                FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT


FLEMMING KRISTENSEN,                     No. 16-15823
              Plaintiff-Appellant,
                                            D.C. No.
                 v.                      2:12-cv-00528-
                                           APG-PAL
CREDIT PAYMENT SERVICES INC.,
FKA mycashnow.com Inc.; ENOVA
INTERNATIONAL, INC.; PIONEER               OPINION
FINANCIAL SERVICES, INC.;
LEADPILE, LLC; CLICK MEDIA, LLC,
DBA ClickMedia 1240 Johnson
Ferry Place, Ste. B75 Marietta, GA
30068, DBA Net1Promotions LLC,
DBA Net 1 Promotions, LLC,
               Defendants-Appellees.


      Appeal from the United States District Court
               for the District of Nevada
      Andrew P. Gordon, District Judge, Presiding

        Argued and Submitted October 20, 2017
              San Francisco, California

                Filed January 10, 2018
2          KRISTENSEN V. CREDIT PAYMENT SERVS.

    Before: Sandra S. Ikuta and Andrew D. Hurwitz, Circuit
          Judges, and James S. Gwin,* District Judge.

                      Opinion by Judge Ikuta


                            SUMMARY**


             Telephone Consumer Protection Act

    The panel affirmed the district court’s grant of summary
judgment in favor of the defendants in a class action under
the Telephone Consumer Protection Act.

    The plaintiff received from AC Referral, a non-party, a
text message that violated the TCPA. The panel held that the
defendants, three lenders and two marketing companies, were
not vicariously liable for AC Referral’s acts. Because AC
Referral was neither the agent nor purported agent of four of
the defendants, they could not have ratified AC Referral’s
acts. Although one of the marketing companies had an
agency relationship with AC Referral, it was not bound by
AC Referral’s acts because it lacked knowledge that AC
Referral was violating the TCPA and did not have knowledge
of facts that would have led a reasonable person to investigate
further.



      *
     The Honorable James S. Gwin, United States District Judge for the
Northern District of Ohio, sitting by designation.
    **
       This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
         KRISTENSEN V. CREDIT PAYMENT SERVS.              3

                       COUNSEL

Alexander G. Tievsky (argued), Roger Perlstadt, and Ryan D.
Andrews, Edelson PC, Chicago, Illinois, for Plaintiff-
Appellant.

James M. Lord (argued) and Asher M.B. Ritmiller, Inman
Flynn Biesterfeld & Brentlinger P.C., Denver, Colorado, for
Defendants-Appellees Credit Payment Services Inc. and
Leadpile LLC.

Brian P. O’Meara (argued), Kevin R. Malloy, Joanne R.
Driscoll, and Kevin M. Forde, Forde Law Offices LLP,
Chicago, Illinois; Dan R. Waite, Lewis Roca Rothgerber
LLP, Las Vegas, Nevada; for Defendant-Appellee Enova
International Inc.

Kelly H. Dove and Chad R. Fears, Snell & Wilmer LLP, Las
Vegas, Nevada; Robert V. Spake Jr. and Russell S. Jones Jr.,
Polsinelli PC, Kansas City, Missouri; for Defendant-Appellee
Pioneer Services Inc.

John H. Gutke and Tara H. Popova, Fox Rothschild LLP, Las
Vegas, Nevada, for Defendant-Appellant Click Media LLC.
4        KRISTENSEN V. CREDIT PAYMENT SERVS.

                         OPINION

IKUTA, Circuit Judge:

    Flemming Kristensen received a text message from AC
Referral that violated the Telephone Consumer Protection Act
(TCPA), 47 U.S.C. § 227. In this class action against three
lenders and two marketing companies, Kristensen claims that
they had ratified the unlawful text messages. Because AC
Referral (which is not a party to this suit) was neither the
agent nor purported agent of four of the defendants, they
cannot have ratified AC Referral’s acts. See Restatement
(Third) of Agency §§ 4.01 and 4.03 (Am. Law Inst. 2006).
Although one of the marketing companies had an agency
relationship with AC Referral, it is not bound by AC
Referral’s acts because it lacked knowledge that AC Referral
was violating the TCPA and did not have knowledge of facts
that would have led a reasonable person to investigate further.
See id. § 4.06. We therefore affirm the district court’s grant
of summary judgment.

                               I

    On December 6, 2011, Flemming Kristensen received an
unwanted text message from an Ohio phone number that
read:

       Do You Need up to $5000 Today? Easy
       Quick and All Online at: www.lend5k.com 24
       Month Repay, All Cred. Ok Reply STOP 2
       End.

