Another day, another story about a court refusing to enforce a third-party lead.
In Hall v. Schwartz, 2024 WL 4335509 (S.D. Oh. Sept. 27, 2024) the defendant had purchased a third-party Medicare lead from the Leads Warehouse for Medicare. The Defendant had used a pre-recorded greeting to initiate the contact and then a live agent was to join the call.
The Defendant moved for summary judgment arguing both that the pre-recorded greeting did not constitute a “call” and that the consent Plaintiff provided on the the website “www.securemedicareenrollment.com” permitting the calls regardless.
The Court sided with Plaintiff.
First the court had little trouble determining the use of a prerecorded greeting to initiate the call constituted the use of a prerecorded voice for TCPA purposes. This is an unsurprising result as the FCC previously held soundboard calls were prerecorded calls and other courts had similarly held that greetings–such as “this call may be recorded for quality purposes” were sufficient to trigger the prerecorded call component of the TCPA.
More interesting was the review of the consent provision.
The website had a decent consent provision reading: “By clicking the ‘Submit’ button below you are providing your express written consent by electronic signature to be contacted by Secure Medicare Enrollment and our Marketing Partners via: automated telephone dialing systems, artificial or prerecorded voices, by email, SMS text message or live agent to the phone number provided, even if my telephone number is a mobile number that is currently listed on any state, federal or corporate ‘Do Not Call’ list, regarding telemarketing promotions for products or services….”
And the court did not quibble with it.
Instead the issue here was whether Plaintiff signed the form at all. The website operator submitted an affidavit suggesting Plaintiff’s name and demographic information was submitted on the form. The Plaintiff, however, denied visiting the website. That was sufficient for the court to deny judgment to defendant and send the issue to the jury:
In contrast, plaintiff denies that he consented to defendant’s telephone sales calls to his cell phone. He avers, “Plaintiff did not request to be contacted by entering his information into the website nor did [p]laintiff authorize another individual or entity to enter his information. If [p]laintiff’s information was entered into a website as a means of requesting contact about Medicare, then [p]laintiff is the victim of identity fraud….” (Doc. 43-2 at PAGEID 228, Ex. 3, Request for Admission 2 Response). 5 Viewing the evidence in the light most favorable to plaintiff, the court finds there is a genuine factual dispute as to whether plaintiff gave his consent to be contacted by defendant.
So Plaintiff submits a declaration saying he never visited the website and now a jury needs to figure it out.
In fairness, I think the court reached the right decision here. This is ia question of fact and a jury does need to figure it out.
Its just one more reminder of why callers relying on third-party leads have so much risk on their shoulders:
- The lead form must be valid (and it often isn’t)
- The lead buyer must be on the form (ask Quote Wizard)
- The lead buyer actually has to be able to prove the interaction on the website took place;
- The consumer must have actually filled out the form.
While issues 1-3 might be solvable with a Jornaya or TrustedForm and good practices, issue no. 4 is a risk inherent in every single lead that is purchased. And, as this case shows, the issue often needs to be sorted out by a jury.
A perfect case to discuss today at the big ACA Stakeholders meeting! Looking forward to being on stage in about an hour!!!
Chat soon.
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I’m surprised plaintiffs are not pointing out that in almost all instances these B.S. websites that they supposedly visited show ZERO organic traffic. Meaning NO ONE visits that website or can even find it on the web to visit it. Traffic can be easily confirmed through a free traffic checker like this one https://ahrefs.com/traffic-checker . There’s even case law to support this argument, (McCurley v. Royal Seas Cruises, Inc., 9th Cir, Apr 5, 2022) citing per expert testimony the claimed number of leads generated by such obscure websites was implausible.
I have your answer, Kelly. So I used to work for the company mentioned in the complaint…they wouldn’t give out the URL in fear someone would go around them because they were just a broker. But we all know it would become obvious that the “leads” were not on the up and up. They took advantage of small/medium sized business owners who didn’t know any better/didn’t understand the TCPA and thought they were buying legitimate leads. There was an amusing sales call where the owner got pressed on his (lack of) understanding of a vertical and he flipped his lid and hung up on the client. Hopefully the feds will catch up eventually as they were reselling data from another company who was busted by the FTC earlier this year.
With so much black market lead data available on the dark web being submitted by scammers, I feel like number 4 is increasingly a difficult thing to do for any traffic source. Validating that the person that submitted the electronic signature was indeed the person listed keeps me up at night.
I don’t think this is lead gen crumbling, I think this is just an instance of a very bad actor getting some well deserved exposure for their bad conduct. The company mentioned resold leads even if they were years old – yes 1-5 year old leads being resold 5x, I don’t believe there was any limit/cap. I even pointed out once to the owner “Well I was just giving this client the 1-2 times sold so they don’t get garbage thats been resold 3-5x+” He advised me to ignore the sold count and sell everything. The clients had to sign invoices that had a small disclosure that they absolved the company of any TCPA or DNC violations. Makes your favorite consent farms look like nuns, right?
Unfortunately, this appears to be the norm more than the exception. Almost all third party “leads” are generated by offshore call centers that make cold calls and violate the TCPA, or from data scraped from public records. Then these lists of numbers (often paired with the name/address of the previous owner of the number) is sold again and again by and between lead brokers.
Only when a lead gets called into question does an opt-in on a B.S. website magically pop-up. At this point, the FCC/FTC should straight up ban buying third party leads. Only way to solve this problem, coz the bad actors will never stop, they just refine their tactics. A major part of the lead generation business model is deceiving their buyers into buying leads they are lead to believe are compliant. What you described here with having clients sign a disclosure stating they absolve the lead gen of TCPA violations is a new one to me. What a scumbag, wow!
The added “fun” here is who the owner(s) of the http://www.securemedicareenrollment.com website seem to be David and Jacquelyn Levine. These are the same two that are currently embroiled in the Final Expense Direct v. Python Leads, LLC case and are fairly regular topics of conversation in the TCPAWorld blogosphere.
For reference, you can still see some pages from the securemedicareenrollment.com on The Wayback Machine. They have an mailing address listed that matches other Levin holdings, and they list their company name as SECURE MEDICARE ENROLLMENT, which is a name registered in Florida with the President listed as David Levin: https://search.sunbiz.org/Inquiry/CorporationSearch/SearchResultDetail?inquirytype=EntityName&directionType=Initial&searchNameOrder=SECUREMEDICAREENROLLMENT%20P210000924590&aggregateId=domp-p21000092459-5e5c0c7f-1e31-4a88-a8ff-341a45cbcdb0&searchTerm=Secure%20Medicare%20Enrollment&listNameOrder=SECUREMEDICAREENROLLMENT%20P210000924590
It’s seeming to be a risky venture at this point to by leads from the Levins.