Cooper v. Charter Communications, 1st Cir. (2014)

7/26/2019 Cooper v. Charter Communications, 1st Cir. (2014)

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United States Court of AppealsFor the First Circuit

Nos. 13- 1726; 13- 1736

BRUCE M. COOPER; J OHN W. ROMI TO; ROY L. BAKER;WHI TNEY TAYLOR THOMPSON, i ndi vi dual l y and on behal f of al l other

per sons si mi l ar l y si t uat ed,

Pl ai nt i f f s , Appel l ant s ,

v.

CHARTER COMMUNI CATI ONS ENTERTAI NMENTS I , LLC;

CHARTER COMMUNI CATI ONS, I NC. ,

Def endant s, Appel l ees.

APPEALS FROM THE UNI TED STATES DI STRI CT COURTFOR THE DI STRI CT OF MASSACHUSETTS

[ Hon. Mi chael A. Ponsor , U. S. Di st r i ct J udge]

Bef or e

Thompson, Stahl , and Kayat t a,Ci r cui t J udges.

J ef f r ey S. Mor neau, wi t h whomNat han A. Ol i n and Connor ,Mor neau & Ol i n, LLP, wer e on br i ef , f or appel l ant s.

Rober t J . Wagner , wi t h whomKat hl een M. Gui l f oyl e, Br i anP. Voke, Campbel l Campbel l Edwards & Conr oy, Roman P. Wul l er , andThompson Coburn, LLP, wer e on br i ef , f or appel l ees.

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KAYATTA, Circuit Judge. I n t he af t er mat h of a

subst ant i al snowst or m, f our cust omer s sued cabl e pr ovi der Char t er

Communi cat i ons Ent ert ai nment I , LLC, and i t s parent company,

Char t er Communi cat i ons, I nc. ( col l ect i vel y, "Char t er ") , on behal f

of t hemsel ves and a put at i ve cl ass of ot her s cl ai med t o be

si mi l ar l y si t uat ed. The pl ai nt i f f s cont end t hat Char t er vi ol at ed

cont r act ual , st at ut or y, and common l aw dut i es by f ai l i ng t o pr ovi de

credi t s t o i t s cust omer s f or t hei r l oss of cabl e, i nt er net , and

t el ephone servi ce dur i ng t he st or m. We hol d t hat t he di st r i ct

cour t pr oper l y exer ci sed i t s j ur i sdi ct i on under t he Cl ass Act i on

Fai r ness Act , 28 U. S. C. 1332( d) , but er r ed i n gr ant i ng Char t er ' s

mot i on t o di smi ss. We t her ef or e vacat e i n par t t he di st r i ct

cour t ' s opi ni on and remand f or f ur t her pr oceedi ngs.

I. Background

Except wher e ot her wi se not ed, t he f act s i n t hi s opi ni on

ar e t aken f r om t he pl ai nt i f f s' compl ai nt , wi t h al l r easonabl e

i nf er ences dr awn i n t he pl ai nt i f f s' f avor . See Mal oy v. Bal l or i -

Lage, 744 F. 3d 250, 251 ( 1st Ci r . 2014) . We bear i n mi nd, however ,

t hat i n assessi ng j ur i sdi ct i onal i ssues, we must wei gh t he evi dence

wi t hout f avor i ng ei t her par t y. Val ent i n v. Hosp. Bel l a Vi st a, 254

F. 3d 358, 364 ( 1st Ci r . 2001) .

Pl ai nt i f f s Br uce Cooper , J ohn Romi t o, Roy Baker , and

Whi t ney Tayl or Thompson ar e resi dent s of Massachuset t s who pur chase

cabl e t el evi si on, i nt er net , or t el ephone ser vi ces f r om Char t er .

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The di st r i ct cour t has not yet consi der ed any mot i on f or cl ass

cer t i f i cat i on, so f or now t hey ar e t he onl y pl ai nt i f f s.

Begi nni ng on Oct ober 29, 2011, Massachuset t s exper i enced

a sever e snow st orm t hat damaged t r ees, made t r avel i mpossi bl e on

many roads, and t ook down power and cabl e l i nes. Dur i ng t he st orm,

t he pl ai nt i f f s di d not r ecei ve ser vi ces f r om Char t er , ei t her

because they l ost el ect r i cal power and t her ef or e coul d not use

t el evi si on or i nt er net devi ces, or because Char t er ' s own equi pment

f ai l ed t o pr ovi de servi ce even wher e power was avai l abl e, or due t o

some combi nat i on of t he two.

Cooper , Romi t o, and Baker f i l ed t he compl ai nt i n t hi s

case i n Massachuset t s st at e court on November 22, 2011. Two weeks

l at er , havi ng not yet served t he compl ai nt on Char t er , t he

pl ai nt i f f s' at t or neys sent t he company a demand l et t er seeki ng

r el i ef on behal f of t he t hr ee or i gi nal pl ai nt i f f s and ot her s

si mi l ar l y si t uat ed. Thi s l et t er was l at er i ncor por at ed i nt o t he

pl ai nt i f f s' f i r st amended and second amended compl ai nt s, t he l at t er

of whi ch i s the oper at i ve compl ai nt her e. The demand l et t er

speci f i ed when t he t hr ee cust omer s' servi ces wer e i nt er r upt ed.

Accor di ng t o t he l et t er , f or exampl e, Cooper and Baker l ost servi ce

at 6: 00 pm on Oct ober 29, 2011, and di d not r ecei ve i t agai n unt i l

3: 00 pmon November 7, 2011. As t o Thompson, who was added as t he

f our t h pl ai nt i f f af t er t he demand l et t er was sent , t he r ecor d

cont ai ns no i nf or mat i on r egar di ng when her servi ce was i nt er r upt ed,

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asi de f r om t he al l egat i on i n t he amended compl ai nt t hat her

i nt er r upt i on l ast ed mor e t han t went y- f our consecut i ve hour s.

