United States District Court, N.D. Illinois, Eastern Division
PHYSICIANS HEALTHSOURCE, INC., an Ohio corporation, individually and on behalf of similarly situated persons, Plaintiffs,
A-S MEDICATION SOLUTIONS, LLC, JAMES BARTA, WALTER HOFF and JOHN DOES 1-10, Defendants.
MEMORANDUM OPINION & ORDER
B. Gottschall United States District Judge.
Physicians Healthsource, Inc. (“PHI”), for itself
and on behalf of the class it seeks to represent
(collectively, “Plaintiffs”), bring this lawsuit
against Defendant A-S Medication Solutions, LLC
(“A-S”), James Barta, Walter Hoff, and John Does
1-10 (collectively, “Defendants”), alleging
violations of the Telephone Consumer Protection Act of 1991
(“TCPA”), 47 U.S.C. 227 et. seq.
Specifically, PHI, on behalf of a putative class consisting
of the owners of 11, 422 fax numbers, claims that it received
an unsolicited fax sent by the defendants. PHI's motion
for class certification pursuant to Fed.R.Civ.P. 23 is before
the court. (Pls. Mot. Class Cert., ECF No. 147.) For the
following reasons, the motion for class certification 
Allscripts Obtains Fax Numbers from the Class
LLC (“Allscripts”) is a company that
“offer[s] an open, integrated portfolio of healthcare
information technology solutions for hospitals, physician
practices, and extended care organizations.” [Def.
Resp. at 6, ECF No. 171. Allscripts has provided a variety of
healthcare-related products and services since its
incorporation in 1986. [Id.] One such healthcare
solution was Allscripts' “pre-packaged medication
fulfillment solutions business” (“MSG”).
[Id.] The MSG provided “both medications and
software for dispensing and inventory control.”
[Id.] Since 2006, Allscripts has used a customer
relationship management database called Salesforce.
[Id.] Salesforce maintained Allscripts'
customers' contact information. [Id.] One of the
ways in which Allscripts communicated with its customers and
prospective customers was via fax. [Id.] Defendants
contend that “if Salesforce included a fax number for a
particular entity, it was only because that entity
voluntarily provided its fax number to Allscripts, along with
permission to fax it something.” [Id. at 7.]
This is the basis for Defendants' contention that
Allscripts obtained consent from its customers to send them
faxes. Allscripts sent information about its various products
and services-including the MSG-to its customers and
prospective customers via fax. [Id.]
Moffett has been an Allscripts employee for 21 years. [Def.
Resp. at 8, ECF No. 171.]; [Pls. Class Cert. Memo. at 5, ECF
No. 147-1.] He is familiar with Allscripts' business
practices and how Allscripts keeps track of information
pertaining to its customers and prospective customers in
Salesforce. [Id.] In his deposition, Moffett
testified that Allscripts had a custom and practice of faxing
advertisements only with the consent of the recipient. [Def.
Resp. at 8, ECF No. 171.] Defendants contend that
Allscripts' employees were trained always to ask
permission before sending fax advertisements, and that part
of asking for permission to send a fax would be to verify the
fax number that Allscripts had for that entity in its
Salesforce database. [Id.]
A-S purchases Allscripts' MSG
March, 2009, A-S and Sav-Rx, LLC (“Sav-Rx”)
entered into an Asset Purchase Agreement (“APA”)
with Allscripts. [Pls. Class Cert. Memo. at 3, ECF No.
147-1.] A-S purchased Allscripts' MSG, which
“include[d] the offering of a formulary of pre-packaged
medications and related dispensing software licensed to
customers using FirstFill and TouchScript, as currently
conducted.” [Id.] A-S purchased “all
property and assets primarily used in or primarily held for
use in” the MSG, which, among other things, included
The machinery, equipment, furniture, tools, computer hardware
and network infrastructure that are primarily used in or
primarily held for use in the [MSG] Business…
The inventories held for use primarily in the operation and
conduct of the [MSG] Business, including raw materials,
packaging materials, goods in process, finished goods, labels
The personnel, benefits and payroll records of the
[A]ll advertising and promotional materials, manuals and
data, sales and purchase correspondence, lists of present and
former suppliers, all customer information and data including
lists of present and former customers…
Any and all software, whether in source code, object code or
human readable form (including any intellectual property
rights related thereto and associated documentation), that is
primarily used in or primarily held for use in the [MSG]
Business, including FirstFillTM and TouchScriptTM…
All of the trade names, trademarks, service marks and other
marks of [Allscripts] (including brand names, product names,
logos, and slogans) and application therefor, other than, for
the avoidance of doubt, any of the foregoing using or derived
from “Allscripts, ” that are primarily used in or
primarily held for use in the [MSG] Business…
[Id. at 9-10.] A-S also assumed “all
liabilities and obligations…primarily relating to or
arising out of the [MSG] Business or the Assets . . .
