As those of us in the industry know well, there always seems to be an “it” claim that makes its way in droves against debt collectors. A few years ago, it was barcodes on an envelope and 1099-C/tax consequences disclosures. More recently, it’s been the written dispute requirement issue in the Third Circuit and interest, fees, and charges disclosures in the Second and Seventh Circuits.

Have you ever wondered how these issues have faired in court decisions? The iA Case Law Tracker lets you get that information quickly. For example, check out these quick stats on how the courts have come down on these issues since 2018.

To add to this, there have been 25 court decisions where the judge calls out the plaintiffs’ bar for abusing the FDCPA to line their own pockets, since the hyper-technical lawsuits they file go against the public policy behind the FDCPA and, in effect, harm consumers.

The coolest—and probably persuasive stat of all—the iA Case Law Tracker let me pull all of this information in just a couple of minutes. 

Subscribing to the iA Case Law Tracker allows you to get specifics on all of these cases, such as:

• The facts involved
• Jurisdiction
• Stage of litigation for the decision
• Who was plaintiffs’ counsel on each
• The type of debt involved

Imagine what you could do with all of that information.

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Editor’s note: This article is provided through a partnership between insideARM and Squire Patton Boggs LLP, which provides a steady stream of timely, insightful and entertaining takes on TCPAWorld.com of the ever-evolving, never-a-dull-moment Telephone Consumer Protection Act. Squire Patton Boggs LLP—and all insideARM articles—are protected by copyright. All rights are reserved. 

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As explained on TCPAWorld, the big SCOTUS TCPA review is likely to have profound impact on the scope of the TCPA–and possibly our freedom to speak more broadly. 

Following our firm’s success in obtaining the first-in-the-nation stay of a TCPA case pending the Supreme Court’s upcoming review of the constitutionality of the TCPA (see here), on February 25, 2020, another district court stayed a TCPA class action pending the Supreme Court’s resolution of Barr v. Am. Assoc. of Political Consultants, No. 19-631. In Seefeldt v. Entm’t Consulting Int’l, Case No. 19-cv-001888, 2020 U.S. Dist. LEXIS 31815, the court granted the  defendant’s motion to stay the case pending the Supreme Court’s decision in Barr, finding that “the best approach is to wait for much-needed clarity from the Supreme Court.” Id. at *9.

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In Seefeldt, the plaintiff filed a class action complaint alleging that the defendants’ texting program promoting specials and events at a brew house violated the TCPA. The court began its analysis of the defendants’ motion to stay by noting that “[t]he TCPA has been the subject of much appellate discourse lately,” including decisions by the Fourth Circuit (Am. Assoc. of Political Consultants, Inc. v. FC.C., 923 F.3d 159 (4th Cir. 2019)) and Ninth Circuit (Duguid v. Facebook, 926 F.3d 1146 (9th Cir. 2019)) striking down the TCPA’s government-debt exception as unconstitutional but severing it. As the Seefeldt court noted, the TCPA “risks a potential total collapse” depending on how the Supreme Court rules on the constitutional challenge to the government-debt exception and the proper remedy if found unconstitutional. Id. at *5, 8.

Reviewing recent decisions from the Seventh, Ninth and Eleventh Circuits on the definition of ATDS, the court also noted that “appellate courts have been unable to agree on the exact definition to give to an ‘autodialer’ that lies at the heart of the TCPA’s prohibitive mandates.” Id. at *3. As the court noted “the Supreme Court has not revealed its hand whether it will also take up review of the definitional problem” of ATDS, which was presented in the Duguid petition but has not yet been ruled upon by the court, “[b]ut, without a doubt, it creates much more uncertainty about the TCPA at large and, specifically, the viability of [the] plaintiff’s claims.” Id. at *8.

Given the uncertainty created by the constitutional challenge and the TCPA’s definitional problem, the court exercised its “inherent power” to stay the case. The court’s decision was partially influenced by a recent decision in the Western District of Missouri in a similar case against the same defendants denying class certification and granting summary judgment. See Beal v. Outfield Brew House, LLC, 2020 WL 618839 (W.D. Mo. Feb. 10, 2020). The court found that the decision in Beal favors a stay because it suggests that the defendants have a likelihood of success in this case and that the public interest will not be harmed. The court also noted that the fact that the case was relatively “young” also favored a stay, as staying the case could “avoid exhausting judicial resources to decide things like [the] defendants’ multifaceted motion to dismiss, the plaintiff’s pending motion for class certification, and any possible discovery-related matters or summary judgment motions to follow which may prove fruitless.” Id. at *11.