A mont h af t er r ecei vi ng t he pl ai nt i f f s' demand, Char t er

sent a l et t er t o t hei r at t or neys, i nf or mi ng t hem t hat Char t er had

i ssued cr edi t s t o t he account s of Cooper , Baker , and Romi t o, whi ch

t he company sai d f ul l y compensat ed t hem f or t he t i me they were

wi t hout ser vi ce.

Af t er t he f i r st amended compl ai nt was ser ved on Chart er

i n Febr uary 2012, t he company removed t he case t o f ederal cour t ,

i nvoki ng t he Cl ass Act i on Fai r ness Act . Char t er t hen f i l ed a

mot i on t o di smi ss, assert i ng t hat t he pl ai nt i f f s' cl ai ms wer e moot

and t hat t he compl ai nt f ai l ed t o st at e a cl ai m. See Fed. R. Ci v.

P. 12( b) ( 1) , ( b) ( 6) . The di st r i ct cour t r ul ed t hat r emoval was

pr oper and gr ant ed Char t er ' s mot i on t o di smi ss. The cour t f ound

t hat t he cl ai ms of Cooper , Baker , and Romi t o were moot because t hey

had r ecei ved cr edi t s cover i ng t he t i me they wer e wi t hout servi ce.

The cour t al so f ound t hat , as t o t he f ourt h pl ai nt i f f , Thompson,

t he compl ai nt f ai l ed t o st at e a cl ai m. Thi s appeal f ol l owed.

II. Legal Standard

Thi s case present s t wo t hreshhol d j ur i sdi ct i onal

quest i ons: whet her t he di st r i ct cour t had subj ect mat t er

j ur i sdi ct i on under t he Cl ass Act i on Fai r ness Act and whet her t he

pl ai nt i f f s' cl ai ms ar e moot . We r evi ew bot h quest i ons de novo.

See Amoche v. Guar ant ee Tr ust Li f e I ns. Co. , 556 F. 3d 41, 48 (1st

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Ci r . 2009) ; Ander son ex rel . Dowd v. Ci t y of Bost on, 375 F. 3d 71,

80 ( 1st Ci r . 2004) . However , wher e t he di st r i ct cour t ' s assessment

of a j ur i sdi ct i onal i ssue t ur ns on f i ndi ngs of f act , we accept

t hose f i ndi ngs unl ess t hey ar e cl ear l y er r oneous. Amoche, 556 F. 3d

at 48; Val ent i n v. Hosp. Bel l a Vi st a, 254 F. 3d 358, 365 ( 1st Ci r .

2001) .

As t o Char t er ' s mot i on t o di smi ss f or f ai l ur e t o st at e a

cl ai m, we al so r evi ew de novo. Mal oy v. Bal l or i - Lage, 744 F. 3d

250, 252 ( 1st Ci r . 2014) . We ask "whet her t he compl ai nt ' st at e[ s]

a cl ai m t o r el i ef t hat i s pl ausi bl e on i t s f ace, ' accept i ng t he

pl ai nt i f f ' s f actual al l egat i ons and dr awi ng al l r easonabl e

i nf er ences i n t he pl ai nt i f f ' s f avor . " I d. ( quot i ng Bel l At l . Cor p.

v. Twombl y, 550 U. S. 544, 570 ( 2007) ) . "To cr oss t he pl ausi bi l i t y

t hr eshhol d, t he pl ai nt i f f must ' pl ead[ ] f actual cont ent t hat al l ows

t he cour t t o dr aw t he reasonabl e i nf er ence t hat t he def endant i s

l i abl e f or t he mi sconduct al l eged. ' " I d. ( quot i ng Ashcrof t v.

I qbal , 556 U. S. 662, 678 ( 2009) ) .

III. Analysis

A. Jurisdiction under the Class Action Fairness Act

Char t er i nvokes f eder al j ur i sdi ct i on under t he Cl ass

Act i on Fai r ness Act . The Act gr ant s j ur i sdi ct i on t o f eder al cour t s

t o hear st at e- l aw cl ass act i ons i f t her e i s mi ni mal di ver si t y of

ci t i zenshi p bet ween t he par t i es, as t he par t i es agr ee t her e i s

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her e, and t he amount i n cont r over sy exceeds f i ve mi l l i on dol l ar s. 1

28 U. S. C. 1332( d) ( 2) . Her e, al t hough a cl ass has not been

cer t i f i ed, t he di st r i ct cour t pr oper l y t r eat ed t he compl ai nt as

asser t i ng a cl ass act i on, and t her ef or e went on t o consi der t he

si ze of t he pr oposed cl ass and t he pot ent i al r ecover y. See Col l ege

Of Dent al Sur geons Of Puer t o Ri co v. Connect i cut Gen. Li f e I ns.

Co. , 585 F. 3d 33, 40 ( 1st Ci r . 2009) ( "CAFA . . . appl i es ' t o any

cl ass acti on bef or e or af t er t he ent r y of a cl ass cer t i f i cat i on

or der by t he cour t wi t h r espect t o t hat act i on. ' " ( quot i ng 28

U. S. C. 1332( d) ( 8) ) ) . The par t y asser t i ng j ur i sdi ct i on bear s t he

bur den t o show wi t h a " r easonabl e pr obabi l i t y" t hat t he amount i n

cont r over sy r equi r ement i s sat i sf i ed. Amoche v. Guarant ee Trust

Li f e Co. , 556 F. 3d 41, 48- 49 ( 1st Ci r . 2009) .

The par t i es agr ee t hat f or pur poses of cal cul at i ng t he

amount i n cont r over sy, t he pl ai nt i f f s seek at l east $75 f or each

member of t he pr oposed cl ass. The part i es al so agr ee t hat

appr oxi matel y 95, 000 Chart er cust omers l ost power dur i ng t he st orm.

