone Act claims brought by state attorneys
general.” 630 F.3d at 464 (citing 47 U.S.C.§ 227(F)(2)). The
court reasoned that Congress therefore clearly knew how to
use language that would create exclusive jurisdiction in a
given forum, yet it had not otherwise done so. Rather,
Congress had merely stated that the private cause of action
created in § 227 could be brought in state courts.5 The court
examined provisions of the statute that permit suits to be
brought in state courts and concluded that they were not
sufficient to divest federal question jurisdiction: “These
provisions may suggest that Congress anticipated that the Act
would be privately enforced primarily in state court. But they
do not establish that such claims may proceed only in state
court—that state court jurisdiction is exclusive. Otherwise,
the Act would preclude even federal—diversity jurisdiction.”
Id. at 464 (citing 28 U.S.C. § 1332).

Conclusion

5
In his dissenting opinion, Judge Garth reasons that
Congress's use of “may” in the TCPA simply reflects the fact
that “a litigant is not required to bring an action, but if he
chooses to do so, he must comply with certain requirements.”
Dissent at 10. However, no aggrieved party is ever required
to bring a lawsuit, and I am therefore not convinced that the
permissive wording of the TCPA can be explained as Judge
Garth suggests. I do not believe that Congress thought it
necessary to tell aggrieved parties that they need not bring a
lawsuit unless they want to.

9
 Today, we correctly hold that the TCPA does not
preclude diversity jurisdiction. However, by allowing our
decision in ErieNet to stand, we create two anomalies: First,
we create an anomaly in our subject matter jurisdiction
jurisprudence by using different analyses when determining
whether there is diversity jurisdiction and federal question
jurisdiction. Second, we create a situation whereby
individual plaintiffs can bring a claim under a federally
created cause of action in federal court only when the
requirements of diversity jurisdiction are satisfied, but
plaintiffs who cannot satisfy those requirements must sue
under a federal statute in state court.

I believe that our analysis with regard to diversity
jurisdiction is equally applicable to federal question
jurisdiction. We should have used this opportunity to correct
the mistake we make in our analysis in ErieNet, and I regret
that we are not taking this opportunity to say so.

10
Landsman & Funk PC v. Skinder-Strauss Associates et al.
Nos. 09-3105, 09-3532 & 09-3793

GARTH, Circuit Judge, dissenting:

The sole issue on this appeal is whether the Federal
courts have jurisdiction to hear claims asserted under the
Telephone Consumer Protection Act, 47 U.S.C. § 227. My
colleagues claim they do. Because I would hold the District
Courts‟ judgments lacked any source of jurisdiction over the
plaintiffs‟ claims -- either federal-question jurisdiction (28
U.S.C. § 1331) or diversity jurisdiction (28 U.S.C. § 1332) --
I am obliged to dissent from Judge Rendell‟s opinion, and I
disagree with Chief Judge McKee‟s separate opinion.1 I
would affirm the dismissal of the complaint in each of the
three cases under review.

I.

The Telephone Consumer Protection Act (TCPA)
prohibits certain uses of telephone equipment. In particular, it
prohibits the use of any device to send an unsolicited
advertisement in the form of a fax, except under certain
circumstances to a recipient with whom the sender has an
established business relationship. 47 U.S.C. § 227(b)(1)(C).
The TCPA creates a private right of action for persons
aggrieved by statutory violations. In relevant part, 47 U.S.C.
§ 227(b)(3) reads:

A person or entity may, if
otherwise permitted by the laws
or rules of court of a State, bring
in an appropriate court of that

1
Judge Rendell believes there is no federal-question §
1331 jurisdiction, but there is diversity § 1332 jurisdiction.
Chief Judge McKee would hold that there is both
federal-question § 1331 jurisdiction and diversity § 1332
jurisdiction.
I would hold that there is no federal-question § 1331
jurisdiction, nor is there diversity § 1332 jurisdiction.

