RECOMMENDED FOR PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 21a0069p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
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BRIAN LYNGAAS, D.D.S., individually and as the
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representative of a class of similarly situated persons,
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Plaintiff-Appellee/Cross-Appellant (20-1199/20-1200), │
Plaintiff-Appellant/Cross-Appellee (20-1200/20-1243), │
> Nos. 20-1199/1200/1243
│
v. │
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CURADEN AG, │
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Defendant-Appellee/Cross-Appellant (20-1200/20-1243), │
│
CURADEN USA, INC., │
Defendant-Appellant/Cross-Appellee (20-1199/20-1200). │
┘
Appeal from the United States District Court
for the Eastern District of Michigan at Detroit.
No. 2:17-cv-10910—Mark A. Goldsmith, District Judge.
Argued: January 13, 2021
Decided and Filed: March 24, 2021
Before: CLAY, GILMAN, and THAPAR, Circuit Judges.
_________________
COUNSEL
ARGUED: Brian S. Sullivan, DINSMORE & SHOHL LLP, Cincinnati, Ohio, for Curaden AG
and Curaden USA, Incorporated. David M. Oppenheim, BOCK, HATCH, LEWIS &
OPPENHEIM, LLC, Chicago, Illinois, for Brian Lyngaas, D.D.S. ON BRIEF: Brian S.
Sullivan, DINSMORE & SHOHL LLP, Cincinnati, Ohio, for Curaden AG and Curaden USA,
Incorporated. David M. Oppenheim, Phillip A. Bock, BOCK, HATCH, LEWIS &
OPPENHEIM, LLC, Chicago, Illinois, for Brian Lyngaas, D.D.S.
GILMAN, J., delivered the opinion of the court in which CLAY, J., joined. THAPAR, J.
(pp. 33–44), delivered a separate opinion concurring in part and dissenting in part.
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 2
_________________
OPINION
_________________
RONALD LEE GILMAN, Circuit Judge. This case involves two unsolicited fax
advertisements received by Brian Lyngaas, D.D.S., in March 2016. Lyngaas asserts, on behalf
of himself and all similarly situated class members, that Curaden AG and its U.S. subsidiary,
Curaden USA, violated the Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227, by
sending the advertisements.
At the summary-judgment stage of the case, the district court ruled that Lyngaas could
not pierce the corporate veil to hold Curaden AG liable for Curaden USA’s action, that faxes
received by a computer over a telephone line (in addition to faxes received by traditional fax
machine) violated the TCPA, and that it had personal jurisdiction over both defendants.
Following a bench trial, the district court held that Curaden USA violated the TCPA by sending
the two unsolicited fax advertisements to Lyngaas, but that Curaden AG was not liable as a
“sender” under the TCPA. The court further held that Lyngaas’s evidence and expert-witness
testimony as to the total number of faxes successfully sent by Curaden USA were inadmissible
due to unauthenticated fax records. It therefore established a claims-administration process for
class members to verify their receipt of Curaden USA’s unsolicited fax advertisements.
Both Lyngaas and Curaden USA appeal the judgment of the district court, and both
Lyngaas and Curaden AG cross-appeal. For the reasons set forth below, we AFFIRM the
judgment of the district court.
I. FACTUAL BACKGROUND
Lyngaas is a dentist who practices in Livonia, Michigan. On March 8 and again on
March 28, 2016, Lyngaas received on his workplace fax machine unsolicited faxes advertising
the Curaprox Ultra Soft CS 5460 toothbrush. The toothbrush in question is manufactured by
Curaden AG, a privately owned Swiss entity. Curaden USA, an Ohio corporation headquartered
in Arizona, is a subsidiary of Curaden AG that promotes Curaden AG products, including the
Curaprox Ultra Soft CS 5460 toothbrush, throughout the United States.
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 3
Although a standard written distribution agreement typically governs the practices of
Curaden AG’s subsidiary distributors, Curaden AG and Curaden USA operated instead under an
oral agreement. This is because the written distribution agreement was exchanged but never
formally executed. But since “[e]verybody ha[d] assumed it ha[d] been signed,” according to the
managing director of Curaden AG, many of the tenets of the standard written distribution
agreement have been observed in practice by both entities. For example, Curaden USA was the
exclusive distributor of Curaden AG products within the United States, consistent with § 2.1 of
the distribution agreement, and Curaden USA “use[d] its best endeavours to promote the sale of
the [Curaden AG] [p]roducts throughout the Territory,” consistent with § 5.1.
Some of the terms of the standard distribution agreement, however, were not observed by
Curaden USA. As relevant to this case, Curaden USA never presented its advertising materials
to Curaden AG for review or approval, even though § 5.7 and § 5.8 of the distribution agreement
gave Curaden AG the right to approve all marketing materials developed by its distributors.
Curaden USA planned a fax campaign as part of its marketing efforts. It purchased a
target list of thousands of dental professionals’ fax numbers, and Curaden USA employee Diane
Hammond created the two fax advertisements at issue in this case. Both advertisements
promoted the Curaprox Ultra Soft CS 5460 toothbrush and were directed to “dental
professionals.” Displayed on the advertisements was Curaden USA’s contact information,
including a fax number, phone number, email address, website, and social media accounts, all of
which were connected to and exclusively maintained by Curaden USA. The advertisements
made no mention of Curaden AG, instead referring all communications to Curaden USA.
Curaden USA did not provide the advertisements for review to either Curaden AG or to
Richard Thomas, the managing director of Curaden UK and an advisor to all Curaden AG
subsidiaries. Rather, on February 23, 2016, Curaden USA’s vice president and managing
director Dale Johnson approved the advertisement and directed Hammond to broadcast the faxes.
Hammond in turn instructed Curaden USA employee Magen James to send the advertisement to
the purchased target list of over 46,000 fax numbers. Curaden USA hired AdMax Marketing, a
fax broadcasting company, to send the faxes. AdMax then hired another company, WestFax, to
complete the job.
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 4
The first fax advertisement was sent, at James’s direction, on March 8, 2016 to the target
list. Hammond then instructed James to send out a newer version of the advertisement to an
attached list of the 46,000-plus fax numbers, updated to exclude those who had opted out after
the first fax blast. This second advertisement was sent out, at James’s direction, on March 28,
2016. After the faxes were transmitted, AdMax invoiced Curaden USA, and Curaden USA paid
the invoices.
II. PROCEDURAL BACKGROUND
Lyngaas, on behalf of himself and all similarly situated class members, filed suit in
March 2017, alleging violations of the TCPA. Curaden USA answered the complaint, whereas
Curaden AG moved to dismiss the complaint based on a lack of personal jurisdiction over it.
The district court denied Curaden AG’s motion.
After a two-year discovery period, Curaden AG moved for summary judgment, arguing
again that the court lacked personal jurisdiction over it, while Lyngaas moved both for summary
judgment and to certify the class. Both Curaden AG and Curaden USA opposed class
certification, arguing that Lyngaas had failed to support his motion with admissible evidence to
establish the elements necessary for class certification, and that the court lacked personal
jurisdiction over them as to the proposed out-of-state class members under Bristol-Myers Squibb
Company v. Superior Court of California, San Francisco County, 137 S. Ct. 1773 (2017). The
district court denied Lyngaas’s summary-judgment motion, denied in part and granted in part
Curaden AG’s summary-judgement motion, and granted class certification.
After a two-day bench trial in September 2019, the court reviewed post-trial briefings and
issued its opinion two months later. At the outset of the opinion, the court affirmed its reasoning
from the earlier motion-to-dismiss and summary-judgment rulings, holding once again that it had
personal jurisdiction over both defendants. The court also found that Curaden USA violated the
TCPA by sending two unsolicited fax advertisements to Lyngaas as part of the two mass-fax
campaigns. It thus awarded Lyngaas statutory damages of $500 for each unsolicited fax, see
47 U.S.C. § 227(b)(3)(B), for a total of $1,000. As for Curaden AG, however, the court held that
Lyngaas had failed to establish that Curaden AG qualified as a “sender” under the TCPA.
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 5
The district court next held that Lyngaas had not established the total number of faxes
successfully sent classwide, ruling that the summary-report logs (documents that purportedly list
each successful recipient) were inadmissible due to inadequate authentication, and that testimony
from Lyngaas’s expert witness was inadmissible and unpersuasive. This caused the court to
establish a claims-administration process to afford class members the opportunity to verify their
receipt of Curaden USA’s unsolicited fax advertisements.
Curaden USA timely appealed. Lyngaas responded with a cross-appeal and filed his own
separate appeal, to which Curaden AG cross-appealed. Specifically, Lyngaas argues that the
district court erred by finding that Curaden AG was not a “sender” for purposes of TCPA
liability, by failing to admit key evidence at trial, and by granting summary judgment in favor of
the defendants on the question of piercing the corporate veil. Curaden AG in turn asserts that the
district court totally lacked personal jurisdiction over it, whereas Curaden USA argues that the
district court did not have personal jurisdiction over it with regard to non-Michigan class
members, and that the court improperly established a claims-administration process to award
relief. Both Curaden AG and Curaden USA further argue that the district court erroneously
found, when certifying the class, that a “telephone facsimile machine” includes faxes routed to
computers, and that the district court improperly relied on inadmissible evidence when certifying
the class.
III. ANALYSIS
A. Standard of review
We review de novo a district court’s denial of a motion to dismiss for lack of personal
jurisdiction and its denial of a motion for summary judgment. AlixPartners, LLP v. Brewington,
836 F.3d 543, 548 (6th Cir. 2016). But we review a district court’s decision of whether to certify
a class under the abuse-of-discretion standard. Hicks v. State Farm Fire & Cas. Co., 965 F.3d
452, 457 (6th Cir. 2020).
In an appeal from a bench trial, we review the district court’s conclusions of law de novo,
but review its findings of fact under the clear-error standard. Overton Distribs., Inc. v. Heritage
Bank, 340 F.3d 361, 366 (6th Cir. 2003). “A finding is ‘clearly erroneous’ when although there
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 6
is evidence to support it, the reviewing court on the entire evidence is left with the definite and
firm conviction that a mistake has been committed.” United States v. Mabry, 518 F.3d 442, 449
(6th Cir. 2008) (quoting United States v. U.S. Gypsum Co., 333 U.S. 364, 395 (1948)). “When
factual findings rest upon credibility determinations, this Court affords great deference to the
findings of the district court.” Schroyer v. Frankel, 197 F.3d 1170, 1173 (6th Cir. 1999).
B. Personal jurisdiction over Curaden AG
In resolving Curaden AG’s motions to dismiss and for summary judgment, the district
court found that it had specific personal jurisdiction over Curaden AG based on Curaden AG’s
contacts with the state of Michigan and that, in the alternative, jurisdiction was proper under
Rule 4(k)(2) of the Federal Rules of Civil Procedure based on Curaden AG’s contacts with the
United States as a whole. But the court then granted summary judgment in favor of Curaden AG
on the question of whether Curaden USA served as an “alter ego” of Curaden AG, holding that
the court should not pierce the corporate veil to exercise personal jurisdiction over Curaden AG
on the basis of Curaden USA’s actions. Lyngaas renews his “alter ego” theory on appeal,
whereas Curaden AG again argues that the district court lacked personal jurisdiction over it on
any basis.
1. Curaden USA as an alter ego of Curaden AG
We agree with the district court’s conclusion that Curaden USA is not Curaden AG’s
alter ego. The alter-ego theory can subject a parent company to personal jurisdiction where “the
parent company exerts so much control over the subsidiary that the two do not exist as separate
entities but are one and the same for purposes of jurisdiction.” Indah v. S.E.C., 661 F.3d 914,
921 (6th Cir. 2011) (citation omitted). In the present case, both parties correctly rely on
Michigan law in determining whether alter-ego liability applies. See Bd. of Trustees, Sheet
Metal Workers’ Nat’l Pension Fund v. Courtad, Inc., No. 12-2738, 2014 WL 3613383, at *3–4
(N.D. Ohio July 18, 2014) (“Outside of labor law or ERISA claims, courts tend not to supplant
state corporate liability doctrine with federal common law.”).
