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TCPA Claim Dismissed Based on Consent Grounds

A federal court in Ohio recently granted a motion to dismiss a TCPA case because the plaintiff did not properly alleged that he did not provide consent to receive telephone calls.

In Whiteacre v. Nations Lending Corp., et al., No. 19-CV-809, 2019 WL 3477262 (N.D. Ohio Jul. 31, 2019), the plaintiff alleged that defendants Nations Lending Corporation and its alleged loan servicer, LoanCare, violated the Telephone Consumer Protection Act when LoanCare purportedly phoned him via an automated voice messaging system.

In the opinion, the court granted defendants’ motion to dismiss the TCPA claim for failure to state a claim. Specifically, the court dismissed the TCPA claim because bare assertions of the elements of claim, without sufficient factual allegations, are insufficient as a matter of law. Additionally, the plaintiff provided his telephone number to defendants and thus granted consent – unless revoked. Plaintiff was required to plead revocation.

The court stated “persons who knowingly release their phone numbers have in effect given their invitation or permission to be called and the number which they have given, absent instructions to the contrary.” Plaintiff made no suggestion in his Amended Complaint that he did not provide his routine data.

Plaintiff failed to properly allege that he did not supply his phone number, or that he revoked his consent. In effect, the court ruled that the burden is on TCPA plaintiffs to allege lack of consent and revocation.

As private plaintiffs and FTC attorneys continue to police telemarketing and do-not-call violations, defense counsel should take note that pleadings must properly set forth how the TCPA was violated. Conclusory TCPA allegations will not cut it.

FTC Halts Alleged Do Not Call Violators

FTC lawyers recently announced that it has obtained a stipulated final order that permanently bans a company from telemarketing. The agency also obtained a preliminary injunction barring the company’s founder and CEO from telemarketing until the final resolution of the case. The individual is the sole remaining defendant in a 2018 case involving alleged calls to more than one million consumers whose numbers are on the National Do Not Call Registry.

According to FTC lawyers, the defendants are repeat violators of the Telemarketing Sales Rule, which prohibits calls to numbers on the DNC Registry. The FTC alleges that the company installed home security systems, and its employees allegedly made outbound calls to solicit the sale of the systems and associated security monitoring services.

The 2018 complaint alleges that the company and individual failed to comply with a 2014 court order. The complaint also alleges that they obtained consumers’ credit scores without consumers’ knowledge or permission, and without having a permissible purpose, in violation of the Fair Credit Reporting Act.

The U.S. District Court for the District of Massachusetts has now issued orders against the two. The stipulated final order against the company resolves the FTC lawyers’ allegations against the company. The order permanently bans the company from all telemarketing and from obtaining or using consumer credit reports without written authorization. It also prohibits the company from misrepresenting its affiliation or association with other alarm companies, and imposes a suspended $9,845,021 judgment against the company, based upon its inability to pay. The judgment will become due in full if it is later determined that the company misrepresented its financial condition to the Commission.

The case against the individual continues, but the preliminary injunction order protects consumers from allegedly his abusive telemarketing and credit inquiries while litigation is ongoing. The order, which remains in place until the resolution of the litigation, bars the individual from outbound telemarketing and from obtaining or using consumer credit reports without written authorization. T

The case has been transferred to federal court in Rhode Island.

Richard B. Newman is an FTC lawyer at Hinch Newman LLP. Follow him on Facebook at FTC CID attorneys.

Information conveyed herein is for informational purposes only and does not constitute, nor should it be relied upon, as legal advice. No person should act or rely on any information contained herein without seeking the advice of an attorney. Attorney advertising.

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Richard B. Newman

Richard B. Newman is an Internet Lawyer at Hinch Newman LLP focusing on advertising law, Internet marketing compliance, regulatory defense and digital media matters. His practice involves conducting legal compliance reviews of advertising campaigns across all media channels, regularly representing clients in high-profile investigative proceedings and enforcement actions brought by the Federal Trade Commission and state attorneys general throughout the country, advertising and marketing litigation, advising on email and telemarketing best practice protocol implementation, counseling on eCommerce guidelines and promotional marketing programs, and negotiating and drafting legal agreements.

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