1
 State [a private claim under the
TCPA].

(Emphasis added.) Recipients of faxes sent in violation of the
TCPA are entitled to an injunction against further violations,
and to damages equal to an amount of the greater of their
actual losses or $500 for each violation. Id. § 227(b)(3).

I emphasize at the outset our obligation to interpret
specific and unambiguous provisions of a statute in a manner
consistent with their plain meaning. United States v. Ron
Pair Enters., Inc., 489 U.S. 235, 242 (1989); Lawrence v. City
of Philadelphia, 527 F.3d 299, 316–17 (3d Cir. 2008). In
construing the meaning of a statute, we are required to look
first to the statute‟s plain meaning, Kaufman v. Allstate N.J.
Ins. Co., 561 F.3d 144, 155 (3d Cir. 2009), as evidenced by
“„the ordinary meaning of the words used,‟” United States v.
Doe, 564 F.3d 305, 310 (3d Cir. 2009) (quoting United States
v. Geiser, 527 F.3d 288, 294 (3d Cir. 2008)). We have been
instructed to begin with the text of a provision and, if its
meaning is clear, end there.

It is therefore clear to me that where Congress
deliberately has designated the “courts of that State” as the
forum for all claims of TCPA violations, we have no
alternative but to comply with that dictate and hold that
Federal courts may not entertain such claims, either by virtue
of federal-question § 1331 jurisdiction, see ErieNet, Inc. v.
Velocity Net, Inc., 156 F.3d 513 (3d Cir. 1998), or by virtue
of diversity § 1332 jurisdiction.

II.

A. ErieNet remains viable as a precedent.

In September 1998, my colleague Judge Rendell and I
constituted a majority of this court‟s panel holding that 28
U.S.C. § 1331, which endows the district courts with
“original jurisdiction of all civil actions arising under the
Constitution, laws, or treaties of the United States,” did not
permit Federal courts to hear TCPA claims. ErieNet, 156
F.3d 513. Although acknowledging that “Congress could
have more clearly expressed its intent in the TCPA to decline

2
to provide jurisdiction for these consumer suits in district
court,” we held: “To find federal court jurisdiction here
would not only be contrary to the clear intent of Congress, but
also would represent a departure from well-established
principles reflecting a reluctance to find federal jurisdiction
unless it is clearly provided for.” Id. at 519.

In an earlier portion of that opinion, where we
concluded that the TCPA did not itself confer jurisdiction on
Federal courts, we examined the text of § 227(b)(3). We
reasoned that “[t]he permissive authorization of jurisdiction in
state courts does not imply that jurisdiction is also authorized
in federal courts,” and concluded that the fora for such claims
were exclusively the state courts, because “the most natural
reading of this language is that Congress intended to
authorize private causes of action only in state courts, and to
withhold federal jurisdiction.” Id. at 516-17.

We also were influenced by the statement of the
TCPA‟s chief legislative sponsor, Senator Hollings,2 which
reflected an intent that TCPA claims be brought in state court,
id. at 515, and for an obvious reason – the penalty for
violating TCPA was $500, far below the $75,000 amount
which must be disputed to invoke a Federal court‟s diversity
jurisdiction. We recognized that the remedy sought by a
consumer would be brought in a State‟s small claims court.
Finally, we observed that some other sections of the statute
expressly provided for concurrent jurisdiction in the Federal
courts, and suggested that the absence of a similar provision
in § 227(b)(3) was “significant.” Id. at 517.

ErieNet thus held that § 1331 does not confer Federal
jurisdiction over TCPA claims on the Federal courts, and has
not since been overruled. And although Judge Rendell‟s
opinion tries to explain away ErieNet by noting that the
ErieNet parties only sought federal-question jurisdiction, it
cannot ignore the unequivocal language of our opinion and
holding. ErieNet categorically discounted all forms of
Federal jurisdiction. We emphatically stated:

2
Sen. Hollings‟s statement is neither questioned nor
contradicted by any other Senator‟s.
3
 “Congress intended that private enforcement suits
under the TCPA be brought in state, and not federal,
courts.” Id. at 516.

