Court Finds Missouri’s Call Monitoring Law Applies to California Business

Summary

While California law requires all parties consent to the monitoring or recording of a communication, most states only require one-party consent.  In a recent case with conflicting statutes, a California district court found that Missouri law applied to a plaintiff’s wiretapping claims.

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Call centers are increasingly targeted in class action lawsuits under California law for monitoring or recording calls without the consent of all parties to a communication.  Cal. Penal Code § 630 et seq.  While California requires all parties’ consent, most states only require one-party consent.  In cases where the type of consent determines the outcome, which state law applies?  A recent case in California may provide guidance.

In Jonczyk v. First Nat’l Capital Corp., 2014 U.S. Dist. LEXIS 17211 (C.D. Cal. 2014), First National and its employee were located in California while the plaintiff called from her home in Missouri.  The District Court applied a conflict-of-law analysis and concluded that the law of Missouri (a one-party consent state) should apply, not California’s requirement of all parties consent.  In its opinion, the Court cited Mazza v. Am. Honda Motor Co., Inc., 666 F.3d 581 (9th Cir. 2012):

In Mazza, the Ninth Circuit considered the relative interests of states in the application of their consumer protection laws, and noted that ‘maximizing consumer and business welfare … does not inexorably favor greater consumer protection.’  The same is true for privacy laws, where any increase in the protections a state affords its citizens is accompanied by a corresponding increase in exposure to liability for businesses.  Moreover, ‘a state ordinarily has an interest in having [a] policy of limited liability applied to out-of-state companies that conduct business in the state.’

Jonczyk, at *9 (internal citations omitted).  Thus, Missouri had a valid interest in protecting out-of-state businesses from excessive exposure to liability for actions directed at its residents.

Further, the Court held California’s interest in applying its laws to business activities in California would not be significantly impaired if Missouri law were instead applied.  However, Missouri’s interest in having its policy of limited liability applied to out-of-state companies that interact with its residents in Missouri would be impaired if California law were applied.  The Court therefore found that Missouri law applied to the plaintiff’s wiretapping claims.  Id. at *13.

This decision may have a meaningful impact on future California call monitoring lawsuits.  If the plaintiff is a resident of a one-party consent state, there is now a potential argument that California’s requirement of all parties consent does not apply.  Call centers must be aware of Jonczyk if they are faced with alleged violations of California’s call monitoring laws.