To pierce the corporate veil under Michigan law, “first, the corporate entity must be a
mere instrumentality of another; second, the corporate entity must be used to commit a fraud or
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 7
wrong; and third, there must have been an unjust loss or injury to the plaintiff.” In re RCS
Eng’rd Prods. Co., Inc., 102 F.3d 223, 226 (6th Cir. 1996) (citing Nogueroas v. Maisel
& Assocs. of Mich., 369 N.W.2d 492, 498 (Mich. 1985)). Lyngaas argues that the district court
erred, first, by not taking Curaden USA’s undercapitalization into full account in the “mere
instrumentality” analysis and, second, by using the incorrect standard in requiring Lyngaas to
show that Curaden AG “engage[d] in deliberate wrongful conduct that was either designed to or
actually did produce injury.”
Regarding undercapitalization, that factor indeed provides at least prima facie weight in
favor of finding that Curaden USA was a “mere instrumentality” of Curaden AG because
Curaden USA was not profitable, and the evidence is unclear as to what extent Curaden USA
paid Curaden AG for the products it purchased. But undercapitalization is just one factor in the
analysis. Whether the corporate entity is a “mere instrumentality of another” is determined by
analyzing
(1) whether the corporation is undercapitalized, (2) whether separate books are
kept, (3) whether there are separate finances for the corporation, (4) whether the
corporation is used for fraud or illegality, (5) whether corporate formalities have
been followed, and (6) whether the corporation is a sham.
Lim v. Miller Parking Co., 560 B.R. 688, 706 (E.D. Mich. 2016) (quoting Glenn v. TPI Petrol.,
Inc., 854 N.W.2d 509, 520 (Mich. 2014)).
Lyngaas does not dispute the district court’s findings that “[t]he two companies keep
separate books . . . and follow corporate formalities,” nor that “Curaden USA has its own
employees and its own offices.” Because the evidence further shows that the plan was for
Curaden USA, launched in 2014, to be profitable within eight years, the district court did not err
in finding that Curaden USA’s “undercapitalization” was outweighed by the other five factors,
none of which supported the finding of an alter-ego relationship. See Needa Parts Mfg., Inc. v.
PSNet, Inc., 635 F. Supp. 2d 642, 647 (E.D. Mich. 2009) (“While it may be true that PSNet was
an undercapitalized start-up company, it does not follow that the court must rule as a matter of
law that PSNet is a mere alter ego of PSNet Communications.”).
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 8
Lyngaas also fails to point to any other telling signs of undercapitalization, such as
leaving creditors unpaid or using Curaden USA as the parent company’s bank account. Cf.
Laborers’ Pension Trust Fund v. Sidney Weinberger Homes, Inc., 872 F.2d 702, 705 (6th Cir.
1988) (piercing the corporate veil where the individual defendant paid corporate expenses out of
his own pocket, the corporation paid the individual’s personal expenses, the individual withdrew
money from the corporation and left creditors unpaid, and the financial records were inadequate);
Grass Lake All Seasons Resort v. United States, 2005 WL 2095890, at *13 (E.D. Mich. Aug. 29,
2005) (piercing the corporate veil where the individual defendant looted the corporation for
personal use, did not have his own bank account or property in his own name, and used the
company to avoid paying taxes for over ten years).
As to whether “the manner of use effected a fraud or wrong on the complainant . . . , it is
not necessary to prove that the owner caused the entity to directly harm the complainant; it is
sufficient that the owner exercised his or her control over the entity in such a manner as to wrong
the complainant.” Green v. Ziegelman, 873 N.W.2d 794, 807 (Mich. Ct. App. 2015). Lyngaas
states the correct standard, but points to no evidence showing how Curaden AG exercised its
control over Curaden USA in such a manner as to wrong him or to pursue some unlawful end.
See Seasword v. Hilti, Inc., 537 N.W.2d 221, 224 (Mich. 1995) (holding that the corporate veil
“may be pierced only where an otherwise separate corporate existence has been used to subvert
justice or cause a result that is contrary to some other clearly overriding public policy”)
(alterations, citation, and internal quotation marks omitted).
“[E]stablishing an entity for the purpose of avoiding personal responsibility is not by
itself a wrong that would warrant disregarding the entity’s separate existence.” Ziegelman,
873 N.W.2d at 807. The lack of “some form of culpable conduct,” in short, dooms Lyngaas’s
theory. See Chrysler Corp. v. Ford Motor Co., 972 F. Supp. 1097, 1105 (E.D. Mich. 1997). We
will thus follow “[t]he general principle . . . that separate corporate identities will be respected.”
In re RCS Eng’rd Prods. Co., Inc., 102 F.3d 223, 226 (6th Cir. 1996) (quoting Wodogaza v.
H&R Terminals, Inc., 411 N.W.2d 848, 852 (Mich. Ct. App. 1987)).
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 9
2. Personal jurisdiction over Curaden AG due to its contacts with the
United States
This leads us to the question of whether there is some other basis for personal jurisdiction
over Curaden AG. The district court held that, pursuant to Rule 4(k)(2) of the Federal Rules of
Civil Procedure, it had personal jurisdiction over Curaden AG due to Curaden AG’s contacts
with the United States as a whole. Notably, Curaden AG does not offer any argument to the
contrary. Rule 4(k)(2) “acts as a sort of federal long-arm statute,” Sunshine Distrib., Inc. v.
Sports Auth. Mich., Inc., 157 F. Supp. 2d 779, 788 (E.D. Mich. 2001) (internal citation and
quotation marks omitted), and provides as follows:
For a claim that arises under federal law, serving a summons or filing a waiver of
service establishes personal jurisdiction over a defendant if:
A. the defendant is not subject to jurisdiction in any state’s courts of
general jurisdiction; and
B. exercising jurisdiction is consistent with the United States Constitution
and laws.
We have yet to apply Rule 4(k)(2) in a published opinion, likely because defendants
rarely have the requisite relationship with the United States as a whole, but not with any
individual state. Other circuits have addressed the application of Rule 4(k)(2), however, and we
adopt their analyses here.
To establish that jurisdiction is proper under Rule 4(k)(2), “(1) the cause of action must
arise under federal law; (2) the defendant must not be subject to the personal jurisdiction of any
state court of general jurisdiction; and (3) the federal court’s exercise of personal jurisdiction
must comport with due process.” Plixer Int’l, Inc. v. Scrutinizer GmbH, 905 F.3d 1, 6 (1st Cir.
2018); see also Cent. States, Se. & Sw. Areas Pension Fund v. Reimer Express World Corp.,
230 F.3d 934, 940 (7th Cir. 2000) (similar). There is no dispute that the first two requirements
are met here: this is a federal-question case and Curaden AG has pointed to no state where it
could properly be sued. See Adams v. Unione Mediterranea Di Sicurta, 364 F.3d 646, 651 (5th
Cir. 2004) (“[S]o long as a defendant does not concede to jurisdiction in another state, a court
may use 4(k)(2) to confer jurisdiction.” (citing ISI Int’l, Inc. v. Borden Ladner Gervais LLP,
Nos. 20-1199/1200/1243 Lyngaas v. Curaden AG, et al. Page 10
256 F.3d 548, 552 (7th Cir. 2001))). The remaining question is whether personal jurisdiction
comports with due process.
Because this is a federal-question case in federal court, the due process requirements
emanate from the Fifth rather than the Fourteenth Amendment. Sunshine Distrib., 157 F. Supp.
2d at 788. But they “are the same as with any other personal jurisdiction inquiry, i.e. relatedness,
purposeful availment, and reasonableness, only in reference to the United States as a whole,
rather than a particular state.” Id. (citing Cent. States, 230 F.3d at 941–42).
Curaden AG purposefully availed itself of the American market by launching Curaden
USA here. And it mandated that Curaden USA “use its best endeavours to promote the sale of
the Products throughout the [United States].” Finally, although it did not exercise its right of
prior approval over Curaden USA’s marketing materials in this case, Curaden AG nevertheless
retains such a right. Curaden AG, in short, made a deliberate decision to target and exploit
American markets, thus showing purposeful availment. See Sunshine Distrib., 157 F. Supp. 2d
at 789 (holding that the defendant purposefully availed itself of the American market where it
“not only sought out and negotiated a licensing agreement with Razor U.S.A. to distribute its
products throughout North America, including the United States,” but also “essentially created
Razor U.S.A. for this sole purpose”); see also J. McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873,
885 (2011) (noting that J. McIntyre directed marketing and sales efforts at the United States
when it contracted with a U.S. distributor to sell its machines in the country).
The next consideration is whether Lyngaas’s TCPA claims arise out of—or relate to—
Curaden AG’s contacts with the United States. This court’s standard for meeting that
requirement is “lenient.” See Bird v. Parsons, 289 F.3d 865, 875 (6th Cir. 2002). “If a
defendant’s contacts with the forum state are related to the operative facts of the controversy,
then an action will be deemed to have arisen from those contacts.” CompuServe, Inc. v.
Patterson, 89 F.3d 1257, 1267 (6th Cir. 1996).
Lyngaas’s alleged injuries caused by the fax advertisements “relate to” Curaden AG’s
creation of its U.S. subsidiary and its direction for the subsidiary to promote Curaden AG’s
products throughout the United States. Curaden AG is correct, as we discuss later, that it was not
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the “sender” of the faxes for purposes of TCPA liability. But the standard here is not so
stringent, and it is met when “the operative facts are at least marginally related to the alleged
contacts” between the defendant and the forum. Bird, 289 F.3d at 875. That standard is clearly
met here.
The final consideration is whether the exercise of jurisdiction over Curaden AG would be
reasonable, such that it would “comport with traditional notions of fair play and substantial
justice.” CompuServe, 89 F.3d at 1268 (citation and internal quotation marks omitted). An
inference arises that the third factor is satisfied if, as here, the first two factors are met. Id. But
where the case involves a “non-resident alien defendant,” the court must give “special weight to
the ‘unique burdens placed upon one who must defend oneself in a foreign legal system.’”
Theunissen v. Matthews, 935 F.2d 1454, 1460 (6th Cir. 1991) (emphasis in original) (quoting
Asahi Metal Indus. Co. v. Superior Court of Cal., 480 U.S. 102, 114 (1987)).
We recognize that the burden on Curaden AG is high because it had no prior contact with
the U.S. federal-court system. But that burden is nonetheless outweighed by other factors. First,
the United States has an interest in enforcing federal laws. Second, Lyngaas’s interest in
obtaining relief is particularly high given that Curaden USA is not profitable and is unlikely to be
profitable in the immediate future. Cf. City of Monroe Emps. Ret. Sys. v. Bridgestone Corp.,
399 F.3d 651, 666 (6th Cir. 2005) (finding the interests of the United States and class plaintiffs to
be “relatively light” where the court’s jurisdiction over the key defendants was already conceded
and “the marginal addition of [one of the defendants] would add little or nothing to the potential
recovery should the plaintiffs ultimately prevail on the merits and be awarded damages”). We
therefore conclude that the district court’s exercise of personal jurisdiction over Curaden AG is
reasonable, and that it comports with due process. And because the district court properly
exercised personal jurisdiction over Curaden AG due to Curaden AG’s contacts with the United
States as a whole, we need not reach the question of whether the court has personal jurisdiction
over Curaden AG due to the latter’s contacts with Michigan alone.