“The most natural reading [of § 227(b)(3)] is that
Congress intended to authorize private causes of action
only in state courts, and to withhold federal
jurisdiction.” Id. at 517.

“„[T]he clear thrust of [Senator Hollings‟] statement
was consistent with the bill‟s text that state courts were
the intended fora for private TCPA actions.‟” Id.
(quoting Int‟l Sci. & Tech. Inst., Inc. v. Inacom
Commc‟ns, Inc., 106 F.3d 1146, 1153 (4th Cir. 1997)).

“[T]he explicit reference to state courts, and the
absence of any reference to federal courts, reflects
Congress‟ intent to withhold jurisdiction over such
consumer suits in federal court.” Id.

“To find federal jurisdiction here would not only be
contrary to the clear intent of Congress, but would also
represent a departure from well-established principles
reflecting a reluctance to find federal jurisdiction
unless it is clearly provided for.” Id. at 519.

“[T]he TCPA reflects Congress‟ intent to authorize
consumer suits in state courts only . . . .” Id.

“Congress intended to refer private litigants under the
TCPA to state court . . . .” Id. at 520.

It must be emphasized that by holding that there was
no Federal jurisdiction, we were not referring to federal-
question § 1331 jurisdiction alone, but we were referring to
Federal jurisdiction as a whole. That whole includes diversity
§ 1332 jurisdiction.

4
 III.
The Federal Courts Have No Diversity Jurisdiction Over
TCPA Claims

Judge Rendell now seeks to explain away our ErieNet
opinion and to limit its reach, its reasoning, and its carefully
chosen language to apply to just federal-question jurisdiction.
In doing so, Judge Rendell‟s opinion now disclaims its all-
inclusive doctrine of jurisdiction despite our Court having
approved the ErieNet opinion on circulation. ErieNet was
circulated to our entire Court pursuant to our internal
procedures, and was approved by the entire Court, other than
the dissenting Judge in ErieNet.3 Under our principles,
standards, and culture, unless an opinion of our Court is
overruled either by the Supreme Court or by an en banc of
our Court, it remains as a steadfast precedent and binds all
subsequent panels, including this panel. See 3d Cir. Internal
Operating P. 9.1. As a consequence, with no Federal
jurisdiction available to adjudicate their claims, appellants
have now argued that diversity § 1332 jurisdiction permits the
Federal courts to hear their claims under the TCPA.

I respectfully disagree.

A. Federal Courts Cannot Presume Jurisdiction Unless
Congress Has Granted It.

As a court of limited jurisdiction, we do not presume
jurisdiction where it has not been otherwise divested, but
rather, may only entertain a case if Congress given us
jurisdiction to hear it. Bowles v. Russell, 551 U.S. 205, 212-
13 (2007); Kokkonen v. Guardian Life Ins. Co. of Am., 511
U.S. 375, 377 (1994); Ankenbrandt v. Richards, 504 U.S.
689, 697-98 (1992) ) (citing, among other cases, Cary v.
Curtis, 44 U.S. 236, 245 (1845); Bender v. Williamsport Area
Sch. Dist., 475 U.S. 534, 541 (1986) (citing Marbury v.
Madison, 5 U.S. 137, 173-180 (1803)); Owen Equip. &
Erection Co. v. Kroger, 437 U.S. 365, 372 (1978); Kline v.
Burke Const. Co., 260 U.S. 226, 233-34 (1922); Sheldon v.
Sill, 49 U.S. 441, 448-49 (1850); United States ex rel.

