ANOTHER foolish telemarketer MTD that results in a nice review of agency law
- Peter Schneider
- Feb 3
- 9 min read
Updated: Jul 22
Just days ago I was writing about my second hand embarrassment for another attorney who wrote a poorly received motion to dismiss in Bradshaw v. CHW Group, 2025 WL 306783 (D. NJ Jan 24, 2025), and then this one comes across my desk.
The case is Newman v. Integrity, 2025 WL 358933 (N.D. Ill Jan. 31, 2025). A Mr. Wes Newman received about 40 telemarketing calls selling life insurance that he believed he traced back to Integrity Marketing Group's network of subsidiaries and agents, and he filed suit under the telephone consumer protection act.
Integrity, represented by a partner at a something like what appears to be a 1,500 lawyer law firm, filed a motion to dismiss. Like the other second hand embarrassment post, I'll bounce back and forth between the motion
and the order from the judge denying it.
The motion to dismissed was couched as a FRCP 12(b)(1) lack of jurisdiction, but it was really just a 12(b)(6). And this situation is very instructive on agency law because Newman's lawsuit didn't contend Integrity placed the calls, but that it was responsible for the calls via an agency relationship (vicarious liability). Integrity argued:
Plaintiff does not allege that he received any calls from IMG. Plaintiff never even alleges that IMG was mentioned during any of the calls described in the Complaint. And Plaintiff never alleges any specific conduct by IMG that would plausibly state a colorable TCPA claim against IMG. Plaintiff does not even allege any product sold by IMG, or that such a product was ever mentioned during any of the calls described in the Complaint. As to IMG, Plaintiff merely alleges that Connexion Point, LLC, Berwick Insurance Group LLC, Your Insurance Group LLC, and Family First Life LLC are “subsidiaries” of IMG. Compl. ¶¶ 74, 84, 104, 110. There are no other allegations regarding the corporate structure, solvency, or any control by IMG of these entities. Indeed, Plaintiff primarily complains that IMG purportedly did not exert sufficient “control” or “influence” over these entirely separate businesses, underscoring their independent and uncoordinated operations
and the district court more or less seemed to agree:
Defendant is a “distributor of life insurance” and other products which it telemarkets through a nationwide network of subsidiaries and other partners. Between November 19, 2021, and July 21, 2023, Plaintiff received approximately forty calls from insurance agents and individuals with Connexion Point, Berwick Insurance Group, Your Insurance Group, and Family First Life, each a subsidiary of Defendant and listed as a “partner” on Defendant’s website. Almost every call was an attempt to sell Plaintiff some kind of insurance. Some calls used artificial or prerecorded voices. Despite his requests not to be called, Plaintiff continued to receive such calls and none of the entities were able to provide a copy of their do-not-call policies upon his requests for them. Plaintiff filed this class action lawsuit against Defendant alleging that all the calls from Connexion Point, Berwick Insurance Group, Your Insurance Group, and Family First Life were solicitations to purchase goods, products, or services through Defendant, were an invasion of privacy, and violated the TCPA.
Integrity's arguments boiled down to, you-can't-sue-us-because-we-didn't-actually-place-the-calls:
Plaintiff specifically alleges that the calls were made by entities he alleges are subsidiaries of IMG: Connexion Point, LLC, Berwick Insurance Group LLC, Your Insurance Group LLC, and Family First Life LLC. Plaintiff never alleges that IMG was ever mentioned during any of the calls described in the Complaint. And Plaintiff never alleges any specific product sold by IMG or that such a product was ever mentioned during any of the calls described in the Complaint. Rather, Plaintiff appears to claim that because these entities are subsidiaries of IMG, IMG must somehow be legally responsible for their conduct in making the alleged calls. Yet longstanding principles of corporate law are fatal to this conclusion. “It is a general principle of corporate law deeply ingrained in our economic and legal systems that a parent corporation . . . is not liable for the acts of its subsidiaries.”
and then brought up a pierce the corporate vail argument that usually only novice attorneys would rely on:
Plaintiff was required to allege specific, plausible facts sufficient to pierce their corporate veils under Delaware law . . . When considering whether to pierce the corporate veil, Delaware courts consider five factors . . . Plaintiff alleges no facts related to even one of these five factors [which should have been a warning to a partner in a law firm] Accordingly, Plaintiff’s failure to plead any facts to pierce the corporate veil of the subsidiaries alleged to have caused his harm, and his inability to do so consistent with Rule 11, preclude a showing that the alleged injury is “fairly traceable to [IMG’s] challenged conduct.”