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C. Curaden AG’s liability under the TCPA
Having decided that personal jurisdiction over Curaden AG exists, we will now examine
whether the district court erred in concluding that Curaden AG was not a “sender” for purposes
of TCPA liability. The TCPA makes it “unlawful for any person within the United States . . . to
use any telephone facsimile machine, computer, or other device to send, to a telephone facsimile
machine, an unsolicited advertisement.” 47 U.S.C. § 227(b)(1)(C). In 2006, the Federal
Communications Commission (“FCC”) promulgated regulations that defined the “sender” of a
fax as “the person or entity on whose behalf a facsimile unsolicited advertisement is sent or
whose goods or services are advertised or promoted in the unsolicited advertisement.”
47 C.F.R. § 64.1200(f)(10).
Lyngaas argues on appeal that the “whose goods or services are advertised or promoted”
prong of the FCC regulation creates a strict-liability standard that the district court improperly
rejected. He argues that, even though Curaden AG did not itself send the faxes at issue, it is
nonetheless strictly liable under the TCPA because the faxes “advertised or promoted” its
toothbrush. Lyngaas relies on two Sixth Circuit cases in support of his strict-liability theory:
Siding & Insulation Co. v. Alco Vending, Inc., 822 F.3d 886 (6th Cir. 2016), and Imhoff Inv.,
L.L.C. v. Alfoccino, Inc., 792 F.3d 627 (6th Cir. 2015).
As the district court reasoned, however, both cases are inapplicable here because each
involved defendants that, unlike Curaden AG, knowingly hired fax broadcasters for the purposes
of fax advertising. See Siding & Insulation, 822 F.3d at 888 (“Alco acknowledged that it had
paid B2B to provide advertising services by broadcasting faxes”); Imhoff, 792 F.3d at 630
(“[Defendants] directed B2B to send out 20,000 faxes to local businesses on behalf of the two
Alfoccino restaurants.”). The distinction is critical. This court has underscored the difference
between (1) defendants that either dispatch the faxes themselves or “cause the fax[es] to be
conveyed” by hiring a fax broadcaster (like the Siding & Insulation and Imhoff defendants, and,
here, Curaden USA), see Health One Med. Ctr., Eastpointe P.L.L.C. v. Mohawk, Inc., 889 F.3d
800, 802 (6th Cir. 2018), and (2) defendants who do neither of the above and thus do not “send”
the faxes at all. Id. The former are “senders” for purposes of TCPA liability and fit within the
TCPA and the FCC regulation, whereas the latter fall outside the scope of the TCPA entirely. Id.
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(“Read in the context of the statute itself, the regulation does not strip the ‘send’ out of
‘sender.’”). In sum, the TCPA does not impose strict liability on a manufacturer simply because
its products wind up on the face of an unsolicited fax advertisement; the manufacturer must
independently fit the role of a “sender.” See id.
Because Curaden AG did not dispatch the faxes itself, the issue becomes whether
Curaden AG “caused” the faxes to be sent. Id. In Health One, this court held that the two
defendant manufacturers in question did not cause the faxes advertising their products to be sent
because the pharmaceutical wholesaler that broadcasted the faxes acted entirely on its own. Id.
at 801 (“Bristol and Pfizer neither caused the subject faxes to be conveyed, nor dispatched them
in any way. Instead only Mohawk did those things. Bristol and Pfizer therefore did not ‘send’
the faxes and thus have no liability for them.”).
But the present case differs slightly from Health One because, although Curaden AG did
not hire a fax broadcaster to advertise its products, it did enter into a distribution agreement with
Curaden USA to “use its best endeavours to promote the sale of the Products throughout the
Territory.” The determinative question, therefore, is whether entering into such a distribution
agreement “caused” the sending of the fax advertisements.
As the district court noted, a case with a nearly identical agreement and factual scenario
was resolved by this court just months before the district court’s decision. In Garner Properties
& Management, LLC v. Marblecast of Michigan, Inc., No. 17-11439, 2018 WL 6788013 (E.D.
Mich. Dec. 26, 2018), defendant American Woodmark entered into a distribution agreement with
defendant Marblecast that obligated Marblecast to “use its best efforts to promote, maintain and
increase sales of [American Woodmark] products.” Id. at *3. The district court, relying on
Health One, found that American Woodmark was not a sender for purposes of the TCPA
because, “[m]aterially, the Agreement neither explicitly requests nor authorizes Marblecast to
advertise American Woodmark’s products via fax. Moreover, Marblecast hired jBlast, the fax
broadcaster, without the consent or direction of American Woodmark.” Id. In June 2020, this
court affirmed the district court’s holding. Garner Properties & Mgmt., LLC v. Marblecast of
Michigan, Inc., 810 F. App’x 454, 456 (6th Cir. 2020) (concluding that, “[i]n short, some level of
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knowledge that an unsolicited fax has been sent is required for an entity to qualify as a sender
under the TCPA”).
The distribution agreement in this case mirrors the agreement in Garner Properties.
Further, the undisputed evidence shows that Curaden AG did not even know that Curaden USA
planned to use faxes as a method of advertisement, much less that Curaden USA had hired a fax
broadcaster or created the fax advertisements at issue. Curaden USA, not Curaden AG, paid
AdMax’s invoices and communicated with AdMax. Cf. Garner Properties, 2018 WL 6788013,
at *3 (“Marblecast did not discuss the Fax with anyone at American Woodmark before it was
sent . . . . American Woodmark had no independent knowledge that Marblecast was sending the
Fax.”). Indeed, all of the contact and social media information listed on the faxes directed
consumers to Curaden USA and not to Curaden AG.
Lyngaas correctly notes that Garner Properties differs from the case at hand in one
respect: “Marblecast would have sent the Fax even had it never agreed to sell American
Woodmark’s products,” id., whereas Curaden USA is unlikely to have sent the two faxes had the
distribution agreement not existed. But this distinction does not change the fact that Curaden AG
did not possess even “some level of knowledge that an unsolicited fax ha[d] been sent.” See
Garner Properties, 810 F. App’x at 456. Because Curaden AG clearly lacked knowledge of and
involvement in the fax advertisements, we agree with the district court’s conclusion that Curaden
AG was not a “sender” and thus not liable under the TCPA.
D. Whether faxes received by computers fall within the scope of the TCPA,
47 U.S.C. § 227(b)(1)(C)
We next address the reach of the TCPA as applied to the facts before us. The TCPA
prohibits the “use [of] any telephone facsimile machine, computer, or other device to send, to a
telephone facsimile machine, an unsolicited advertisement . . . .” 47 U.S.C. § 227(b)(1)(C)
(emphasis added). Curaden AG and Curaden USA argue on appeal that a TCPA claim is not
actionable if the unsolicited advertisement is received by any device (such as a computer through
an “efax”) other than a traditional fax machine. Thus, they argue, Lyngaas failed to satisfy the
requirements of Rule 23(b) of the Federal Rules of Civil Procedure because he failed to establish
which proposed class members received faxes on a traditional fax machine versus another
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device, such as a computer. We are unpersuaded by the defendants’ attempt to limit a “telephone
facsimile machine” to only traditional fax machines, however, because such a narrow definition
does not comport with the plain language of the TCPA.
The TCPA defines a “telephone facsimile machine” as “equipment which has the
capacity (A) to transcribe text or images, or both, from paper into an electronic signal and to
transmit that signal over a regular telephone line, or (B) to transcribe text or images (or both)
from an electronic signal received over a regular telephone line onto paper.” 47 U.S.C.
§ 227(a)(3). This definition makes clear that a “telephone facsimile machine” encompasses more
than traditional fax machines that automatically print a fax received over a telephone line. In
particular, it includes “equipment” that has the “capacity . . . to transcribe text or images,” id.
(emphasis added), from or onto paper—as long as the electronic signal is transmitted or received
over a telephone line. The statutory text alone, therefore, rebuts the defendants’ argument.
The FCC reinforced this point. In 2003, after a period of notice-and-comment, the FCC
issued an order explaining that “developing technologies permit one to send and receive
facsimile messages in a myriad of ways,” and concluding that “faxes sent to personal computers
equipped with, or attached to, modems and to computerized fax servers are subject to the
TCPA’s prohibition on unsolicited faxes.” In Re Rules & Regulations Implementing the Tel.
Consumer Prot. Act of 1991, 18 F.C.C. Rcd. 14014, 14133 ¶ 200 (2003). It reasoned that
the purpose of the requirement that a “telephone facsimile machine” have the
“capacity to transcribe text or images” is to ensure that the prohibition on
unsolicited faxing not be circumvented. Congress could not have intended to
allow easy circumvention of its prohibition when faxes are (intentionally or not)
transmitted to personal computers and fax servers, rather than to traditional stand-
alone facsimile machines.
Id. ¶ 201. But, the FCC stated, the statute’s prohibition “does not extend to facsimile messages
sent as email over the Internet.” Id. at ¶ 200.
This last caveat prompted WestFax, the same company that transmitted the faxes at issue
here, to seek clarification from the FCC as to whether an “efax” that is received on a fax server
and then converted to an email is a “fax, an email or both.” In the Matter of Westfax, Inc.
Petition for Consideration & Clarification, 30 F.C.C. Rcd. 8620, 8622 ¶ 5 (2015). In response,
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the Consumer and Governmental Affairs Bureau (the Bureau) of the FCC issued a declaratory
ruling in August 2015 “mak[ing] clear that a type of fax advertisement—an efax, a document
sent as a conventional fax then converted to and delivered to a consumer as an electronic mail
attachment—is covered by the consumer protections in the [TCPA].” Id. at 8620 ¶ 1. The
Bureau reasoned that because efaxes, as defined by WestFax, were sent over telephone lines, it
satisfied “the statutory requirement that the communication be a fax on the originating end.” Id.
at 8623 ¶ 9. And the “statutory requirements to be a fax on the receiving end” were satisfied
because “[t]he definition of ‘telephone facsimile machine’ sweeps in the fax server and modem,
along with the computer that receives the efax because together they by necessity have the
capacity to ‘transcribe text or images (or both) from an electronic signal received over a
telephone line onto paper.’” Id. (quoting 47 C.F.R. § 64.1200(f)(13)).
We are not persuaded by the dissent’s disagreement with the Bureau’s analysis because
the dissent assumes that a computer receiving a fax exists in isolation, without the high
probability that such a computer is connected to a printer and to a modem capable of receiving
faxes, which as a whole is fully capable of receiving electronic signals over a telephone line and
printing out a fax. (Indeed, a traditional fax machine is composed of a modem, scanner, and
printer, and thus parallels the computer set-up mentioned above). Nor are we persuaded by the
dissent’s analysis based on the fact that the word “computer” appears in only part of the TCPA’s
prohibitory language, 47 U.S.C. § 227(b)(1)(C), because (1) a computer is not excluded from the
statutory definition of a “telephone facsimile machine,” id. § 227(a)(3), and (2) Congress
presumably understood that a computer, as a stand-alone device, can be distinct from a telephone
facsimile machine and yet part of one as an integrated piece of “equipment.”
The Bureau also clarified its earlier email caveat: “By contrast, a fax sent as an email
over the Internet—e.g., a fax attached to an email message or a fax whose content has been
pasted into an email message—is not subject to the TCPA.” 30 F.C.C. Rcd. 8623–24 ¶ 10
(emphasis in original). In other words, with an efax “[t]here is an end-to-end communication
that starts when the faxed document is sent over a telephone line and ends when the converted
document is received on a computer,” whereas emails originate not as a fax over a telephone
line, but “over the Internet.” Id.
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In sum, the defendants’ argument is overbroad. They ask us to hold that a fax received
by any device (such as a computer) that is not a traditional fax machine falls outside the scope of
the TCPA. The statutory definition, however, encompasses more than a traditional fax machine.