.” [Id. at 10.] A-S had, for a limited period
of time and pursuant to the Marketing Agreement, remote
access to Allscripts's Salesforce database, including a
login and password. [Id. at 5.]
used a software system AlphaServer 4100 (“Alpha”)
in its internal operations. (Pls. Class Cert. Memo. at 4, ECF
No. 147-1.) A-S started using Alpha following the APA.
(Id.) Alpha maintains business contact information
for all A-S customers. (Id.)
The Fax Blast
a former customer of Allscripts. (Def. Resp. at 13, ECF No.
171.) Allscripts and PHI communicated on multiple occasions,
including via fax. (Id.) PHI received the fax image
(the “Fax”) at issue on February 18, 2010 from
A-S. [Pls. Class Cert. Memo. at 5, ECF No. 147-1.] Subsequent
forensic analysis of A-S's call records showed that A-S
conducted a fax blast between February 10 and February 28,
2010. [Id. at 6.] This broadcast included 15, 669
total fax transmissions to 15, 666 unique fax numbers, and
11, 422 transmissions were documented by the transmission log
as fully received error-free transmissions. [Id.]
Hoff has been the chief executive officer of A-S since March
2009. [Id.] Hoff is also one of the owners of A-S;
he is in charge of the production facility, purchasing and
pricing, client relationships, the A-S sales force, legal,
regulatory, and IT departments. [Id. at 2- 3.] PHI
contends that Hoff “approved” sending the Fax.
[Id. at 5.] Hoff testified that A-S acquired
PHI's fax number not from Alpha but from the Allscripts
Salesforce database, and that Allscripts provided A-S access
to the Salesforce database for “a short time, ”
during which A-S could log in and run reports. [Pls. Class
Cert. Memo. at 5, ECF No. 147-1.] A digital forensic analysis
also showed that fax numbers from the A-S fax log for the fax
blast matched fax numbers and other corresponding data in
Allscripts' Salesforce database. [Def. Resp. at 17, ECF
No. 171.] The Fax was transmitted to a list of
Allscripts' customers and prospective customers that was
generated from Allscripts' Salesforce database rather
than A-S's Alpha database. [Def. Resp. at 17, ECF No.
advances class-action claims based on alleged violations of
The Telephone Consumer Protection Act of 1991
(“TCPA”), 47 U.S.C. 227 et. seq. The
Federal Communications Commission (“FCC”) has
authority to prescribe regulations to implement the TCPA.
Id. at § 227(b)(2); Mims v. Arrow Fin.
Servs., LLC, 132 S.Ct. 740, 744 (2012) (the Act directs
the FCC to prescribe implementing regulations). TCPA forbids
the use of “any telephone facsimile machine, computer,
or other device to send, to a telephone facsimile machine, an
unsolicited advertisement, ” unless certain exceptions
are met. 47 U.S.C. § 227(b)(1)(C).
claims that Defendants successfully sent 11, 422 unsolicited
facsimiles advertising the availability and quality of
A-S's pharmaceutical products and services. (Pls. Class
Cert. Memo. at 2, ECF No. 147-1.) The Fax was sent to
Plaintiffs in a fax blast conducted by the Defendants between
February 10, 2010, and February 28, 2010, and was received by
PHI on February 18, 2010. (Id. at 2.) TCPA defines
an “unsolicited advertisement” as “any
material advertising the commercial availability or quality
of any property, goods, or services which is transmitted to
any person without that person's prior express
invitation or permission, in writing or
otherwise.” Id. § 227(a)(5) (emphasis
Prior Express Invitation or Permission
argue that A-S had the recipients' prior express
invitation or permission to send the Fax at
issue. Defendants have the burden of proving
prior express invitation or permission. See Thrasher-Lyon
v. Ill. Farmers Ins. Co., 861 F.Supp.2d 898, 905 (N.D.
Ill. 2012). The parties do not dispute that A-S obtained the
list of fax numbers from Allscripts' Salesforce database.
[See Pls. Class Cert. Memo. at 5, ECF No. 147-1.];
[Def. Resp. at 13, ECF No. 171 (“A-S Medication
acquired Plaintiff's fax number from Allscripts'
Salesforce database of customers.”).] Further, there is
no dispute that A-S did not obtain prior express permission
from any of the class members directly. [Def. Resp. at 7, ECF
No. 171. (“Defendants are not arguing that Allscripts
specifically obtained express consent for A-S Medication to
send fax advertisements after Allscripts divested the
MSG.”).] Rather, Defendants contend that “[i]f
Salesforce included a fax number for a particular entity, it
was only because that entity voluntarily provided its fax
number to Allscripts, along with permission to fax it
something.” [Def. Resp. at 7, ECF No. 171.]
Accordingly, Defendants argue that the consumers'
permission to receive faxes from Allscripts was ...