Finally, as the court noted, a decision from the Supreme Court – as least on the constitutionality of the TCPA – will likely come this term, and oral argument in the Barr case has been set for April 22, 2020. We at TCPAWorld have already marked our calendars for this important event! Until then, we will continue to monitor the TCPA landscape and whether other courts are taking a wait-and-see approach to the TCPA.

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The iA Case Law Tracker can help you keep up with new court decisions and conduct quick, incisive legal research in less time than it takes to pour your morning cup of coffee.

Editor’s Note: This is the final part of a 3-part article. The previous parts can be found here: Part 1 and Part 2.

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The California AG’s Office has been working hard on the California Consumer Privacy Act’s (CCPA) proposed regulations. On Friday, February 7, 2020, the AG published revised proposed regulations, and then just three days later, on February 10th, the AG published revised proposed regulations again (citing an omission in the February 7th publication). 

Many of the revisions are meaningful and show the AG has been carefully listening and reviewing feedback, as well as doing its homework. For example, the AG’s Office is required to disclose what documents and information it relied upon during the rulemaking process, and the AG has disclosed 20 different published sources (ranging from studies and legal journals, to online articles and reports). 

While there were many revisions, there were 15 significant changes that may be of interest to the credit and collections industry. In this final part, we will cover the final 5 changes. Part 1 covers changes 1-5 and Part 2 covers changed 6-10.

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11. Clarifications How to Treat Requests to Delete 

The proposed regulations no longer require a business to specify the way it deleted personal information. Instead, the revisions simply require a business to “inform the consumer whether or not it has complied” with the request. The revisions also clarify that a business “may retain a record of the request for the purpose of ensuring that the consumer’s personal information remains deleted from the business’s records.” The revisions also added that if a business denies a consumer’s request to delete, it must not only “describe the basis for the denial” but also explain any “conflict with federal or state law, or exception to the CCPA, unless prohibited from doing so by law.” 

12. Clarifications for Service Providers 

The revisions made some practical changes to what service providers may do with personal information it receives from its customers, without the service provider traversing into the realm of being a third party. For example, the revisions clarify that a service provider may use their customer’s personal information for retaining and employing other service providers as subcontractors (provided the subcontractor meets the requirements for a service provider). The revisions also allow service providers to use personal information for their own internal use, including building or improving the quality of their services, “provided that the use does not include building or modifying household or consumer profiles, or cleaning or augmenting data acquired from another source.” It also allows service providers to use personal information to “detect security incidents, or protect against fraudulent or illegal activity.” 

Another significant revision made to the proposed regulations is that it no longer requires a service provider to respond to requests to know or delete. Instead, a service provider has the option to either “act on behalf of the business” by responding to the request or informing “the consumer that the request cannot be acted upon because the request has been sent to a service provider.” Accordingly, it behooves service providers to clarify with their clients how they should treat requests received directly from consumers. 

13. Setting the Accessibility Standards to be Followed  

The revisions incorporate by reference the Web Content Accessibility Guidelines (“WCAG”), version 2.1 of June 5, 2018, from the World Wide Web Consortium. If the CCPA requires any information or notices online, the revisions make clear all such content must follow WCAG. The revisions provide for all other contexts, a business is still required to “provide information on how a consumer with a disability may access the notice in an alternative format.” 

14. Changes to Reporting Threshold 

The original proposed regulations used to require that a business which buys, receives, sells or shares, for commercial purposes, the personal information of 4,000,000 or more consumers annually would be required to compile and report certain metrics. The revisions bumped the number up to 10,000,000 and clarified that it is 10,000,000 in a calendar year. 

15. How to Treat Household Requests and Requests from Authorized Agents  

Given the sensitive nature of personal information, there was quite a stir surrounding how to handle requests for household personal information and requests from consumer’s authorized agents. The revisions fortified guidance on both topics. 

