Picking Up the Pieces: Quicken’s Big TCPA Arbitration Loss is a Lesson for Us All

Lawyers are generally terrible at understanding technology—particularly their client’s technological solutions deployed to meet specific business needs. Something about the idea of machines doing meaningful stuff just makes most lawyers’ brains shut off.

In the TCPAWorld, however, you either understand technology—at least the basic import of what the technology is actually doing—or you are bound to end up on the wrong side of the win/loss column. That’s at least part of why we’ve been so successful here at TCPAWorld.com—we’ve never been afraid to get our hands dirty when it comes to understanding technology and, critically, pushing back on the claims or assumptions of vendors or IT managers.

Let me give you an example.

Quicken recently lost an effort to compel a TCPA case to arbitration following a lengthy evidentiary hearing because the visual rendering it was relying on to prove Plaintiff accepted critical arbitration language didn’t actually show Plaintiff accepting the terms. Quite the oversight.

And while the cut-off visual rendering surely should have alerted Quicken and its counsel that a problem was afoot, they boldly proceeded to an evidentiary hearing on the subject begging the question of whether they fully understood the solution to begin with.

Let’s break this down because it is really interesting and there are several lessons to be gleaned.

In Hill v. Quicken Loans, Case No. ED CV 19-0163 FMO (SPx), 2020 U.S. Dist. LEXIS 140980 (C.D. Cal. Aug. 5, 2020) the Court denied arbitration following a multi-day evidentiary hearing. The procedural posture here is a bit confusing because, on the one hand, the Court suggests that Quicken maintained a burden to prove arbitrability by a preponderance of the evidence—suggesting that the was sitting as the finer of fact as if the proceeding were a trial on arbitrability—but, on the other hand, denied arbitration after finding Plaintiff had raised a “question of fact” as to whether or not she agreed to arbitration—a determination the Court just as easily could have reached on the papers. Weird.

Hill involved a common factual scenario—a lender (Quicken) purchased a lead through a third-party lead provider (LowerMyBills.com) who, in turn, had purchased a lead from a website called YourVASurvey.Info. Interestingly the Plaintiff admitted to visiting YourVASurvey.info—which TCPA Plaintiffs do not always do—but contended she got halfway through the registration form on the website before determining that the site was a “scam” website and electing not to finish the process. Interesting story.

The owners of YourVASurvey showed up at the evidentiary hearing and testified that there is no way it would have sold Plaintiff’s lead (i.e. the data she submitted in the form on its website) to LMB unless Plaintiff had clicked the “submit” button at the end of the multi-page form. But there was a problem—and it wasn’t Plaintiff’s curious testimony. YourVASurvey used a third-party consent verification program called Jornaya. (I love those guys BTW—not picking on them.) But the Jornaya visual rendering—which is a rendering of data capturing the entire interaction between a Plaintiff and a website—cut-off before the critical “click” of the submit button. This fact may have been overlooked by Quicken or its counsel—they did not have a witness from Jornaya on the stand to explain what happened—but it was not overlooked by the Court, which relied on this gap in denying the motion to compel.

But things get more interesting.

After the lead was sold to LMB, Plaintiff was sent a text message with a link to LMB’s terms and conditions. LMB contends Plaintiff clicked the link and subsequently clicked another button accepting those terms outright. A witness from LMB testified to the same. Plaintiff, however, again claimed to have pursued the terms but elected not to click “accept.” Once again, however, there was a problem for Quicken. LMB also used a third-party consent verification program—a company called ActiveProspect whose product TrustedForm also provides a visual playback of customer website interaction. (Love those guys too—again, not picking on anyone.) But guess what? Just like the Jornaya playback on the YourVASurvey website, the TrustedForm playback on the LMB terms and conditions page likewise shows Plaintiff interacting with the page but cuts off before the terms are actually accepted.

In light of this evidence the Court had little trouble denying arbitration—the two visual rendering vendors that were supposed to prove Plaintiff accepted terms and conditions actually seemed to prove exactly the opposite. Indeed, one wonders if the result would have been different had Quicken not provided the visual rendering playbacks to begin with—the renderings helped Plaintiff’s story in a very inconvenient way.

So here are a few lessons to keep in mind TCPAWorld (my observations about the case, not legal advice or endorsements folks):

  1. Incomplete Jornaya/Trusted Form visual renderings can get you killed. Do not just assume a Court will accept that terms were accepted if the visual rendering shows otherwise.
  2. Sometimes Jornaya/trusted Form verifications can be incomplete for technical reasons. In my experiences these companies will stand behind their product and assist you in litigation. Quicken elected not to have a witness from either company testify regarding the seemingly incomplete visual rendering playbacks. You can infer from that whatever you will, but I suspect (without having spoken with either company) that they would have happily supplied a witness to assist Quicken’s case had they been asked.
  3. If you are a lead supplier trying to sell leads without consent—and I am not saying that is what happened here, I simply do not know—you are not going to get away with it in an era where every website interaction is tracked.
  4. If you are a lead buyer do not buy leads that lack third-party verification—how else would Quicken have ever found out that leads from LMB were incomplete (if that I what happened).
  5. If you are a caller do NOT place calls to numbers that were supplied on a website but before the consumer actually accepts consent/arbitration disclosures—we’ve seen that one before.

But the biggest lesson is for the lawyers. Litigators cannot close their eyes to evidentiary gaps simply because they persist within high-technology solutions that the attorneys might not fully understand. The fact that neither the Jornaya nor the Trusted Form playback demonstrated Plaintiff accepted the critical disclosures should have been apparent to Quicken and its attorneys. They seemingly had no chance of success on the motions in light of that evidence, yet they persisted in pursuing arbitration without (as far as I can tell) attempting to explain the evidentiary gap in any meaningful fashion. Was this because the lawyers did not fully understand the technological solutions at issue, or due to something else?

I couldn’t tell you.

But what I can tell you is that any attorney that hope to make it in TCPAWorld needs to understand the systems, technologies, and processes deployed by the myriad players in this ecosystem. Otherwise,  you’re bound to be beaten by those who do.



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