The company provi ded t hat est i mat e i n an af f i davi t , and t he

pl ai nt i f f s t hen i ncor por at ed t he f i gur e i nt o t hei r own compl ai nt ,

char act er i zi ng i t as a mi ni mum number of af f ect ed cust omer s. The

compl ai nt asser t s t hat al l of t hese cust omer s f ai l ed t o r ecei ve

1 The di ver si t y r equi r ement , whi ch i s not at i ssue her e,r equi r es at l east one pl ai nt i f f t o be a ci t i zen of a di f f er entst at e t han at l east one def endant , subj ect t o cer t ai n except i ons.See 28 U. S. C. 1332( d) ( 2) , ( 4) , ( 5) , and ( 9) .

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ser vi ces f r omChar t er , and t he pl ai nt i f f s have of f er ed no r eason t o

excl ude any of t hose af f ect ed f r om t hei r pr oposed cl ass.

Wi t h a put at i ve cl ass of at l east 95, 000 peopl e, and

possi bl e damages of at l east $75 per cl ass member , t he amount i n

cont r over sy i s at l east $7, 125, 000. The di st r i ct cour t ' s exer ci se

of j ur i sdi ct i on was t her ef or e pr oper .

B. Mootness

Char t er cont ends t hat t he cl ai ms of Cooper , Baker , and

Romi t o became moot when, af t er t hi s sui t was f i l ed, t hey accept ed

cr edi t s pr opor t i onal t o the t i me t hey wer e wi t hout ser vi ce. 2 There

i s no di sput e t hat Thompson' s cl ai ms r emai n l i ve.

The di sput e bet ween t he pl ai nt i f f s and Char t er f ocuses on

whet her and when Char t er must pr ovi de a cr edi t or r ebate to any

subscr i ber whose ser vi ce i s i nt er r upt ed. The pl ai nt i f f s say t hat

t he ser vi ce out ages i n Oct ober and November of 2011 t r i ggered a

dut y t o pr ovi de cr edi t s or r ebates under Mass. Gen. Laws ch. 166A,

5(l) , and under Char t er ' s l i censi ng agr eement s. I mpor t ant l y,

t hey al so cl ai mt hat Char t er was obl i gat ed t o pr ovi de t hose r ebat es

or cr edi t s t o each af f ect ed cust omer wi t hout wai t i ng t o f i r st

r ecei ve a r equest f r om t hat cust omer . Char t er r ej ect s bot h

cont ent i ons.

2 Char t er pr esent s i t s ar gument as a cl ai mof moot ness r at hert han a chal l enge under t he r el at ed doct r i ne of st andi ng, achar act er i zat i on we accept because Char t er di d not gi ve t hepl ai nt i f f s a cr edi t unt i l wel l af t er t hi s l awsui t was f i l ed. SeeRam r ez v. Snchez Ramos, 438 F. 3d 92, 97 (1st Ci r . 2006) .

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Yet , t he pl ai nt i f f s have not cont est ed t hat Cooper ,

Baker , and Romi t o accept ed cr edi t s f r omChar t er pr opor t i onal t o t he

t i me t hey wer e wi t hout ser vi ce. And al t hough t he pl ai nt i f f s al l ude

t o t he exi st ence of other t ypes of damages t hey mi ght have

suf f er ed, t hey f ai l t o i dent i f y any such damages, even by t ype or

cat egor y. I n shor t , t he i ndi vi dual damages cl ai ms of t hese t hr ee

put at i ve cl ass r epr esent at i ves wer e f ul l y sat i sf i ed af t er t hey

f i l ed t hi s act i on. Consequent l y, t hey al so may not r ecei ve

st at ut or y or t r ebl e damages under t he Massachuset t s unf ai r busi ness

pr act i ces l aw, whi ch makes such r el i ef avai l abl e onl y wher e a

def endant has f ai l ed t o of f er a set t l ement " r easonabl e i n r el at i on

t o t he i nj ur y act ual l y suf f er ed. " See Mass. Gen. Laws ch. 93A,

9(3). 3

Wer e t he t hr ee or i gi nal pl ai nt i f f s seeki ng onl y monet ar y

damages, and wer e Thompson not j oi ned as a pl ai nt i f f , t he f or egoi ng

chr onol ogy woul d pr esent compl i cat ed i ssues of st andi ng and

moot ness i n t he cont ext of a put at i ve cl ass act i on. See, e. g. ,

Genesi s Heal t hcare Corp. v. Symczyk, 133 S. Ct . 1523, 1529- 32

( 2013) ( anal yzi ng t he vi abi l i t y of a col l ect i ve act i on under t he

3 The pl ai nt i f f s do not cont est t hat Char t er compl i ed wi t h

t he f ormal r equi r ement s f or a set t l ement under Chapt er 93A when i tcr edi t ed t hei r account s and i nf or med t hem i n wr i t i ng t hat i t haddone so. Whet her t he pl ai nt i f f s may be abl e t o r ecover at l eastpar t i al at t or neys' f ees and cost s under t he Massachuset t s unf ai rbusi ness pract i ces l aw, see Mass. Gen. Laws ch. 93A, 9( 4) , wel eave t o t he di st r i ct cour t t o consi der i f and when t he t i me i sr i ght .

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Fai r Labor St andar ds Act , af t er assumi ng t hat t he pl ai nt i f f ' s

i ndi vi dual damages cl ai m was moot ) . I n t hi s case, t hough, t he

pl ai nt i f f s al so seek a decl ar at i on t hat Massachuset t s l aw and

Char t er ' s l i censi ng agr eement s r equi r e t he company t o pay credi t s

wi t hout r equest . See 28 U. S. C. 2201 ( al l owi ng f eder al cour t s t o

i ssue decl ar at or y r el i ef ) . Char t er avows no agr eement wi t h t he

pl ai nt i f f s' i nt er pr et at i on of Char t er ' s dut i es under ei t her

Massachuset t s l aw or under the l i censi ng agr eement s. I ndeed,

Char t er has made cl ear t hat i t gave cr edi t s t o t he pl ai nt i f f s under

a pol i cy i t adopt ed "vol unt ar i l y, " whi ch was l i mi t ed t o t hi s st or m,

and whi ch, accor di ng t o Char t er , "exceed[ ed] r equi r ement s under t he

l aw. "

