On Friday of last week, the Northern District of Illinois foiled what appears to be an attempt by a consumer attorney to drum up a Fair Debt Collection Practices Act (FDCPA) violation by a debt collector. Garcia v. Miramed Revenue Grp., LLC, No. 18-cv-1384 (N.D. Ill. Aug. 16, 2019) is an example of the litigation dilemma faced by debt collectors as previously discussed on insideARM.

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In this case, the plaintiff had a past-due medical debt that the service provider placed with Miramed Revenue Group (Miramed) for collection. Miramed sent a collection letter that contained phone numbers, an address where the plaintiff can send correspondence, and a link to a website where the plaintiff can make a payment. Notably, there was no email address or invitation to email communications on the letter.

Despite the letter’s clear instructions on how to communicate with Miramed, the plaintiff’s attorney sent a message through a completely separate website’s “contact us” section. Miramed’s affiliated parent company Miramed Global, which is not a debt collector, owned this website. The message requested that Miramed—not the parent company—stop calling the plaintiff’s cell phone. The court notes that the law firm “used Microsoft’s snipping tool to screenshot the contents of the message and saved that screenshot to its server.” 

After Miramed continued to place calls to plaintiff’s phone number, the plaintiff sued—represented by the same law firm that sent the communication to the plaintiff’s parent company. Defendant filed a summary judgment motion on the issue, which the court granted.

At first, the decision looks a little grim because the court found that the bona fide error defense did not apply. While the parent company would forward messages that it thought were meant for Miramed, there were no policies and procedures in place to ensure this happened. Typically, only “a handful” of messages would get forwarded per month.

The decision then takes a positive turn. The court granted summary judgment in favor of Miramed, finding that there was no evidence that it received the message, which is a requirement for a cease and desist request under the FDCPA.

The court states:

Though a reasonable juror could conclude that Miramed Global received the request, given the lack of procedures in place requiring it to pass along relevant messages, that does not mean that Miramed received it. That Miramed Global sometimes forwarded messages it thought were intended for Miramed, does not allow the inference that Miramed received Garcia’s message.

…

Though the two companies are affiliated, they are not the same, and notice to one does not automatically count as notice to the other.

insideARM Perspective

This is not a unique situation. Debt collectors regularly deal with these types of crafty violation baiting attempts. Some examples include:

• A jury finding Lexington Law guilty of fraud by sending mass volumes of dispute letters to debt collectors.
• The call baiting about whether the account can be disputed over the phone.
• Consumers baiting violations via scripts typically obtained from consumer attorneys.

With the one-sided nature of the attorney fee provision and the strict liability nature of the FDCPA, these types of attempts are unlikely to go away. It creates an easy target, even of debt collectors who in good faith try to do right by consumers and comply with the myriad federal and state requirements governing the industry. The good news is that the Consumer Financial Protection Bureau has taken notice, at least indirectly, and brought its own lawsuit against Lexington Law.

Well, the Wolverine state is now at war with itself—and I’m not talking about college football.

As we’ve reported previously, the Eastern District of Michigan has repeatedly followed the statutory approach to interpreting the TCPA’s phrase “ATDS” and required random or sequential number generation to state a TCPA claim. A court in the Western District of Michigan weighed in on the fight over the proper interpretation of an ATDS this week, however, and sided with the Ninth Circuit’s expansive holding in Marks that all dialers that call from a list of numbers automatically qualify under the TCPA.  This is the first time that Marks has been adopted within the Sixth Circuit and represents a further expansion of the Ninth Circuit’s TCPA reach.

