Holster v. Gatco, Inc.

Cite as: 559 U. S. ____ (2010) 1

GINSBURG, J., dissenting

SUPREME COURT OF THE UNITED STATES
CHARLES E. HOLSTER, III v. GATCO, INC. DBA FOLIO
ASSOCIATES
ON PETITION FOR WRIT OF CERTIORARI TO THE UNITED

STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

No. 08–1307. Decided April 19, 2010

JUSTICE GINSBURG, with whom JUSTICE BREYER joins,
dissenting.
Petitioner Charles Holster filed this putative class
action against Gatco, Inc., in federal court, invoking the
court’s jurisdiction under the Class Action Fairness Act of
2005, 28 U. S. C. §1332(d). Holster sought statutory dam
ages for Gatco’s alleged violation of the Telephone Con
sumer Protection Act of 1991 (TCPA), 47 U. S. C. §227,
which authorizes a “[p]rivate right of action” when a per
son is “otherwise permitted by the laws or rules of court of
a State” to bring the action. §227(b)(3).
The District Court dismissed Holster’s suit based on
N. Y. Civ. Prac. Law Ann. (CPLR) §901(b) (West 2006), the
provision at issue in Shady Grove Orthopedic Associates,
P. A. v. Allstate Ins. Co., 559 U. S. ___ (2010). That stat
ute prescribes that, unless specifically permitted, “an
action to recover a penalty, or minimum measure of recov
ery created or imposed by statute may not be maintained
as a class action.” §901(b). The District Court noted that,
pursuant to §901(b), New York courts had closed their
doors to class actions seeking statutory damages under the
TCPA. 485 F. Supp. 2d 179, 185 (EDNY 2007).
Adopting its prior decision in Bonime v. Avaya, Inc., 547
F. 3d 497 (2008), the Second Circuit summarily affirmed.
Bonime held that §901(b) barred TCPA claims brought as
class actions for two independent reasons. First, the
Court of Appeals determined that §901(b) governed be
cause it qualified as “substantive” under the doctrine of
2 HOLSTER v. GATCO, INC.

GINSBURG, J., dissenting

Erie R. Co. v. Tompkins, 304 U. S. 64 (1938). 547 F. 3d, at
501–502.
As a “second, independent” ground for its holding, the
Bonime panel stated:
“The private right of action created by the TCPA al
lows a person or entity to, ‘if otherwise permitted by
the laws or rules of court of a State, bring . . .’ an ac
tion for a violation of the TCPA. See 47 U. S. C.
§227(b)(3) (emphasis added). This statutory language
is unambiguous—a claim under the TCPA cannot be
brought if not permitted by state law. ‘In determining
the proper interpretation of a statute, this court will
look first to the plain language of a statute and inter
pret it by its ordinary, common meaning. If the statu
tory terms are unambiguous, our review generally
ends and the statute is construed according to the
plain meaning of its words.’ Tyler v. Douglas, 280
F. 3d 116, 122 (2d Cir. 2001) (internal citations, quo
tation marks, and alteration omitted). This provision
constitutes an express limitation on the TCPA which
federal courts are required to respect.” Id., at 502.
Judge Calabresi concurred, joining only the second
ground “identified by the majority for its conclusion.” Ibid.
As Judge Calabresi explained:
“A state law that bars suit in state court, like
C. P. L. R. 901(b), . . . effectively eliminates the cause
of action created under the TCPA because it elimi
nates the ‘may’ and the rest of the phrase that follows
(‘bring . . . an action’). Federal law (the TCPA’s cause
of action) directs courts to look to ‘the laws’ and ‘rules
of court’ of a state. Thus, when a state refuses to rec
ognize a cause of action, there remains no cause of ac
tion to which any grant of federal court jurisdiction
could attach.” Id., at 503.
 Cite as: 559 U. S. ____ (2010) 3

GINSBURG, J., dissenting

Although Shady Grove may bear on the Second Circuit’s
Erie analysis,* nothing in Shady Grove calls for a reading
of §227(b)(3) that fails fully to honor “the laws [and] rules
of court of [New York] State.” The Second Circuit’s inter
pretation of the TCPA’s private-right-of-action authoriza
tion stands on its own footing as an adequate and inde
pendent ground for dismissing Holster’s suit. I would
spare the Court of Appeals the necessity of revisiting—
and, presumably, reinstating—its TCPA-grounded ruling.

——————
* Holster, however, arguably forfeited the argument, accepted in

Shady Grove, that Federal Rule of Civil Procedure 23 preempts §901(b);
the District Court concluded that Rule 23 and §901(b) did not conflict
and noted that Holster “d[id] not dispute” that point. 485 F. Supp. 2d
179, 185, n. 3 (EDNY 2007).