Wilcox v. Swapp et al, No. 2:2017cv00275 - Document 108 (E.D. Wash. 2019)

Court Description: ORDER Denying 80 Defendants' Motion to Dismiss. Signed by Judge Rosanna Malouf Peterson. (PL, Case Administrator)

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Wilcox v. Swapp et al Doc. 108 1 2 FI LED I N THE U.S. DI STRI CT COURT EASTERN DI STRI CT OF WASHI NGTON 3 Jan 24, 2019 4 SEAN F. MCAVOY, CLERK UNITED STATES DISTRICT COURT 5 EASTERN DISTRICT OF WASHINGTON 6 7 JADE WILCOX on behalf of herself and all others similarly situation, NO: 2:17-CV-275-RMP 8 Plaintiff, 9 ORDER DENYING DEFENDANTS’ MOTION TO DISMISS v. 10 11 12 13 JAMES CRAIG SWAPP, individually; and SWAPP LAW, PLLC, doing business as Craig Swapp and Associates, Defendants. 14 15 BEFORE THE COURT is Defendants James Craig Swapp and Swapp Law, 16 PLLC’s (collectively, “Defendants”) Motion to Dismiss Plaintiff’s Amended 17 Complaint, ECF No. 80. Defendants move to dismiss Plaintiff Jade Wilcox’s First 18 Amended Class Action Complaint, ECF No. 69. The Court held a hearing in this 19 matter on November 20, 2018. Ms. Wilcox was represented by Robert Barton. 20 Defendants were represented by Ryan McBride. The Court has considered the 21 parties’ arguments, briefings, and the record, and is fully informed. ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 1 Dockets.Justia.com 1 BACKGROUND 2 The following are facts alleged in Ms. Wilcox’s first amended complaint, 3 ECF No. 69. Following car accidents in Washington, the Washington State Patrol 4 (“WSP”) prepares Police Traffic Collision Reports (“PTCRs”) using a standardized 5 collision report form. Id. at 8. Before this Court issued a preliminary injunction in 6 the Batiste case requiring the WSP to institute procedures to redact personal 7 information, the WSP would sell these unredacted records to any third party that 8 would ask and pay for them. 1 Id. 9 Ms. Wilcox claims that the PTCRs are prepared using a software called 10 SECTOR. ECF No. 69 at 10. SECTOR allows officers to scan the bar code on a 11 driver’s license or a vehicle registration to auto-populate the PTCR form with a 12 driver’s personal information. Id. The data are placed on the bar codes by the 13 Washington State Department of Licensing (“DOL”) when the DOL creates the 14 licenses and registrations. Id. The information scanned from a driver’s license’s 15 bar code includes a driver’s name, address, license number, and date of birth, 16 among other things. Id. at 10–11. The information scanned from a motor vehicle 17 registration’s bar code includes a driver’s name and home address, as well as 18 information about the driver’s vehicle. Id. 19 Ms. Wilcox alleges that Defendants purchased more than 10,000 of these 20 1 21 The Court has since dissolved that preliminary injunction. See Wilcox v. Batiste, No. 2:17-CV-122-RMP, 2018 WL 6729791 (E.D. Wash. Dec. 21, 2018). ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 2 1 PTCRs from the WSP between 2013 and 2017. ECF No. 69 at 13. Defendants 2 would then use the personal information on the PTCRs to send letters and 3 pamphlets to the persons involved in the accidents to solicit clients for Defendants’ 4 automobile personal injury practice. Id. at 15. The letters would contain 5 Defendant Craig Swapp’s signature. Id. 6 Ms. Wilcox claims that she was involved in two separate car accidents on 7 August 1, 2015, and on July 11, 2016. ECF No. 69 at 17–18. She alleges that 8 Defendants purchased the PTCRs created as a result of these accidents. Id. at 18. 9 Ms. Wilcox alleges that Defendants sent her a letter advertising their services on 10 July 14, 2016, using Plaintiff’s personal information gleaned from her Collision 11 Reports. Id. The letter was signed by Defendant Craig Swapp. Id. 12 LEGAL STANDARD 13 A complaint will be dismissed if it fails to state a claim upon which relief 14 can be granted. Fed. R. Civ. P. 12(b)(6). To survive a motion to dismiss under 15 Rule 12(b)(6), the plaintiff must plead “enough facts to state a claim to relief that is 16 plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A 17 claim is plausible when the plaintiff pleads “factual content that allows the court to 18 draw the reasonable inference that the defendant is liable for the misconduct 19 alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 20 21 In ruling on a Rule 12(b)(6) motion to dismiss, a court “accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 3 1 favorable to the nonmoving party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 2 519 F.3d 1025, 1031 (9th Cir. 2008). A court is not required, however, to “assume 3 the truth of legal conclusions merely because they are cast in the form of factual 4 allegations.” Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir. 2011) (per curiam) 5 (internal quotation omitted). “[C]onclusory allegations of law and unwarranted 6 inferences are insufficient to defeat a motion to dismiss.” Adams v. Johnson, 355 7 F.3d 1179, 1183 (9th Cir. 2004). 8 DISCUSSION 9 Defendants argue that Ms. Wilcox fails to allege facts that establish a DPPA 10 claim. ECF No. 80. The DPPA “sets forth the three elements giving rise to 11 liability, i.e., that a defendant (1) knowingly obtained, disclosed or used personal 12 information, (2) from a motor vehicle record, (3) for a purpose not permitted.” 13 Howard v. Criminal Info. Servs., Inc., 654 F.3d 887, 890–91 (9th Cir. 2011) 14 (quoting Thomas v. George, Hartz, Lundeen, Fulmer, Johnstone, King and Stevens, 15 P.A., 525 F.3d 1107, 1111 (11th Cir. 2008)). The Court examines whether the 16 facts in the complaint, construed in the light most favorable to Ms. Wilcox, satisfy 17 the three elements of a DPPA claim. 2 18 2 19 20 21 Ms. Wilcox argued that Defendants’ motion to dismiss was procedurally barred as law of the case and violated Federal Rule of Civil Procedure 12(g)(2) because they previously brought a motion to dismiss the original complaint. ECF No. 95 at 10. The Court rejects these arguments and considers Defendants’ motion on the merits. See City of L.A., Harbor Div. v. Santa Monica Baykeeper, 254 F.3d 882, 888 (9th Cir. 2001) (holding that law of the case does not prohibit a district court ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 4 1 Knowingly Obtaining, Disclosing, or Using Personal Information 2 The first element of a DPPA claim is that the defendant knowingly obtained, 3 disclosed, or used personal information. Howard, 654 F.3d at 890–91; 18 U.S.C. § 4 2724(a). The parties dispute whether the complaint sufficiently alleges that 5 Defendant Craig Swapp knowingly used personal information. ECF No. 80 at 19; 6 ECF No. 95 at 21.3 7 The DPPA defines “personal information” as “information that identifies an 8 individual, including an individual’s photograph, social security number, driver 9 identification number, name, address (but not the 5-digit zip code), telephone 10 number, and medical or disability information, but does not include information on 11 vehicular accidents, driving violations, and driver’s status.” 18 U.S.C. § 2725(3). 12 The first amended complaint sufficiently alleges that Defendants received personal 13 information from the PTCRs purchased from the WSP, including drivers’ names and 14 addresses. See ECF No. 69 at 18 (alleging that Defendants sent Ms. Wilcox a 15 solicitation letter using her name and address). However, the statute does not define 16 what it means to “use” personal information. See 18 U.S.C. § 2725 (definitions). 17 18 19 20 21 from reconsidering its prior holdings); United States v. Somnia, Inc., 339 F. Supp. 3d 947 (E.D. Cal. 2018) (holding that Rule 12(g)(2) does not prevent raising new arguments on a motion to dismiss an amended complaint). 3 Defendants do not dispute that the first amended complaint sufficiently alleges that Defendant Swapp Law, PLLC knowingly obtained, disclosed, or used personal information. See ECF No. 80. ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 5 1 When a term is undefined in a statute, the term is given its ordinary 2 meaning, often with assistance from a dictionary definition. Taniguchi v. Kan Pac. 3 Saipan, Ltd., 566 U.S. 560, 566 (2012). “Use,” as a verb, is defined by Merriam- 4 Webster as “to put into action or service; avail oneself of; employ,” or “to carry out 5 a purpose or action by means of; utilize.” Use, Merriam-Webster’s Dictionary 6 Online (last visited Jan. 10, 2019). Black’s Law Dictionary gives the word “use” a 7 similar definition: “[t]o employ for the accomplishment of a purpose; to avail 8 oneself of.” Use, Black’s Law Dictionary (10th ed. 2014). The Supreme Court 9 and the Ninth Circuit have found the same ordinary meaning for “use” when 10 interpreting the word in other statutes. See Smith v. United States, 508 U.S. 223, 11 228–29 (1993); United States v. Laursen, 847 F.3d 1026, 1032 (9th Cir. 2017). 12 Other courts have determined that an actor cannot be vicariously liable for a 13 DPPA violation; there must be some sort of direct conduct by an individual that 14 can be attributed to “using” personal information within the meaning of the statute. 