3
A petition for rehearing was denied by the Court.
No Judge other than Judge Alito voted for rehearing.
5
Gittlemacker v. County of Philadelphia, 413 F.2d 84, 88 (3d
Cir. 1969). That fundament of our jurisdiction rings as true
today at it did in 1799, when the Supreme Court held that “[a]
circuit court . . . is of limited jurisdiction . . . [a]nd the fair
presumption is (not as with regard to a court of general
jurisdiction unless the contrary appears, but rather) that a
cause is without its jurisdiction, until the contrary appears.”
Turner v. Bank of N. Am., 4 U.S. 8, 10 (1799). And certainly
when Congress has provided that such claims may only be
heard in state courts, and not Federal courts, a court should be
loath to impute jurisdiction that would confound and run
contrary to the statutory language Congress has chosen. See
Am. Fire & Cas. Co. v. Finn, 341 U.S. 6, 17-18 (1951) (“The
jurisdiction of the federal courts is carefully guarded against
expansion by judicial interpretation . . . .”).

Judge Rendell‟s opinion, which relies upon diversity
jurisdiction to accommodate the plaintiffs‟ claims under the
TCPA, is flawed. “Diversity, like all federal jurisdiction, is
limited in nature . . . .” Ramada Inns, Inc. v. Rosemount
Mem‟l Park Ass‟n, 598 F.2d 1303, 1306 (3d Cir. 1979); see
also, e.g., Loughlin v. United States, 393 F.3d 155, 171 (D.C.
Cir. 2004) (“„Because federal courts are of limited
jurisdiction, there is a presumption against the existence of
diversity jurisdiction.‟” (quoting Naartex Consulting Corp. v.
Watt, 722 F.2d 779, 792 (D.C. Cir. 1983)); Bank One, Texas,
N.A. v. Montle, 964 F.2d 48, 54 (1st Cir. 1992) (stating that
finding of no jurisdiction “is consistent with the notion that
federal courts are courts of limited jurisdiction and the
corollary presumption against diversity jurisdiction”); Bishop
v. Hendricks, 495 F.2d 289, 293 (4th Cir. 1974) (noting that
“artificial creation of diversity” would “run counter to the
general policy of viewing the federal courts as tribunals of
limited jurisdiction whose subject matter jurisdiction
principles should be applied with restraint” (citation and
internal quotation marks omitted)). Thus, diversity
jurisdiction is not available to parties in lawsuits involving
federal statutes that specify and provide restrictions and
requirements for jurisdiction. Congress, in §227(b)(3),
provided that all private claims (which would include

6
diversity) be maintained in state courts, not Federal courts.4
There is simply no basis on which a Federal court can
conclude that its diversity jurisdiction is any less limited than
other founts of Federal jurisdiction.

I admire Judge Rendell‟s historical analysis of
diversity § 1332 jurisdiction. See Rendell op. at 17-28.
Unfortunately, however, it has no application here, and is thus
irrelevant because Congress has decreed that all cases under
the TCPA are to be brought in state court. This being so, I
see no point in discussing the history of diversity jurisdiction.

B. Jurisdiction over TCPA claims is exclusive in the state
courts.

Section 227(b)(3) is the only provision of the TCPA
that addresses the remedy available to a private party who has
received an unsolicited fax in violation of the statute.
Congress imposed two key constraints on the availability of a
forum for such a claim.5

Under Congress‟s explicit language, the cause of
action must be both (1) “permitted by the laws or rules of
court of a State” and (2) “[brought] in an appropriate court of
that State.”

The only reading of this language that is faithful to
Congress‟s intent is that a private party may sue only in state
court. By referring to a “court of a State” and a “court of that

4
In Gottlieb v. Carnival Corp., 436 F.3d 335, 340 (2d
Cir. 2006), the reasoning and holding of which Judge Rendell
relies on heavily, the Second Circuit inexplicably deviated
from established precedent by concluding that “the better
course” would be to assume that “§ 1332 applies to all causes
of action, whether created by a state or federal law, unless
Congress expresses a clear intent to the contrary.”
5
As noted earlier, § 227(b)(3) provides: “A person or
entity may, if otherwise permitted by the laws or rules of
court of a State, bring in an appropriate court of that State” a
private claim under the TCPA.

7
State,” Congress was referring to state courts, not to Federal
courts. The basic definitions of the word “of” include
“[d]erived or coming from,” “[b]elonging or connected to,”
and “issuing from.” Webster’s II University Dictionary
(1988). A court that is “of” a State must, therefore, be one
whose power is derived from, belongs to, or is issued from,
the State.