Notably, it does not require the actual printing of the advertisement, which dispels the
defendants’ argument that Congress was concerned only with the burdensome ink-and-paper
costs of fax advertising.
For the sake of completeness on this issue, we note our awareness that the Bureau issued
a declaratory ruling in December 2019 that efaxes sent through an “online fax service” are not
covered by the TCPA. In re Amerifactors Fin. Group, LLC Pet. for Expedited Declaratory
Ruling, CG Docket Nos. 02-278, 05-338, 2019 WL 6712128, *1, *3 ¶¶ 2, 11 (Dec. 19, 2019).
But an application for review of the Bureau’s ruling is currently pending before the FCC, see
Applicant Career Counseling Services, Inc.’s Application for Review, CG Docket Nos. 02-278,
05-338 (Jan. 8, 2020), the Amerifactors ruling is not mentioned by either party, and the ruling in
any event would have no bearing on the case before us because the operative facts here took
place more than three years earlier, see Bowen v. Georgetown Univ. Hosp., 488 U.S. 204, 208
(1988) (“Retroactivity is not favored in the law. Thus, congressional enactments and
administrative rules will not be construed to have retroactive effect unless their language requires
this result.”); see also Maple Drive Farms Ltd. P’ship v. Vilsack, 781 F.3d 837, 857 (6th Cir.
2015) (holding that because, “[g]enerally, [r]etroactive application of policy is disfavored,” the
federal agency had to apply the version of its guidance that was in effect at the time of the
incident in question) (citation and internal quotation marks omitted).
E. Whether class certification must be based on admissible evidence
We now turn to the issue of class certification. A district court’s decision of whether to
certify a class is reviewed under the abuse-of-discretion standard. Hicks v. State Farm Fire
& Cas. Co., 965 F.3d 452, 457 (6th Cir. 2020). “An abuse of discretion occurs if the district
court relies on clearly erroneous findings of fact, applies the wrong legal standard, misapplies the
correct legal standard when reaching a conclusion, or makes a clear error of judgment.” In re
Whirlpool Corp. Front-Loading Washer Prod. Liab. Litig., 722 F.3d 838, 850 (6th Cir. 2013)
(quoting Young v. Nationwide Mut. Ins. Co., 693 F.3d 532, 536 (6th Cir. 2012)).
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The defendants argue that the district court abused its discretion by relying on
inadmissible evidence to certify the class. Specifically, they argue that, because Lyngaas failed
to put forth admissible evidence showing which individuals actually received the fax
advertisements, the district court should not have found that the “predominance” and
“ascertainabilty” requirements of Rule 23(b) of the Federal Rules of Civil Procedure were
satisfied. The defendants, however, did not move to decertify the class after the district court
found at the bench trial that Lyngaas’s evidence of the summary-report logs was inadmissible;
rather, they argue now that the district court improperly certified the class and, as discussed later,
improperly established a claims-administration process based on the inadmissible evidence.
A plaintiff seeking class certification must show that the class satisfies “all four of
the Rule 23(a) prerequisites—numerosity, commonality, typicality, and adequate
representation—and fall[s] within one of the three types of class actions listed in Rule 23(b).”
Young, 693 F.3d at 537. The relevant Rule 23(b) requirement here is that “questions of law or
fact common to class members predominate over any questions affecting only individual
members.” Fed. R. Civ. P. 23(b)(3). Moreover, although not explicitly stated in Rule 23 “the
class definition must be sufficiently definite so that it is administratively feasible for the court to
determine whether a particular individual is a member of the proposed class.” Young, 693 F.3d
at 537–38 (citation omitted). In this case, the district court found that the predominance and
ascertainability requirements were met based on summary-report logs that purportedly listed
each successful recipient of the two fax advertisements by fax number. It noted that, although
Lyngaas had yet to authenticate the logs, the court could still consider them at the
class-certification stage.
This court has never required a district court to decide conclusively at the
class-certification stage what evidence will ultimately be admissible at trial. Nor does any
binding precedent impose such a requirement. See Hicks, 965 F.3d at 465 (“We have yet to
settle this matter.”). We conclude that, on this issue of first impression, the district court is
correct.
As an initial matter, the Supreme Court has helpfully shed some light on this subject. In
deciding whether to certify a class, the trial court must undertake a “rigorous analysis” to ensure
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“that the prerequisites of Rule 23(a) have been satisfied.” Gen. Tel. Co. of Sw. v. Falcon,
457 U.S. 147, 161 (1982). Although this analysis sometimes requires the trial court to “probe
behind the pleadings,” at other times, “the issues are plain enough from the pleadings”—
suggesting that admissible evidence is not always required. Id. at 160. Either way, a party
seeking to maintain a class action must “satisfy through evidentiary proof at least one of the
provisions of Rule 23(b).” Comcast Corp. v. Behrend, 569 U.S. 27, 33 (2013) (explaining that
“the same analytical principles govern Rule 23(b).”).
We hold, as have the Eighth and Ninth Circuits, that such “evidentiary proof” need not
amount to admissible evidence, at least with respect to nonexpert evidence. See In re Zurn Pex
Plumbing Prod. Liab. Litig., 644 F.3d 604, 611, 614 (8th Cir. 2011) (holding that a district court
need not “decide conclusively at the class certification stage what evidence will ultimately be
admissible at trial”); Sali v. Corona Reg’l Med. Ctr., 909 F.3d 996, 1004 (9th Cir. 2018)
(“Inadmissibility alone is not a proper basis to reject evidence submitted in support of class
certification.”).
The Eighth and Ninth Circuits have persuasively explained that the differences between
Rule 23, summary judgment, and trial “warrant greater evidentiary freedom at the class
certification stage.” Sali, 909 F.3d at 1005. Because class certification must occur at “an early
practicable time after a person sues or is sued as a class representative,” Fed. R. Civ. P.
23(c)(1)(A), “[l]imiting class-certification-stage proof to admissible evidence risks terminating
actions before a putative class may gather crucial admissible evidence . . . [a]nd transform[s] a
preliminary stage into an evidentiary shooting match,” Sali, 909 F.3d at 1004; Zurn Pex,
644 F.3d at 613 (“As class certification decisions are generally made before the close of merits
discovery, the court’s analysis is necessarily prospective and subject to change, and there is
bound to be some evidentiary uncertainty.”) (internal citation omitted).
Summary judgment and class certification occurred simultaneously in this case, but the
district court nevertheless relied on the natural progression of litigation and evidentiary
discovery. It noted that, although the summary-report logs were not admissible evidence,
“Lyngaas has indicated that he will be able to admit the evidence at trial.”
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Further, unlike a summary-judgment decision or a judgement after trial, a
class-certification order is “inherently tentative.” Coopers & Lybrand v. Livesay, 437 U.S. 463,
469 n.11 (1978); Fed. R. Civ. P. 23(c)(1)(C) (“An order that grants or denies class certification
may be altered or amended before final judgment.”). Therefore, “[a]pplying the formal strictures
of trial to such an early stage of litigation makes little common sense.” Sali, 909 F.3d at 1004;
see also Zurn Pex, 644 F.3d at 613–14 (“Because a decision to certify a class is far from a
conclusive judgment on the merits of the case, it is ‘of necessity not accompanied by the
traditional rules and procedure applicable to civil trials.’”) (quoting Eisen v. Carlisle
& Jacquelin, 417 U.S. 156, 178 (1974)) (alterations omitted)).
Numerous district courts in our circuit have indeed depended on the concept that the
“manner and degree of evidence required” shifts through “successive stages of the litigation,” see
Sali, 909 F.3d at 1006, and have thus considered evidence at the class-certification stage
that is reliable but that might ultimately be deemed inadmissible. In Serrano v. Cintas Corp,
No. 04-40132, 2009 WL 910702 (E.D. Mich. Mar. 31, 2009), aff’d sub nom. Davis v. Cintas
Corp., 717 F.3d 476 (6th Cir. 2013), for example, both parties submitted employee declarations
in support of and in opposition to the plaintiffs’ motions to certify the classes. Id. at *2–3. The
district court denied both parties’ motions to strike the declarations, explaining that “[a]t this
stage of litigation, the Court should consider all the evidence presented in support of and in
opposition to class certification, and grant to the evidence the weight that the Court finds is most
appropriate.” Id. at *3; see also Stephenson v. Family Solutions of Ohio, Inc., No. 1:18cv2017,
2020 WL 6485106, at *6 (N.D. Ohio Nov. 4, 2020) (rejecting the defendants’ motion to strike
the plaintiffs’ unauthenticated exhibits, reasoning that the court’s inquiry at the class-certification
stage is “tentative, preliminary, and limited”) (citation and internal quotation marks omitted);
Tedrow v. Cowles, No. 2:06-cv-637, 2007 WL 2688276, at *2–3 (S.D. Ohio Sept. 12, 2007)
(finding that “the rules of evidence are not to be applied strictly in deciding a motion for class
certification,” and thus rejecting a motion to strike where the defendants disputed the authenticity
of the exhibit).
The cases that the defendants rely on are unpersuasive. They first cite to Sandusky
Wellness Center, LLC v. ASD Specialty Healthcase, Inc., 863 F.3d 460 (6th Cir. 2017), in which
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this court upheld the district court’s denial of class certification. The district court in that case
had concluded that the plaintiff could not satisfy the predominance and ascertainability
requirements when she had evidence that the fax in question was successfully transmitted to
75 percent of the individuals targeted, but lacked the fax logs to show which individuals actually
received the fax. Id. at 470. Because “no circuit court has ever mandated certification of a
TCPA class where fax logs did not exist,” this court affirmed the district court’s decision. Id. at
473. In the present case, however, the fax logs do exist. The only remaining question before the
district court was whether they could be authenticated. In short, the requisite evidentiary proof
was lacking in Sandusky, but was present here.
Defendants next cite to Unger v. Amedisys Inc., 401 F.3d 316 (5th Cir. 2005), the only
circuit case to explicitly state that “findings must be made based on adequate admissible
evidence to justify class certification.” Id. at 319. Unger is unhelpful, however, because the
question of admissibility played no part in that court’s disposition of the case. Although the
Unger court indeed made the statement in its introductory paragraph, it later noted that “[c]lass
certification hearings should not be mini-trials” and proceeded to focus on whether the proffered
evidence was adequate—not whether it was admissible. Id. at 321, 325. It ultimately decertified
the class because the district court had failed to consider, in a complex fraud case, several factors
relevant to whether a proposed investor class satisfied Rule 23(b)(3)’s predominance
requirement. Id. at 323–25.
By contrast, the district court here undertook the rigorous analysis required of it and
correctly found sufficient evidence for class certification. The court had before it
summary-report logs that detailed which fax numbers had purportedly received the faxes at issue,
as well as other corroborating evidence, such as Curaden USA’s target lists of fax numbers and
numerous emails detailing the transmissions. All that was left was authentication of the
summary-report logs. Requiring the court to “rely[ ] on formalistic evidentiary objections” at
this stage would have been inappropriate, particularly given Lyngaas’s assurance that he would
be able to authenticate the logs at trial. See Sali, 909 F.3d at 1006 (“By relying on admissibility
alone as a basis to strike the Ruiz declaration, the district court rejected evidence that likely
could have been presented in an admissible form at trial.”). The court therefore did not abuse its
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discretion in granting class certification when it relied on evidence that had yet to be
authenticated.
F. The district court’s evidentiary rulings
We next examine the district court’s evidentiary rulings. Decisions by a district court to
admit or exclude evidence are reviewed under the abuse-of-discretion standard and reversed
“only if we are firmly convinced of a mistake that affects substantial rights and amounts to more
than harmless error.” United States v. Baldwin, 418 F.3d 575, 579 (6th Cir. 2005) (internal
quotation marks omitted). Lyngaas argues that the district court abused its discretion by
excluding the summary-report logs and the opinions of his expert witness, Lee Howard, from
evidence.
