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  • 9th Circuit amended opinion holds company not vicariously liable under TCPA

    Privacy, Cyber Risk & Data Security

    On April 4, the U.S. Court of Appeals for the 9th Circuit issued an amended opinion to further affirm a district court’s decision to grant summary judgment in favor of a defendant concerning allegations that it was vicariously liable for telemarketing activity in violation of the Telephone Consumer Protection Act (TCPA). The three-judge panel held that the defendant, who sells vehicle service contracts (VSCs) through automobile dealers and “marketing vendors,” was not vicariously liable under the TCPA for calls made by telemarketers employed by a company that sold VSCs for the defendant and multiple other companies. Last August, the three-judge panel determined that the company’s telemarketers acted as independent contractors, rather than as the defendant’s agents. In amending their opinion, the three-judge panel further determined that the telemarketers lacked actual authority (under express language contained within the parties’ contract) to place the unlawful calls, and that the defendant “exercised insufficient control over the manner and means of the work to establish vicarious liability under the asserted theory.”

    Privacy/Cyber Risk & Data Security Courts TCPA Appellate Ninth Circuit

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  • 9th Circuit affirms dismissal of claims alleging survey provider violated TCPA

    Courts

    On March 29, the U.S. Court of Appeals for the 9th Circuit affirmed a district court’s decision to grant summary judgment in favor of a patient satisfaction survey provider (defendant), concluding that a plaintiff's signed enrollment form with her health insurance provider meant she granted “prior express consent” to receive calls from the defendant. According to the opinion, the plaintiff accused the defendant of allegedly violating the Telephone Consumer Protection Act (TCPA) when it used an automatic telephone dialing system to repeatedly call her to inquire about the quality of her experience with a network physician. She later challenged the dismissal of her suit, arguing that the calls fell outside the scope of consent. However, in agreeing with the district court’s decision, the three-judge panel held that by providing her phone number on an insurance enrollment form that permitted the insurer to share her information for “quality improvement” and other purposes, the plaintiff had provided the level of consent required by the TCPA to receive calls from the defendant. While the court acknowledged that the plaintiff “could not have known the identity of the specific entity that would ultimately call her,” by authorizing the insurance company “to disclose her phone number for certain purposes, she necessarily authorized someone other than [the insurance company] to make calls for those purposes. Specifically, she authorized calls from entities to which [the insurance company] disclosed her information.” According to the panel, the defendant fell within that category.” The panel also rejected the plaintiff’s argument that the calls violated the TCPA because the defendant failed to demonstrate that it called her on the insurance company’s behalf, finding that there is “no statutory or logical basis for imposing such a requirement.”

    Courts Appellate Ninth Circuit TCPA

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  • 7th Circuit rules bank cannot arbitrate debt claim with a minor in TCPA suit

    Courts

    On March 22, the U.S. Court of Appeals for the 7th Circuit reversed a district court’s decision that had granted a national bank’s motion to compel arbitration of a putative class action. In 2014, the plaintiff filed a lawsuit alleging the bank’s debt collection practices violated the Telephone Consumer Protection Act (TCPA), after the bank called the plaintiff’s phone number seeking payment on her mother’s overdue card payments. The three-judge panel held that the district court erred in ruling that the plaintiff—who made a one-time purchase with her mother’s credit card when she was a minor—became an authorized user under the account and was bound by her mother’s credit card agreement, including the arbitration provision, regardless of whether she received a direct benefit from the cardholder agreement. The panel opined that, “an individual does not become an [a]uthorized [u]ser simply by using the credit card to complete the cardholder’s transaction.” Specifically, a provision to add authorized users to an existing account “clearly foresees an [a]uthorized [u]ser as playing a far more durable role in the account,” and in fact, the panel noted, the plaintiff’s mother did not follow the required steps to add an authorized user to the account. Furthermore, the plaintiff did not have the legal capacity to enter into a contractual relationship with the bank, and therefore, could not be bound by the agreement. The 7th Circuit remanded the case back to the district court for review.

    Courts Seventh Circuit Appellate Debt Collection TCPA

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  • Buckley Sandler Special Alert: D.C. Circuit significantly narrows FCC’s order defining autodialer

    Courts

    On March 16, the D.C. Circuit issued its much anticipated ruling in ACA International v. FCC. The D.C. Circuit’s ruling significantly narrows a Federal Communication Commission order from 2015, which, among other things, had broadly defined an “autodialer” for purposes of the Telephone Consumer Protection Act.

