Stick the landing - Court rules TCPA Lawsuits should allege facts of TCPA violations

A Western District of North Carolina Court just gave a primer on how to make proper allegations when multiple parties are involved in TCPA violating phone calls to consumers.

Pro se plaintiff Craig Cunningham sued six named defendants for TCPA violations and four of them moved to dismiss. They of course tried the usual professional plaintiff routine but the court signaled that it is an unbiased court.

"Plaintiff is no stranger to the court system, as he has filed numerous actions asserting claims under the TCPA and its state equivalents.1 While this background is instructive in terms of evaluating Plaintiff’s familiarity with the Federal Rules of Civil Procedure and federal court system in general, it does not have any bearing on the merits of his action here."

Cunningham v. Autoguard Dkt 37.pdf

Download PDF • 232KB

Where things go wrong

Spoiler alert, the court grants the motion to dismiss, starting with

"These generalized allegations are made against all Defendants without distinction. To support these claims, Plaintiff includes only a few factual allegations describing Defendants’ purported wrongful conduct:"

"¶35. The Plaintiff received multiple calls on behalf of the multiple defendant entities selling the extended car warranty services for the benefit of each of the above named entities, which appeared in the car warranty service booklet, which was mailed to the Plaintiff. These calls resulted in a policy DAE1027594 being sold on or about 10/27/2021[.]"

"¶36. The plaintiff was sent a policy that listed each of the above named defendants in it or their respective corporations for the individuals indicating that they engaged in a common enterprise to harass multiple consumers by peppering them with unwanted robocalls selling their overpriced extended car warranty services. As an example, Autoguard Advantage is listed as the “Service Contract Provider” for this contact and Dimension Service Corporation is listed as the “Administrator” and Affordable Auto Protection is listed as the seller of the policy."

The court noted "other than the initial paragraph identifying the parties, Plaintiff’s Amended Complaint does not mention Lexington, Sing for Service, or Mepco by name in any factual allegation to support his claim" and went ton to say:

"Plaintiff has not plausibly alleged or carried his burden to show that his injury is “fairly traceable to the challenged conduct of” Defendants Autoguard, Dimension, Lexington, and Mepco . . . particularly where it is clear that “AAP” made the calls . . . At best, Plaintiff’s allegations assert Defendants Autoguard and Dimension were connected to the policy issued by AAP because they were listed as the service contract provider and administrator, respectively. This allegation is insufficient—on its own—to plausibly allege traceability to the wrongful conduct for these Defendants."

What could Mr. Cunningham have done to avoid this? The court educates:

"For example, no allegation suggests these Defendants were aware of any calls that AAP made to Plaintiff, and Plaintiff fails to allege the existence of an agreement among AAP and any other Defendant or plausibly allege ratification by any other Defendant, which might be suggestive of vicarious liability. Furthermore, no allegation plausibly alleges an agency relationship . .."

"A ‘defendant may be held vicariously liable for TCPA violations where the plaintiff establishes an agency relationship, as defined by federal common law, between the defendant and a third-party caller.’” Wilson v. PL Phase One Operations L.P., 422 F. Supp. 3d 971, 980 (D. Md. 2019) (quoting Gomez v. Campbell-Ewald Co., 768 F.3d 871, 879 (9th Cir. 2014), aff'd, 577 U.S. 153 (2016)). Here, Plaintiff has failed to plead facts sufficient to support a theory of vicarious liability under the TCPA because Plaintiff's allegations do not show plausibly that the party who actually, physically initiated the telephone calls at issue was subject to any Defendant’s control in an agency relationship"

One possible way might have been to write a letter to the other defendants informing them of the illegal telemarketing calls. This is to hook them in later with ratification:

"Ratification is 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. . . . However, a party ‘is not bound by a ratification made without knowledge of material facts involved in the original act when the [party] was unaware of such lack of knowledge.’” 885 F.3d at 252 (quoting Restatement (Third) of Agency §§ 4.01(1), 4.06 (2006))."