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In Allan v. Pennsylvania Higher Education Assistance Agency, No. 2:14-cv-54 (W.D. Mich. Aug. 19, 2019), the Court granted the plaintiffs’ motion for summary judgment requesting an award damages for the 353 calls the defendant made to the plaintiffs’ cell phones using a system that automatically dialed numbers from a list created using specific selection criteria (i.e., not randomly or sequentially generated).  In analyzing the issue of whether the defendant’s phone system qualifies as an ATDS, the Court ignored the Third Circuit’s decision in Dominguez v. Yahoo, 894 F.3d 116 (3d Cir. 2018) and the many other district court decisions we have previously reported on which have held that an ATDS must be capable of generating random or sequential telephone numbers.  Instead, the Court in Allan noted that “[t]he only circuit court to analyze the issue in depth since the D.C Circuit’s ruling in ACA International is the Ninth Circuit.”  The Court then analyzed the Ninth Circuit’s decision in Marks, highlighting the provisions of the TCPA that it claimed “presumes a definition of an ATDS that includes equipment dialing from a list of individuals.”  Without further discussion, the Allan Court agreed with the Ninth Circuit’s conclusion that “the statutory definition of ATDS includes a device that stores telephone numbers to be called, whether or not those numbers have been generated by a random or sequential number generator” and held that “because there is no question that the [defendant’s phone system] . . . uses store[d] telephone numbers to be called and automatically dials those numbers, the system qualifies as an ATDS.” 

The court’s decision in Allan, however, is not entirely bleak for defendants caught up in the ATDS confusion.  After concluding that the calls at issue violated the TCPA, the Court rejected the plaintiffs’ argument that the defendant violated the TCPA willfully and knowingly by continuing to call plaintiffs using an ATDS after they revoked consent to receive such calls.  The Court found that, because the defendant’s violations were made at a time when the FCC had equivocated on whether the type of system it used qualified as an ATDS, the defendant’s violations were not willful or knowing and, therefore, not subject to treble damages.

The takeaway here is plain—the battle over the TCPA’s ATDS definition is still raging on. Although court’s adopting the “statutory approach” are now the more numerous—and particularly so in 2019—a surprising number of courts continue to show a willingness to apply Marks.

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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. 

ATLANTA, Ga.—Check Into Cash, a national industry leader in direct lending and short-term credit solutions with hundreds of retail locations across the country and an ever-expanding online presence, has selected Telrock, a global technology provider of SaaS-based software solutions, to provide their enterprise-wide collections and recovery platform Optimus.

Telrock’s cloud-based modern collection and recovery platform, Optimus, was developed from the ground up to meet the broad and rich set of capabilities desired by sophisticated organizations such as Check Into Cash, says Dale Williams, CEO of Telrock. Williams adds, “Optimus readily supports the high degree of flexibility, automation, control, and ease-of-use that today’s collection operations want but most other collection software systems can’t provide.”

“Check Into Cash selected Optimus because it represented the most complete solution for our business,” says Phil Korn, Vice President of Check Into Cash Collections. “Optimus covered certain key requirements we wanted, in particular, a more intelligent collector interface design, real-time processing capabilities, strong compliance, and reporting tools, and embedded digital channel customer engagement and self-serve capabilities.”

About Check Into Cash®

A pioneer in the short-term, direct-lending industry, Check Into Cash has provided financial solutions since its founding in 1993. Based in Cleveland, TN, Check Into Cash serves customers nationwide, providing flexible solutions and options, in-store and online, to fit customers’ needs. 

Check Into Cash is a founding member of the Community Financial Services Association of America (CFSA), the nation’s trade organization for the short-term loan industry. The CFSA enforces compliance, best practices, and works with state legislators and federal consumer groups to promote responsible legislation in an effort to balance the needs of customers with the interests of the industry. 

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About Telrock

Headquartered in Atlanta, Ga., and London, England, Telrock is a global technology provider of SaaS-based software solutions for enterprise-wide collections and recovery and digital channel customer engagement. Their clients include major banks, other credit providers, and business process-outsource companies in North America and Europe. Telrock’s solutions are SaaS-based; are built on highly scalable modern,     open-source technologies; and are deployed in secure PCI-compliant data centers. Visit www.telrock.com to learn more. 

It’s not every week that we see multiple decisions on the bona fide error defense from the courts, yet last week we saw three. Two were great, and one was scary. Below we’ll discuss each and how this may impact your business.