Char t er al so f ai l s t o ar gue t hat t he r equest f or

decl ar at or y r el i ef i s i t sel f ei t her moot or unr i pe. Nor woul d i t

appear unl i kel y t hat t he New Engl and weat her wi l l pr oduce another

sever e wi nt er st or m, as evi denced by t he f act t hat Massachuset t s

passed a l aw t o addr ess t he si t uat i on i n t he f i r st pl ace. I n t hese

ci r cumst ances, we f i nd t he di sput e bet ween t he pl ai nt i f f s and

Char t er about t he ext ent of Char t er ' s dut i es t o t he pl ai nt i f f s

under Massachuset t s l aw and i t s l i censi ng agr eement s t o be l i ve and

pr oper f or j udi ci al consi der at i on. See Al r eady, LLC v. Ni ke, I nc. ,

133 S. Ct . 721, 727 ( 2013) ( hol di ng t hat a def endant "bear s t he

f or mi dabl e bur den of showi ng t hat i t i s absol ut el y cl ear t he

al l egedl y wr ongf ul behavi or coul d not r easonabl y be expect ed t o

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r ecur " when i t cl ai ms t hat i t s own vol unt ary conduct has made a

pl ai nt i f f ' s cl ai mmoot ( i nt er nal quot at i on mar ks omi t t ed) ) ; Knox v.

Ser vi ce Empl oyees I nt ' l Uni on, Local 1000, 132 S. Ct . 2277, 2287

( 2012) ( f i ndi ng no moot ness where the def endant uni on had of f ered

a f ul l r ef und of money t he pl ai nt i f f s cl ai med was col l ect ed

unl awf ul l y because " t he uni on cont i nue[ d] t o def end t he l egal i t y"

of i t s act i on, maki ng i t "not cl ear why the uni on woul d necessar i l y

r ef r ai n f r om col l ect i ng s i mi l ar f ees i n t he f ut ur e") . 4

Al l f our pl ai nt i f f s t her ef or e may pur sue t hei r unr equi t ed

r equest s f or decl ar at or y r el i ef r egar di ng t hei r pr esent di sput e

wi t h Char t er over t he nat ur e of i t s obl i gat i ons t o t hem. And

Thompson has an unsat i sf i ed damages cl ai m t o pur sue as wel l .

C. Failure to State a Claim

Each of t he pl ai nt i f f s' cl ai ms ar i ses under Massachuset t s

st atut ory or common l aw, and so we l ook t o t hat l aw i n assessi ng

t he pl ausi bi l i t y of t hei r cl ai ms. See Dai gl e v. Mai ne Med. Ct r . ,

I nc. , 14 F. 3d 684, 689 ( 1st Ci r . 1994) .

4 I n t hese r espect s, t hi s case i s easi l y di st i ngui shabl e f r omAmer i can Ci vi l Li ber t i es Uni on of Massachuset t s v. Uni t ed St at esConf er ence of Cat hol i c Bi shops, 705 F. 3d 44 ( 1st Ci r . 2013) , on

whi ch t he di st r i ct cour t r el i ed. Ther e, t he pl ai nt i f f s sought adecl ar at i on t hat a gover nment cont r act vi ol at ed t he Est abl i shmentCl ause, but t he cont r act had al r eady expi r ed and had been r epl aced,so t he cour t coul d "saf el y assume t hat f or t he f or eseeabl e f ut ur et he chal l enged cont r act t er ms wi l l not r ecur . " I d. at 56.

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Wi t h one except i on, t he pl ai nt i f f s' cl ai ms r evol ve ar ound

a pr ovi si on i n Massachuset t s l aw r equi r i ng t hat :

I n t he event a l i cense i s i ssued [ t o pr ovi de cabl eser vi ce] , each l i censee shal l agr ee t o t he f ol l owi ng:

. . . ( l) I n t he event i t s ser vi ce t o any subscr i ber i si nt er r upt ed f or t went y- f our or mor e consecut i ve hour s, i twi l l gr ant such subscr i ber a pr o r at a credi t or r ebat e.

Mass. Gen. Laws ch. 166A, 5.

Char t er has i ndeed i ncl uded such l anguage i n i t s

l i censi ng agr eement s, al most ver bat i m, al bei t wi t h the pr esumabl y

r easonabl e l i mi t i ng gl oss t hat cr edi t s or r ebat es need be pr ovi ded

onl y when " t he i nt err upt i on was not caused by t he Subscr i ber and

t he Li censee knew or shoul d have known of t he servi ce

i nt er r upt i on. "

The par t i es di sput e how t o i nt er pret t he st at ute' s

l anguage, and t hus t he near l y i dent i cal l anguage of t he l i censi ng

agr eement s. Char t er assert s t hat t he st at ut or i l y- mandat ed l anguage

onl y r equi r es t he company t o pr ovi de credi t s or r ebat es t o

subscr i ber s who ask f or t hem. We r ej ect t hi s cl ai mas i nconsi st ent

wi t h t he st at ut e' s act ual l anguage. The l anguage i mposes no such

l i mi t at i on, i nst ead f l at l y i mposi ng a dut y t o pr ovi de a credi t or

r ebat e t o any subscr i ber whose servi ce i s i nt er r upt ed f or

suf f i ci ent dur at i on. Char t er never t hel ess cl ai ms t hat t he

l egi sl at ur e woul d have used t he pl ur al f or m, "subscr i ber s, " r at her

t han t he t er m "any subscr i ber , " i f i t i nt ended cabl e pr ovi der s t o

gi ve credi t s t o al l subscr i ber s who l ost ser vi ce. Char t er does not

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ci t e any l egal pr ecedent , nor any gr ammat i cal r ul e, t o suppor t i t s

ar gument , and we f i nd i t i l l ogi cal : t he st at ut e' s l anguage pl ai nl y

appl i es wi t hout l i mi t at i on t o al l subscr i ber s who l ose ser vi ce f or

t went y- f our hour s or mor e, j ust as a r ul e pr ohi bi t i ng "any per son"