Integrity's law firm partner probably got tennis elbow patting herself on the back for this clever argument the entities that allegedly initiated the calls have been specifically identified by Plaintiff in the complaint, are located in the United States, and there is no indication that they cannot provide any relief requested if ultimately found liable for the conduct of which Plaintiff complains that totally missed the point:
Under the TCPA, a principal/seller may be held vicariously liable for its agent’s/third-party telemarketers’ violations of the statute “under federal common law principles of agency.” In re Joint Petition filed by Dish Network, LLC, 28 F.C.C.R. 6574, 6582 (2013). An agency relationship arises when a principal “manifests assent” to an agent that will act on the principal’s behalf and subject to the principal’s control, and the agent consents so to act. Restatement (Third) of Agency § 1.01 (2006). The agency theories of actual authority, apparent authority, and ratification each offer an independent basis for vicarious liability. Bilek v. Fed. Ins. Co., 8 F.4th 581, 587 (7th Cir. 2021). An agent acts with actual authority to bind the principal when “the agent reasonably believes, in accordance with the principal’s manifestations to the agent, that the principal wishes the agent so to act.” Restatement (Third) of Agency § 2.01 (2006). To prove actual authority, Plaintiff must show that (1) a principal/agent relationship exists, (2) the principal controlled or had the right to control the alleged agent’s conduct, and (3) the alleged conduct fell within the scope of the agency. Bilek, 8 F.4th at 587.
In most courts, at the pleading stage a plaintiff is only required to allege generalized facts sufficient to infer an agency relationship, and Newman did:
Plaintiff contends Defendant engages a network of subsidiaries, insurance agents, and (sub)vendors to telemarket insurance and other products to consumers, for which Defendant has “absolute control.” This control is achieved through uniform policies, practices, procedures, and call-scripts issued by Defendant to those conducting telemarketing on behalf of itself and its subsidiaries. Additionally, Plaintiff alleges Defendant authorizes the agents and telemarketers to use its and its subsidiaries’ tradenames, while also providing access to Defendant’s own lead-generating platform. Plaintiff further alleges Defendant expressly authorizes insurance agents and subagents to hire telemarketers and lead suppliers to make telemarketing calls on Defendant’s behalf. Perhaps most pertinent, Plaintiff contends Defendant has the authority to dictate which telemarketing or lead-generating vendors may be used.
The court completely denied the poorly reasoned motion, Integrity got jeered in the press, and we get a reminder of how a TCPA plaintiff can pursue vicarious liability claims in a telephone consumer protection act lawsuit.
Newman's attorney did a great job of checking all the boxes to make a vicarious liability claim directly against apparent boss of a whole bunch of telemarketers, and hopefully they get the evidence they need to bring their lawsuit to a successful conclusion.
Speaking of discovery in the case, back in July of 2024 the parties apparently agreed to hold off discovery until the motion to dismiss was ruled on. See docket 16: The parties may omit a proposed discovery plan from the report and note instead that a discovery plan will be submitted after the Court has ruled on the motion to dismiss. And then docket 27 denying the motion: By 2/14/2025, the parties shall submit a proposed discovery plan.
This is a pretty good sign Newman's attorney didn't have faith the MTD would be denied and if I was in Newman's position I would have wanted a good explanation from my attorney or I would find a different law firm that believed in my case.
If your attorney does not believe in your case it will be the last one they want to spend time working on and it will show.
I am coming back to add another case to this post, Helmuth v Friedland & Associates.
TCPA plaintiff Helmuth alleged receiving more than 130 unsolicited live and pre-recorded telephone solicitation calls, calls that continued even after he requested that they stop. The Helmuth complaint named the Seller, Friedland & Associates, but not the Telemarkers who it seems was never specifically identified and so was referred to as the "Doe Defendants".
Friedland & Associates moved to dismiss, arguing that Helmuth failed to identify which actions it did that contributed to the illegal calls, vs those that were done by the Doe Defendants. This can be a common problem in TCPA lawsuit. The consumer got a call from a phone agent and eventually was transferred to the Seller. How can the consumer know the exact relationship between the Telemarketer and Seller when those entities usually go to some effort to hide it.
