If I’ve said it once, I have said it a hundred times– if you’re using Pakistan call centers you are in harm’s way.
Really really interesting case for you today. Especially for those of you in the Lead Generation World. So listen up.
A court in a pending TCPA class action just granted summary judgment in favor of one defendant against a different defendant. And you don’t see that everyday– and yes, that means the facts here are really bad.
In George Moore v. Torchlight Technology Group, LLC, Call Centrix, LLC, and Carol Stitz, 2023 WL 3863354 (N.D. Ill. June 7, 2023), the Defendants are facing a putative nationwide TCPA class action brought by a guy named George Moore who is no stranger to TCPA suits.
The calls at issue were made by a company called Wolf BPO, a company located in Pakistan. Uh oh.
Wolf sold the lead to Call Centrix, who purports to provide “‘compliant lead generation’ call center services.”
Call Centrix, in turn, had contracted with Torchlight who had apparently agreed to pay CC about $900k for TCPA compliant leads. (Lots of money in this business folks.)
Turns out though the Moore lead wasn’t TCPA compliant. Not even close.
Per the ruling, WolfBPO originally claimed that Moore had supplied his contact information on a website called “FindQualityInsurance.com,” but they were big fact liars. The lead was “fabricated.” Moore denied having visited this website and the website itself confirmed that it had no record of Moore’s consent. As such, Call Centrix conceded that it does not have any evidence of valid written express consent to initiate telemarketing calls to Moore and thus, Moore did not consent to receive such calls.
That is so so so so very bad.
Torchlight, as you’d imagine, was pretty upset about this situation and demanded indemnity from Call Centrix. When Call Centrix refused to defend Torchlight, Torchlight filed a claim against CC and then moved for summary judgment–and that’s where the ruling comes in.
In Moore the Court GRANTED summary judgment to Torchlight essentially ordering Call Centrix to defend and indemnify it. This is true because in its insertion order:
- Call Centrix represented that all the consumers whose calls it transferred to Torchlight gave express written consent to receive telemarketing calls about insurance as required by the TCPA and Do Not Call List requirements;
- Call Centrix warranted that consumers’ prior consent would be validated by third-party software;
- Call Centrix additionally agreed to preserve records of all calls made for five years and provide those records within five business days on request;
- Call Centrix warranted that it would monitor and control its vendors, who were similarly required to comply with the Agreement;
- Call Centrix agreed to obtain comprehensive insurance coverage for its actions under the Agreement and name Torchlight as an additional insured; and
- Call Centrix “agreed to indemnify, defend, and hold Torchlight harmless from any and all claims arising from any actual or alleged breach of the express representations or warranties Call Centrix made under the Agreement.
But it, apparently, did none of those things.
Indeed, Call Centrix initially refused to indemnify Torchlight “because there was ‘only one call to Mr. Moore under the Agreement and because Call Centrix’s vendor Wolf BPO is the one to blame.'” The old, pass the buck defense.
But think about that– the company promises to provide complaint leads, promises to supervise its vendors, goes out and hires a Pakistan call center, and then says “wasn’t our fault.”
In the end the Court rejected all of Call Centrix’ excuses (arguments) and ordered it to defend and indemnity Torchlight as it agreed to.
Lots of take aways here folks:
- If you are working with Call Centrix or Wolf BPO you have to question that relationship in light of this case;
- Always be cautious of working with offshore call centers–especially Pakistan, definitely an outsized share of the troublemakers seems to be coming from that region;
- Indemnity provisions are not always what they seem to be;
- Enforcing an indemnity provision is great, but Torchlight is still stuck in the case;
- Call Centrix is in deep trouble because of its reliance on an offshore BPO when it probably would have been fine making its own calls to its own leads–using someone offshore is often MORE dangerous not LESS dangerous;
- Call Centrix apparently failed to have a document retention policy and did not encourage its vendors to have one either–the resulting loss of records is a very serious problem for CC and Torchlight in this case. Learn from that mistake and make sure you are maintaining records and having vendors do the same.
Always here to discuss.