Sunday, May 11, 2014

Eleventh Circuit Holds That TCPA Consent May be Orally Revoked

For some reason, the phrase "prior express consent" in the Telephone Consumer Protection Act has been a source of confusion in the federal district courts, particularly with regard to whether a TCPA plaintiff who has given prior express consent to be called may later revoke that consent.  Fortunately, the courts of appeals have proven more adept at interpreting a phrase whose meaning has been clearly explained by the rich history of the common law concept of "consent."

In a March decision, the Eleventh Circuit in Osorio v. State Farm Bank, F.S.B., 2014 U.S. App. LEXIS 5709 (11th Cir. March 28, 2014), joined the Third Circuit in holding, consistent with the established common-law concept of "consent," that prior express consent under the TCPA, once given, may be revoked at any time.  The Third Circuit reached the same conclusion in its 2013 decision in Gager v. Dell Financial Services, LLC, 727 F.3d 265 (3rd Cir. 2013).  The Eleventh Circuit further held that such a revocation may be given orally, disagreeing with a line of New York district court cases holding that an effective TCPA revocation of consent had to be in writing.  Those cases had confused the requirements of the TCPA with the separate restrictions contained in the Fair Debt Collection Practices Act, and it was a welcome relief to see the common-sense observation of the Eleventh Circuit that such an analysis "conflates apples and oranges."  Osorio, slip op. at 28.

The rationale for both Osorio and Gager is quite simple:  when Congress uses a well-defined common-law term without providing a specific definition for it, courts should assume that Congress intended that the common-law meaning should apply.  The common law concept of consent is not a matter of controversy, and of course the concept includes the idea that consent may be revoked.

The Eleventh Circuit also made two other important holdings in Osorio, each of which deserves its own post.

Tuesday, February 25, 2014

2014 -- Year of the TCPA

Well, it's been awhile since I've posted anything, but mainly that's been because we've been so busy that I allowed the blogging to slip. We're just as busy, but I've decided I need to make time because there's so much going on that people need to know about.

Lately, Davis & Norris LLP has spent a good deal of time litigating over the Telephone Consumer Protection Act ("TCPA"), and specifically that act's prohibition against the use of "auto-dialers" and pre-recorded voice messages to make calls to cellular telephones.

Congress enacted the TCPA in response to one of the leading consumer complaints in the United States – unsolicited debt collection and telemarketing telephone calls. It is a familiar experience for the average American. It is 7:00 p.m., and the family is passing food around the dinner table and catching up on the day, when the phone rings. Daddy, thinking it might be Grandma who has been in poor health or the boss calling about the big project, interrupts family dinner to answer to the phone, only to hear a prerecorded voice offering new wireless services, Cheap!, or seeking to collect a late credit card payment. Anyone who has had such an experience can testify that the disruption to the family routine is real and more than a little irritating. The American public’s widespread adoption of the cell phone in the 1990s allowed those annoying calls to follow the consumer outside of the home, to the workplace, to the family vacation, to runs to the grocery store, and to the daily commute. 

The impact of these calls widened and worsened with the development of technology with which unwelcome calls can be made by computerized dialing machines and prerecorded voices. Modern autodialers plowing through a database of telephone numbers can place many times the number of calls a paid human employee can place, and while answering the phone to a live salesperson or dunning agent is annoying enough, the irritation is immeasurably heightened when the voice on the other end of the line is not that of a live human, but instead a prerecorded and endlessly recycled canned message. 

Congress responded to the public widespread annoyance with these unsolicited calls (as well as the then-widespread practice of blast fax advertisements) in 1991 with the passage of the TCPA. Concerning calls to cell phones, the TCPA says this: "It shall be unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States-- (A) to make any call (other than a call made for emergency purposes or made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice-- * * * (iii) to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call." 47 U.S.C. § 227(b)(1). 