Helmuth, for his part, did a good job of alleging facts.
Plaintiff alleges the calls were placed by the Doe Defendants, acting as an agent of Friedland, to prescreen Plaintiff as a potential client for Friedland and, if so, “to conduct a so-called hot transfer” to Friedland . . . Plaintiff alleges the calls were made by the Doe Defendants (id. ¶ 5) and that the calls placed to Plaintiff by the Doe Defendants, “including the timing of their transmission and content, were authorized, controlled, and/or ratified by” Friedland . . . Plaintiff also alleges the Doe Defendants provided his cell number to Friedland, which called Plaintiff to offer legal services. Id. ¶ 18. After he spoke with an employee of Friedland, Plaintiff received a follow-up call from the Doe defendants asking how the intake process with Friedland went. The phone calls are continuous and ongoing, even after the do-not-call request.
And these allegations of an agency relationship between Friedland & Associates and the Doe Defendants was enough:
The Amended Complaint alleges an agency relationship between Friedland and the Doe Defendants. Plaintiff asserts that the calls specifically “encouraged Plaintiff to engage the legal services” of Friedland. (DE [12] ¶ 15). Additionally, Plaintiff alleges that the “Doe Defendants provided Plaintiff’s number to Defendant Friedland, which proceeded to call Plaintiff offering its legal services.” Id. ¶ 18. After Plaintiff spoke with Friedland, one of the Doe Defendants made a follow up call asking how the intake process with Friedland went. Id. ¶ 19. These allegations are sufficient to withstand the Motion to Dismiss. The callers identified Friedland and followed up after Plaintiff spoke with Friedland. These allegations suggest that the phone calls were made with the knowledge, direction, and ratification of Friedland.
Here is the result of a third foolish motion to dismiss - Barry v. Firstsource Solutions USA LLC. I'll just pull out the parts of the opinion that highlight what a waste of the court's time the motion was.
The basis of their motion was failing to state a claim and that the complaint was so devoid of facts as to be conclusory.
Firstsource seeks dismissal of Barry’s claims on two main grounds: the Complaint fails to state a claim under the TCPA by failing to allege a proper theory of liability and that Barry has failed to plead non-conclusory facts as to support an inference that Firstsource used an artificial or prerecorded voice in the calls.
The court likened this case to Jewell v. Magnolia Bank, Inc., No. 3:23-CV-78-RGJ, 2024 WL 203972 (W.D. Ky. Jan. 17, 2024), and easily found that if callers identified themselves as calling from Firstsource, that is a pretty solid indication of a relationship between the caller and Firstsource.
In the Complaint, Barry alleges that the calls placed from January to February 2023 began with a prerecorded voice and the speaker self-identified as calling from Firstsource. Barry has also alleged that the voice message directed the recipient to Firstsource’s website, pointing to the existence of an “apparent relationship,” that meets the required threshold at this stage. Taking these allegations as true, Barry has stated a TCPA claim by alleging that these calls were directly initiated by Firstsource.
Firstsource tried citing caselaw where the caller did not identify themselves, and Berry's complaint sufficiently [take note TCPA plaintiffs!] alleged the artificial or prerecorded voice facts:
She states that the calls seemed to be artificial or prerecorded in nature because the tone and intonation of the caller were unnatural and did not reflect live speech. Barry also notes that Oliver’s name was said in a distinct manner that sounded different than the rest of the prerecorded message. Barry plainly offers allegations regarding the use of prerecorded and artificial language used in the calls as required by the TCPA.
Motion to dismiss denied!
Would you like a free case review? Do you have a question or a telemarketing, debt collection, or bankruptcy case that would make a great blog article? We might even review your pro-se complaint or motion in a blog post. Email peter@nwdebtresolution.com and/or nathen@nwdebtresolution.com and we may answer it for everyone!
Are telemarketers harassing you in Washington or Oregon? My Washington State TCPA plaintiff law practice can help, just give us a call at 206-800-6000 or email peter@nwdebtresolution.com.
The thoughts, opinions and musings of this blog are those of Peter Schneider, a consumer advocate and Washington State plaintiff's TCPA attorney at Northwest Debt Resolution, LLC. They are just that, his thoughts, opinions and musings and should be treated as such. They are not legal advice. If you are looking to file a lawsuit for TCPA violations and unwanted calls please contact me for a consultation.
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