Stuart v. Global Tel*Link Corp., No. 18-2640 (8th Cir. 2020)
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Plaintiff, an inmate who had used Global's services, brought a putative class action alleging that Global's rates and fees were unjust and unreasonable under the Federal Communications Act (FCA) and that Global had unjustly enriched itself in violation of state laws. After the regulatory backdrop for the inmate calling service industry changed, the district court decertified all classes and granted summary judgment for Global on all claims.
The Eighth Circuit affirmed the district court's decisions on class decertification and summary judgment in favor of Global. The court held that the district court acted within its discretion in deciding that common questions no longer predominated, and that a class action was not the proper vehicle for resolving this type of claim. The court held that the district court did not err in dismissing plaintiffs' individual claims that the rates were unjust and unreasonable, and plaintiffs' common law unjust enrichment claim. Finally, the district court properly decertified the class action without seeking a determination by the agency on a methodology for segregating ancillary fees. The court dismissed Global's conditional cross-appeal as moot.
Court Description: [Colloton, Author, with Wollman and Benton, Circuit Judges] Civil case - Class Actions. In this case a prisoner brought an action against Global, a company providing telephone services to correctional facilities, alleging a claim the company's rates and fees were unjust and unreasonable under the Federal Communications Act, as well as a claim for unjust enrichment under state laws; the district court certified a nationwide class for the FCA claims and four subclasses for the unjust enrichment claims; however, in light of Glob. Tel*Link v. FCC, 866 F.3d 397 (D.C. Cir. 2017), the district court decertified the class, denied plaintiff's request to refer two questions to the FCC and granted Global summary judgment. Held: when the court certified the class two common questions united it - whether Global set call rates for the purpose of recovering site commissions through call rates and whether the recovery of site calls commissions through call rates was unjust and unreasonable as defined by the FCC; after the D.C. Circuit's decision, the theory of class certification became untenable, and the district court did not err in decertifying the class on the ground that common questions no longer predominated; the district court did not err in dismissing plaintiffs' individual claims that the rates were unjust and unreasonable because there is no order or regulation of the FCC declaring Global's rates unreasonable; plaintiffs' common law unjust enrichment claims were properly dismissed because, in each jurisdiction involved here, the general rule is that a common law claim of unjust enrichment is not available where a valid contract governs the same matter; the district court did not err in decertifying the class action without seeking a determination by the FCC on a methodology for segregating ancillary fees.
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