l ess t han t hi r t y- f i ve year s ol d f r ombecomi ng pr esi dent appl i es t o

al l such peopl e despi t e i t s use of t he si ngul ar wor d "per son. " See

U. S. Const . ar t . I I , 1, cl . 4. Si mi l ar l y, we see no basi s f or

Char t er ' s cl ai m t hat t he l egi sl at ur e woul d have used t he t er m

"aut omat i c" i f i t i nt ended cabl e pr ovi der s t o gr ant r ef unds t o al l

subscr i ber s who l ost ser vi ce. Al t hough i ncl usi on of t hat wor d i n

t he st at ut e woul d have pr ovi ded bel t - and- suspender s suppor t f or our

concl usi on, i t does not f ol l ow t hat t he wor d' s absence l eads us t o

di sr egar d t he cl ear meani ng of t he wor ds t he l egi sl at ur e act ual l y

used.

Even t he i mpl i ci t l i mi t at i on made expr ess i n Char t er ' s

agr eement - - t hat Char t er knows or shoul d have known of t he

i nt er r upt i on - - i s not so l i mi t ed as t o appl y onl y when Char t er ' s

knowl edge ar i ses f r oma consumer compl ai nt or r equest . I f Char t er

knows, f or exampl e, t hat i t i s not t r ansmi t t i ng t o an ent i r e ar ea

because one of i t s own f aci l i t i es i s not passi ng al ong a si gnal , we

can concei ve of no r eason why the Massachuset t s l egi sl atur e woul d

have i nt ended - - but not wr i t t en i nt o t he st at ut e - - a r equi r ement

t hat subscr i ber s i n t hat ar ea must communi cat e t o Char t er what i t

al r eady knows or shoul d know i n or der t o r ecei ve a cr edi t .

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Of cour se we do not know - - or suggest - - t hat Char t er

f ai l ed t o pr ovi de a credi t or r ebat e t o subscr i ber s whom i t knew

( or shoul d have known) suf f er ed a servi ce i nt er r upt i on f or t went y-

f our or mor e hour s. Al so not r ai sed by t hi s appeal i s when exact l y

ser vi ce i s "i nt er r upt ed" under t he st at ut e. 5 On a r evi ew of

di smi ssal of t hi s compl ai nt under Rul e 12( b) ( 6) , r at her , we assume

t hat pl ai nt i f f s suf f er ed a cover ed ser vi ce i nt er r upt i on, of whi ch

Char t er was awar e, si mpl y because i t i s pl ausi bl y al l eged.

We t heref ore assume t hat Chart er has conduct ed i t sel f and

i s cur r ent l y asser t i ng a r i ght t o cont i nue conduct i ng i t sel f i n a

manner t hat we f i nd t o be vi ol at i ve of t he l i censi ng t er m t hat

Massachuset t s' l egi sl at ur e vi ewed as suf f i ci ent l y i mpor t ant as t o

be a r equi r ed t er m of al l such l i censi ng agr eement s. The quest i on

i s whet her pl ai nt i f f s can mai nt ai n a pr i vat e cause of act i on as a

r esul t of t hi s assumed br each. We now anal yze t hat quest i on,

bear i ng i n mi nd t hat t he f ol l owi ng di scussi on, t o t he ext ent i t

consi der s cl ai ms f or damages, appl i es onl y to pl ai nt i f f Thompson.

1. Contract Claims

The pl ai nt i f f s cont end t hat t hey can sue as t hi r d- par t y

benef i ci ar i es t o enf or ce t he l i censi ng agr eement s i ncor por at i ng t he

st at ut or y mandat e. Under Massachuset t s l aw, t o pr evai l on a t hi r d-

5 Char t er ar gues as a mat t er of f act t hat t he pl ai nt i f f s'ser vi ce i nt er r upt i on was out si de i t s cont r ol , and as a mat t er ofl aw t hat i t was t her ef or e not obl i gat ed t o pr ovi de cr edi t s. Ast hi s appeal pr ovi des no occasi on t o f i nd f act s, we al so expr ess novi ew what soever on Char t er ' s prof f er ed r eadi ng of t he l aw.

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par t y benef i ci ar y cl ai m, a pl ai nt i f f must est abl i sh t hat t he

" l anguage and ci r cumst ances of t he cont r act show t hat t he par t i es

t o t he cont r act cl ear l y and def i ni t el y i nt ended t he benef i ci ar y t o

benef i t f r omt he pr omi sed per f or mance. " Cumi s I ns. Soc' y, I nc. v.

BJ ' s Whol esal e Cl ub, I nc. , 455 Mass. 458, 466 ( 2009) ( i nt er nal

quot at i on mar ks, al t er at i ons omi t t ed) . Because gover nment

cont r act s by t hei r ver y nat ur e t end t o benef i t t he publ i c,

Massachuset t s cour t s appl y a pr esumpt i on agai nst f i ndi ng t hi r d-

par t y l i abi l i t y i n assessi ng t hose cont r act s, over come onl y wher e

t he l anguage and ci r cumst ances of t he cont r act make i t par t i cul ar l y

cl ear t hat t he par t i es i nt ended member s of t he publ i c t o possess

enf orcement power. See MacKenzi e v. Fl agst ar Bank, FSB, 738 F. 3d

486, 491 ( 1st Ci r . 2013) ( appl yi ng Massachuset t s l aw) . I n

assessi ng at t empt s by t hi r d par t i es t o enf or ce gover nment

cont r act s, we pay speci al heed t o " [ t ] he di st i nct i on bet ween an

i nt ent i on t o benef i t a t hi r d par t y and an i nt ent i on t hat t he t hi r d

par t y shoul d have t he r i ght t o enf or ce t hat i nt ent i on, " wi t h onl y

t he l at t er suppor t i ng t hi r d- par t y enf or cement . 9 J . Mur r ay, Cor bi n

on Cont r act s 45. 6, p. 92 ( r ev. ed. 2007) ( quot ed i n Laguer v.

