California Court of Appeals, Fourth District, Second Division
[REVIEW GRANTED BY CAL. SUPREME COURT]
Cal.Rptr.3d 62] APPEAL from the Superior Court of Riverside
County. Sharon J. Waters, Judge. Affirmed. (Super.Ct.No.
[Copyrighted Material Omitted]
Offices of Todd M. Friedman, Todd M. Friedman and Adrian R.
Bacon, Beverly Hills, for Plaintiff and Appellant.
Toffer Roosevelt & Lilly, Michael R. Williams and Jared M.
Toffer, Irvine, for Defendant and Respondent.
Jeremiah Smith filed a class action complaint against LoanMe,
Inc. (LoanMe), alleging that LoanMe violated the California
Invasion of Privacy Act (Privacy Act) (Pen. Code, � 630, et
seq.). Smith alleged that LoanMe violated
section 632.7 by recording a phone call with Smith without
his consent while he was using a cordless telephone, and he
claimed that a "beep tone" at the beginning of the
call did not constitute sufficient notice that LoanMe was
recording the call. In a bifurcated trial about the beep tone
issue, the trial court concluded that (1) the beep tone
provided sufficient notice to Smith that the call was being
recorded, and (2) Smith implicitly consented to being
recorded by remaining on the call.
requested supplemental briefing on the issue of whether
section 632.7 applies to the recording of a phone call by a
participant in the phone call or instead applies only to
recording by third party eavesdroppers. We asked that the
briefs address the question in light of the plain language of
section 632.7, its legislative history, and its relationship
with other provisions of the Privacy Act. No California
appellate opinion addresses the issue. Several federal
district courts in California have analyzed the issue, and
they are not in agreement.
Cal.Rptr.3d 63] We conclude that section 632.7 prohibits only
third party eavesdroppers from intentionally recording
telephonic communications involving at least one cellular or
cordless telephone. Conversely, section 632.7 does not
prohibit the participants in a phone call from intentionally
recording it. Consequently, Smith failed to state a claim
against LoanMe under section 632.7. We therefore affirm the
trial court’s dismissal of Smith’s lawsuit.
is in the business of providing personal and small business
loans. Smith’s wife is the borrower on a loan from LoanMe. In
October 2015, an employee of LoanMe called the telephone
number provided to LoanMe by Smith’s wife to discuss the
loan. Smith answered the call on a cordless telephone and
informed the caller that his wife was not available, and the
call then ended. The call lasted approximately 18 seconds.
LoanMe recorded the call. Three seconds into the call LoanMe
"caused a ‘beep tone’ to sound." It is LoanMe’s
practice to cause a beep tone to play at regular 15 second
intervals on all of its outbound calls. LoanMe did not orally
advise Smith that the call was being recorded. Smith also did
not sign a contract granting LoanMe consent to record calls.
September 2016, Smith filed a class action complaint against
LoanMe, alleging that LoanMe recorded phone calls without
consent in violation of section 632.7 and seeking statutory
damages and injunctive relief. On the parties’
stipulation, the trial court ordered a bifurcated bench trial
to resolve the "the beep tone issue." After
listening to a recording of the phone call, the trial court
concluded that the beep tone provided Smith sufficient notice
under section 632.7 that the call was being recorded and that
Smith implicitly consented to being recorded by remaining on
the call. The trial court entered judgment against Smith.
Analytical Framework for Statutory Interpretation
interpreting a statute, our goal " ‘ " ‘is to
determine the Legislature’s intent so as to effectuate the
law’s purpose. We first examine the statutory language,
giving it a plain and commonsense meaning. We do not examine
that language in isolation, but in the context of the
statutory framework as a whole in order to determine its
scope and purpose and to harmonize the various parts of the
enactment.’ [257 Cal.Rptr.3d 64] " ’ " (Meza v.
Portfolio Recovery Associates, LLC (2019) 6 Cal.5th 844,
856, 243 Cal.Rptr.3d 569, 434 P.3d 564 (Meza ).) In
other words, "[t]he meaning of a statute may not be
determined from a single word or sentence; the words must be
construed in context, and provisions relating to the same
subject matter must be harmonized to the extent
possible." (Lungren v. Deukmejian (1988) 45
Cal.3d 727, 735, 248 Cal.Rptr. 115, 755 P.2d 299.) " ‘
" ‘If the language is clear, courts must generally
follow its plain meaning unless a literal interpretation
would result in absurd consequences the Legislature did not
intend. If the statutory language permits more than one
reasonable interpretation, courts may consider other aids,
such as the statute’s purpose, legislative history, and
public policy.’ " ’ " (Meza, supra, at p.
856, 243 Cal.Rptr.3d 569, 434 P.3d 564.)
independently review questions of statutory interpretation.
(California Building Industry Assn. v. State Water
Resources Control Bd. (2018) 4 Cal.5th 1032, 1041, 232
Cal.Rptr.3d 64, 416 P.3d 53.)
The Privacy Act Provisions Relating to Cordless and
Cellular Phones, and Section 632
1967, the Legislature enacted the Privacy Act "to
protect the right of privacy of the people of this
state" from technological advances that "led to the
development of new devices and techniques for the purpose of
eavesdropping upon private communications." (� 630.) The
Legislature considered eavesdropping on private
communications a serious threat that "cannot be
tolerated in a free and civilized society." (� 630;
Kearney v. Salomon Smith Barney, Inc. (2006) 39
Cal.4th 95, 115, 45 Cal.Rptr.3d 730, 137 ...