Decision 1: “Redundant” Policies and Procedures Save the Day

The first decision we’ll discuss is Williams v. Enhanced Recovery Co., No. 18-cv-03699 (N.D. Cal. Aug. 14, 2019). In this case, ERC was unable to establish contact with the consumer despite mailing collection letters and several attempts to reach the consumer by phone. After being unable to connect with the consumer, ERC reported the consumer’s accounts to the credit bureaus. Next thing ERC knew, the consumer filed a lawsuit against the company alleging that, despite the consumer sending in a dispute letter, ERC continued to report the account without indicating the consumer disputed it. ERC, however, never received the consumer’s dispute letter. 

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The court punted the disputed issue of whether there was indeed a dispute letter sent and received. Instead, the court went straight to granting summary judgment in favor of ERC on the bona fide error defense. Even if the consumer sent a dispute letter, the court found that ERC’s “redundant” policies and procedures for mail processing, dispute handling, and credit reporting were more than reasonable to prevent the alleged error. 

Legal and compliance professionals in this industry understand the importance of policies and procedures. Those in business and operational roles might feel like their legal/compliance colleagues place too much emphasis on documenting processes. However, this case is a perfect example of these exact documented processes being the difference between potential class action liability and no liability.

Shelly Gensmer, ERC’s Vice President of Legal and Compliance, spoke with insideARM about this case:

ERC goes above and beyond to ensure its policies and procedures are written and followed such that its practices follow the law, but even more so, it puts in place additional means to catch any exceptions in processes. It even has measures in place to make sure the exceptions process goes the way it was designed. The judge’s order was strong in ERC’s favor and while we certainly take some level of pride in the success of this case, our takeaway is to continue to press the importance in all of our departments that policies and procedures must be reviewed and updated regularly.

Decision 2: The Obvious Saves the Day

The next decision we’ll discuss is Ketterman v. I.C. Systems, Inc., No. 4:18-cv-1136 (E.D. Mo. Aug. 12, 2019). In this case, the consumer sued I.C. Systems for allegedly attempting to collect a utility debt owed by his ex-wife, not him. The decision primarily discusses processing fees—the bona fide error defense came in at the end as an “even if” resolution. On that specific issue, the court found that I.C. Systems reasonably relied on the information provided by the creditor regarding the ownership of the debt to qualify it for the bona fide error defense. The facts presented also show that it was reasonable to believe the consumer owed the debt. The consumer’s testimony shows that he lived in the home while the debt accumulated, his name was on the account, and he paid the utility bill in the past.

Decision 3: Programmers Beware, Connecticut Thinks You Don’t Ever Make Mistakes 

The final decision—admittedly a scary one—is Garcia v. Law Offices of Howard Lee Schiff, P.C., No. 3:16-cv-791 (D. Conn. Aug. 15, 2019). The defendant here sent a collection letter that included a debt itemization similar to the one required by the New York Department of Financial Services and contemplated by the Consumer Financial Protection Bureau’s Notice of Proposed Rulemaking for debt collection (NPRM). The current balance in the letter was different than the balance at charge off, but the itemization did not explain the difference. The itemization listed zeros for interest, fees, and payments since charge off. The letter omitted the consumer’s prior payment to the creditor, which was a typographical error.

The court found that the letter is confusing and misleading to the consumer about the amount he owed. However, even though the evidence shows this error was inadvertent, the court refused to find that the defendant was entitled to the bona fide error defense. The court found that the programmer’s mistake was not reasonable, considering the programmer’s experience and the letter’s short length. The court found that the defendant’s policies and procedures were not reasonable to prevent the mistake due to the error not being caught in testing despite the letter’s simplicity.

There are a few red flags in this decision. First, the court mistakenly thinks that the length and “simplicity” of a letter equates to the level of complexity in programming such letter, which is not the case. Second, the court thinks that experienced programmers are not human and are immune from inadvertent, typographical errors—the exact type of error contemplated by the bona fide error defense. Third, the court seems to oversimplify the letter testing process for a business that sends significant volumes of letters. 

The takeaways from Garcia are twofold. First, double-check the calculations in the debt itemization on letters. Second, said with tongue-in-cheek, programmers are beyond inadvertent human mistakes.

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Want to keep up with other similar FDCPA cases as they come out? You can do so through iA’s Case Law Tracker, which allows you to conduct incisive and quick legal research in less time than it takes to pour your morning cup of coffee.