The provision seems straightforward, other than technical term “automatic telephone dialing system.” If one uses an ATDS or artificial or prerecorded voice to call a cell phone without prior express consent and in the absence of an emergency, the statute imposes liability. Statutory damages can be substantial if the plaintiff can prove that a particular defendant made numerous calls to her in violation of the TCPA.  Each violation (i.e., each call or message) carries with it a minimum $500 penalty, which can be trebled if the court finds that the violation was willful or knowing.

The companies defending these cases are trying their best to make these seemingly-simple provisions into something complicated.  They argue about the meaning of consent, the definition of an ATDS, whether consent, once given, may be revoked, and the definition of a violation of the act, among others in a long laundry list of defense-oriented arguments.  Their arguments smack of disbelief that Congress really intended to provide such penalties for violating this statute.  

This area  of litigation is exciting in many ways, particularly right now.  It is a relatively new area, because although the TCPA has been around since 1991, it has only been in the last couple of years that federal courts have been regularly asserting jurisdiction over TCPA cases (a weirdly-worded jurisdictional statement in the statute gave some courts pause as to whether the cases belonged in state or federal court, and the Supreme Court had to resolve the issue in 2010).  It is an area where substantial damages can be recovered, because often a company, particularly a debt collector, will call a consumer hundreds of times -- which ccan add up in a hurry at $1,500 or even $500 a call.  And it is an area where the plaintiff lawyers are jumping on the bandwagon now, lawyers who two years ago probably had never even heard of the TCPA.

I predict 2014 will be the Year of the TCPA.  I think filings will accelerate and the law will develop favorably to plaintiffs, mainly because the statute itself is so plaintiff-friendly despite the arguments of the defense.  At Davis & Norris, I am in the cat-bird's seat to watch all this unfold, because our firm represents over 4,000 clients in cases against Santander Consumer USA, which is a subsidiary of a Madrid bank that in a short period of time has taken a prominent position in the U.S. sub-prime auto lending market.  Over the next couple of months we expect to arbitrate to verdict a dozen or more of these cases.  Over the next year we will see how many of the defense arguments will carry the day.  I will be reporting it all right here.  Stay tuned!

Wednesday, June 27, 2012

When Orange Juice Isn't

Davis & Norris is currently pursuing a number of class actions against the manufacturers (yes that is the right word) of so-called 100% "not from concentrate" orange juice.  We all drink the stuff.  It's in the produce section (right where they sell actual oranges).  The brands include Tropicana, Simply Orange,  Florida's Natural, and many others.  When you read the labels, they list only one ingredient:  "pastuerized orange juice."  It makes you feel good to serve your family such a natural and wholesome product, right?  Well, it's not nearly so simple as that.

Not from concentrate orange juice is in fact a highly sophisticated product dependent upon extremely complex chemical and manufacturing processes.  As it turns out, fresh-squeezed orange juice has an extremely limited shelf life.  The orange juice makers use two processes, pastuerization and deareation, to extend the shelf life.  The  problem is that these rather harsh processes strip the orange juice of its natural flavor, leaving a liquid that basically tastes like sugar water.  It is undrinkable.  In order to "restore" the natural orange juice flavor, the orange juice companies add "flavor packets," which are extremely sophisticated chemical products. 

So there's nothing natural about the orange juice you are buying in the produce section.  Quite the contrary, often the flavorings added to the orange juice are manufactured by perfume manufacturers.  Yes, you read that right.  Orange juice is frequently flavored by chemicals manufactured by the same folks that gave you Chanel #5.   In a word, ewwwwwww!

But of course they don't tell you that and the FDA doesn't enforce its own rules concerning full disclosure of ingredients on food product labels.  That's where we come in.  We are trying to force the orange juice manufacturers to tell you the truth about the orange juice you serve your family.

For extensive background about how this travesty came to pass, you should read read Alissa Hamilton's shocking book about the orange juice industry, Squeezed:  What You Don't Know About Orange Juice.