Following McCurley the biggest trend in new TCPA suits are class actions against lead purchasers contending that lead aggregators falsified leads.
The theories behind these new suits vary. Some suits contend that the data supplied by the lead aggregators was obtained from third-parties as a result of black market purchases or data breach exploitation. Some contend that leads are cooked up by the lead generators themselves, with falsified tokens from third-party consent verifiers documenting web-site interactions that never took place. These theories are nascent and developing. But they form the backbone of innumerable TCPA class actions winding their way through the Courts at the moment and have placed lead purchasers firmly in the cross hairs. (You can bet your bottom dollar the team is going to address this trend LIVE on stage next Tuesday at Lead generation World.)
But is any of this true? There has yet to be a single finding–to my knowledge at least–that any reputable lead aggregator has definitively (much less deliberately) sold false leads. Plus the theory makes no sense from a business perspective- why would a lead aggregator dilute the value of its product with fake leads? Sure they might make a few extra bucks in the short term but pretty quickly folks will stop buying their leads as conversion plummets.
So this all smells like a hair-brained conspiracy theory–especially since no reliable evidence of misconduct by aggregators has surfaced (again, at least not to my knowledge or in any case we’ve reported on–other than possibly McCurely). Yet the suits keep piling up.
And in a marked escalation of these lawsuits, things just got personal for Adrian Bacon, a prominent consumer lawyer from California. Yesterday he filed a TCPA suit in federal court in Texas seeking to personally serve as a class representative against a large and reputable lead provider—All Web Leads, Inc–contending that the lead generator was systematically falsifying leads. The allegations of the Complaint—which are just allegations at this point—are as follows:
Defendant’s business practices include making “tens of thousands” of autodialed telemarketing calls to leads every day in order to inquire whether the consumer is interested in purchasing insurance, check the accuracy of their contact information, and determine whether the consumer is interested in speaking with an agent about their insurance needs. After Defendant “qualifies” the lead, Defendant completes a live transfer of the consumer’s phone call to one of its insurance industry customers.
One of the methods in which Defendant generates leads is through the utilization of Internet marketing. Defendant owns and operates various websites that are devoted to offering insurance quotes for specific types of insurance that consumers search for over the Internet. One of the websites that Defendant owns and operates is www.insurancequotes.com.
Upon information and belief, Defendant also engages and works with third-party call centers to contact consumers who never inquired about insurance through any medium. In one instance, a third party, utilizing a sophisticated automated voice response system, contacts consumers and attempts to illicit a positive response from each when the computer asks whether that individual is interested in receiving information about insurance. The computer then immediately forwards the caller’s information as a positive hit to Defendant, who then places a subsequent call to that consumer for the purpose of making a sales pitch. Defendant and/or the third parties believe they have circumvented the TCPA and have legal consent to place the calls to these individuals.
The problem is, on information and belief, the call center forwards contact information for any live body who answers the call and communicates with the automated system, regardless of whether that person gave valid consent to receive subsequent marketing calls from Defendant. Furthermore, there is no question the initial calls from the call centers are placed in violation of the TCPA. Therefore, the call centers (agents) are also liable for violating the TCPA, as are the principals (Defendant).
It remains to be seen whether any of these allegations have merit. All Web Leads declined to comment for the story but I’m pretty sure they’re going to have a lot to say about the lawsuit in court.
So what do you think TCPAWorld? Is this rash of lawsuits just the Plaintiff’s bar’s latest quixotic effort to cash in with bogus lawsuits? Or, far-fetched though it seems, are lead aggregators really selling bogus leads by the barrel full to make a buck, despite the massive risk such conduct would create? I know where my money is, but you have to admit this is interesting stuff–especially since the courts have yet to shut down this sort of lawsuit. The jury is, quite literally, still out.
The complaint can be found here: Bacon
We will, of course, keep you posted on developments.