On Friday, August 16, the Consumer Financial Protection Bureau (CFPB) announced that it has appointed Robert Cameron as the private education loan ombudsman. Cameron comes to the CFPB with experience as both a Staff Judge Advocate with the Pennsylvania Army National Guard as well as the Pennsylvania Higher Education Assistance Agency. 

The CFPB’s prior student loan ombudsman, Seth Frotman, resigned a year ago with a resignation letter accusing the Bureau—led by Former Acting Director Mick Mulvaney at the time—of failing to protect student loan borrowers. Following his resignation, Frotman launched the Student Borrower Protection Center. 

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Frotman’s resignation letter spurred Congressional inquiries into the matter. When the CFPB’s Director Kathleen Kraninger appeared before Congress in March of this year to provide the CFPB’s semi-annual report merely three months after her appointment, she was met with multiple questions about why the ombudsman role remained vacant.

Often organizations miss out on higher bad debt recoveries. The number one reason this happens is that they hold on to the debt for too long.

If you have been following this adventure you how important payment terms are to the process. It’s important in the onboarding process to start with the end in mind: setting yourself up for success by having mutually agreed payment terms, billing cycle, right party contact information, etc. However, even if you have done that all correctly from the start, some customers, unfortunately, aren’t able to pay for one reason or another. Here’s how to know when to cut bait and give it to the professionals.

Recommendations:

Don’t ignore the warning signs. Your customer isn’t paying within the agreed payment terms. Or maybe they were paying on time, but lately, they have been pushing farther and farther out.

• The customer is showing past due more often and/or farther past due than historically
• The customer hasn’t paid you in the last 45+ days
• The customer is 60+ day’s past due to their mutually agreed payment terms
• The customer made broken promises to pay
• The customer stopped taking your phone calls
• The customer’s emails are suddenly not going through, or the physical mailing address is returning mail to sender

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Communicating. Don’t be afraid to ask how things are going, especially if you noticed they are outside their normal payment cycle. Immediately offer alternative options instead of having to pay you the full past-due amount today. Set the expectation that it’s vitally important that they keep the communication lines open. If they have something come up, they need to call you. And always answer your calls. You have to be blunt and purposeful in your approach here, so they understand the commitment to you.

Alternative Options. While it’s so important that the customer is taking your calls, it’s equally important to give them attainable goals. If the customer feels that they have options, they are more likely to keep the lines of communication open. Alternative options might include things like offering the ability for the customer to make a small weekly payment towards the balance.

Offer the ability for the customer to continue doing business with you while making payments. The best way to accomplish this is to set the expectation they must remain current on the new invoices. Make the weekly payments smaller, so they can keep to the commitment.

A customer can always call you and make additional payments. However, it’s most important that they are sticking to their original commitment. Ask the customer what is the dollar amount they can afford to make weekly (hopefully automatically)? If the dollar amount is less than their normal spend, this is a sign that they can’t stay active as a customer right now. Give them an option to use alternative vendors until they can cover their average invoices plus the delinquent amount.

I’m sure Sales aren’t going to be the biggest fan of that message, but they will thank you in the long run. Especially if they have chargebacks or are commissioned on collected revenue. Lastly, customers appreciate that you recognize and don’t want to see them get to a place of debt they can’t repay. The snowball effect of continuing to let a customer who can’t pay continue billing can be detrimental.

No one wins, if the customer files bankruptcy or worse yet goes out of business.

Recommended exercise, look at your customers that haven’t made a payment to you in the last 45 days. These should be a top priority for collections.

Make your goal to be first in line not last. Don’t miss out on collecting because you waited too long to send an account.

How fast are you making this decision today? Do you have an easy process for your collector to recognize it’s time to cut bait? Are the collectors being trained to recognize the warning signs and make quicker decisions? Don’t let your customers get into the 90 and 120-day buckets. They should already be with your third party agency at that point. That is if you want an opportunity to recover that debt and fast. If you are using the steps outlined above, you should see higher recoveries.

If you need help finding a good 3rd-party collections agency, or you have questions on the performance of your existing partner, let me know. I’d be glad to recommend some great alternatives.

