Just last week I wrote about how the Eleventh Circuit is trying to take away incentive for TCPA class actions since they are clogging the dockets of federal courts across the country. Well, for those of you out there that wonder how we ended up here in the first place, boy do I have a story for you.
On March 19, 2019 repeat TCPA Player Todd Bank filed a putative TCPA class action lawsuit against Verde Energy.
The lawsuit alleged receipt of one illegal call. One.
By March 26, 2019—7 days after the suit was filed—Verde had already given up the ghost and agreed to a settlement of $75,400.00. For a one phone call case.
Don’t believe me? Here are the payment terms and signatures:
This is not a classwide settlement folks. No one released their claims but Todd. Claims regarding one call (ok fine, ultimately two but Verde and its counsel didn’t know that at the time they agreed to the settlement) are all that was released.
Check out the full settlement agreement here: Bank Settlement
What in the world were these folks thinking? This is why there is so much TCPA litigation out there folks.
There’s more to the story though. You’ll notice this is a purportedly confidential settlement. So how do I have a copy of it?
Stick with me because this gets better/worse/weirder.
Despite the huge settlement, Verde apparently (allegedly) went ahead and called Plaintiff’s cell phone again on the very day the settlement was supposed to become effective. In response, the ever-clever Bank decided to keep the settlement money– $75,400.00 you’ll recall—but not dismiss the class action. Instead he dismissed only his claim related to the one phone call that was alleged in the original complaint. But he amended the complaint to add the new phone call made on March 26, 2019—again the day the settlement became effective—and refused to dismiss the class claims.
So the class action against Verde continued despite the huge money they paid Bank. My goodness. How frustrating that must have been.
Mustering their courage, Defendant asked the court for help and moved for summary judgment arguing that the settlement agreement included a release of claims against Verde up until and including March 26, 2019. So the one call Verde attempted on that date was also covered. Bank opposed-probably snickering as he typed his brief– arguing that the release only covers claims in existence “as of” March 26, 2019 and his claim didn’t arise until March 26, 2019– so no release.
The court found the settlement agreement’s release language—which indeed included only those claims Plaintiff had “as of” the settlement’s effective date– yet included claims arising on the date of the agreement, as a matter of law for some reason. So Defendant ended up being granted summary judgment and gets the dismissal it bought and paid for. See Bank v. Verde Energy United States, 19-cv-01472 (AMD) (LB), 2020 U.S. Dist. LEXIS 171630 (E.D.N.Y. Sept. 18, 2020).
It only took $75,400.00 and 18 months of litigation to get a dismissal. Of a one call case.
Oh, and the Court denied Defendant’s request for attorney’s fees. So Verde had to pay its defense counsel (that was definitely not Squire Patton Boggs’s diverse and powerful TCPA team) on top of the $75k. Ugh.
So how did I get the settlement agreement?
Well, in order to have the settlement agreement considered by the Court, the Defendant had to lodge the confidential agreement for review. While both parties asked the court to seal the agreement, the Court refused. Reasoning that the “presumptive right of public access (read: TCPAWorld.com) to judicial documents” is compelling and can only be overcome by a strong showing of prejudice, the Court held that neither party had successfully made the required showing of need to seal the settlement agreement. Moreover, the confidentiality provision was expressly limited so as not to apply to efforts to enforce the agreement. On this basis too the Court found that the settlement was not entitled to confidential treatment.
So here we are.
Lessons: i) understand that this is why people like Todd Bank keep filing TCPA class actions; ii) stop paying so much money to people like Todd Bank in TCPA class actions; iii) don’t file your settlement agreements with the court if you pay so much money to people like Todd Bank in TCPA class actions; iv) don’t call Todd Bank without consent (and maybe just don’t call him at all– dnc.com?); v) definitely don’t call Todd Bank after you settle with him; vi) follow tcpaworld.com