For households, the definition was revamped to a “person or group of people who: (1) reside at the same address, (2) share a common device or the same service provided by a business, and (3) are identified by the business as sharing the same group account or unique identifier.” When a household does not have a “password protected account with a business,” the revisions clarify a business does not need to comply with a household’s request to know or delete unless three conditions are met: (1) all consumers in the household “jointly request access,” (2) the business is able to “individually” verify each household member (note, the revisions clarify that if a household member is under the age of 13, parental consent must be provided), and (3) the business is able to verify that “each member making the request is currently a member of the household.” 

For authorized agents, the revisions clarify that when an agent makes a request on behalf of a consumer: (1) a business may ask the consumer to provide the authorized agent with written and signed permission evidencing that the agent is authorized to act on the consumer’s behalf, (2) a business may verify the authorized agent’s own identity, and (3) a business may require the consumer to “[d]irectly confirm with the business” that he/she provided the authorized agent permission to submit the request. The revisions further clarify that an authorized agent must “implement and maintain reasonable security procedures and practices to protect the consumer’s information” and that they may not “use a consumer’s personal information, or any other information collected from or about the consumer, for any purpose other than to fulfill the consumer’s requests, for verification, or for fraud prevention.”  

Closing

Overall, the revisions do help companies better operationalize the CCPA. It is clear the AG is trying to provide clarifications for companies that are not internet-based companies. However, many questions remain. For example, how far does the Gramm-Leach-Bliley (GLBA) exception stretch? If a debt collector is a service provider to a non-profit, and non-profits are not subject to the CCPA, should that non-profit still execute a CCPA addendum with its service providers since the regulations state that a business that provides services to an organization that is not a business is still required to follow the CCPA? Thinking of a consumer’s experience on a telephone call, can the AG authorize an abbreviated version of the required notice at the time of collection? Do debt collectors have to treat licensed attorneys as service providers under the CCPA? For example, a business may share a consumer’s personal information with its outside legal counsel when defending against a consumer lawsuit. Is this kind of information exchange subject to the CCPA, wherein a company would need to have the law firm sign and agree not to sell personal information? Outside legal counsels do not “sell” consumer information they receive from their clients, as this would be contrary to the Rules of Professional Conduct governing lawyers. In a similar vein, is information exchanged with other professionals, such as external auditors, CPAs, and tax firms, subject to the CCPA? It would be helpful for the AG to provide clarity on these kinds of things.

ROCKVILLE, Md. — insideARM and the iA Institute today announced the launch of iA Collection Strategy & Tech, a free bi-weekly newsletter designed for strategy, analytics, and tech leaders tasked with reducing the cost to collect through improved efficiency and effectiveness. The Collection Strategy & Tech newsletter keeps you informed, just often enough, with tailored content covering the move to the cloud, digital strategy, agent productivity, making your case for investment in innovation, and more. Each issue features original articles from our Think Differently series, updates about the iA Strategy & Tech conference, and other information we think will be helpful to the mission of innovation in collections. 

Register here (in confidence — we do not sell our lists) for the free newsletter. 

“For the last decade, most of what we have covered has been related to legal, compliance or regulatory information. While these topics remain critical to credit & collections, we recognize that industry professionals and executives also must focus on how to remain relevant and profitable for the future,” said Stephanie Eidelman, CEO of the iA Institute. “Innovation in strategy, process, and technology are the avenues. As a result, the iA Institute launched a suite of solutions to help chart the course.” 

The newsletter is part of a new, comprehensive suite of strategy and tech resources designed for forward-thinking collections executives. Other solutions include the following:

The iA Innovation Council is a membership group for organizations that understand their ability to survive depends on thinking differently and being at the forefront of communications, analytics, payments, and compliance technology. We identify opportunities for collaborative learning and problem-solving where the community is more powerful together than it is separately. Together, we envision the future and map how to get there.

iA Strategy & Tech is a conference (June 10-12, 2020 in Austin, TX) where you’ll hear from credit and collections strategy experts with the broadest, most data-informed and practical points-of-view, plus you’ll get to vet innovative, applicable new technology – all in one place. Designed by strategy experts for strategy experts, this is not a compliance conference masquerading as a strategy/tech conference.

About the iA Institute

A certified woman-owned business, the iA Institute is a media company that provides news, education, events and connection for professionals in the consumer and commercial credit & collections industry. Some of our core beliefs include: the good stuff is below the surface, taking action is more effective than griping, and communities can solve problems together. Read more at www.theiAinstitute.com. 