I hope you see purposeful decision-making throughout the steps mentioned above. If not, feel free to reach out to me via email at keich@theiainstitute.com. I would love to hear your thoughts. Even better, #ChimeIn on my personal LinkedIn page where this article will be shared and published for open comments.

I look forward to seeing you at our upcoming strategy workshop this December in Scottsdale, Arizona, and helping your organization maximize revenue without increasing your bad debt!

Tonawanda, N.Y.—Arbeit Software has integrated Arbeit Voice, the company’s cloud-based business phone system with Beam Software’s receivables management platform; BEAM.  The integration gives Beam Software’s customers the ability to generate more phone calls and remain compliant while doing so. 

BEAM’s click-to-dial integration with Arbeit Voice allows agents to simply click on a telephone number to automatically dial it.  BEAM will also disposition the account using predefined text to document the result of the call.  This provides consistency across the organization when it comes to documenting call history. It eliminates the chance of an agent misdial. It also allows agents to comply with the requirements surrounding the use of an automatic telephone dialing system (ATDS) according to the FCC’s 2015 TCPA Order. 

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As new industry regulations are released, the importance of accuracy and compliance is intensified. In fact, the BCFP stated that new consumer protections will “overhaul the debt collection market by capping collector contact attempts and by helping to ensure that companies collect the correct debt.” 

“We’re always focusing on compliance and security since the climate for regulations is consistently changing.  Beam wants to make it easy for its customers to remain compliant.” said Thomas Mohr, Beam Software CEO. “We’re especially excited to be working with the bright development team at Arbeit.” 

The Arbeit Voice integration also provides agents with a screen pop on inbound telephone calls.  The BEAM collector screen automatically opens up when the agent answers an inbound call. 

“The integration is going to give agencies a huge productivity boost,” said Alex Villafranca, Arbeit Software CEO. “Pairing Beam’s innovative collection software alongside our TCPA compliance solution and office phone system is going to give agencies more ways to compliantly reach the consumer.”

About Arbeit Software

Arbeit Software is a leading contact solutions provider for call centers, debt collection agencies and small businesses. The suite of software was built by former debt collection agency owners and is designed to be efficient, easy to use and powerful.  In addition to a broadcast dialer, Arbeit offers a first of its kind, TCPA compliant manual dialing solution that removed the 3 second pause from the beginning of calls and allows agencies to make up to 250 manual calls per hour, per agent. Their business phone system Arbeit Voice is a perfect fit for small businesses who value cost efficiency and reliability. To see a demo or get a quote, visit www.arbeitsoftware.com. 

About Beam Software

Beam Software is a thought leader in collections and portfolio management technology and is a Microsoft Gold Certified Partner.  Its development team has written software for Wall Street while its executives have been heavily involved in the debt industry for over 25 years.  The company’s innovative collection software suite is built from real industry experience using leading technologies.  For more information, visit www.beamsoftware.com or call 800-212-2326.

Editor’s Note: This article originally appeared on the DCM Services website and is republished on insideARM with permission.

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On Thursday, August 8, 2019, the Seventh Circuit Court of Appeals (7th Cir.) published its long-awaited opinion in the matter of Lavallee v. Med-1 Solutions, LLC, 17-3244 (7th Cir. Aug. 8, 2019). For everyone in the ARM industry that is considering using email to deliver requisite 1692g disclosures, the decision is mandatory reading.

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I wrote an article about this case in October of 2017 when I was still at insideARM. At that time, I wrote: “On September 29, 2017, in a very interesting and timely Fair Debt Collection Practices Act (FDCPA) case, a district court in Indiana shot down a debt collector’s argument that it “sent” its validation notice to a consumer via email. The case is Lavallee v. Med-1 Solutions, LLC (Case No. 1-15-cv-1922, U.S.D.C., Southern District of Indiana).”

Everyone in the ARM industry is talking about more “digital engagement” with consumers. Interactive web portals, emails, texts, chat are the obvious options, with email being the most interesting and potentially most beneficial. However, use of email, particularly for 1692g disclosures, is fraught with issues.