OneWest Bank, FSB, 2013 WL 831055, at *11 ( Mass. Super . Feb. 27,

2013) ) .

Her e, t he pl ai nt i f f s submi t t ed wi t h t hei r compl ai nt a

copy of one l i censi ng agr eement between Char t er and a Massachuset t s

muni ci pal i t y. We wi l l assume f or t he pur poses of t hi s opi ni on t hat

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t he agr eement i s i dent i cal i n al l mat er i al r espect s t o any ot her

l i censi ng agr eement , wi t h a di f f er ent muni ci pal i t y, t hat mi ght

appl y t o t he pl ai nt i f f s' cl ai ms. The cont r act r equi r es Char t er t o

"gr ant a pr o r at a cr edi t or r ebat e t o any Subscr i ber whose ent i r e

Cabl e Ser vi ce i s i nt er r upt ed f or t went y- f our ( 24) or mor e

consecut i ve hour s, i f t he i nt er r upt i on was not caused by the

Subscr i ber and the Li censee knew or shoul d have known of t he

ser vi ce i nt er r upt i on. " The pl ai nt i f f s ar e cor r ect t hat thi s

pr ovi si on seems i nt ended to benef i t cabl e cust omer s such as

t hemsel ves, and t he cont r act r equi r es Char t er t o make payment

di r ect l y t o t hose cust omer s, l endi ng suppor t t o t hei r cl ai m. See

Pub. Serv. Co. of New Hampshi r e v. Hudson Li ght & Power Dep' t , 938

F. 2d 338, 342 ( 1st Ci r . 1991) . The cont r act pr ovi si on t hus

r esembl es t he i l l ust r at i on of f er ed by t he Second Rest at ement of

Cont r act s of a gover nment cont r act t hat does cr eat e enf or ceabl e

r i ght s i n t hi r d par t i es: "A, a muni ci pal i t y, ent er s i nt o a cont r act

wi t h B, by whi ch B promi ses t o bui l d a subway and t o pay damages

di r ect l y t o any person who may be i nj ur ed by t he work of

const r uct i on. " Rest at ement ( Second) of Cont r act s 313 i l l us. 3

( 1981) ; see al so MacKenzi e, 738 F. 3d at 491 ( r el yi ng on t hi s

sect i on of t he rest at ement i n appl yi ng Massachuset t s l aw) .

We ar e never t hel ess persuaded by t he l anguage of t he

cont r act as a whol e t hat t he par t i es di d not i nt end i ndi vi dual s t o

hol d power t o enf or ce i t . The cont r act i ncl udes a separ at e sect i on

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t hat spel l s out i n det ai l how t he cont r act can be enf or ced.

Accor di ng t o t he cont r act , t he muni ci pal i t y may seek speci f i c

per f or mance, monet ar y damages, or r evocat i on of t he l i cense. I t

must f i r st not i f y Char t er of an al l eged br each, t hen wai t t hi r t y

days f or Char t er t o ei t her cur e the def aul t or expl ai n why i t f eel s

no cur e i s r equi r ed. I f t he muni ci pal i t y i s not sat i sf i ed, i t must

schedul e a publ i c hear i ng at whi ch Char t er may of f er evi dence.

Onl y af t er t hose r equi r ement s have been f ul f i l l ed may t he

muni ci pal i t y pur sue a r emedy. Where t he part i es have pr ovi ded such

speci f i c and el abor at e pr ocedur es as pr er equi si t es t o enf or cement ,

we cannot t r eat t he pl ai nt i f f s' at t empt t o ci r cumvent t hose

pr ocedur es as consi st ent wi t h t he par t i es' i nt ent . 6

We not e t hat t he di smi ssal of t he pl ai nt i f f s' t hi r d- par t y

benef i ci ar y cl ai m does not depr i ve t hem of any oppor t uni t y f or

r el i ef under t he l i censi ng agr eement . Rat her , i n si t uat i ons i n

whi ch an el ect ed l ocal gover nment hol ds enf or cement power , ci t i zens

can seek recour se by act i ng t hr ough t he pol i t i cal pr ocess t o cause

t he muni ci pal i t y t o seek a r emedy i n t he f or m of credi t s f or al l

af f ect ed consumers. But because t he agr eement her e cannot

6 Al t hough nei t her par t y ci t es Ast r a USA, I nc. v. Sant a Cl ar a

Count y, Cal i f or ni a, 131 S. Ct . 1342 ( 2011) , i t pr ovi des f ur t hersuppor t f or our deci si on. See i d. at 1347 ( r ej ect i ng under f eder alcommon l aw an at t empt by a thi r d par t y t o enf or ce a gover nmentcont r act wher e t he cont r act i ncor por at ed st at ut or y obl i gat i ons, andsui t s by t hi r d par t i es "woul d under mi ne t he [ gover nment ' s] ef f or t s"t o enf or ce t he obl i gat i ons "har moni ousl y and on a uni f or m . . .bas i s") .

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pl ausi bl y suppor t a t hi r d- par t y benef i ci ar y cl ai m, t he pol i t i cal

pr ocess i s t he pl ai nt i f f s' onl y r ecour se t o secur e enf or cement of

t he agreements qua agreements.

The pl ai nt i f f s' compl ai nt al so al l eges breach of

"cont r act s and/ or i mpl i ed cont r act s" bet ween t he i ndi vi dual

pl ai nt i f f s and Char t er . I t appear s t hat t hey r ef er her e not t o any

expr ess cont r act but i nst ead t o an i mpl i ed cont r act t hat ar ose when

t hey made advance payment f or Char t er ' s ser vi ces. They have not

made anythi ng ot her t han a per f unct or y ef f or t t o def end such a

cl ai m on appeal , and so we af f i r m i t s di smi ssal . Fi nal l y, t he

pl ai nt i f f s' cl ai m f or br each of t he dut y of good f ai t h and f ai r

deal i ng f ai l s because, f or t he reasons we have descr i bed above, t he

pl ai nt i f f ' s compl ai nt does not est abl i sh any cont r act ual

r el at i onshi p between t hemand Char t er . See MacKenzi e, 738 F. 3d at

493.