A Federal court, of course, possesses none of these
properties; it is, instead, a court whose power is derived from
the Federal government. A Federal district court merely
happens to be located within the geographic boundaries of a
State, and is not “of” that State. Thus, the District Court for
the District of New Jersey cannot be said to be a “court of”
New Jersey. Only the state courts of New Jersey satisfy that
definition.6 Hence, when the TCPA uses the words “court of
that State” plainly and unambiguously, it unmistakably refers
to a court which is part of a State‟s judicial system -- i.e., a
state court.

That conclusion is not affected by the statute‟s use of
the word “may” rather than “shall.” Although “[t]he word
„may,‟ when used in a statute, usually implies some degree of
discretion[,] . . . [t]his common-sense principle of statutory
construction is by no means invariable, . . . and can be
defeated by indications of legislative intent to the contrary or
by obvious inferences from the structure and purpose of the
statute.” United States v. Rodgers, 461 U.S. 677, 706 (1983)
(citations and footnote omitted). The plain meaning of this

6
This reading of the statute is consistent with other
Federal statutes and with case law. Federal statutes use the
terms “courts of a State” and “courts of the State” to refer
exclusively to state courts. See, e.g., 28 U.S.C. § 2254(b)(1)
(“An application for a writ of habeas corpus . . . shall not be
granted unless it appears that . . . the applicant has exhausted
the remedies available in the courts of the State . . . .”); 28
U.S.C. § 1257(a) (“Final judgments or decrees rendered by
the highest court of a State in which a decision could be had,
may be reviewed by the Supreme Court by writ of certiorari .
. . .”). Indeed, I have discovered no instance in which the
phrase “court of a State” is used in a context that could
possibly be read to include Federal courts.
8
term in this context is that a litigant is not required to bring an
action, but if he chooses to do so, he must comply with
certain requirements. Here, the text, purpose, and structure of
§ 227(b)(3) demonstrate that Congress intended to limit the
private right of action to state courts, notwithstanding its use
of the term “may.” Thus, a claimant need not bring an action
under the TCPA, but if he chooses to do so, he must bring it
in state court.

Moreover, as we said in ErieNet, “[f]or Congress‟
reference to state courts to have any meaning,” it must be that
a private action under the TCPA may be brought only in state
court. 156 F.3d at 517. By specifically referring to state
courts, Congress was directing that those courts be the proper
forum. Why else would they, and only they, be mentioned?
Indeed, while Senator Hollings noted that Congress had not
“dictated” which state court, Congress was clearly delineating
state courts, as opposed to the Federal court.

C. Statements of Legislators

Notwithstanding our observation in ErieNet that
“Congress referred [TCPA] claims to state court as forcefully
as it could, given the constitutional difficulties associated
with Congress‟ mandating a resort to state courts,” 156 F.3d
at 516 (emphasis added), Judge Rendell and Chief Judge
McKee now perceive ambiguity in that same congressional
directive. I see no reason to depart from our holding in
ErieNet that the language of the TCPA is plain and
unambiguous, and requires a plaintiff‟s claim under the
TCPA to be brought in a state -- not a Federal -- forum.

But even if the language were not so plain, it is telling
that nowhere in the Congressional Record is there any
implication or contemplation that private enforcement actions
in the Federal courts were to be countenanced. Indeed,
recognizing Sen. Hollings‟ concerns, it is apparent, as I noted
earlier, that Congress wanted to make it easier for consumers
to obtain damages from those who violate the bill. The
Senator stated: “Small claims court, or a similar court, would
allow the consumer to appear before the court without an
attorney.” 137 Cong. Rec. S16204, 16205. It is obvious to
me, as it must have been to Sen. Hollings and his colleagues,

9
that Federal courts do not entertain “small claims,” and that a
consumer would likely retain counsel if the cause of action
were to be pursued in Federal court.