What the Lavallee case has taught us is this: sending an email that contains a hyperlink to the requisite disclosures is NOT a communication of the requisite disclosures under the Fair Debt Collection Practices Act (FDCPA). The crux of the court’s opinion revolves around the definition of “communication,” particularly what constitutes a “communication” under the FDCPA. The court found that the emails were not “communications” since the substance of the email itself contained no disclosures or debt information. Nor did the hyperlink save the emails because it required the consumer to take multiple extra steps to obtain the information. (In fact, the court found that the consumer would have been required to take six (6) separate actions to read the notice.) The court noted:

To access the validation notice, Lavallee would have had to (1) click on the “View SecurePackage” hyperlink in the email; (2) check a box to sign for the “SecurePackage”; (3) click a link to open the “SecurePackage”; (4) click on the “Attachments” tab; (5) click on the attached .pdf file; and (6) view the .pdf with Adobe Acrobat or save it to her hard drive and then open it.

The CFPB’s NPRM is currently the hot topic in the ARM space. The NPRM is opening the door to more electronic communications, including emails. However, it is not clear at this time how “open” that door is going to be. Use of emails for initial communications is an interesting concept – but many questions remain to be answered.  Notably: How and when can the industry use emails for communication?  What will be required to use emails? Should “prior consent” be required, and how will we track consent and revocation? Finally, what in the world does the ESIGN Act have to do with this?

The NPRM’s comment period has been extended. Debt collectors and industry groups now have until September 18, 2019, to submit comments on this specific issue. 

It will be very interesting to see how email communications will be used in the future.  Among the open issues to be resolved is what options will pass muster when sending required disclosures to consumers via email if using Lavallee-like hyperlinks are not considered an appropriate communication?

TCPA litigation is big business. TCPA class lawyers make millions for the right case, and competition for good leads is fierce.

As I have said many times, however, TCPA class litigation is among the most complex and nuanced out there, and pitfalls abound both in pursuing and defending these actions. It is not just high-end TCPA defense lawyers that are in hot demand—top TCPA class lawyers find themselves wanted in more cases than they can safely take on.

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One class lawyer of relatively high repute is Keith Keogh. He’s had his run-ins with a couple of courts, such as the District of Minnesota finding his client had “distort[ed]” the evidentiary record in pursuing a certification motion, see Ung v. Universal Acceptance Corp. 249 F. Supp. 3d 985, n. 3 (D. Minn. 2017) and his engagement letter had to be modified before he could be approved as class counsel in Lanteri v. Credit Protection Asst. However, he has also successfully shepherded a number of TCPA class actions through to successful resolutions including arguably the best (from the plaintiff’s perspective) TCPA settlement in history. This makes his involvement in TCPA class suits valuable for would-be class representatives (and lawyers hoping to make a referral fee for his efforts) and somewhat foreboding for defense lawyers hoping to thwart certification in such actions.

But Keogh doesn’t just jump blindly into cases that are brought to him, as highlighted in the recent decision in Wexler v. AT&T Corp., 15-CV-686 (FB)(PK), 2019 U.S. Dist. LEXIS 131869 (E.D.N.Y. Aug. 5, 2019).

Wexler has an extremely interesting procedural history. The case was originally initiated as a putative class with Plaintiff’s husband serving as class counsel. That didn’t last long; however, as a class representative’s husband should not serve as class counsel owing to a potential conflict of interest issues. Nonetheless, when Mr. Wexler first withdrew as class counsel, he initially intended to seek recovery of fees on a quantum meruit theory. That created its own nest of issues that eventually resulted in him disclaiming any recovery to fees in a bid to avoid potential conflict issues.

In the meantime, however, Wexler was working behind the scene with Keogh on a potential engagement to bring him (Keogh) and another lawyer—Scott Owens—into the suit to serve as class counsel. According to the Court’s analysis, there had been “close business dealings between Mr. Wexler and [Keogh]” prior to this potential engagement, however.  Moreover, the original retainer agreement (apparently) did not mention a specific cut coming back to Mr. Wexler but did assign a 40% cut of a fee to Keogh. Although Plaintiff and other potential class counsel executed this retainer agreement, Keogh did not sign it. According to the Wexler decision, this was because Keogh wanted to see if the Defendant would successfully pursue arbitration before taking on representation in the case. Interesting, no?