This article is part of the iA Think Differently series. Written by members of the iA Innovation Council, the series showcases thought leadership in analytics, communications, payments, and compliance technology for the accounts receivable management industry.

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I suppose there is an app for strategic planning. However, when it comes time for me to advise a client who is beginning to consider a business exit strategy or strategic combination, I often go “old school.”

Don’t overthink

“When strategic planning is on the agenda, “ I advise, “it is not uncommon to overreach. You will be tempted to identify every possible scenario. You will consider multiple time horizons and then reconsider them. You will agonize over the implications of each decision, and then agonize over your agony.”

“By the time you are through with all these deliberations, though, you can potentially risk losing all appetite for action.”

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Simple can be most powerful

I then reintroduce the strategic planner to what were once bold innovations, and they remain enormously useful vehicles for innovative thought: a single sheet of paper and a ballpoint pen. While I am partial to the uni-ball 207 Impact RT, I recommend any pen that fits comfortably in the hand and produces a strong line.

Where the strategic planner sits is of no great consequence, though I do recommend he or she choose a comfortable chair. Discomfort can lead to a crabbed, unimaginative thought process. While I personally think best with a cup of coffee in my hand, any warm beverage will do. Warm beverages, as opposed to cold beverages, can relax the mind.

Focus

Why the paper and pen? They help to focus the mind. Consider the paper to be your landing strip and the pen to be the plane upon which you are about to make a soft landing. They can also help you remember stray thoughts that can later be recognized as pure inspiration.

A digital device is a land mine of distractions. I, for example, am recording these thoughts on a laptop as I mightily resist the temptation to take a brief detour on the Internet. I could so easily take a break to see if the Dow Jones is heading north or south. I am sort of interested in the weekend weather forecast. I am also a mere two clicks away from visiting The New York Times home page. There is no telling when I will return to this article once I land there.

I soldier on.

Make it concise

Why a single sheet of paper? It is said, although there is no record, that Winston Churchill would return reports to their writers to be rewritten on a single side of paper. Whether or not Churchill did express this sentiment, it works for me. Brevity, according to William Shakespeare, is the soul of wit. It also imposes discipline on the strategic planning process.

Use the wisdom – but avoid the distraction – of those around you

Were friends, family, professional peers, and colleagues ever innovators? Maybe, maybe not. That notwithstanding, they can prove to be plenty useful during the strategic planning process. For this reason, I advise strategic planners to make generous use of this pool of wisdom and experience.

These individuals should not be excuses to delay the strategic planning process or to throw up pointless roadblocks to your forward movement. Clearly articulate the nature of the advice you are seeking as you sort through the variables, and then add this to your thought process.

Thinking, of course, is not an innovation. Innovative thoughts are. While I warn strategic planners away from pointless, endless deliberations, I do encourage deliberate thought. The planner can and should think hard about what he or she wishes to achieve. While the brain isn’t a muscle, it works better after it has been warmed up.

Look at that sheet of paper for a while. Don’t be frightened by its blankness. Stretch your brain and begin by jogging in place. Then get thinking. You will officially be on the road to innovating the next chapter of your professional life.

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Michael Lamm is Managing Partner at Corporate Advisory Solutions (www.corpadvisorysolutions.com), a boutique merchant bank with offices in Philadelphia and Washington, DC., and a strategic partner to the Innovation Council. 

About the iA Innovation Council

The iA Innovation Council is a collaborative working group of product, tech, strategy, and operations thought leaders at the forefront of analytics, communications, payments, and compliance technology. Group members meet in person several times each year to engage in substantive dialogue and whiteboard sessions with the creative thinkers behind the latest innovations for the industry, the regulators who audit and establish guardrails for new technology, and educators, entrepreneurs and innovators from outside the industry who inspire different thinking. 

2020 members include:

Editor’s Note: This article was originally published on the Maurice Wutscher blog and is republished here with permission.

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Consumer data privacy appears to be on the minds of legislators in Arizona this session.  As previously mentioned, House Concurrent Resolution 2013 was introduced in Arizona on Jan. 10, 2020, by five Republicans and one Democrat declaring:

1. That the Members of the Legislature oppose the enactment of laws, the adoption of regulations or the imposition of out-of-state standards that would restrict or otherwise dictate standards related to consumer data privacy, absent a clear nexus with consumer harm.
2. That the Members of the Legislature believe a single federal standard for comprehensive consumer data privacy regulation is preferable to a state-by-state approach.