   This text message was generated as an indirect result of
marketing campaigns undertaken by three payday lenders,
         KRISTENSEN V. CREDIT PAYMENT SERVS.                5

Enova International, Inc., Pioneer Financial Services, Inc.,
and Credit Payment Services, Inc. The lenders entered into
separate agreements with LeadPile LLC, a company that buys
and sells customer leads. In order to obtain leads, LeadPile
in turn contracted with Click Media, LLC. Click Media uses
leads from thousands of “publishers” who generate leads. If
these leads lead to loans, the loan providers pay Click Media
and Click Media pays the publishers, like AC Referral, a
portion of that fee. Click Media and AC Referral entered into
a contract that contemplated using text messages as one
method of generating leads, and stated that AC Referral must
comply with the TCPA. AC Referral had no contact with
LeadPile, Enova, Pioneer Services, or Credit Payment
Services; its representatives had not even heard of these
companies before the lawsuit was filed.

    In performing its contract with Click Media, AC Referral
purchased lists of consumer phone numbers from other lead
generating companies, and uploaded those phone numbers
into a program that sent out advertisements. This program
sent the text message that Kristensen received. A consumer
who clicked on the link in the text message would be
redirected to a loan application website controlled by Click
Media. If the consumer filled out an application, the website
would redirect the consumer to the website of an appropriate
lender.

    Kristensen did not click on the link nor apply for a loan.
Instead, he filed a putative class action complaint against
Credit Payment Services, Pioneer Services, Enova, LeadPile,
and Click Media on behalf of himself and all other persons
who received an unauthorized text message advertisement,
alleging that the defendants were vicariously liable for
sending the text messages in violation of the TCPA. The
6         KRISTENSEN V. CREDIT PAYMENT SERVS.

district court certified a class of all individuals who were sent
a text message from various telephone numbers from
December 5, 2011 through January 11, 2012. Kristensen v.
Credit Payment Servs., 12 F. Supp. 3d 1292, 1308 (D. Nev.
2014).

    The lenders and LeadPile moved for summary judgment,
and the district court granted the motion. It rejected each of
Kristensen’s theories of vicarious liability, including his
theory that the defendants ratified AC Referral’s texting
campaign by accepting leads while knowing that AC Referral
was using texts to generate those leads. The court
subsequently held that ClickMedia was entitled to summary
judgment on the same grounds as the lenders and entered a
stipulated summary judgment in its favor.

     On appeal, Kristensen argues only that there was a
genuine issue of material fact as to whether the defendants
ratified AC Referral’s unlawful texting by accepting the
benefits of the text messages sent by AC Referral while
unreasonably failing to investigate its texting methods. We
have jurisdiction pursuant to 28 U.S.C. § 1291. We review a
district court’s grant of summary judgment de novo,
McDonald v. Sun Oil Co., 548 F.3d 774, 778 (9th Cir. 2008),
viewing the evidence in the light most favorable to the
nonmoving party in order to determine whether there are any
genuine issues of material fact, Thomas v. Ponder, 611 F.3d
1144, 1149–50 (9th Cir. 2010) (quoting LVRC Holdings LLC
v. Brekka, 581 F.3d 1127, 1137 (9th Cir. 2009)).

                               II

   The TCPA makes it “unlawful for any person within the
United States, or any person outside the United States if the
          KRISTENSEN V. CREDIT PAYMENT SERVS.                     7

recipient is within the United States—(A) to make any call
(other than a call made for emergency purposes or made with
the prior express consent of the called party) using any
automatic telephone dialing system . . . (iii) to any . . . cellular
telephone service.” 47 U.S.C. § 227(b)(1)(A)(iii). The
Federal Communications Commission (FCC) has concluded
that communicating by means of a text message falls within
the meaning of “to make any call,” and we defer to that
conclusion. See Satterfield v. Simon & Schuster, Inc., 569
F.3d 946, 952 (9th Cir. 2009).

    Pursuant to its authority to make rules and regulations to
implement the TCPA, 47 U.S.C. § 227(b)(2), the FCC has
ruled that “[c]alls placed by an agent of the telemarketer are
treated as if the telemarketer itself placed the call,” In re
Rules & Regulations Implementing the TCPA of 1991, 10
FCC Rcd. 12391, 12397 (1995), and has construed actions
under the TCPA “to incorporate federal common law agency
principles of vicarious liability,” In re Joint Petition Filed by
Dish Network, LLC, 28 FCC Rcd. 6574, 6584 (2013). The
FCC relies on the Restatement (Third) of Agency as the
federal common law of agency. See id. at 6586, n.100;
Gomez v. Campbell-Ewald Co., 768 F.3d 871, 877–78 (9th
Cir. 2014), aff’d, 136 S. Ct. 663 (2016), as revised (Feb. 9,
2016). We defer to this construction of the TCPA, as well as
the FCC’s reliance on the Restatement. See Gomez, 768 F.3d
at 878–79.