Regarding the summary-report logs, we agree with the district court’s conclusion that the
logs at issue do not constitute hearsay. The hearsay rule applies only to out-of-court statements,
Fed. R. Evid. 801(c)(1), and the rule defines a “statement” as “a person’s oral assertion, written
assertion, or nonverbal conduct, if the person intended it as an assertion,” Fed. R. Evid. 801(a).
The “written assertion” here was not made by a “person”; the court instead found, and the
defendants do not contest, that the logs were data compilations automatically generated by a
computer. This means that the logs are not hearsay. See Patterson v. City of Akron, 619 F.
App’x 462, 479–80 (6th Cir. 2015) (holding that a Taser Report was “merely a report of raw data
produced by a machine” and thus did not constitute hearsay) (collecting similar cases); United
States v. Lamons, 532 F.3d 1251, 1263–64 (11th Cir. 2008) (concluding that a
computer-generated spreadsheet of telephone billing data was not hearsay).
But overcoming the defendants’ hearsay objection was not sufficient to make the
summary-report logs admissible. A computer-generated compilation might still “present
evidentiary concerns. A machine might malfunction, produce inconsistent results or have been
tampered with.” United States v. Lizarraga-Tirado, 789 F.3d 1107, 1110 (9th Cir. 2015).
“[S]uch concerns are addressed by the rules of authentication,” id., and Lyngaas thus had the
burden of authenticating the logs.
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Federal Rule of Evidence 901(a) requires a proponent of evidence to produce proof
“sufficient to support a finding that the item is what the proponent claims it is.” Rule 901(b) in
turn provides a nonexhaustive list of means by which to authenticate evidence. By not
presenting anyone to attest as to how the logs at issue were created or to personally vouch for
their accuracy, Lyngaas failed to satisfy the requirements of Rule 901. Accordingly, the district
court did not abuse its discretion in ruling that the logs were inadmissible as evidence.
Nor did the district court abuse its discretion in concluding that Howard’s testimony was
both unreliable under Daubert and unpersuasive. The court found that Howard’s opinions
regarding the successful number of fax transmissions were premised entirely on the
unauthenticated summary-report logs, as well as by an affidavit from the president of WestFax
that was filed in another case and thus did not address the specific data at issue in the present
case. Howard’s opinions, therefore, did not meet the Daubert requirement that an expert’s
“knowledge” be premised on “‘good grounds’ based on what is known” and not on “subjective
belief or unsupported speculation.” Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 590
(1993). And again, because of the lack of testimony describing how the report logs were created
or having anyone vouch for their accuracy, Howard’s opinions regarding the logs were both
speculative and unpersuasive. We will thus not disturb the district court’s evidentiary rulings.
G. The district court’s use of a claims-administration process
Because we find that the district court did not abuse its discretion in making its
evidentiary rulings, we next consider the claims-administration process imposed by the court.
Curaden USA does not dispute, and the court correctly found, that “Curaden USA sent two
mass-fax transmissions.” Nor is there any dispute that Lyngaas was one of the recipients of the
fax advertisements. Nevertheless, Curaden USA argues that, because Lyngaas failed to establish
the precise number of individuals who received the faxes, the claims-administration process
established by the court to afford class members relief is inappropriate.
As the district court aptly noted, “courts [in class actions] must use their discretion, and
in many cases their ingenuity, to shape decrees or to develop procedures for ascertaining
damages and distributing relief that will be fair to the parties.” (quoting 7AA Charles Alan
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Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice & Procedure § 1784 (3d ed.
2017)). The manner of a claims-administration process is to be driven by the particular needs of
an individual case, id., with the ultimate goal of distributing “as much of the available damages
remedy to class members as possible and in as simple and expedient a manner as possible,”
4 William B. Rubenstein, Newberg on Class Actions § 12:15 (5th ed. 2017).
Contrary to Curaden USA’s argument, the situation at hand—where there exists a target
list of fax numbers that were sent the unsolicited fax advertisement—is precisely the type best
handled through a claims-administration process. See, e.g., Krakauer v. Dish Network, LLC, No.
1:14-CV-333, 2017 WL 3206324, at *5 (M.D.N.C. July 27, 2017) (“[T]he trial already
established all of the elements necessary to prove a violation . . . . Whether a claimant is a class
member is a question that can be more appropriately, fairly, and efficiently resolved through a
claims administration process as authorized by Rule 23.”); Booth v. Appstack, Inc.,
No. C13-1533JLR, 2016 WL 3620798, at *2 (W.D. Wash. June 28, 2016) (“Whether a given
claimant is a rightful class member is an inquiry common to every consumer class action that
reaches the claims administration stage.”); Boundas v. Abercrombie & Fitch Stores, Inc.,
280 F.R.D. 408, 417 (N.D. Ill. 2012) (recognizing that a court need not ascertain “absent class
members’ actual identities . . . before a class can be certified,” so long as the class members can
be identified in the claims-administration process).
The class here consists of “[a]ll persons who were successfully sent one or more
facsimiles in March 2016 offering the Curaprox ‘5460 Ultra Soft Toothbrush’ for ‘.98 per/brush’
to ‘dental professionals only.’” To secure relief, claimants must submit sworn affidavits
attesting to the following information: “(1) their name, (2) their contact information, including
fax number and address, (3) their receipt of a fax from Curaden USA on March 8, 2016 and/or
on March 28, 2016, and (4) that they did not expressly invite or permit Curaden USA to send
them faxes.” The claims administrator will then “verify[ ] the information contained in each
claimant’s affidavit with the information reflected on the target lists” and the parties will “confer
regarding disputes or agreement with respect to each claimant’s status as a class member.”
Curaden USA’s concern that those who did not receive the fax will erroneously be
afforded damages is alleviated by the claims-administration process designed by the district court
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to weed out those who do not fit within the class definition. We therefore conclude that the
district court’s establishment of a claims-administration process was proper.
H. Personal jurisdiction over Curaden USA as to non-Michigan class members
Curaden USA’s final argument is that, “pursuant to the Supreme Court’s decision in
Bristol-Myers Squibb,” the “district court’s exercise of jurisdiction over out-of-state plaintiffs
violated Curaden USA’s due process rights and should be reversed.” In short, Curaden USA
asks us to extend Bristol-Myers Squibb Company v. Superior Court of California, San Francisco
County, 137 S. Ct. 1773 (2017)—which held that a state court in a mass action must have
personal jurisdiction over the defendant as to each plaintiff—to federal class actions. This would
require the district court to have personal jurisdiction over the defendant as to each unnamed
class member.
We decline to extend Bristol-Myers Squibb in this manner. Long-standing precedent
shows that courts have routinely exercised personal jurisdiction over out-of-state defendants in
nationwide class actions, and the personal-jurisdiction analysis has focused on the defendant, the
forum, and the named plaintiff, who is the putative class representative. Besides being well
established, this rule has a well-reasoned basis for its existence.
As the Seventh Circuit highlighted in Mussat v. IQVIA, Inc., 953 F.3d 441 (7th Cir.
2020), the argument made by Curaden USA would constitute “a major change in the law of
personal jurisdiction and class actions.” Id. at 448. There has long been a “general consensus
that due process principles did not prohibit a plaintiff from seeking to represent a nationwide
class in federal court, even if the federal court did not have general jurisdiction over the
defendant.” Id. at 445. “For cases relying on specific jurisdiction over the defendant, minimum
contacts, purposeful availment, and relation to the claim were assessed only with respect to the
named plaintiffs . . . . Once certified, the class as a whole is the litigating entity.” Id.
This historical practice is not confined to the lower courts. The Supreme Court has
“regularly entertained cases involving nationwide classes where the plaintiff relied on specific,
rather than general, personal jurisdiction in the trial court, without any comment about the
supposed jurisdictional problem” raised by Curaden USA. Id. (citing Wal-Mart Stores, Inc. v.
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Dukes, 564 U.S. 338 (2011)), a nationwide class action brought in a federal court in California in
which the defendant was headquartered in Arkansas and incorporated in Delaware, and Phillips
Petroleum Co. v. Shutts, 472 U.S. 797 (1985), a nationwide class action brought in a state court
in Kansas in which the defendant was headquartered in Oklahoma and incorporated in
Delaware). In sum, “[d]ecades of case law show that . . . the practice of federal courts”—i.e.,
precedent—has not required any contacts, let alone “minimum” contacts in the
specific-jurisdiction sense, between absent class members and the forum. Id.
The facts at issue in Bristol-Myers Squibb reside outside the class-action context.
Bristol-Myers Squibb involved not a class action in federal court, but a mass-tort action in state
court. Bristol-Myers Squibb, 137 S. Ct. at 1777. Hundreds of individual plaintiffs (86 from
California, and 592 from 33 other states) filed eight separate complaints in California state
courts, asserting state-law claims based on injuries allegedly caused by Plavix, a blood-thinning
drug. Id. at 1778. The separate complaints were assigned as a coordinated action to a state
trial-court judge. See Bristol-Myers Squibb Co. v. Superior Court, 377 P.3d 874, 878 (2016).
Such a coordinated mass action is “authorized under section 404 of the California Civil
Procedure Code, but . . . has no analogue in the Federal Rules of Civil Procedure.” Mussat,
953 F.3d at 446.
Bristol-Myers Squibb contested the state court’s jurisdiction over the out-of-state
plaintiffs’ claims, arguing that those plaintiffs had no connection to the state of California.
Bristol-Myers Squibb, 137 S. Ct. at 1777–78. The California Supreme Court rejected the
argument, holding instead that the out-of-state plaintiffs could bring their state-law claims in
California court based on California’s “sliding scale approach to specific jurisdiction.”
Bristol-Myers Squibb, 377 P.3d at 889 (citation omitted). That approach allowed the required
“connection between the forum contacts and the claim” to be reduced depending on how “wide
ranging the defendant’s forum contacts” were. Id. at 885.
The United States Supreme Court reversed. It first examined precedent, noting that “the
primary focus of our personal jurisdiction inquiry is the defendant’s relationship to the forum
State.” Bristol-Myers Squibb, 137 S. Ct. at 1779. Should general jurisdiction not exist, the court
turns to specific jurisdiction, under which “the suit must arise out of or relate to the defendant’s
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contacts with the forum.” Id. at 1780 (alterations, citation, and internal quotation marks omitted)
(emphasis in original). “[T]here must be an affiliation between the forum and the underlying
controversy, principally, an activity or an occurrence that takes place in the forum State and is
therefore subject to the State’s regulation.” Id. (alterations, citation, and internal quotation marks
omitted).
Against this backdrop, the Supreme Court held that California’s “sliding scale approach”
contravened these “settled principles regarding specific jurisdiction” because that approach
relaxed “the strength of the requisite connection between the forum and the specific claims at
issue.” Id. at 1781. Critically, there was no “adequate link between the State and the
nonresidents’ claims.” Id. That some plaintiffs were allegedly injured in California “does not
allow the State to assert specific jurisdiction over the nonresidents’ claims,” even if the “third
parties (here, the plaintiffs who reside in California) can bring claims similar to those brought by
the nonresidents.” Id.
The Supreme Court stated that its decision was nothing more than a “straightforward
application . . . of settled principles of personal jurisdiction.” Id. at 1783. And the Court was
careful to cabin the scope of its decision. Because the Court had mentioned “federalism
interests” and “the due process limits on the exercise of specific jurisdiction by a State,” its final
words noted that the decision did not address “whether the Fifth Amendment imposes the same
restrictions on the exercise of personal jurisdiction by a federal court.” Id. at 1780–84. It also
did not touch on whether the same result would apply to a class action under Rule 23 of the
Federal Rules of Civil Procedure. See id. at 1789 n.4 (Sotomayor, J., dissenting) (“[T]he Court
today does not confront the question whether its opinion here would also apply to a class
action.”).