Not surprisingly, that sentiment was not universally shared and SB 1614 was introduced on Feb. 5, 2020, by 13 Democrats.  The legislation is CCPA Lite, providing consumers the right to know, delete and opt-out of the sale of information.  The legislation would apply to a for-profit business that “does business in Arizona” and:

1. Has annual gross revenue in excess of $15 million;
2. Buys, receives, sells or shares the personal information of 50,000 or more consumers; or
3. Derives 50% or more of its annual revenue from the sale of consumers’ personal information.

Unlike the CCPA and legislation pending in other states, the bill does not provide any GLBA, HIPAA or FCRA exemptions.

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In the event of a breach due to the failure to maintain reasonable security measures, a consumer may file suit for statutory damages of $100 to $750 per consumer per incident, or actual damages.  A 30-day notice and opportunity to cure provision is included but only applies to an action for statutory damages and does not apply if the action is for “actual pecuniary damages.” The attorney general would be authorized to seek civil penalties up to $7,500 per violation.

HB 2729, was introduced on Feb. 10, 2020, by 12 Democrats and one Republican, the Republican being the Chair of the House Committee on Technology.  The applicability of the legislation includes a little GDPR flavoring in that it primarily governs the conduct of “controllers” and “processors.” Controllers are“natural or legal persons that, alone or jointly with others, determines the purposes and means of processing personal data.” Processors are “natural or legal person that processes personal data on behalf of the controller.” It would apply to:

A legal entity with annual gross revenue of at least $25 million that conducts business in [Arizona] or produces products or services that are intentionally targeted to residents of [Arizona] and that satisfies either of the following thresholds:

1. Controls or processes data of at least 100,000 consumers.
2. Derives over 35% of gross revenue from the sale of personal information and processes or controls personal information of at least 25,000 consumers.

Consumers would have the right to know, delete and correct their personal data.  The bill does not provide consumers an opt-out of the sale of their personal information.  Instead, consumers would have the right to object to the processing of their personal data. “Processing” is defined as “collecting, using, storing, disclosing, analyzing, deleting or modifying personal data.”

If the objection relates to processing for the purpose of targeted advertising, the controller must cease such processing and communicate the objection “unless it proves impossible or involves disproportionate effort . . .”  If the objection to processing is for any other reason, the processing can continue “if the controller can demonstrate a legitimate ground to process that personal data that overrides the potential risks to the rights of the consumer . . .” 

The legislation exempts “data sets” regulated by HIPAA and GLBA and “businesses and activities” covered by the FCRA.

There would be no private right of action.  Civil penalties may be sought by the Attorney General in the amount of $2,500 per violation, or $7,500 per intentional violation.  Interestingly, the bill specifically provides that if more than one controller and/or processor commit the violation, “liability shall be allocated among the parties according to principles of comparative fault, unless such liability is otherwise allocated by contract among the parties.”

The same sponsors introduced HB 2728 governing the use of biometric data.  The legislation requires notice and consent to “enroll” a consumer’s “biometric identifier in a database for a commercial purpose.” 

Excluded are “activities” subject to HIPAA and “a financial institution or an affiliate of a financial institution” subject to the GLBA.  If only that GLBA exemption had been used in HB 2729.

On Friday afternoon, the Consumer Financial Protection Bureau (CFPB) released its long-awaited Supplemental Notice of Proposed Rulemaking (SNPRM) for time-barred debts. The CFPB first hinted that an SNPRM  was coming last year when it included a placeholder for time-barred debts in its full NPRM for debt collection, as well as when it launched a consumer survey for time-barred debt disclosures. As recently as December, the CFPB noted that the SNPRM would be coming “very early in 2020“—and now it is here.

The Proposed Disclosures

Following the path of certain states that already require time-barred debt disclosures, the CFPB has created three separate proposed disclosures that would be applied to applicable situations. First is the general time-barred disclosure, to be used on all time-barred debs:

The law limits how long you can be sued for a debt. Because of the age of this debt, we will not sue you for it.