2. The Massachusetts Unfair and Deceptive Trade Practices

Statute

Al t hough t hi r d- par t y benef i ci ar y pr i nci pl es pr ovi de no

basi s on whi ch t he pl ai nt i f f s can sue Char t er f or br each of i t s

pr omi se t o muni ci pal i t i es, Massachuset t s' l egi sl at ur e has pr ovi ded

an al t er nat i ve pat h t o a si mi l ar dest i nat i on, wi t hout r equi r i ng any

i nqui r y i nt o common l aw not i ons of i nt ended benef i ci ar i es.

Speci f i cal l y, Chapt er 93A of t he Massachuset t s code aut hor i zes

consumer s t o sue f or " [ u] nf ai r met hods of compet i t i on and unf ai r or

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decept i ve act s or pr act i ces i n t he conduct of any t r ade or

commerce. " Mass. Gen. Laws ch. 93A, 2( a) .

I n consi der i ng whet her a par t i cul ar act or pr act i ce

vi ol at es t he unf ai r ness pr ong of Chapt er 93A, Massachuset t s cour t s

assess: " ( 1) whet her t he pr act i ce i s wi t hi n at l east t he penumbr a

of some common- l aw, st at ut or y, or ot her est abl i shed concept of

unf ai r ness; ( 2) whet her i t i s i mmor al , unet hi cal , oppr essi ve, or

unscr upul ous; and ( 3) whet her i t causes subst ant i al i nj ur y t o

consumers ( or compet i t ors or ot her busi nessmen) . " Massachuset t s

Eye & Ear I nf i r mar y v. QLT Phot ot her apeut i cs, I nc. , 412 F. 3d 215,

243 ( 1st Ci r . 2005) ( quot i ng PMP Assocs. , I nc. v. Gl obe Newspaper

Co. , 366 Mass. 593, 596 ( 1975) ) ( i nt er nal al t er at i ons omi t t ed) .

For t he pr act i ce t o f al l wi t hi n t he penumbr a of a st at ut e' s concept

of unf ai r ness, i t need not actual l y vi ol at e t he st at ut e.

Ot herwi se, t here woul d have been no need f or t he Massachuset t s

Supr eme J udi ci al Cour t t o r ef er t o penumbr as. Cf . Kat t ar v.

Demoul as, 433 Mass. 1, 12- 13 ( 2000) ( hol di ng that Chapt er 93A

"makes conduct unl awf ul whi ch was not unl awf ul under t he common l aw

or any pr i or st at ut e" ( i nt er nal al t er at i on omi t t ed) ) . Fur t her mor e,

because " t her e i s no l i mi t t o human i nvent i veness i n t hi s f i el d, "

Massachuset t s cour t s eval uat e unf ai r and decept i ve t r ade pr act i ce

cl ai ms based on t he ci r cumst ances of each case. I d. at 13

( i nt er nal quot at i on mar ks, al t er at i on omi t t ed) . I n gener al , t he

eval uat i on of what const i t ut es an unf ai r t r ade pr act i ce i s f or t he

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f i nder of f act , subj ect t o t he cour t ' s per f or mance of a l egal gat e-

keepi ng f unct i on. Mi l l i ken & Co. v. Dur o Text i l es, LLC, 451 Mass.

547, 563 ( 2008) .

A r ecent deci si on by the Massachuset t s Supr eme J udi ci al

Cour t makes cl ear t hat a f ai l ur e by Char t er t o pay a cr edi t i n

accor d wi t h i t s st at ut or i l y- i mposed cont r act ual obl i gat i on woul d

l i kel y vi ol at e Chapt er 93A. See Casavant v. Nor wegi an Cr ui se Li ne

Lt d. , 460 Mass. 500, 504 ( 2011) . I n Casavant , a st at e r egul at i on

r equi r ed sel l er s of t r avel ser vi ces t o di scl ose r ef und pol i ci es t o

consumer s. I d. The r egul at i ons f ur t her pr ovi ded t hat , shoul d a

sel l er f ai l t o di scl ose i t s r ef und pol i cy t o a cust omer who had

pur chased servi ces, t he cust omer coul d cancel hi s or her cont r act

and r ecei ve a f ul l r ef und. I d. Anal yzi ng a crui se l i ne' s f ai l ur e

t o pr ovi de a r ef und i n accor dance wi t h t hese regul at i ons,

Massachuset t s' hi ghest cour t f ound such a cl ear vi ol at i on of

Chapt er 93A t hat i t r ever sed a cont r ar y concl usi on by t he

f actf i nder . I d. at 504- 05.

To be sure, t hi s case di f f er s f r om Casavant i n t hat no

r egul at i on l i t er al l y r equi r ed t hat Char t er pr ovi de credi t s t o

consumer s. Rat her , a r egul at i on r equi r ed Char t er t o pr omi se i t

woul d do so i n speci f i ed ci r cumst ances. But act ual l y pr ovi di ng a

credi t i s cer t ai nl y wi t hi n at l east t he penumbr a of t he st at ut or y

mandat e t hat Char t er promi se t o pr ovi de cr edi t s. Why, af t er al l ,

woul d t he l egi sl at ur e have requi r ed Char t er t o pr omi se t o pay i f i t

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di d not i nt end f or Char t er t o do so? And i f Char t er br eached such

a pr omi se, i t caused pr eci sel y t he i nj ur y t o consumer s t hat t he

l egi sl at ur e sought t o avoi d. Whether such a br each vi ol at ed 93A as

a mat t er of l aw, as i n Casavant , we need not deci de at t hi s st age.

We need onl y deci de whether t he al l eged conduct pl ausi bl y makes out

a Chapt er 93A cl ai m. I t most cer t ai nl y does.