    * * *

    Click here to read the full special alert.

    If you have questions about the ruling or other related issues, please visit our Class Actions practice page, or contact a Buckley Sandler attorney with whom you have worked in the past.

    Courts FCC Appellate D.C. Circuit TCPA Special Alerts

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  • 9th Circuit reverses lower court’s dismissal of TCPA claim

    Courts

    On February 28, the U.S. Court of Appeals for the 9th Circuit reinstated a consumer’s lawsuit against two banks on charges that the nearly 300 calls she received seeking payment of a debt may have violated the Telephone Consumer Protection Act (TCPA). The three-judge panel stated that the district court’s decision to dismiss the case on standing grounds was incorrect in light of a subsequent 9th Circuit ruling in a different case, which held that “a violation of the TCPA is a concrete, de facto injury.” The court further held that the TCPA is not limited to telemarketing calls, and that the unsolicited contact—“regardless of caller or content”—is evidence of “concrete harm” that can be traced back to the conduct at issue. Additionally, the panel also held that the district court erred in granting the banks’ request for summary judgment on the plaintiff’s claim under California’s Rosenthal Fair Debt Collection Practices Act and her claim for “intrusion upon seclusion,” finding that the banks’ actions “allegedly caused harm” to the plaintiff’s solitude. The court reversed and remanded the case for further proceedings.

    Courts Appellate Ninth Circuit TCPA Debt Collection

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  • 10th Circuit upholds TCPA statutory damages as uninsurable under Colorado law

    Courts

    On February 21, the U.S. Court of Appeals for the 10th Circuit affirmed a district court’s decision that under Colorado law, an insurance company had no duty to indemnify and defend its insured against TCPA claims seeking statutory damages and injunctive relief. According to the appellate opinion, the FTC and the states of California, Illinois, North Carolina, and Ohio sued a satellite television company for violations of the TCPA, Telemarking Sales Rule (TSR), and various state laws for telephone calls made to numbers on the National Do Not Call Registry (FTC lawsuit). The FTC lawsuit sought statutory damages of up to $1,500 per alleged violation and injunctive relief. The defendant requested that its insurer defend and indemnify it for the claims pursuant to existing policies. The insurance company filed a complaint for declaratory judgment, seeking a declaration that it need not defend or indemnify the company in the FTC lawsuit. The district court determined that there was no coverage for several reasons, including: (i) that the statutory TCPA damages were a “penalty,” rendering them uninsurable under Colorado law; and (ii) that the injunctive relief sought did not qualify as damages under the policies’ definition. The 10th Circuit Court of Appeals affirmed both holdings, concluding that no coverage existed. 

    Courts TCPA Tenth Circuit Appellate Damages Insurance FTC Telemarketing Sales Rule State Issues

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  • TCPA lawsuit passes Spokeo, survives motion to dismiss

    Courts

    On February 20, a judge for the U.S. District Court for the Northern District of Illinois denied a national insurance company’s motion to dismiss a proposed Telephone Consumer Protection Act (TCPA) class action suit brought by a California-based plumbing company. The plaintiff had sued the insurance company and one of its agents for using an autodialer to make prerecorderd sales calls. One call was answered by the plaintiff’s principal and interrupted business, which Plaintiff alleges violated the TCPA. The plaintiff also alleges that the autodialed calls “seized and trespassed upon the use of its cell phones.” In its motion to dismiss, the insurance company argued, among other things, that the plaintiff failed to allege a concrete injury, which is required to establish standing. Citing the Supreme Court ruling in Spokeo, Inc. v. Robins, the judge held that the plaintiff had alleged sufficient facts, including the disruption to its business, to establish a concrete harm.

