TCPA Quick Hitter: Another CEO Caught in TCPA Trap

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You start a business. You create an LLC. That’s supposed to protect you from personal liability for the activities of your business, right?

Not when it comes to the TCPA.

As I’ve reported over and over again, the Court’s have zero trouble holding CEOs and other officers of companies directly liable for corporate conduct in TCPA suits. Even low level employees who are just following instructions can be held personally liable under the TCPA’s strict liability rules.

Its the most unfair rule in the entire legal world. 

But that’s all old news. Here’s the new news.

In a new case out yesterday a court just held that a CEO can be personally named in a TCPA suit based on allegations that the company is a small company (two employees) so the CEO must have been involved in sending the allegedly illegal messages.

Yep. That’s it.

Notably the Plaintiff didn’t even name the company in the suit. Just went directly after the CEO.

So basically the door is now open to directly sue the CEO of any small company for any TCPA violation.

Got it. Totally the way the law is supposed to work.

If you’re a small business owner or a start up operator please please do not assume that any level of corporate formality will keep you safe from the TCPA. These cases do NOT require piercing the corporate veil. These guys can come directly after you merely because you were “involved” with the allegedly illegal conduct–even if your sole involvement was mandated by your role and responsibilities in the business.

Its nuts.

The case is Marden’s Ark Corp. v. Bodenhamer, No. 5:20-CV-611-BO, 2021 U.S. Dist. LEXIS 169797 (E.D. N.C.  Sept. 08, 2021).

Unrelated–how many of you will be in Denver next week? Contact.io baby.

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Published by Eric J. Troutman

The Czar of TCPAWorld Eric Troutman is one of the country’s prominent class action defense lawyers and is nationally recognized in Telephone Consumer Protection Act (TCPA) litigation and compliance. He has served as lead defense counsel in more than 70 national TCPA class actions and has litigated nearly a thousand individual TCPA cases in his role as national strategic litigation counsel for major banks and finance companies. He also helps industry participants build TCPA-compliant processes, policies, and systems. Eric has built a national litigation practice based upon deep experience, rigorous analysis and extraordinary responsiveness. Eric and his team feel equally at home litigating multibillion dollar telecommunications class actions in federal court as they do developing and executing national litigation strategies for institutions facing an onslaught of individual TCPA matters. They thrive in each of these roles – delivering consistently excellent results – while never losing sight of the client experience. While many firms now tout TCPA expertise, Eric has been there from the beginning. He built one of the country’s first TCPA-only defense teams and began serving as national TCPA counsel for his clients nearly a decade ago. This perspective allows him to swiftly develop the right litigation strategies for dealing with recurring problems, without wasting time on tactics that are bound to fail. Eric’s rich historical perspective and encyclopedic knowledge of the TCPA landscape also make him an invaluable resource to institutional compliance teams struggling to comply with the shifting regulatory landscape. No task is too small – or too big. Indeed, Eric and his team have helped build TCPA-compliant systems and processes for some of the largest and most complex corporate entities in the country. He commonly works with in-house compliance counsel to build and implement enterprise and business-line specific TCPA solutions, performs TCPA audits and drafts and reviews proposed TCPA policies and procedures. He and his team also have the technical expertise necessary to assist call centers seeking to develop TCPA-resistant call path architecture or to modify existing telephony and software integration to better insulate from potential TCPA exposure. Eric has built a reputation for thought leadership. An avid blogger and speaker, he has been at the forefront of the industry’s effort to push for clarity and a return to sanity for the TCPA for years. He was selected to advocate for the financial services industry on important TCPA issues before the Federal Communications Commission and co-authored the nation’s only comprehensive practice guide on TCPA defense. In his spare time, Eric leads defense teams representing banks and other financial services companies in consumer finance litigation matters. He has experience representing clients in UCC, TILA, RESPA FCRA, CCRA, CLRA, FDCPA, RFDCPA and FCCPA claims, as well as in fraud and bank operations issues.

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