If Mr. Cunningham gave these other telemarketing defendants knowledge of the illegal calls and they did nothing to stop them, Mr. Cunningham's position would be a lot stronger. And finally Mr. Cunningham could have accomplished one more thing with letters - establishing specific jurisdiction in this court had he included a North Carolina address as the location he was receiving the illegal calls.

"Collectively, the materials upon which Plaintiff relies are insufficient to make a prima facie showing of specific personal jurisdiction for Defendants Autoguard, Dimension, or Lexington. While the Court must draw all reasonable inferences in Plaintiff’s favor, nothing in the record before the Court connects Defendants Autoguard, Dimension, or Lexington to these calls—allegedly in violation of the TCPA—made by a distinct entity: “AAP.” At best, Plaintiff’s allegations regarding Autoguard’s and Dimension’s names appearing on the policy issued by AAP are insufficient to confer personal jurisdiction without a plausible connection to the calls, which form the basis for his claims . . . No allegation suggests these Defendants were aware of any calls by AAP, and no allegation contends Defendants were aware of any marketing strategies employed by AAP and directed to potential consumers using ATDS on behalf of Defendants . . . Plaintiff does not allege a telemarking agreement or contract among AAP and any Defendants, which might be suggestive of vicarious liability. The unsubstantiated identification of Autoguard and Dimension on the policy, without more, is insufficient for Plaintiff to carry his burden to show either of these Defendants—or Lexington, who is not even mentioned in connection with the policy—purposefully availed itself of the privilege of conducting activities in North Carolina or that Plaintiff’s claims arise out of those activities."

Information is king in a lawsuit. Information that the folks hiring and benefitting from the telemarketing calls know about the nature of the unwanted calls goes a long ways to building an airtight case telemarketers can't wiggle out of.

For another example see Martin v. Bottom Line Concepts, 2024 WL 1119982 (S.D. N.Y. March 14, 2024).

Dkt 35 - Martin v Bottom Line Concepts.pdf

Download PDF • 801KB

It is a great case if for nothing else Snoop Dog allegedly plays a role in placing the calls, and it talks about actual and apparent authority, but it talks about probably the most important theory of liability in telemarketing violations case, ratification.

Sellers typically hire someone else to do make the illegal calls, folks who are either sitting in India, or an American-based telemarketer who is nothing more than a desk at a co-working space (judgement proof). Ratification can allow you to hold them accountable like in this recent dispute I helped negotiate a six figure settlement.

"The FAC [first amended complaint] next alleges ratification. It alleges that BLC "ratified the Referral Partners' TCPA violations" by (1) "knowingly accepting the benefit of new contacts with consumers despite the fact that these consumers were generated through conduct that violates the TCPA "willfully turning a blind eye" to the fact that its Referral Partners were violating the TCPA. These violations were evident based on the "numerous complaints" BLC received "regarding the conduct of the entities that made prerecorded calls on their behalf.""

Martin brought sufficient facts to defend her complaint against dismissal:

"[Martin] pleads that the phone number from which the robocall was placed, when called back, played a message: "[T]hank you for calling the Employee Retention Hotline brought to you by Bottom[ ]Line Capital." FAC ,i 49. It further alleges that "[a]t the time of the call[]," Bottom Line Capital's website "note[d] that it is 'powered by Bottom Line Concepts,"' id. (emphasis in original), and that Bottom Line Capital "is a d/b/a ofBLC"-that is, that Bottom Line Capital is a trade name used by BLC. Id. ,i 35. Based on these factual allegations, a reasonable factfinder could draw several relevant inferences: that Bottom Line Capital owned and controlled the phone number used to place the robocall to Martin; that Bottom Line Capital, as the owner of the phone number used to place the robocall, and as the beneficiary of the message conveyed via the robocall, placed the robocall; and that Bottom Line Capital is a pseudonym of BLC, such that an action by Bottom Line Capital is an action by BLC. These allegations plausibly plead BLC' s liability for the robocalls Martin claims to have received."

Court are pretty much going to universally find that TCPA lawsuits should allege facts of TCPA violations for each defendant.

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, Oregon, or Montana? 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.