15 See, e.g., Bass v. Anoka Cty., 998 F. Supp. 2d 813, 820 (D. Minn. 2014) (“[T]he 16 DPPA does not impose liability on one who indirectly facilitates another’s access 17 of a motor vehicle record” (emphasis in original).). Ms. Wilcox’s first amended 18 complaint must allege that Mr. Swapp personally engaged in conduct that 19 constituted “use” of personal information to sufficiently state a DPPA claim. Id. 20 Ms. Wilcox alleges that the solicitation letters Defendants would send out 21 contained Mr. Swapp’s signature. ECF No. 69 at 15. She claims the solicitation ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 6 1 letter that she received contained Mr. Swapp’s signature as well. Id. at 18. 2 Construing the first amended complaint in the light most favorable to Ms. Wilcox, 3 Mr. Swapp’s personal signature on the letter to Ms. Wilcox sufficiently supports 4 Ms. Wilcox’s plausible allegation that Mr. Swapp put the personal information 5 from the PTCRs into action or service, carried out a purpose or action with Ms. 6 Wilcox’s personal information, and employed her personal information for the 7 accomplishment of a purpose by placing his signature on the solicitation letters. 8 See Use, Merriam-Webster’s Dictionary Online (last visited Jan. 10, 2019); Use, 9 Black’s Law Dictionary (10th ed. 2014). Mr. Swapp’s signature gave the 10 solicitation letters legitimacy in Defendants’ offering of legal services. 11 Accordingly, the complaint adequately alleges that Mr. Swapp “used” personal 12 information within the meaning of the DPPA. 13 In their reply brief and at oral argument, Defendants argue that the complaint 14 fails to allege that Mr. Swapp personally penned his signature on the solicitation 15 letters, and that the lack of that allegation shows that Mr. Swapp did not personally 16 “use” the personal information within the meaning of the DPPA. ECF No. 96 at 17 13. Essentially, Defendants argue that because there is no allegation that Mr. 18 Swapp signed the letters himself, rather than someone else putting his signature on 19 the letter for him, Mr. Swapp cannot be liable under the DPPA. Id. 20 The idea that Mr. Swapp cannot be liable for his own signature on a 21 document because someone else placed it there is flawed. An attorney’s signature ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 7 1 represents the attorney’s endorsement of the content within the document and the 2 purpose for which the document was used. See Fed. R. Civ. P 11(b) (stating that 3 by signing a document and presenting it to the Court, the attorney makes certain 4 promises and assurances); Wash. Rule of Professional Conduct § 1.0(n) (defining 5 “signed writing” as a writing that is “executed or adopted by a person with the 6 intent to sign the writing”). An attorney would not be absolved from Rule 11 7 misconduct by alleging he or she did not personally sign a document submitted to 8 the Court. The Court finds that Mr. Swapp, an attorney, should understand the 9 significance of having his personal signature attached to the letter to Ms. Wilcox 10 11 and others. Therefore, Mr. Swapp’s argument is not persuasive. The Court finds that the first amended complaint sufficiently alleges that Mr. 12 Swapp used personal information within the meaning of the DPPA. 13 From a Motor Vehicle Record 14 The second element of a DPPA claim is that the personal information used, 15 obtained, or disclosed was from a “motor vehicle record.” Howard, 654 F.3d at 16 890–91; 18 U.S.C. § 2724(a). The parties dispute whether a driver’s license or 17 motor vehicle registration is a “motor vehicle record” for the purposes of DPPA 18 liability. ECF No. 80 at 12; ECF No. 95 at 15. Additionally, the parties dispute 19 whether DPPA liability attaches when the driver gives his or her driver’s license 20 and registration to a police officer to create a PTCR. ECF No. 80 at 12; ECF No. 21 95 at 18. ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 8 1 The DPPA defines a “motor vehicle record” as “any record that pertains to a 2 motor vehicle operator’s permit, motor vehicle title, motor vehicle registration, or 3 identification card issued by a department of motor vehicles.” 18 U.S.C. § 2725(1). 4 Interpreting this definition, one circuit court has held that “pertains” in this statute 5 means “to belong as a part, member, accessory, or product.” Lake v. Neal, 585 F.3d 6 1059, 1061 (7th Cir. 2009). With this definition, some district courts have 7 concluded that driver’s licenses and motor vehicle registrations are not motor 8 vehicle records because objects cannot “pertain” to themselves. See, e.g., Whitaker 9 v. Appriss, Inc., 266 F. Supp. 3d 1103, 1108 (N.D. Ind. 2017) (“A driver’s license 10 isn’t a part, member, accessory, or product of a motor vehicle operator’s permit; it is 11 a motor vehicle operator’s permit” (emphasis in original).). 