Despite the pains that the Supreme Court took to limit is decision, litigants have rushed to
argue that Bristol-Myers Squibb renders many nationwide class actions constitutionally invalid
for lack of specific personal jurisdiction over the defendant with respect to the claims of
unnamed class members. The vast majority of lower courts have rejected their arguments, as
has the only circuit court to have so far addressed the issue. See Chernus v. Logitech, Inc.,
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No. 17-673(FLW), 2018 WL 1981481, at *7 (D.N.J. Apr. 27, 2018) (collecting cases); Mussat,
953 F.3d 441.
We follow their lead in holding that Bristol-Myers Squibb does not extend to federal class
actions. There are at least two related reasons supporting the long-standing rule. First, a class
action is formally one suit in which, as a practical matter, a defendant litigates against only the
class representative. Second and relatedly, precedent shows that absent class members are not
considered “parties,” as a class representative is, for certain jurisdictional purposes.
The different procedures underlying a mass-tort action and a class action demand
diverging specific personal jurisdiction analyses. See Mussat, 953 F.3d at 446–47. A class
action is the product of the certification procedures set forth in Rule 23, and these “[p]rocedural
formalities matter,” as they result in practical differences. Id. at 446. The Seventh Circuit
persuasively points out that the Supreme Court, in Taylor v. Sturgell, 553 U.S. 880 (2008),
stressed the importance of class certification as a pre-requisite for binding a
nonparty (including an unnamed class member) to the outcome of a suit. Id. at
894. With that in mind, it rejected the notion of “virtual representation” as an
end-run around the careful procedural protections outlined in Rule 23. Id. at 901.
Class actions, in short, are different from many other types of aggregate litigation,
and that difference matters in numerous ways for the unnamed members of the
class.
Id. at 446–47.
In a coordinated mass action, each plaintiff is a named party. That means that the
defendant must defend against each plaintiff and their individualized claims. Although the
statute at issue in Bristol-Myers Squibb allowed the trial court to “consolidate their cases for
resolution of shared legal issues,” the court would eventually “mov[e] on to individual issues.”
Mussat, 953 F.3d at 447. These individual issues might “present significant variations” such that
a defense would require different legal theories or different evidence. Sanchez v. Launch Tech.
Workforce Sols., LLC, 297 F. Supp. 3d 1360, 1366 (N.D. Ga. 2018).
In a class action, by contrast, “the lead plaintiffs earn the right to represent the interests of
absent class members by satisfying all four criteria of Rule 23(a) and one branch of Rule 23(b).”
Mussat, 953 F.3d at 447. The defendant “is presented with a unitary, coherent claim to which it
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need respond only with a unitary, coherent defense.” Sanchez, 297 F. Supp. 3d at 1366. In this
sense, the only “suit” before the court is the one brought by the named plaintiff. Thus, when the
court considers whether the suit “arise[s] out of or relate[s] to the defendant’s contacts with the
forum,” Bristol-Myers, 137 S. Ct. at 1780 (alterations and citation omitted), the court need
analyze only the claims raised by the named plaintiff, who in turn represents the absent class
members, see Gen. Tel. Co. of the Sw. v. Falcon, 457 U.S. 147, 155 (1982) (“The class-action
device was designed as ‘an exception to the usual rule that litigation is conducted by and on
behalf of the individual named parties only.’”) (quoting Califano v. Yamasaki, 442 U.S. 682,
700–01 (1979)).
The dissent’s contrary view fails to concentrate on the “affiliation between the forum and
the underlying controversy,” the core of the specific-jurisdiction inquiry. See Bristol-Myers
Squibb, 137 S. Ct. at 1780. Rather, the dissent hangs its hat on Phillips Petroleum Co. v. Shutts,
472 U.S. 797 (1985). But the Supreme Court in Shutts, confronted with a personal-jurisdiction
challenge by the out-of-state defendant, in fact allowed the nationwide class action to proceed.
In that case, one Kansas resident and two Oklahoma residents brought a nationwide class
action in a Kansas state court for interest on delayed royalty payments stemming from natural
gas operations in eleven states. Id. at 799–801. The defendant, a Delaware corporation with its
principal place of business in Oklahoma, attempted to avoid its obligations to non-Kansas
residents on personal-jurisdiction grounds. It asserted that the “Kansas trial court did not possess
personal jurisdiction over absent plaintiff class members as required by International Shoe Co. v.
Washington, 326 U.S. 310 (1945), and similar cases” because the absent class members “did not
possess ‘minimum contacts’ with Kansas.” Id. at 802. As such, the defendant argued, absent
class members should be required to affirmatively request inclusion into the class. Id. at 812.
The Supreme Court in Shutts expressly rejected the defendant’s attempt to impose the
“minimum contacts” requirement of the Due Process Clause onto absent class members, finding
that the defendant’s argument was supported by “little, if any precedent.” Id. at 812. Instead, the
“minimal procedural due process protection” owed by the forum state to the absent class
members was satisfied by a “fully descriptive” opt-out notice mailed to each class member, id. at
811–812, 814, as well as by class certification procedures requiring “that the named plaintiff at
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all times adequately represent the interests of the absent class members,” id. at 812. In other
words, due to the opt-out and certification procedures, the Kansas trial court could exercise
jurisdiction over the absent class members. Id. at 811.
The dissent makes an unjustified inferential leap from Shutts. It argues that because a
court must provide due process protection to absent class members, a court must also have
specific personal jurisdiction over the defendant as to those absent class members. (Dissent at
p. 36) But as the Shutts Court emphasized, the Due Process Clause places different demands on
the court as to each, and the jurisdictional inquiry changes precisely because of the unique
posture of a class action. The dissent, like the defendant in Shutts, both conflates jurisdictional
inquiries and “ignores the differences between class-action plaintiffs, on the one hand, and
defendants in nonclass civil suits on the other,” id. at 812, as well as the differences between
named plaintiffs and absent class members, id. at 809–810. These practical differences are more
than material to the due process inquiry in Shutts; they are decisive. The class-certification
procedures ensure the “common nature of the named plaintiffs’ and the absent plaintiffs’ claims,
the adequacy of representation, [and] the jurisdiction possessed over the class,” thus
fundamentally changing the nature of the suit and the jurisdictional analysis. Id. at 809.
Not only does the dissent read a new and unsupported holding into Shutts (that a court
must have specific personal jurisdiction over the defendant as to each absent class member), but
it then proceeds to read a new and unsupported holding into Bristol-Myers Squibb as well: that
“a state court lacks the power to decide the absent class members’ claims if they arise from
wholly out-of-state activity.” (Dissent at p. 37–38). What the dissent papers over is that Bristol-
Myers Squibb involved a mass action rather than a class action, which, as we have already
explained, is a very material distinction. In short, the dissent asserts that that our analysis rests
upon the difference between the jurisdictional powers of a state court versus a federal court (it
does not), and that both Shutts and Bristol-Myers Squibb have already answered the jurisdictional
question presented in this case (they have not).
To put this issue another way, we are tasked, when determining whether a court may
exercise specific personal jurisdiction over a defendant, to analyze the “relationship among the
defendant, the forum, and the litigation,” Daimler AG v. Bauman, 571 U.S. 117, 132–33 (2014),
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and that relationship does not depend on the makeup of the unnamed class members. Curaden
USA inflicted injuries in Michigan, and the resulting litigation—depositions, discovery, etc.—
stemmed from those injuries. The litigation would not have changed had the absent class
members been composed solely of Michiganders or of individuals spanning all fifty states. That
is because class-action procedures allowed the district court to treat the class as a single litigating
entity represented by one Michigander. Indeed, only after Lyngaas’s claim was litigated and
after judgment was rendered, were the absent class members brought into the picture to collect
their due through an administrative process. To find, therefore, that the underlying suit changes
depending on the diversity of absent class members is to ignore the practical realities of class-
action litigation and the formal status of the class representative vis-à-vis the absent class
members.
The Supreme Court has recognized as much, and has thus held that these procedures
make “[n]onnamed class members . . . parties for some purposes and not for others.” Devlin v.
Scardelletti, 536 U.S. 1, 9–10 (2002); see also Shutts, 472 U.S. at 808 (“[A] ‘class’ or
‘representative’ suit [is] an exception to the rule that one could not be bound by judgment in
personam unless one [is] made fully a party in the traditional sense.”). The Devlin Court
concluded, in determining whether absent class members could appeal a court-approved
settlement, that “[t]he label ‘party’ does not indicate an absolute characteristic, but rather a
conclusion about the applicability of various procedural rules that may differ based on context.”
Devlin, 536 U.S. at 10.
Regarding subject-matter jurisdictional inquires, the Supreme Court has held that absent
class members are not considered parties at all. See id. at 10 (noting that absent class members
are not considered parties for assessing whether the requirement of diverse citizenship under
28 U.S.C. § 1332 has been met); Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546,
566–67 (2005) (recognizing that, as long as the named representative meets the amount-in-
controversy requirement, jurisdiction exists over the claims of the unnamed class members).
And this is so even though subject-matter jurisdiction is a constitutional and statutory
requirement, Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 89 (1998), and is perhaps more
fundamental than personal jurisdiction because it cannot be waived or forfeited, Arbaugh v. Y&H
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Corp., 546 U.S. 500, 514 (2006). As the Mussat court aptly concluded, we “see no reason why
personal jurisdiction should be treated any differently from subject-matter jurisdiction . . . : the
named representatives must be able to demonstrate either general or specific personal
jurisdiction, but the unnamed class members are not required to do so.” 953 F.3d at 447.
In sum, long-standing precedent regarding personal jurisdiction over defendants as to
absent class members is well supported. We therefore reject Curaden USA’s jurisdictional
argument.
IV. CONCLUSION
For all of the reasons set forth above, we AFFIRM the judgment of the district court.
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______________________________________________________
CONCURRING IN PART AND DISSENTING IN PART
______________________________________________________
THAPAR, Circuit Judge, concurring in part and dissenting in part. While I agree with
most of the majority’s thoughtful opinion, I believe a federal rule and a federal statute require us
to narrow the class.
Federal courts follow federal rules of procedure. When those rules incorporate other
restrictions, courts must comply with those restrictions as well. Here, that means the federal
district court must respect the due process principles that would apply in state court. A Michigan
state court could not resolve the claims of out-of-state class members (without violating the
defendant’s right to due process). Because of the federal rules, neither can the federal court.
Since the court lacks personal jurisdiction over one of the defendants for the claims of out-of-
state class members, I would exclude those plaintiffs from the class.
Federal courts also follow federal statutes. Here, the statutory question is comparatively
simple: Does the Telephone Consumer Protection Act make it illegal to send unauthorized fax
ads to computers? The majority concludes that it does, because it considers a computer to be a
type of “telephonic facsimile machine.” I respectfully disagree.
I.
This is a nationwide class action filed in the Eastern District of Michigan. The named
plaintiff, a dentist in Michigan, sued Curaden USA, a toothbrush company incorporated and
headquartered in Ohio. The plaintiff claims that Curaden faxed toothbrush ads to hundreds of
dentists across the country in violation of federal law. Curaden argues that a Michigan court can
resolve the dispute only for Michigan dentists; the ones from other states must sue elsewhere.
Curaden is right. Courts do not have unlimited authority to bind parties to their
judgments. Here, a Michigan state court could not decide the claims of out-of-state dentists.
