PUBLISH
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
_________________
No. 96-9149
__________________
D. C. Docket No. 95-CV-101
SAM NICHOLSON, and All Other Persons
or Entities Similarly Situated,
Plaintiffs-Appellants,
versus
HOOTERS OF AUGUSTA, INC.,
Defendant-Cross-Claimant-
Third-Party Plaintiff-
Appellee,
BAMBI K. CLARK d.b.a. Value-Fax
of Augusta,
Defendant-Cross-
Defendant-Appellees.
_____________________
Appeal from the United States District Court
for the Southern District of Georgia
____________________
(March 10, 1998)
Before DUBINA, Circuit Judge, and HILL and GIBSON*, Senior
Circuit Judges.
JOHN R. GIBSON, Senior Circuit Judge:
Sam Nicholson appeals the district court's dismissal
of his action against Hooters of Augusta, Inc. for
failure to state a claim. Nicholson alleged that Hooters
violated the Telephone Consumer Protection Act, 47 U.S.C.
§ 227 (1994), by sending unsolicited advertisements to
Nicholson's facsimile machine. Nicholson contends the
court erred in concluding that the Telephone Consumer
Protection Act covers only interstate, and not
intrastate, transmissions of unsolicited advertisements
by facsimile, and that individual citizens may not bring
suit under the Act. Because we conclude that Congress
granted state courts exclusive subject matter
jurisdiction over private actions under the Act, we
vacate the judgment of the district court and remand with
directions to dismiss this case for lack of subject
*Honorable John R. Gibson, Senior U.S. Circuit
Judge for the Eighth Circuit, sitting by
designation.
-2-
matter jurisdiction.
The Telephone Consumer Protection Act prohibits "any
person within the United States... [from] us[ing] any
telephone facsimile machine, computer, or other device to
send an unsolicited advertisement to a telephone
facsimile machine." 47 U.S.C. § 227(b)(1)(C). The Act
creates a private right of action to obtain injunctive
relief as well as to recover actual damages or $500.00,
whichever is greater, for each violation. 47 U.S.C. §
227(b)(3). The private right of action may be filed "if
otherwise permitted by the laws or rules of court of a
State,...in an appropriate court of that State." Id.
Nicholson filed a complaint in the Superior Court of
Richmond County, Georgia, alleging that Hooters violated
the Telephone Consumer Protection Act by sending
unsolicited advertisements to his facsimile machine. The
state court entered a temporary restraining order
enjoining Hooters from sending further advertisements by
facsimile.
Hooters removed the case to the United States
District Court for the Southern District of Georgia.
-3-
Hooters then filed a motion to dismiss for failure to
state a claim upon which relief could be granted, arguing
that the Act did not apply to intrastate facsimiles, and
that an individual could not bring a private right of
action. The district court granted Hooters' motion to
dismiss, ruling first that Nicholson could not maintain
a private right of action. The court reasoned that the
language in the Act providing that a private right of
action could be brought "if otherwise permitted by the
laws or rules of the court of a State," authorized a
private right of action only if state law specifically
authorized a private action. Because there was no
specific provision for private actions under Georgia law,
the court held there could be no private action in
federal court. The court rejected Nicholson's argument
that the Act provides for concurrent jurisdiction of
private actions in state and federal courts. The court
also held that the Telephone Consumer Protection Act
applied only to interstate facsimile transmissions.
Because Nicholson received an intrastate facsimile, the
court held there could be no claim under the Act.
-4-
Nicholson appealed. After the district court's
decision, the Fourth Circuit considered a similar action,
International Science & Tech. Inst. Inc. v. Inacom Comm.,
Inc., 106 F.3d 1146 (4th Cir. 1997). The Fourth Circuit
affirmed the district court's dismissal of the case for
lack of subject matter jurisdiction. Id. At 1150. The
Fourth Circuit reached the "somewhat unusual conclusion"
that the Act vests jurisdiction only in state courts.
Id. at 1150-1152.
Because the Act is silent as to federal court
jurisdiction, the Fourth Circuit relied on several
sources to determine whether the federal court had
subject matter jurisdiction. The Fourth Circuit rejected
the argument that section 227(b)(3) conferred
jurisdiction to both the federal and state courts. The
court determined that the permissive authorization
contained in section 227(b)(3) did not confer federal
court jurisdiction because the language was not a
specific grant of authorization. Id. at 1151-52. The
court interpreted the silence as to federal court
jurisdiction and the express grant of jurisdiction to
-5-
state courts as telling for several reasons. The court
found it "meaningful" that Congress explicitly mentioned
only state courts because, in general, it is unnecessary
to vest state courts with concurrent jurisdiction. Id.
at 1152. The court found confirmation of its
interpretation by the fact that section 227(f)(2) of the
Act while authorizing state court jurisdiction for a
private right of action, conferred exclusive federal
jurisdiction over an action brought by a state attorney
general. Id. "We find it significant that in enacting
the [Telephone Consumer Protection Act], Congress wrote
precisely, making jurisdictional distinctions in the very
same section of the Act by providing that private actions
may be brought in appropriate state courts and that
actions by the states must be brought in the federal
courts." Id. Also observing that other parts of the
Communications Act of 1934 gave specific grants of
jurisdiction, the court concluded that Congress would
have authorized federal jurisdiction, if it so intended.