12 Other district courts have come to the opposite conclusion: that the personal 13 information in a driver’s license is protected by the DPPA. Pavone v. Law Offices of 14 Anthony Mancini, Ltd., 205 F. Supp. 3d 961, 966 (N.D. Ill. 2016). The Pavone court 15 supported its interpretation of the statute with two points. First, the personal 16 information in a driver’s license did come “from a motor vehicle record” because the 17 driver’s license was created with information from motor vehicle records created and 18 held by the state DOL. Id. Second, the information on the driver’s license, 19 including the driver’s license number, address, and name, is a “part” of the driver’s 20 license itself, and therefore “pertains to” the motor vehicle operator’s permit. Id. 21 Therefore, because the information on driver’s licenses originated from a motor ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 9 1 vehicle record kept by the state DOL, and the information on a driver’s license 2 pertains to a motor vehicle operator’s permit, a driver’s license qualifies as a “motor 3 vehicle record” under the statute. Id. 4 When presented with these potential readings of the statute at oral argument, 5 Defendants argued that it was not the intent of Congress to potentially criminalize 6 certain uses of a driver’s license by businesses that hold driver’s licenses as 7 collateral for renting or using a business’s services, such as reserving or renting a 8 locker at a gym. According to Defendants, the personal information must come 9 directly from a motor vehicle record kept by the state’s DOL to receive DPPA 10 11 protection. In response, Ms. Wilcox argued that personal information is protected by the 12 DPPA even if it is found in a location other than a state DOL record if that 13 information is originally sourced to the state licensing department. She argued that 14 it makes no difference where the personal information is found; if its original source 15 is a motor vehicle record from the state licensing department, Ms. Wilcox argues 16 that the DPPA protects that information. 17 When interpreting a statute, the Court begins with the statute’s text. United 18 States v. Neal, 776 F.3d 645, 652 (9th Cir. 2015). “We interpret statutory terms in 19 accordance with their ordinary meaning, unless the statute clearly expresses an 20 intention to the contrary.” Id. Courts should interpret statutes as a whole, giving 21 meaning to each word and avoiding interpretations that render other words or ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 10 1 provisions of the statute inconsistent, meaningless, or superfluous. Boise Cascade 2 Corp. v. U.S. Envtl. Prot. Agency, 942 F.2d 1427, 1432 (9th Cir. 1991). “Particular 3 phrases must be construed in light of the overall purpose and structure of the whole 4 statutory scheme.” United States v. Lewis, 67 F.3d 225, 228–29 (9th Cir. 1995). 5 The Court will not read additional terms, phrases, or words into a statute unless it 6 must do so to avoid absurd results. Mobil Oil Corp. v. Higginbotham, 436 U.S. 7 618, 625–26 (1978) (“There is a basic difference between filling a gap left by 8 Congress’ silence and rewriting rules that Congress has affirmatively and 9 specifically enacted.”). 10 The Court turns to the plain text of the statute. Starting with the definition 11 of a motor vehicle record, Ms. Wilcox has provided several different 12 interpretations that would satisfy the “pertains” definition from Lake while also 13 applying to Defendants’ conduct in this case. First, the information on the driver’s 14 license or motor vehicle registration itself is a “part of” the motor vehicle 15 operator’s permit or registration, showing that the information may “pertain” to the 16 motor vehicle’s operator permit or registration. Second, the first amended 17 complaint alleges that PTCRs are created with the SECTOR system, which 18 requires police officers to scan the bar code on the back of a driver’s license or 19 registration card. ECF No. 69 at 10. A bar code is at least a part of, if not also a 20 member, accessory, or product of, a motor vehicle operator’s permit or 21 registration. See Lake, 585 F.3d at 1061. ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 11 1 The plain language of the statute is also devoid of the requirement that the 2 personal information come directly from a state’s licensing department, as 3 Defendants argue. The statute only says that the personal information comes 4 “from a motor vehicle record.” 