Although this case is in federal court, the state court rules are what matter. Why? Because the
federal rules ordinarily require federal courts to “follow state law in determining the bounds of
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their jurisdiction over persons.” Daimler AG v. Bauman, 571 U.S. 117, 125 (2014); Fed. R. Civ.
P. 4(k)(1)(A). (There are exceptions, but none apply here.) A Michigan court’s jurisdiction is
limited by Michigan law and by the Fourteenth Amendment to the Constitution. The parties
agree that Michigan law does not pose an obstacle, so what follows is an analysis of the
Fourteenth Amendment’s constraints on a state court’s jurisdiction.
Of course, the Fifth Amendment (not the Fourteenth) supplies the due process limits on
jurisdiction in federal courts. See Bristol-Myers Squibb Co. v. Super. Ct. of Cal., 137 S. Ct.
1773, 1783–84 (2017). But the crucial question is what the Fourteenth Amendment allows.
That’s because the federal rule authorizing jurisdiction over Curaden USA, Rule 4(k)(1)(A),
incorporates the Fourteenth Amendment’s protections. See Daimler, 571 U.S. at 121 (“The
question presented is whether the Due Process Clause of the Fourteenth Amendment precludes
the [federal] District Court from exercising jurisdiction over Daimler in this case . . . .”). The
majority does not consider this aspect of Rule 4(k)(1)(A), and its analysis relies in part on the
distinction between federal and state courts. But until the rules change, that’s a distinction
without a difference: The Fourteenth Amendment matters just as much in federal court.
A.
State courts, like federal courts, have the authority to decide cases and issue binding
judgments. But this power is limited. Under the Due Process Clause of the Fourteenth
Amendment, a state court cannot bind citizens of another state (without their consent) unless
those citizens had some relevant contact with the forum state. This requirement—called
“personal jurisdiction”—is one of the constitutional guarantees of due process.
Three basic principles frame the personal jurisdiction analysis for corporations. First, a
state court has personal jurisdiction to adjudicate any claims against corporations that are “at
home” in the state. Daimler, 571 U.S. at 126–27. Second, it can also adjudicate claims against a
corporation of another state, as long as the claims “arise out of or relate to” the corporation’s
contacts with the forum state. Id. (cleaned up). Third, any party can consent to a state court’s
exercise of personal jurisdiction. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 473 n.14
(1985).
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Take a simplified version of this case as an example. If Curaden USA—an Ohio
corporation—sent an unlawful fax to a dentist in Texas, the dentist could sue in Ohio or in
Texas. The Ohio state court could issue a judgment that binds the defendant because Curaden is
at home in Ohio. The Texas state court could too, because the claim arises out of Curaden’s
contacts in Texas. And both courts could bind the dentist, who consented to jurisdiction by
choosing the forum.
What if the Texan dentist sued in Michigan? A Michigan state court would dismiss the
case for lack of jurisdiction. Curaden is not at home in Michigan, and the claim does not arise
out of or relate to the company’s contacts with Michigan. See Daimler, 571 U.S. at 126–27.
So without Curaden’s consent, the Michigan court would have no power to bind the company to
its judgment.
Now suppose the company sent the same fax to thousands of dentists at the same time—
the Texan dentist and a host of Michigan dentists too. Since the company sent the fax to
Michigan dentists in exactly the same way as it did the dentist in Texas, you might think that the
Texan’s claim “relates to” the company’s contacts with Michigan. See id. (affirming that state
courts have specific personal jurisdiction over claims that “arise out of or relate to the
defendant’s contacts with the forum” (emphasis added) (cleaned up)); 2 William B. Rubenstein,
Newberg on Class Actions § 6:26 (5th ed. 2020) (explaining the theory). So could the Texan sue
in Michigan? No. The Supreme Court recently rejected this precise argument. See Bristol-
Myers Squibb, 137 S. Ct. at 1781 (“The mere fact that other plaintiffs were prescribed, obtained,
and ingested Plavix in California—and allegedly sustained the same injuries as did the
nonresidents—does not allow the State to assert specific jurisdiction over the nonresidents’
claims.”). The State of Michigan still has nothing to do with the dispute between a Texan dentist
and an Ohio corporation, even if Michigan dentists were injured in the same way.
Brian Lyngaas, the class representative, is not a Texan. He is a Michigan dentist who
could have sued just for the faxes that Curaden sent to his Michigan office. And if he had, the
Michigan state court would have jurisdiction over Curaden for this claim. But Lyngaas seeks
redress for unlawful faxes sent to hundreds of dentists across the country. If dentists from other
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states joined Lyngaas’s suit, the Michigan court would dismiss their claims—Curaden would
have rightly argued that the court lacked personal jurisdiction.
On this much we all agree.
B.
So where do we part ways? The majority believes that a court can resolve a class action
even when it would lack personal jurisdiction to decide the claims of absent class members. I do
not.
1.
A court cannot bind all parties to a class action unless it has personal jurisdiction over all
parties for each claim—including the claims of absent class members. The Supreme Court said
as much in Phillips Petroleum Co. v. Shutts, a nationwide class action brought by investors who
alleged that Phillips Petroleum owed them interest on delayed royalty payments. 472 U.S. 797
(1985). Phillips, the defendant, argued that a Kansas state court lacked personal jurisdiction over
the claims of the out-of-state plaintiffs. It’s unusual for defendants to show solicitude for the due
process rights of the opposing party. But as the Court explained, Phillips had a “great interest in
ensuring that the absent plaintiff’s claims [were] properly before the forum.” Id. at 809. If the
Kansas court had no personal jurisdiction over the absent class members on these claims, the
plaintiff class would not be bound by the final judgment and could bring similar claims against
Phillips in future lawsuits. Id. at 811–12. Phillips prevailed on the first premise of this
argument: The Kansas court needed personal jurisdiction to adjudicate the claims of out-of-state
class members.
Thanks to this analysis in Shutts, we know that in a class action as in all actions, a court
must have personal jurisdiction to bind the parties to its judgment. Ultimately, the Shutts Court
held that the Kansas court did have personal jurisdiction to adjudicate the claims of the absent
class members. Id. at 811. Since the plaintiffs had a meaningful chance to opt out of the class,
the choice not to opt out implied consent. Id. at 812–14. Thus, the exercise of jurisdiction
satisfied the due process requirements of the Fourteenth Amendment. Id. The plaintiffs
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consented by choosing not to opt out, and Phillips consented by failing to object to personal
jurisdiction on its own behalf. (As I explain below, Phillips’s failure to object was not as strange
as it may seem.)
This reasoning follows the fundamental principle that a court’s power to bind extends
only as far as its jurisdiction. William Baude, The Judgment Power, 96 Geo. L.J. 1807, 1827–28
(2008). In a class action, a court resolves the claims of each class member, and its decision is
binding. When the claims have merit, the court’s judgment also requires the defendant to
provide the class members with some relief. As a leading treatise has explained, “If the class
prevails in the case, the goal is a binding judgment over the defendant as to the claims of the
entire nationwide class—and the deprivation of the defendant’s property accordingly.”
Rubenstein, supra, § 6:26. So it makes sense that the court must separately evaluate its personal
jurisdiction for the claims of absent class members (if a party asks it to). Courts must have
jurisdiction over the parties for each claim they conclusively resolve.
Although Shutts concerned the personal jurisdiction rights of the absent plaintiffs, and not
those of the defendants present in the forum, there is no reason to think that the analysis is one-
sided. The Shutts Court itself explained that a defendant’s due process interests are even more
acute than those of absent class members. 472 U.S. at 808–10; see also id. at 807 (“[T]he
requirement that a court have personal jurisdiction comes from the Due Process Clause’s
protection of the defendant’s personal liberty interest, and . . . represents a restriction on judicial
power . . . as a matter of individual liberty.” (citation omitted)). And more fundamentally, a
court must be able to bind both parties to its decision. What use is a judgment binding on the
plaintiffs if it is not also binding on the defendant?
2.
Thus, a court needs personal jurisdiction to bind the defendant with respect to the class
claims. To find out whether the court has personal jurisdiction, we need to examine these
claims—we cannot just assume that jurisdiction over the class representative’s claims confers
jurisdiction over the claims of the class. Why? Because a state court lacks the power to decide
the absent class members’ claims if they arise from wholly out-of-state activity. And that’s true
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even if they concern the same subject matter as a claim the court can decide—including the
claim of the class representative. See supra, Part I.A; Bristol-Myers Squibb, 137 S. Ct. at 1781.
It doesn’t matter that the defendant, unlike the absent class members, is already present in
court to defend against the representative’s claim. A defendant’s due process interests do not
vanish just because it has been haled into a forum. The Court has explained that “[n]othing” in
its cases “suggests that a particular quantum of local activity should give a State authority over a
far larger quantum of activity having no connection to any in-state activity.” Daimler, 571 U.S.
at 139 n.20 (cleaned up); see also BNSF Ry. Co. v. Tyrrell, 137 S. Ct. 1549, 1559 (2017).
Indeed, that is the whole point of specific (rather than general) jurisdiction. A court might have
specific jurisdiction to adjudicate particular claims against a company, but that does not give the
court the power to decide all similar disputes involving that defendant. Bristol-Myers Squibb,
137 S. Ct. at 1781.
This case makes the point. A Michigan state court has jurisdiction to decide the claims of
Michigan dentists. But without the defendant’s consent, it lacks jurisdiction to decide the claims
of dentists in other states. See supra, Part I.A; Bristol-Myers Squibb, 137 S. Ct. at 1781. Not
individually, not jointly, and not as part of a class action.
C.
The majority breaks with this precedent and writes a different rule: As long as the court
has jurisdiction to adjudicate the claims of the class representative, it can bind the defendant for
the claims of the whole class. That position means that a class action gives a court the power to
exceed its ordinary jurisdictional reach. Because of the class action, a court without power to
decide a claim between a Texan dentist and an Ohio corporation could do just that.
How come? In the majority’s view, that’s how it’s always been done. It has a point.
Courts have long adjudicated nationwide class actions against defendants in states where
defendants are not subject to the general jurisdiction of the courts. Shutts itself is one example.
Phillips, the defendant, was incorporated in Delaware and headquartered in Oklahoma, but the
plaintiff class sued in Kansas state court. If my view of jurisdiction is correct, Phillips could
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have simply refused to consent to the Kansas court’s jurisdiction over it. Instead, it chased a
creative jurisdictional argument all the way to the Supreme Court—on behalf of the plaintiffs!
Why didn’t Phillips just contest jurisdiction on its own account? It probably thought
there was no use. Phillips, a giant multinational corporation, had continuous and systematic
contacts in all fifty states. At the time, the prevailing view was that a company with such
pervasive contacts was subject to the general jurisdiction of courts in every state. But the
Supreme Court has since explained that this view was wrong. “The general jurisdiction inquiry
does not focus solely on the magnitude of the defendant’s in-state contacts,” for a “corporation
that operates in many places can scarcely be deemed at home in all of them.” Daimler, 571 U.S.
at 139 n.20 (cleaned up); see also id. at 152–54 (Sotomayor, J., concurring) (describing “the new
rule” as a departure from the “settled approach” to general jurisdiction that had been taught to
generations of law students). Instead, a corporation with operations in every state is ordinarily
subject to general jurisdiction in only two: its place of incorporation and its principal place of
business. BNSF, 137 S. Ct. at 1559. We know now what Phillips did not.