Sen. Hollings was similarly aware of the disturbance
caused to consumers by unsolicited faxes and telephone calls.
He referred to patients in hospitals whose treatment might be
interrupted by unsolicited calls, among others who would be
the beneficiaries of this amendment. Accordingly, his
amendment to the TCPA provided, in the same legislation,
that any person who has received more than one telephone
call within any twelve-month period by or on behalf of the
same entity, in violation of the prescribed regulations, was
permitted to bring in an appropriate “court of that State” an
action which could result in $500 in damages, or if the
violation was willful, an amount not more than $1500. Both
the fax and the telephone provisions have amounts
recoverable as damages in state court only. These statutory
damages are far less than any diversity amount established by
Congress for a Federal court‟s diversity jurisdiction.

D. State Claims (47 U.S.C. § 227(f)(2)) as Distinct from
Private Claims (47 U.S.C. § 227(b)(3)))

47 U.S.C. § 227(f)(2) provides that when a State, as
distinct from a private claimant, brings an action under the
TCPA, it must be brought in the Federal courts.

It is significant that when Sen. Hollings‟ amendment
turned to the authority of a State to pursue violators, that
section of the amendment to the TCPA directed that
jurisdiction was exclusive in the Federal courts. See 47
U.S.C. § 227(f)(2). 7 It is evident that the Senate was keenly

7
Section 227(f)(2) provides:

The district courts of the United
States, the United States courts of
any territory, and the District
Court for the District of Columbia
shall have exclusive jurisdiction
over all civil actions brought
under this subsection [“Actions by
10
aware of both state and Federal jurisdictions, and had both in
mind when it sorted them out for defined purposes: A
consumer‟s private right of action had to be brought in state
court; a State‟s cause of action had to be brought in Federal
court.

What could be plainer or more unambiguous?

E. Sister Courts of Appeals

I acknowledge that other courts have held that
diversity jurisdiction may exist notwithstanding the absence
of federal-question jurisdiction. See Gene & Gene, LLC v.
BioPay, LLC, 541 F.3d 318, 325 n.6 (5th Cir. 2008); US Fax
Law Ctr., Inc. v. iHire, Inc., 476 F.3d 1112, 117-18 (10th Cir.
2007); Gottlieb, 436 F.3d at 340-41; see also Charvat v.
EchoStar Satellite, LLC, 630 F.3d 459, 464 (6th Cir. 2010)
(holding, contra ErieNet and case law in five other circuits,
that federal-question jurisdiction exists over TCPA claims);
Brill v. Countrywide Home Loans, Inc., 427 F.3d 446, 450-51
(7th Cir. 2005) (holding that TCPA suits could be brought in
Federal court under either § 1331 or § 1332, but noting that
“if state jurisdiction really is „exclusive,‟ then it knocks out §
1332 as well as § 1331”). However, I simply do not find the
reasoning of these cases persuasive.

States”]. Upon proper
application, such courts shall also
have jurisdiction to issue writs of
mandamus, or orders affording
like relief, commanding the
defendant to comply with the
provisions of this section or
regulations prescribed under this
section, including the requirement
that the defendant take such
action as is necessary to remove
the danger of such violation.
Upon a proper showing, a
permanent or temporary
injunction or restraining order
shall be granted without bond.
11
 For example, in Gottlieb, the case on which Judge
Rendell seeks to support her diversity theory, the Second
Circuit acknowledged its own precedent, which, like ErieNet,
concluded that Federal courts do not have § 1331 jurisdiction
over TCPA claims. See Foxhall Realty Law Offices, Inc. v.
Telecomms. Premium Servs., Ltd., 156 F.3d 432 (2d Cir.
1998). The Second Circuit said, “Our discussion of
„exclusive jurisdiction‟ in Foxhall must be read in context.
Foxhall dealt only with federal question jurisdiction; diversity
jurisdiction was not raised in Foxhall.” Gottlieb, 436 F.3d at
337. In an accompanying footnote, the court said: “Our use
of the word „exclusive‟ in Foxhall meant only that state courts
have exclusive substance-based jurisdiction over private
TCPA claims. Foxhall did not speak to the existence of
citizenship-based, or diversity, jurisdiction.” Id. at 337 n.3.
With Foxhall thus distinguished, the court in Gottlieb went on
to consider whether § 1332 provided a basis for jurisdiction,
and concluded that it did, because “there is no clear statement
of congressional intent to divest the federal courts of diversity
jurisdiction over TCPA claims.” Id. at 340-41.