    The Restatement (Third) of Agency defines “ratification”
as “the affirmance of a prior act done by another, whereby the
act is given effect as if done by an agent acting with actual
authority.” Restatement (Third) of Agency § 4.01(1).
“Ratification does not occur unless . . . the act is ratifiable as
stated in § 4.03.” Id. § 4.01(3)(a). An act is ratifiable “if the
8         KRISTENSEN V. CREDIT PAYMENT SERVS.

actor acted or purported to act as an agent on the person’s
behalf.” Id. § 4.03. Therefore, “[w]hen an actor is not an
agent and does not purport to be one,” the doctrine of
ratification does not apply. Id. § 4.03 cmt. b.

    Even if a principal ratifies an agent’s act, “[t]he principal
is not bound by a ratification made without knowledge of
material facts about the agent’s act unless the principal chose
to ratify with awareness that such knowledge was lacking.”
Id. § 4.01 cmt b. A principal has assumed the risk of lack of
knowledge if “the principal is shown to have had knowledge
of facts that would have led a reasonable person to investigate
further, but the principal ratified without further
investigation.” Id. § 4.06 cmt. d. For instance, if a principal
knows that a chandelier has been removed from an old
building but ratifies its agent’s acquisition of the chandelier
without inspecting it, the principal has assumed the risk that
the chandelier may require expensive rewiring. See id. § 4.06
illus. 3. Similarly, if a principal receives a letter from a
customer stating it is increasing its order due to a new return
policy and improved product quality, and the principal ratifies
the contract with the customer even though it knows there is
no new return policy or improved product quality, the
principal assumes the risk that its agent made
misrepresentations to the customer. Id. § 4.06 illus. 4; see
also Computel, Inc. v. Emery Air Freight Corp., 919 F.2d
678, 682–83 (11th Cir. 1990) (applying this assumption of the
risk principle).

                               III

    Under these settled principles, the district court did not err
in concluding that Kristensen failed to raise a genuine issue
of material fact as to whether Credit Payment Services,
         KRISTENSEN V. CREDIT PAYMENT SERVS.                 9

Pioneer Services, Enova, or LeadPile ratified AC Referral’s
unlawful text messaging. It is undisputed that AC Referral
did not enter into a contract with any of the lenders or with
LeadPile. It is also undisputed that AC Referral did not
communicate with or even know of the lenders or LeadPile
before the lawsuit was filed. Because AC Referral was
neither an agent nor a purported agent of the lenders or
LeadPile, AC Referral’s actions do not qualify as ratifiable
acts. See Restatement (Third) of Agency §§ 4.01, 4.03.
Accordingly, the lenders and LeadPile cannot be held
vicariously liable for AC Referral’s unlawful text messages
under a ratification theory.

    Nor did Kristensen raise a genuine issue of material fact
as to whether Click Media ratified AC Referral’s unlawful
text messages. Although AC Referral was an agent of Click
Media, Kristensen presented no evidence that Click Media
had actual knowledge that AC Referral was sending text
messages in violation of TCPA. Nor is there any basis to
infer that Click Media assumed the risk of lack of knowledge,
because Kristensen did not present evidence that Click Media
“had knowledge of facts that would have led a reasonable
person to investigate further,” but ratified AC Referral’s acts
anyway without investigation. Id. § 4.06 cmt. d.

    Kristensen points to the fact that Click Media’s contract
with AC Referral stated that AC Referral could use text
message marketing and required AC Referral to comply with
the TCPA. According to Kristensen, this was sufficient to
trigger Click Media’s duty to investigate whether AC Referral
was acting in compliance with law. We disagree. The
knowledge that an agent is engaged in an otherwise
commonplace marketing activity is not the sort of red flag
that would lead a reasonable person to investigate whether the
10         KRISTENSEN V. CREDIT PAYMENT SERVS.

agent was engaging in unlawful activities.1 Because Click
Media had no “knowledge of facts that would have led a
reasonable person to investigate further,” id., Click Media
cannot be deemed to have ratified AC Referral’s actions and
therefore is not vicariously liable.2

     AFFIRMED.




     1
       Kristensen argues that Click Media was on notice of AC Referral’s
unlawful behavior because Click Media contacted AC Referral on April
2, 2012 and March 7, 2013 regarding allegedly unlawful text messages.
Because both incidents took place outside the class period (December 5,
2011 to January 11, 2012), they cannot be the basis for Kristensen’s claim.
See Retail Wholesale & Dep’t Store Union Local 338 Ret. Fund v.
Hewlett-Packard Co., 845 F.3d 1268, 1277 (9th Cir. 2017).
    2
      We deny all pending motions to strike portions of the briefs and
excerpts of the record as moot.