See id.
The court also decided that the legislative history
-6-
of the Act supported its interpretation that Congress
intended private actions to be treated as "small claims
best resolved in state courts ... so long as the states
allow such actions." Id. The Fourth Circuit rejected
the argument that Congress intended to establish
concurrent jurisdiction manifested through its preemptive
occupation of interstate telecommunications for two
reasons. Id. at 1153. First, it determined that even if
the Act preempted substantive state law, the Act
specifically provided for state courts to hear cases
under the Act unless there was a contrary congressional
intent. Id. Second, it noted that the Act specifically
held that it did not preempt any state law that imposed
more restrictive intrastate requirements or which
prohibited certain practices. Id.
Finally, the Fourth Circuit determined that its
decision that Congress intended to confer exclusive
jurisdiction upon state courts was consistent with the
Act's history and purpose, which was to allow consumers
to easily and inexpensively enforce the Act. Id. at
1152-53.
-7-
In light of this decision, we requested additional
briefing from the parties. After the parties submitted
their supplemental briefs, the Fifth Circuit also held
that Congress granted state courts exclusive subject
matter jurisdiction over private actions under the
Telephone Consumer Protection Act.1 Chair King, Inc. v.
Houston Cellular Corp., 131 F.3d 507 (5th Cir. 1997).
Like this case, the plaintiffs in Chair King brought
a private suit under the Act. Id. at 509. The district
court dismissed the claims brought under the Act, holding
that the Act only regulates interstate telemarketing
activity. Id. Following the lead of the Fourth Circuit,
the Fifth Circuit vacated the judgment of the district
court and remanded with directions to dismiss the case
for lack of subject matter jurisdiction. Id. at 514.
1
The district court for the Southern District of New
York adopted the Fourth Circuit's approach in Foxhall
Realty Law Offices, Inc. v. Telecommunications Premium
Services, Ltd., 975 F. Supp. 329 (S.D.N.Y. 1997). The
district court of Indiana, however, ruled that the Act
confers subject matter jurisdiction of private actions
upon both state and federal courts. See Kenro, Inc. v.
Fax Daily, Inc., 904 F. Supp. 912 (S.D. Ind. 1995), on
reconsideration, 962 F. Supp. 1162 (S.D. Ind. 1997).
-8-
We have carefully examined the reasoning of the
Fourth and Fifth Circuits and, we too, are persuaded that
federal courts lack subject matter jurisdiction of
private actions under the Act.
Like the Fourth and Fifth Circuits, we also reject
Hooters's argument that federal-question jurisdiction
exists under 28 U.S.C. § 1331 (1994) because Nicholson's
complaint clearly presents a federal question as it
alleges a violation of federal law. See International
Science, 106 F.3d at 1154; Chair King, 131 F.3d at 510.
We recognize that "as a general matter, a cause of action
created by federal law will properly be brought in the
district courts." 106 F.3d at 1154. Nevertheless, the
general jurisdictional grant of section 1331 does not
apply if a specific statute assigns jurisdiction
elsewhere. Id. Here, the text of the Act, including
the specific grant of federal jurisdiction to state
attorneys general, as well as the Act's legislative
history, demonstrate that Congress intended to assign the
private right of action to state courts exclusively.
Relying on Kenro, Inc. v. Fax Daily, Inc., 904 F.
-9-
Supp. 912 (S.D. Ind. 1995), on reconsideration, 962 F.
Supp. 1162 (S.D. Ind. 1997), Hooters contends that the
use of the permissive word "may" in section 227(b)(3)
does nothing more than provide concurrent state and
federal court jurisdiction. The Fourth Circuit, however,
rejected this argument, reiterating that courts of
limited jurisdiction require a specific grant of
jurisdiction, and that it could not imply a grant of
jurisdiction in light of the language of the Act, its
history, and its purpose. International Science, 106
F.3d at 1151-52. For these same reasons, we cannot
accept Hooters' argument that the federal court has
concurrent jurisdiction.
Accordingly, we VACATE the judgment of the district
court and REMAND the case to the district court with
directions to dismiss this cause for lack of subject
matter jurisdiction.
-10-