18 U.S.C. § 2724(a). The statute does not say that 5 the personal information must be copied directly from a motor vehicle record, or 6 that the information loses its protected status if it is first put on another object, like 7 a driver’s license; rather, the statute states that the personal information is 8 protected if it comes “from a motor vehicle record.” Id. 9 The Court will not read a direct-source requirement into the statute as 10 Defendants ask the Court to do here. Mobil Oil Corp., 436 U.S. at 625–26; ECF 11 No. 80 at 13. Therefore, the Court concludes that the DPPA protects the 12 information on driver’s licenses and motor vehicle registrations, because the 13 information on those items come “from a motor vehicle record” at the state DOL. 14 The Court finds that Ms. Wilcox has sufficiently alleged that the personal 15 information received by Defendants on PTCRs came from a motor vehicle record. 16 For the same reasons, the Court also rejects Defendants’ argument that Ms. 17 Wilcox cannot allege DPPA violations because she provided her driver’s license 18 and registration to the police officer, who used them to create the PTCRs. 19 Defendants cite to several cases in their motion that have all held that the state’s 20 licensing department must be the direct source of the information for DPPA 21 liability to attach. ECF No. 80 at 17. But, as stated above, there is no requirement ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 12 1 in the text of the statute that the state licensing department be the direct source of 2 the personal information. See Whitaker v. Appriss, Inc., No. 3:13-CV-826-RLM- 3 CAN, 2014 WL 4536559, at *4 (N.D. Ind. Sept. 11, 2014) (“If the original source 4 of the other government agency’s information is the state department of motor 5 vehicles, the DPPA protects the information throughout its travels.”). 6 The cases cited by Defendants do not endorse a voluntariness requirement, 7 i.e., that the DPPA only protects information when it is involuntarily given to other 8 people, rather than voluntarily given. ECF No. 80 at 17. Because the Court finds 9 that the complaint sufficiently alleges the information on the PTCRs originated 10 from the Washington State DOL, and finds that such information is protected by 11 the DPPA, the distinction between voluntary and involuntary transfers of personal 12 information is irrelevant to the Court’s decision.4 For this reason, the Court will 13 14 4 15 16 17 18 19 20 21 Defendants argue that a “parade of horribles” might result from this interpretation of the DPPA that would result in cashiers at convenience stores “violating” the DPPA by checking a person’s driver’s license for that person’s birthday when the person tries to buy tobacco. ECF No. 80 at 15–16. However, Defendants’ hypothetical situations differ from this case. This case involves a third party allegedly obtaining and using personal information by affirmatively purchasing PTCRs and using that information for an improper purpose. See ECF No. 69. In Defendants’ proposed scenario, a customer offers up his or her identification to effectuate the customer’s goal; i.e., the purchase of tobacco. That situation is far different from a driver giving a police officer his or her license and registration, as mandated by state law, and then a third party obtaining and using the information from the license and registration down the line. One situation involves a person willingly giving identification to effectuate the person’s desired purpose, while the ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 13 1 not rule on this issue, and instead finds that Ms. Wilcox’s complaint against 2 Defendants sufficiently alleges that the information obtained and used by 3 Defendants was “from a motor vehicle record.” 4 For a Purpose Not Permitted 5 The third element of a DPPA claim is that the personal information from a 6 motor vehicle record was obtained, disclosed, or used for a purpose not permitted 7 under the statute. Howard, 654 F.3d at 890–91; 18 U.S.C. § 2724(a). The parties 8 do not dispute that using DPPA-protected information for the solicitation of legal 9 services is a purpose not permitted by the DPPA. See Maracich v. Spears, 570 10 11 U.S. 48, 78 (2013). Therefore, the Court finds that Ms. Wilcox’s complaint sufficiently alleges 12 that Defendants obtained and used DPPA-protected personal information for a 13 purpose not permitted. 14 15 16 17 18 19 Accordingly, IT IS HEREBY ORDERED that Defendants’ Motion to Dismiss, ECF No. 80, is DENIED. The District Court Clerk is directed to enter this Order and provide copies to counsel. DATED January 24, 2019. s/ Rosanna Malouf Peterson ROSANNA MALOUF PETERSON United States District Judge 20 21 other involves a third party taking advantage of a person doing what state law mandates in a certain situation. ORDER DENYING DEFENDANTS’ MOTION TO DISMISS ~ 14

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