    Courts TCPA Spokeo

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  • 11th Circuit denies revival of TCPA suit

    Courts

    On January 22, the U.S. Court of Appeals for the Eleventh Circuit denied an Ohio-based bank’s request for a rehearing en banc. Last August, the three-judge panel reinstated a suit accusing the bank of violating the Telephone Consumer Protection Act (TCPA) when it allegedly made “over 200 automated calls” to the consumer plaintiff who claimed to have partially revoked her consent by telling the bank to stop calling at certain times. As previously covered in InfoBytes, the appellate court’s August 2017 decision to remand the case for trial concluded that “the TCPA allows a consumer to provide limited, i.e., restricted, consent for the receipt of automated calls,” and that “unlimited consent, once given, can also be partially revoked as to future automated calls under the TCPA.” Furthermore, the decision made clear that the lower court erred in its decision to grant summary judgment in favor of the bank “because a reasonable jury could find that [the consumer plaintiff] partially revoked her consent to be called in ‘the morning’ and ‘during the workday’” during a phone call with a bank employee.

    However, in its en banc rehearing petition, the bank argued that the “ruling is likely to create ambiguity amongst both consumers and callers regarding the ability of consumers to impose arbitrary limits on communications . . . despite the FCC’s consistent and unwavering proclamation that in order to revoke consent, consumers must clearly request no further communications.” The appellate court’s decision to deny the petition provides no explanation aside from noting that none of its active judges requested that the court be polled on a rehearing en banc.

    Courts Eleventh Circuit Appellate TCPA Litigation FCC

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  • Ninth Circuit: payday lenders not vicariously liable under TCPA for text messages

    Privacy, Cyber Risk & Data Security

    On January 10, the U.S. Court of Appeals for the Ninth Circuit affirmed that three payday lenders and two marketing companies (together, the defendants) did not indirectly violate the Telephone Consumer Protection Act (TCPA) by accepting marketing help from a separate lead generator company that used a program to send text-messaged advertisements. In upholding the district court’s decision, the three judge panel concluded that “it is undisputed” that the defendants did not enter into a contract with the lead generator company, and further, that the lead generator company did not act as their agent or purported agent. The plaintiff-appellant that received the text-messaged advertisement—which directed consumers who clicked on the link within the message to a loan application website controlled by one of the defendants—filed a putative class action complaint, certified by the district court, against the defendants to allege that they were vicariously liable for sending the text messages in violation of the TCPA. Specifically, the plaintiff-appellant claimed the defendants ratified the lead generator company’s actions when they accepted leads even though they knew the leads were being generated through text messages. The district court granted summary judgments for all the defendants, and ruled they were not vicariously liable for the lead generator company’s actions, and that additionally, the plaintiff-appellant failed to present evidence that defendants had actual knowledge that the texts were being sent in violation of the TCPA. The appellate panel also noted that because one of the defendants—a contracted lead provider—had “no ‘knowledge of facts that would have led a reasonable person to investigate further,’ . . . [the defendant] cannot be deemed to have ratified [the] actions and therefore is not vicariously liable.”

    Privacy/Cyber Risk & Data Security Courts Ninth Circuit Appellate TCPA Payday Lending

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  • District Court Cites Spokeo, Refuses to Certify TCPA Class Action Suit

    Courts

    On August 15, a federal judge in the U.S. District Court for the Northern District of Illinois Eastern Division granted a pet health insurance company’s (defendants) motion to strike class allegations in a Telephone Consumer Protection Act (TCPA) lawsuit over alleged robocalls. Citing a recent Supreme Court ruling in Spokeo v. Robins, the judge opined that because evidence proved some of the class members agreed to receive calls, plaintiffs failed to establish a lack of consent and could therefore not claim to have suffered a concrete injury. In 2014, plaintiffs filed a suit against the defendants proposing certification of two classes—“advertisement” and “robocall”—alleging that calls were made to individuals’ cell phones without specific consent and arguing that these calls were a form of “advertising,” which, pursuant to FTC rules, requires express written consent. However, the defendants’ position—for which the judge ruled in favor—was that because affidavits signed by individuals during the pet adoption process show that some of the class members consented to receive calls about special offers (electing not to opt-out), these individuals would not be able to prove injury under the Spokeo standard. Thus, issues of individualized consent would predominate, making it impossible for plaintiffs to “establish a lack of consent with generalized evidence.” Furthermore, the court stated that if plaintiffs agreed to receive calls—as defendants claim a significant number did, just not in writing—a lack of written evidence does not make the calls unsolicited.

    Courts TCPA Class Action Litigation U.S. Supreme Court Spokeo

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