Second, if the relevant state laws allow the statute of limitations to restart—discussed as “revival” in the SNPRM—then the debt collector must use the following in the disclosure:

The law limits how long you can be sued for a debt. If you do nothing or speak to us about this debt, we will not sue you to collect it. This is because the debt is too old. BUT if you make a payment, then we can sue you to collect it.

Third, if the applicable state laws allow revival through the consumer’s acknowledgment of the debt, then the following disclosure applies:

The law limits how long you can be sued for a debt. If you do nothing or speak to us about this debt, we will not sue you to collect it. This is because the debt is too old. BUT if you acknowledge in writing that you owe this debt, then we can sue you to collect it.

And, if both of the above scenarios revive the statute of limitations, there is a proposed disclosure that combines them:

The law limits how long you can be sued for a debt. If you do nothing or speak to us about this debt, we will not sue you to collect it. This is because the debt is too old. BUT if you make a payment or acknowledge in writing that you owe this debt, then we can sue you to collect it.

When to Provide the Disclosures

The disclosure must be provided in the initial communication with the consumer—including oral communications—as well as in the validation letter. If the debt was not time-barred at the time the debt collector began collection efforts but later becomes time-barred, the debt collector must provide the disclosure in the first communication after the debt becomes time-barred.

The SNPRM provides a “knows or should know” standard—rather than a strict liability standard—for debt collectors. In other words, if the debt collector knows or should know that the debt is time-barred, then it must provide the disclosure. If the debt collector didn’t know and shouldn’t have known that the debt was time-barred, then the debt collector must provide the disclosure after it becomes aware or should have become aware that the debt is time-barred. 

If the applicable state for the debt already requires a time-barred debt disclosure, the SNPRM states that the state-required disclosure can be placed on the reverse side of the page. We’re already thinking what you’re thinking, check out the iA Perspective below for more.

Comment Due Date

The SNPRM has not yet been published in the Federal Register. However, once it is, comments will be due 60 days after publication.

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insideARM Perspective

There are a few things to unpack here, we will just name a few.

Conflict with State Laws. The SNPRM notes that several states already provide a verbatim disclosure. In such situations, the CFPB’s disclosure should be on the front of the letter, while the state’s disclosure can be on the reverse side of the letter and still be in compliance with the rule. This causes two primary issues.

First, some states—like New York—require that their time-barred debt disclosure be placed on the front page of the letter. Per the SNPRM, this would already be deemed not in compliance. With all of the other validation notice requirements, there is simply no room on a standard letter-sized piece of paper to include all of the required information and two time-barred debt disclosures. Does this mean that, as a practical matter, the CFPB is effectively banning time-barred debt collections in New York?

Second, the SNRPM’s disclosure are extremely similar—if not almost identical—to the disclosures required by the “verbatim disclosure” states.  For example, states with revival statutes already require that the implications of payment or acknowledgment of the debt be included in their disclosure. What is the point of repetitive disclosures? It would seem more prudent to create an exception in the SNPRM for time-barred debts that are already subject to verbatim disclosure requirements by their applicable states, since the consumer is already on notice of the time-barred nature of the debt.

Jurisdictional Split for “Will Not Sue” and “Cannot Sue.” In the SNPRM, the CFPB mentions that it considered both a “will not sue” and “cannot sue” disclosure, finding that “will not sue” is sufficient. This would, hopefully, bring a close to a jurisdictional split on the issue. A few district courts—such as the Northern District of Illinois and the District of Utah—found that “will not sue” implies that the debt collector is choosing not to sue the consumer, rather than being prohibited from doing so by law. Other jurisdictions—such as the 9th Circuit Court of Appeals and the District of Colorado—found that “will not sue” is fine. 

Editor’s Note: We found this jurisdictional split information—including details about each case, and the fact that many of these decisions originate from cases filed by the same set of consumer attorneys—through just a couple of clicks in the iA Case Law Tracker.

There are several more observations—the least of which being how clunky and confusing the “if you do nothing or speak to us about this debt, we will not sue you” proposed disclosure is—but we’ll save those for the comment.

Editor’s note: This article is provided through a partnership between insideARM and Squire Patton Boggs LLP, which provides a steady stream of timely, insightful and entertaining takes on TCPAWorld.com of the ever-evolving, never-a-dull-moment Telephone Consumer Protection Act. Squire Patton Boggs LLP—and all insideARM articles—are protected by copyright. All rights are reserved. 