Plaintiff’s apparent willingness to grant fees to Keogh despite his decision to wait-and-see on the arbitration issue would ultimately have a major impact on the court’s analysis of her adequacy to represent the class. In assessing the adequacy of Mrs. (Dr.) Wexler to continue representing the class as Plaintiff in 2019, the court noted that she had signed that retainer agreement in 2015 even though Keogh had not yet agreed to represent the class and despite the fact that she had never met him. As the court relates matters:

[t]he fact that Plaintiff would agree to give an interest in attorneys’ fees to someone who specifically declined to act as her counsel creates the appearance that Plaintiff had a conflict of interest, such that she would act to benefit those with financial dealings with her husband over members of the class.

The court was also concerned that the original retainer agreement did not make any mention of payment to Mr. Wexler for his fees in the case although he still expected to recover fees. As the Court views this matter, this fact alone demonstrates potential misdealing: “there is no indication of how he was to be paid…  [this] gap creates an appearance that Mr. Wexler had a spoken or unspoken side agreement with Mr. Giardina and Mr. Keogh.” This appearance was apparently heightened by deposition testimony in which “Mr. Wexler testified that he expected to get a ‘reasonable amount’ of fees, but that he was not included in the 2015 Retainer Agreement because ‘it would raise more problems than it would solve’ in light of the potential adequacy issues.”

A new retainer agreement was signed by Mrs. (Dr.) Wexler in 2016 that gave 50% of fees to Keogh and 50%  to another Plaintiff’s firm, but that new agreement clearly reserved to Mr. Wexler the ability to petition the court for a quantum meruit recovery.  As noted above, Mr. Wexler eventually disclaimed his right to any QM recovery in the case—apparently via a status report to the court in 2018—in a bid to salvage his wife’s adequacy to represent the class. But it was too late:

In light of Mr. Wexler’s close business relationships with Plaintiff’s current counsel, along with Plaintiff’s actions and inactions, the undersigned finds that a conflict of interest is apparent between Plaintiff and class counsel, such that divided loyalties impede her from monitoring counsel in this action.

Wow.

So there you have it TCPAWorld. A case that began with the potential class being represented by the husband of the class representative has hit the rocks of adequacy yet again. Keogh wanted to sit on the sidelines and await the outcome of the initial scuffle over arbitration but the class representative’s willingness to turn over fees to him despite his unwillingness to join the case—and apparently in blind reliance on her spouse’s advice—was deemed to create an appearance of impropriety thwarting adequacy given the “close business dealings” between her husband and Keogh.

I guess its a small TCPAWorld after all.

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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. 

Columbia, S.C.—Employees of AMCOL Systems, Inc., a nationally recognized leader in patient experience analytics and revenue cycle optimization, were moved to make a donation after recent mass shootings.  

“When we heard Ensemble in Mason, Ohio, had set up a fund for families of shooting victims, the employees here were quick to ask what we could do to help,” said Chip Hellmann Jr., President and CEO of AMCOL.  AMCOL works closely with Ensemble in the revenue cycle management industry.  “The empathy our team members have toward others is evident on a daily basis, but it is especially apparent in times of such human tragedy,” added Hellmann.

Employees have consistently come together to provide funds in times of crisis such as the wildfires in Tennessee, hurricanes in Texas, and flooding in their community. Animal shelters, military organizations, food banks, and children’s charities are just some of the frequent recipients of funds on a local level.

About AMCOL Systems, Inc.

Founded in 1976, AMCOL Systems is a leading provider of Self-Pay Collection, Bad Debt Recovery, and Insurance Claims Resolution services exclusively to the Healthcare Industry. AMCOL’s mission is to be trusted advisors who deliver tailored, patient-centered financial solutions to benefit their partners and their communities. ISO 27001 Certified for Information Security Management, and Quality certified through ACA International’s Professional Practices Management System, AMCOL is a leader in the healthcare receivables management industry and helps their clients accelerate cash flow and resolve patient accounts quickly and within all compliance standards. Additional information about the company can be found at amcolsystems.com.

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