Mixed-Bag Ruling Results in Vicarious Liability Claims Surviving

A recent ruling out of the Southern District of Florida brings some good news and some bad news for TCPA defendants.  See Hossfeld v. Am. Fin. Sec. Life Ins. Co., 2021 U.S. Dist. LEXIS 112608 (S.D. Fla. June 16, 2021).  As an eternal optimist, I will start with the good news first.  Standing challenges for single calls remain alive and well in the Eleventh Circuit.  The court dismissed a number of defendants that were connected to only one call in the complaint.  The court  also found that if a plaintiff does not allege calls violating the TCPA after making a do-not-call request, then that plaintiff does not have standing to challenge a defendant’s failure to maintain and honor an internal do-not-call list.  Now, the bad news.  The court joined a growing number of courts rejecting the so-called Creasy argument and found that the TCPA is enforceable against defendants as to calls made between 2015 and July 2020.  In addition, the court permitted the plaintiff’s prerecorded call claims to go forward against certain defendants based on vicarious liability.  The court found that plaintiff’s broad allegations of control were sufficient to allege liability under common law agency principles.  Now, whether plaintiff’s allegations can actually be proven is a different story, but the plaintiff has lived to fight another day and the case goes on.

In Hossfeld, plaintiff alleged that he received a series of unsolicited insurance sales calls over the course of a year, some of which began with a prerecorded message.  He sued the insurance companies identified during the purported calls.  Defendants argued that the court lacked subject matter jurisdiction because the entire TCPA, as amended in 2015, was rendered invalid by the Supreme Court’s decision in Barr v. Am. Ass’n of Political Consultants, 140 S. Ct. 2335 (July 6, 2020).  The court disagreed and found that the severance of the government-debt exception in Barr “does not destroy the pre-existing robocall restriction.”  However, relying on the Eleventh Circuit’s decisions in Cordoba v. DIRECTV, LLC, 942 F.3d 1259 (11th Cir. 2019) and Salcedo v. Hanna, 936 F.3d 1162 (11th Cir. 2019), the court held that “[b]ecause [p]laintiff has not adequately alleged receipt of more than one unlawful call on behalf of [six insurance defendants], [p]laintiff has no standing to bring a TCPA claim against them.”

As to the two remaining insurance defendants, the court found that neither could be directly liable under the  TCPA because neither placed the calls – a third party did.  However, the court found that both could be liable under federal common law agency principles, including actual authority, apparent authority or ratification.  For purposes of the motion to dismiss, the court described its role as determining whether there is a factual basis that gives rise to an inference of an agency relationship.  “Therefore, [p]laintiff must allege enough facts to show that [the insurance defendants] exercised substantial control over the third-party telemarketer agents’ actions, ratified the agents’ conduct, or represented that the agents acted with authority from [the insurance defendants].”  Plaintiff made allegations that the insurance defendants authorized the calls, paid for the calls, authorized agents to use the insurance company’s name, controlled the telemarketing at issue by providing or approving the scripts used, and ratified the calls by emailing contracts and quotes.  In addition, according to plaintiff, the insurance defendants benefitted from the telemarketing.  The court found these allegations sufficient to plead a cause of action for vicarious liability.

Ending on a good note, however, the court dismissed count II for lack of standing, which alleged that one of the insurance defendants failed to maintain and honor a written internal DNC policy.  Relying on Cordoba, the court dismissed this claim because plaintiff did not allege any calls that violated the TCPA after he made his do-not-call request (they were either unanswered or made by live representatives).  Thus, the court found that plaintiff lacked standing to pursue this case.

While the case goes forward against two of the insurance defendants based on vicarious liability, it remains to be seen whether plaintiff has any evidence to back up his broad allegations of control by the defendants.  We here at TCPAWorld will have to wait and see!

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