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With the ATDS picture slowly taking shape in TCPAWorld the newest battle surrounds Article III standing in the context of TCPA violations.

In order to assert standing to sue under the statute a Plaintiff must demonstrate–for each and every phone call folks–that the call caused “concrete” and “real world harm” that is “fairly traceable” to the Defendant’s conduct. A new decision out today in Drake v. Firstkey Homes, LLC, Case No. 19-cv-1746 (N.D. Ga. Feb. 21, 2020) explores the contours of both aspects of the standing inquiry. And–given the *ahem* creative arguments presented by the Defense– the decision is quite illuminating.  The opinion can be found here: Drake v. Firstkey

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Things start off well enough for the Defense in Drake. The Plaintiff’s first claim was that a pre-recorded voicemail left by the Defendant–yes, the case involved a single pre-recorded call leading to a putative nationwide class action–violated the TCPA delivery restrictions because it did not include an automated opt-out mechanism as required by the statute. Yet, as Defendant argued, Plaintiff never received a second call. So the absence of the opt-out mechanism could not have caused Plaintiff any harm. The Court agreed and concluded that the failure to include the opt-out mechanism was merely a procedural violation of the statute that amounted to zero real world harm. Claim dismissed.

So far so good.

But the Drake Court reached the opposite result on the issue of Article III harm resulting from the receipt of that same voicemail more broadly. Specifically, Plaintiff did not consent to the call and the Court found she was adequately injured by its receipt to justify the suit.

In reaching this conclusion, the Drake court analyzed the effect of both Salcedo and Cordoba and concluded, in essence, that the holding of Salcedo is limited to text messages because phone calls necessarily tie up a phone line in a way that text messages do not.  The Court finds that “enduring” a 30 second voicemail is sufficient to cause Article III harm.

The Court was also unmoved on the Defendant’s argument that Plaintiff’s injury was not traceable to its conduct. The number at issue had been (erroneously?) supplied by the Defendant’s customer–the appropriately-named-for-February Ms. Valentine. So, the argument went, Plaintiff lacks standing to sue Defendant because Valentine is the one to blame for the phone calls and not it.  But the call at issue was plainly placed by the Defendant. So the Court concluded the injury was traceable to its conduct. (That’s…pretty straightforward folks.)

Defendant also argued that Cordoba somehow required Plaintiff to respond to a voicemail and ask not to receive further calls before she could sue for a violation of the TCPA’s pre-recorded voice provisions. This is so because the Cordoba court had held that a party that had never asked not to receive calls cannot recover for a Defendant’s failure to maintain an internal DNC list. But it does not follow–at least in the Drake court’s view– that a Plaintiff must therefore affirmatively remove herself from a calling list when it becomes apparent she was receiving inadvertent phone calls.

Apart from standing, the Defendant also argued the FCC’s one-call recycled number afforded a defense. That’s an odd argument given that: i) the safe harbor was set aside by the D.C. Circuit Court of Appeal (although it was replaced by something even better); and ii) the number at issue was not a recycled number but just a wrong number. To surmount the latter hurdle Defendant offers this Hail Mary: the number must have been recycled to Plaintiff at some point–I mean, she didn’t always have the phone number, right? I mean, right?

Eesh.

While it is undoubtedly true that Plaintiff was not born with her phone number and it must, therefore, have been “reassigned” from somebody else to her at some point, that doesn’t mean it is a recycled phone number for purposes of the FCC’s safe harbor. The recycled number safe harbor existed–while it existed–to protect callers that received consent from the subscriber of a phone and then continued to call the new subscriber when the number changed hands without their knowledge. It, rather obviously, did not afford one free call to any number that was ever assigned to anyone ever.  The Drake court makes short work of this argument.

It is important to understand, of course, that the one-call safe harbor (again, while it existed) was not a general “wrong number” safe harbor–it was a specific recycled number safe harbor. A point that was not lost on the Drake court.

Drake also goes on to reject Defendant’s constitutional challenge, but that was more on procedural grounds than substantive and is not worth discussion here except to note that if you ever want to read a really long footnote check out FN6.

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The iA Case Law Tracker can help you keep up with new court decisions and conduct quick, incisive legal research in less time than it takes to pour your morning cup of coffee.