We acknowl edge t hat t hi s concl usi on seems at f i r st bl ush

at odds wi t h our concl usi on r egar di ng t he t hi r d par t y benef i ci ar y

cl ai m. Any such appearance i s mi sl eadi ng. To t he extent a dut y i s

mer el y cr eat ed by cont r act , i t makes sense t hat Massachuset t s l aw

woul d l eave i t t o t he cont r act i ng par t i es t o deci de who can enf or ce

i t . To t he ext ent t hat t he dut y al so emanat es f r om a l egi sl at i ve

j udgment t hat i t r ef l ect s f ai r t r eatment of cust omer s, however , t he

st at e l egi sl at ur e by enact i ng Chapt er 93A has opt ed t o l et

consumer s seek r el i ef i n cour t . I n shor t , t he Massachuset t s

l egi sl at ur e cr eat ed t wo pot ent i al causes of act i on i n t he event of

a br each by Char t er : an act i on f or br each of cont r act , and an

act i on under Chapt er 93A, each subj ect t o di f f er ent pr ocedur es and

r emedi es. The f act t hat Massachuset t s, l i ke ot her st at es, al l ows

t he cont r act i ng par t i es t o deci de who can mai nt ai n an act i on f or

br each of t he cont r act does not mean that Massachuset t s has al l owed

t he cont r act i ng par t i es t o t ake away the consumer s' r i ght s under

Chapter 93A.

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3. Unjust Enrichment, Money Had and Received

Fi nal l y, t he pl ai nt i f f s' compl ai nt asser t s cl ai ms f or

unj ust enr i chment and money had and recei ved based on t hei r own

i ndi vi dual deal i ngs wi t h Char t er . 7 Bot h cl ai ms r est on t he not i on

t hat Char t er unf ai r l y benef i t ed by col l ect i ng money f r om t he

pl ai nt i f f s f or ser vi ces not actual l y r ender ed.

Char t er ' s onl y pr eserved ar gument agai nst t hese cl ai ms

i s t hat "an expr ess cont r act gover ns t he r el at i onshi p bet ween t he

Pl ai nt i f f s and Char t er , " pr ecl udi ng any quasi - cont r act cl ai m. 8

Char t er i s cor r ect t hat damages f or br each of cont r act and unj ust

enr i chment ar e mut ual l y excl usi ve. See Pl at t en v. HG Bermuda

Exempt ed Lt d. , 437 F. 3d 118, 130 ( 1st Ci r . 2006) ( "Massachuset t s

l aw does not al l ow l i t i gant s t o over r i de an expr ess cont r act by

ar gui ng unj ust enr i chment . ") . Never t hel ess, i t i s gener al l y

per mi ssi bl e t o pur sue al t er nat i ve t heor i es at t he pl eadi ng st age.

See Fed. R. Ci v. P. 8( d) . And, i n any event , we cannot det er mi ne

7 We have descr i bed t hese causes of act i on as "ver y cl ose i ncharacter - - one root ed i n common l aw and the ot her equi t yj ur i sprudence. " J el mol i Hol di ng, I nc. v. Raymond J ames Fi n.Ser vs. , I nc. , 470 F. 3d 14, 21 ( 1st Ci r . 2006) . Thei r el ement s ar eas f ol l ows: "Money had and r ecei ved i s based on money, or i t sequi val ent , whi ch i n equi t y and good consci ence shoul d be ret ur nedt o the cl ai mant and i s of t en st yl ed as money t hat shoul d ber et ur ned wher e one i s unj ust l y enr i ched at anot her ' s expense.

Unj ust enr i chment i s an equi t abl e cl ai mwi t h t he same el ement s savet hat i t i s not l i mi t ed t o enr i chment by money, or i t s equi val ent . "I d. at 17 n. 2 ( i nt er nal ci t at i ons and quot at i on mar ks omi t t ed) .

8 Because i t was not r ai sed bel ow, we wi l l not consi derChar t er ' s al t er nat i ve ar gument t hat t he cl ai ms ar e "def i ci ent f orl ack of suf f i ci ent pl eadi ng. "

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at t hi s st age of t he case whet her Char t er i s cor r ect t hat an

expr ess cont r act bet ween t he par t i es exi st s. I n assessi ng a mot i on

t o di smi ss, we f ocus nar r owl y on t he pl ai nt i f f s' compl ai nt al ong

wi t h any i ncor por at ed document s. The pl ai nt i f f s say t hat t hei r

compl ai nt shoul d not be i nt er pr et ed as r ai si ng any cl ai m based on

a cont r act between t hemand Chart er , and t he compl ai nt undi sput edl y

di d not i ncor por at e any such cont r act , i ncl udi ng t he sever al f or mal

cont r act s t hat Char t er l at er submi t t ed. Al t hough we suspect t hat

t her e i s i ndeed an expr ess cont r act bet ween t he par t i es t hat wi l l ,

by i t s exi st ence, f or ecl ose a cl ai m f or unj ust enr i chment , we

si mpl y cannot say now t hat i t i s i mpl ausi bl e to thi nk ot her wi se. 9

Consequent l y, we decl i ne t o f i nd t hat t he pl ai nt i f f s'

compl ai nt f or ecl oses t hei r quasi - cont r act cl ai ms.

IV. Conclusion

For t he r easons out l i ned above, we af f i r m t he di st r i ct

cour t ' s exer ci se of j ur i sdi ct i on under t he Cl ass Act i on Fai r ness

Act but vacat e t he di st r i ct cour t ' s gr ant of Char t er ' s mot i on t o

di smi ss under Feder al Rul es of Ci vi l Pr ocedur e 12( b) ( 1) and

12( b) ( 6) . Cost s ar e t axed agai nst t he appel l ees.

So order ed.

9 Rul es 26( f ) ( 3) ( B) and 56 of t he Feder al Rul es of Ci vi lPr ocedur e of f er t he di st r i ct cour t pl ent y of di scret i on t o have t hepar t i es f i sh or cut bai t on t hi s speci f i c i ssue wi t hout anypr ol onged di scover y, expense, or del ay.

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Cooper v. Charter Communications, 1st Cir. (2014)

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