I am not convinced, and I do not agree. Each of the
considerations that led us in ErieNet (and the Second Circuit
in Foxhall) to conclude that § 1331 jurisdiction is absent --
the statutory text‟s reference to state courts, the statement,
motivation, and reasoning of the bill‟s legislative sponsor, etc.
-- applies equally to the question of whether diversity
jurisdiction exists. It simply does not make sense to say that
Congress has made state-court jurisdiction “exclusive” with
respect to one jurisdiction-conferring statute (§ 1331), but not
the other (§ 1332).

Our holding in ErieNet that Federal courts lacked
federal-question § 1331 jurisdiction flowed from our analysis
that Congress intended to confine private TCPA claimants to
state court. Every rationale we relied upon to support that
conclusion in ErieNet applies with equal force against the
contention that Federal courts may exercise their diversity
jurisdiction to hear TCPA claims.8

8
Judge Rendell‟s opinion maintains that aggregation
of small claims for purposes of diversity jurisdiction assuages
any concern that small claims could worm their way into
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 F. Class Action Fairness Act of 2005

Nor am I persuaded to change my view because of the
fact that the Class Action Fairness Act (CAFA) was enacted
later in time than the TCPA. As I understand it, the argument
is that since CAFA was enacted in 2005, fourteen years after
the TCPA was enacted in 1991, and since CAFA is a
jurisdiction-conferring statute, it created Federal jurisdiction
over claims brought under TCPA, even if the Federal courts
would have lacked jurisdiction to hear them before CAFA
became effective. I believe that it reads too much into CAFA
to conclude that it creates jurisdiction over particular causes
of action that Congress had earlier decided to exclude from
Federal jurisdiction.

CAFA was enacted to expand Federal jurisdiction over
class actions involving classes with certain characteristics
(e.g., only minimal diversity) that would have precluded
Federal jurisdiction pre-CAFA. CAFA could not, and did
not, confer jurisdiction over particular causes of action that
Congress had previously withdrawn from the Federal courts.
It is for Congress and only Congress, not the courts, to decide
whether TCPA should be amended to allow claims to be
heard in the Federal courts. Cf. Bowles, 551 U.S. at 212
(“Within constitutional bounds, Congress decides what cases
the federal courts have jurisdiction to consider.”). The courts
of the Third Branch should not, and cannot, amend
Congress‟s legislation to accord with a court‟s view. It is not
a judicial function to enact legislation, or to repeal or amend
legislation by court decree. That function -- the legislative
function -- has been assigned by the Constitution to the
Congress -- not the courts.

Federal court. See Rendell op. at 33-35, 39-40. But we are
not concerned with whether diversity jurisdiction over TCPA
claims makes sense as a matter of policy; rather, our task is to
hew as closely as possible to the intent of Congress, as
evidenced by the statutory terms its has chosen. See infra
Section III.F.

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 IV.

I therefore respectfully dissent from the opinions of
Judge Rendell and Chief Judge McKee. I would hold that
Federal courts lack all jurisdiction -- under either § 1331 or §
1332 -- to adjudicate claims asserted under 47 U.S.C. §
227(b)(3). I would therefore affirm the District Court‟s
decisions on the basis that no jurisdiction existed to entertain
the various plaintiffs‟ claims. Thus, I do not address the
issues that the majority opinion has discussed pertaining to
class actions and Shady Grove Orthopedic Associates, P.A. v.
Allstate Insurance Co., 559 U.S. ___, 130 S.Ct. 1431 (2010).

14