GENESEO, N.Y. — Coast Professional, Inc. (Coast) has hired Christopher Woodworth as Government Relations Facilitator. The Government Relations Facilitator is responsible for the management of the company’s government contracts, as well as the company’s All Small Mentor-Protégé Program. Christopher will be working from the company’s Geneseo, NY office. 

In his previous roles, Christopher oversaw the daily operations of government contracts, subcontractors, and over 450 employees. He brings 17 years of industry experience to his position and specializes in the large scale coordination of collection activities, policy generation, trend forecasting, and cross-functional team management. Christopher will be responsible for the continued top performance of Coast’s federal government contracts by creating and evaluating the company’s operational strategies and systems. 

“Christopher is joining Coast as a dynamic industry leader with nearly two decades of experience,” said Jonathan Prince, Coast COO. “He is an expert in strategic planning and developing high-performing teams and his management skills align perfectly with Coast’s overall mission. Christopher is a results-oriented leader, and his operational foresight will help streamline the company’s day-to-day procedures. Christopher will bring immense value to Coast and I am excited to welcome him to our team.” 

Christopher is a member of Project Management Institute, as well as the National Contract Management Association. He is currently pursuing his master’s degree in management science from Keuka College. 

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About Coast Professional, Inc.:

Coast Professional, Inc. is an accounts receivable management company, dedicated to the respectful and ethical collection of higher education and government debt. Coast provides professional collection services to over 200 campus based colleges, universities, and government clients. Coast is a six-time honoree on the Inc. 5000 list for America’s Fastest-Growing Private Companies provided by Inc. Magazine and in 2019, was recognized for the fourth time as one of the “Best Places to Work In Collections” by insideARM.com and Best Companies Group. Since 1976, Coast has worked closely with clients to increase recoveries by assisting consumers in resolving their financial obligations. Coast’s success is exemplified by exceptional recoveries, superior service, and dedication to the highest levels of compliance. More information about Coast can be found at www.coastprofessional.com

CHICAGO, Ill. — Provana, a leading provider of best-in-class solutions for accounts receivables management, is excited to announce its acquisition of Surefire Data Solutions. Surefire combines industry-leading compliance, advanced analytics, and proprietary software to deliver superior results and ROI for the nation’s largest credit issuers, auto finance companies, collections law firms, and agencies. 

Provana, headquartered in Chicago, IL, has a global presence of over 1,400 employees and invests heavily in building intelligent solutions designed to improve compliance, operational efficiency and access to business intelligence for regulated small-medium businesses and networked enterprises. 

This acquisition enables Provana to further strengthen its suite of product offerings by leveraging Surefire’s technology solutions which specialize in compliance software for data scrubbing, redaction, and indexing.  

The acquisition will benefit all of Surefire’s clients, which include several of the industry’s largest financial services companies. Clients such as PRA, CarMax, and Credit Acceptance, will now have access to Provana’s powerful technology suite of compliance management, network oversight, business intelligence, consumer contact, and process automation solutions. 

“I am confident that Provana’s domain-expertise and large technology team will result in further enhancements to our products as well as provide higher value to our clients. The Surefire team, led by Rick Olejnik, will work closely with the Provana team to ensure a smooth transition for our clients,” says Bill Sturm, Partner at Surefire Data Solutions. 

“Provana’s focus on investing in innovative legal process automation tools and external performance management solutions is a top priority for 2020,” adds Sandeep Bhargava, CEO and Co-founder of Provana. “The stellar Surefire products and market reputation will be an important addition to our existing product suite of legal tech solutions for our clients.” 

About Provana

Founded in 2011 and headquartered in Chicago, IL, Provana offers small- and mid-sized businesses and networked enterprises access to a global delivery model and cutting-edge tech-enabled solutions — including compliance management, business intelligence, consumer contact solutions, and process outsourcing & automation. 

The combination of technology expertise and a large global workforce with high breadth and depth of experience makes Provana the perfect partner to help organizations increase profitability, improve performance and exceed client expectations. 

About Surefire

Surefire provides innovative tech-driven data solutions that bolster compliance, analytics, and drive process automation. Surefire products help ARM industry professionals better utilize their existing data to increase revenue, collaboration and efficiency while reducing risk and improving compliance to deliver superior results and ROI for the nation’s largest credit issuers, auto companies, credit unions, and banks.