I agree that after Bristol-Myers Squibb, it would be difficult to bring a nationwide class
action in forums other than the defendant’s home states. In the majority’s view, this observation
carries the day. After all, the Bristol-Myers Squibb Court said it was applying “settled principles
of personal jurisdiction” when it decided the case. 137 S. Ct. at 1783; see also Mussat v. IQVIA,
Inc., 953 F.3d 441, 448 (7th Cir. 2020) (taking the same position and explaining that a contrary
view would effect “a major change in the law of personal jurisdiction and class actions”). But
any change in class-action practice largely stems from general jurisdiction cases decided before
Bristol-Myers Squibb—in particular, Daimler and its precursor, Goodyear Dunlop Tires
Operations v. Brown. 571 U.S. 117 (2014) (Daimler); 564 U.S. 915 (2011) (Goodyear). These
cases clarified that the scope of general jurisdiction was narrower than many (including Phillips,
most likely) had believed it to be.
That isn’t to say that Bristol-Myers Squibb does not matter. It does. As explained above,
before the Bristol-Myers Squibb decision, plaintiffs could have tried to argue that specific
jurisdiction allowed nationwide class actions against a corporation running identical operations
throughout the country. They would have said that a claim arising from activity in one state
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“relates to” identical activity taking place in another state. But after Bristol-Myers Squibb, that
doesn’t cut it. See 137 S. Ct. at 1781; Rubenstein, supra, § 6:26. Bristol-Myers Squibb
foreclosed this potential (but already tenuous) basis for specific jurisdiction.
In the end, this issue is not fundamentally about Bristol-Myers Squibb. That decision just
clarified when a court has specific jurisdiction over a corporate defendant with regard to many
identical claims. The question is whether a court must have personal jurisdiction over that
defendant as to the claims of absent class members at all. Following Shutts and the basic
principles of jurisdiction, the answer is yes.
The majority bases its contrary view on the theory that “absent class members are not
considered parties at all” when it comes to “subject-matter jurisdictional inquiries”—so we
should exclude them from the personal jurisdiction inquiry, too. Majority Op. at 31–32; see also
Mussat, 953 F.3d at 447–48 (“We see no reason why personal jurisdiction should be treated any
differently from subject-matter jurisdiction and venue . . . . [A] district court need not have
personal jurisdiction over the claims of absent class members at all.”). But the premise and its
application to personal jurisdiction are flawed.
First, the premise. It is not true that courts may overlook absent class members for the
purposes of subject matter jurisdiction. On the contrary—the claims of each absent class
member must satisfy the constitutional and statutory prerequisites. Exxon Mobil Corp. v.
Allapattah Servs., Inc., 545 U.S. 546, 559 (2005) (“Once the court determines it has original
jurisdiction over the civil action, it can turn to the question whether it has a constitutional and
statutory basis for exercising supplemental [subject matter] jurisdiction over the other claims in
the action.”). If “the district court has no statutory basis for exercising supplemental jurisdiction
over the additional claims” in a class action, those claims must be dropped. Id. at 558.
So what is the majority getting at? It correctly observes that some of the ordinary
statutory constraints on subject matter jurisdiction in diversity cases do not apply to absent class
members: They do not have to allege any particular amount in controversy, and they can be
citizens of the same state as a defendant. See id. at 566–67; 28 U.S.C. § 1367.
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But that’s not because there’s an unwritten class-action exception to jurisdictional
requirements. It’s because Congress can and did create exceptions to its own statutory
prerequisites. (The amount-in-controversy and complete-diversity requirements are not
constitutional. See Exxon Mobil, 545 U.S. at 566–67; State Farm Fire & Cas. Co. v. Tashire,
386 U.S. 523, 531 (1967).) A court can exercise jurisdiction over class claims that do not
themselves meet these requirements because the supplemental jurisdiction statute authorizes
them to. See Exxon Mobil, 545 U.S. at 566–67; 28 U.S.C. § 1367; cf. Class Action Fairness Act
of 2005, Pub. L. No. 109-2, 119 Stat. 4 (codified in relevant part in 28 U.S.C. § 1332(d)) (also
modifying the statutory prerequisites to diversity jurisdiction).
Personal jurisdiction, like subject matter jurisdiction, also has constitutional and statutory
requirements. And Congress can lift or modify the statutory requirements for personal
jurisdiction just the same. See infra, Part I.D. But nothing about the class action changes the
basic rule—a court cannot adjudicate claims without jurisdiction. Contrary to the majority’s
position, invoking that device neither excuses nor satisfies the personal jurisdiction requirement.1
D.
So does this spell the end of the nationwide class action? Certainly not. Typically,
plaintiffs will have no problem bringing nationwide class actions against a corporation in its state
of incorporation or in the state where it has its headquarters. Here, the plaintiffs sued in Detroit.
But just sixty miles south is the great city of Toledo, where the plaintiffs could have sued without
a problem. For a nationwide class action, is that really too much to ask?
If it is, Congress has an out. Remember, the plaintiffs sued in a federal court in
Michigan. That court’s personal jurisdiction is limited to the jurisdictional reach of a Michigan
state court, but only by the Federal Rules of Civil Procedure. See Fed. R. Civ. P. 4(k)(1)(A);
1The majority is correct that the procedures for certifying a class action satisfied the Shutts plaintiffs’ due
process interests in personal jurisdiction. But it is incorrect to infer that “the class-certification procedures . . .
fundamentally chang[e] . . . the jurisdictional analysis.” Majority Op. at 30. The basic personal jurisdiction
framework remains the same: Litigants have always been able to consent to personal jurisdiction, and the Shutts
Court’s exercise of jurisdiction hinged on the plaintiffs’ consent. Shutts, 472 U.S. at 812–14. The class-certification
procedures are relevant because they let the plaintiffs opt out, and so the court could infer consent from those who
chose not to opt out. Id. Class-action defendants who object on jurisdictional grounds have plainly not consented.
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Daimler, 571 U.S. at 125. Congress has created exceptions to this rule before and can do so
again.
One exception even applies to Curaden USA’s co-defendant and parent company,
Curaden AG. As the majority opinion correctly explains, Curaden AG is subject to the district
court’s jurisdiction under a different part of the federal rule. Unlike Rule 4(k)(1)(A), Rule
4(k)(2) allows a federal court to exercise jurisdiction over the parent company for claims under
federal law because that company has contacts with the United States and “is not subject to
jurisdiction in any state’s courts of general jurisdiction.” Since Curaden USA is subject to the
jurisdiction of Ohio’s courts, the rule doesn’t apply. But nothing prevents Congress from
authorizing all federal courts to exercise personal jurisdiction over any corporation with
sufficient contacts to the United States.
Since Congress has not done so yet, the Fourteenth Amendment analysis still governs
here. Curaden USA cannot be subject to the jurisdiction of a Michigan state court for claims
concerning faxes sent to out-of-state dentists. Because of Rule 4(k)(1)(A), the same goes for
federal court.2
If a district court finds itself with a class of claims beyond its jurisdictional reach, what is
it to do? The simple answer, once the class has been certified, is to narrow the class to exclude
the claims of out-of-state class members.
What about before certification? That’s a little more complicated. Until the class has
been certified, only the named plaintiff’s claims are before the court. See A. Benjamin
Spencer, Out of the Quandary: Personal Jurisdiction over Absent Class Member Claims
Explained, 39 Rev. Litig. 31, 38 (2019); see also Smith v. Bayer Corp., 564 U.S. 299, 313
(2011); Devlin v. Scardelletti, 536 U.S. 1, 16 n.1 (2002) (Scalia, J., dissenting) (“Not even
petitioner, however, is willing to advance the novel and surely erroneous argument that a
2Although creative lawyers could argue that Rule 23 implicitly abrogates Rule 4(k)(1)(A) and makes the
Fourteenth Amendment analysis irrelevant, neither the plaintiff nor the majority has suggested that it does. In any
case, that argument would be unpersuasive. The constraints of Rule 4(k)(1)(A) do not hinder the operation of Rule
23. All they do is require litigants to bring class actions in the appropriate forum. Since the two rules are “capable
of co-existence, it is the duty of the courts . . . to regard each as effective.” Morton v. Mancari, 417 U.S. 535, 551
(1974).
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nonnamed class member is a party to the class-action litigation before the class is certified.”).
Thus, a pre-certification motion to dismiss for lack of personal jurisdiction would be premature.
See Molock v. Whole Foods Mkt. Grp., Inc., 952 F.3d 293, 298 (D.C. Cir. 2020). A court cannot
dismiss claims that are not before it.
But that does not mean defendants are out of options at the pleading stage. A court may
grant a motion to strike class allegations before certification. See Fed. R. Civ. P. 23(d)(1) (“In
conducting an action under this rule, the court may issue orders that . . . require that the pleadings
be amended to eliminate allegations about representation of absent persons and that the action
proceed accordingly.”). So if a company believes that a court would lack personal jurisdiction
for the claims of out-of-state members of the putative class, “the proper procedural move is to
file a motion to strike the nationwide class allegations.” Penikila v. Sergeant’s Pet Care Prod.,
LLC, 442 F. Supp. 3d 1212, 1214 (N.D. Cal. 2020); see also Spencer, supra, at 49–51. That
way, a defendant would not have to subject itself to the burdens of “extensive class discovery”
when the nationwide class is uncertifiable. Molock, 952 F.3d at 304 (Silberman, J., dissenting).
II.
One final point about the class: Not all class members can state a claim for relief. Some
of the class members’ claims involve e-faxes that were sent to computers. The Telephone
Consumer Protection Act makes it illegal (with certain exceptions) “to use any telephone
facsimile machine, computer, or other device to send, to a telephone facsimile machine, an
unsolicited advertisement.” 47 U.S.C. § 227(b)(1)(C). The district court and majority conclude
that this prohibition applies to e-faxes sent to computers because, in their view, the term
“telephone facsimile machine” encompasses computers. I disagree.
The statute defines “telephone facsimile machine” as “equipment which has the capacity
(A) to transcribe text or images, or both, from paper into an electronic signal and to transmit that
signal over a regular telephone line, or (B) to transcribe text or images (or both) from
an electronic signal received over a regular telephone line onto paper.” Id. § 227(a)(3).
A computer, on its own, does not have the capacity to do either. You need to hook it up to extra
equipment first—a printer or a scanner.
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So does a computer fall under the statutory definition? At first glance, it doesn’t look
like it—a fax sent to a computer is not a fax sent to equipment with the capacity to scan or print.
And there’s another clue in the statute. Recall that the TCPA makes it illegal to use a
“telephone facsimile machine” or a “computer” to send an unsolicited advertisement “to a
telephone facsimile machine.” Id. § 227(b)(1)(C). Congress expressly included computers
alongside “telephone facsimile machine[s]” in the (broad and open-ended) list of sender devices.
But it omitted computers from the list of receiver devices.
Given this distinction, we cannot read “telephone facsimile machine” to encompass
computers without creating two interpretive problems. First, “[w]here Congress includes
particular language in one section of a statute but omits it in another . . . it is generally presumed
that Congress acts intentionally and purposely in the disparate inclusion or exclusion.” Russello
v. United States, 464 U.S. 16, 23 (1983). Here, the difference occurred not across sections, but
in different parts of the same sentence. So if we can assume that Congress remembered what it
said in the first half of the sentence by the time it got to the second, we can take it that the
omission of “computer” in the second half was no accident. Second, our job is to “give effect to
each word” in the statute. Nat’l Air Traffic Controllers Ass’n v. Sec’y of Dep’t of Transp.,
654 F.3d 654, 657 (6th Cir. 2011) (cleaned up). If “telephone facsimile machine” included
“computers,” Congress would not have listed them separately.
In my view, understanding a “computer” to be a “telephone facsimile machine” conflicts
with the statutory definition, the syntax of the relevant provision, and the common understanding
of both terms. Since the TCPA imposes liability for faxes sent to “telephone facsimile
machines” and not to “computers,” I would exclude from the class any claims involving faxes
sent to computers.
* * *
Because of these constraints, I believe the class should not include claims concerning
faxes that were sent to fax machines outside of Michigan and faxes sent to all computers.
Otherwise, I join the majority opinion.