The Robocall Wars: The Rise of Robocalls and the TCPA Robocall Cops

Daniel Solove
Founder of TeachPrivacy

Robocalls and the TCPA Robocall Cops 02

Move over robocop, there’s a new constable in town — the robocall cop. In the past decade, robocalls have surged.  There has also been a dramatic rise in litigation about these calls under the Telephone Consumer Protection Act (TCPA). The TCPA litigation is led by a small group of serial litigators, people who have assumed the role of private enforcers of the TCPA.  This is a fascinating story about how privacy law combats the growing scourge of robocalls.  We are seeing the effective use of private litigation as an enforcement tool, but there are differing interpretations about the virtues of the robocall cops. Also wrapped up on the story is the issue of harm. 

Robocop and RobocallsRobocalls are rising at an alarming rate.  In the month of September 2017 alone, there were 2.4 billion robocalls.  The number keeps rising per month, and September 2018 gave birth to 4.1 billion robocalls.  At this rate, there may be billions and billions more robocalls than stars in the universe!  Robocalls are definitely a problem.  I’ve never heard of anyone who likes robocalls; the mosquito probably ranks higher in popularity.  But robocalls persist and proliferate.  Annually, in the United States, the number of robocalls exceeds 100 per person.  There are 4.5 million robocall complaints per year to the FTC.

Along with the rise of robocalls, litigation has also been increasing.  Lawsuits are perhaps a bit more popular than robocalls or mosquitos, but not by much.  The TCPA, 47 U.S.C. § 227, passed in 1991, requires various forms of prior consent for robocalls, which are calls made with what the TCPA refers to as an “automatic telephone dialing system” (ATDS).  Violations of the TCPA can be enforced through a private right of action, and there are statutory damages of $500 per violation ($1,500 for willful violations).  The number of TCPA lawsuits has skyrocketed, from 14 federal cases in 2007 to 4,392 federal cases in 2017.

Many of these lawsuits have been brought by a few individuals.  I’ll call them the robocall cops.  One litigant was recently chronicled in a great article in the Philadelphia Inquirer — Andrew Perrong, a 21-year old seminary student who has filed about 45 lawsuits.  According to the article:

Perrong stands out for the frequency of his lawsuits and the great lengths he goes to catch the companies that call him. He has claimed to own eight phone numbers over the years, his opponents note in court filings, and has cajoled callers hiding behind fake numbers to reveal their true identities.

In one case, he scheduled an appointment through a telemarketer, ostensibly to get a home-repair estimate. When a repairman arrived, Perrong took his business card, sent him home, and then sued his company the next day in May, according to his complaint. In another case, he placed an order, froze the credit-card payment so the company would call back, and sued the same day.

Perrong has settled many of his cases for undisclosed amounts.

There are other litigants like Perrong.  According to a Forbes article, a frequent TCPA plaintiff named Jan Konopca brought more than 30 TCPA cases and made more than $800,000 through settlements.

Courts have begun to push back.  A few years ago, one district court relied in part on the U.S. Supreme Court case Spokeo v. Robins, to deny standing to a TCPA litigant.  The case involved robocall cop Melody Stoops. She amassed 35 cell phones to try to ensnare violators.  But the court in Stoops v. Wells Fargo (W.D. Pa., June 24, 2016) threw her case out of court:

As her testimony establishes, Plaintiff’s privacy interests were not violated when she received calls from Defendant. Indeed, Defendant’s calls “[did] not adversely affect the privacy rights that [the TCPA] is intended to protect.” 47 U.S.C. § 227(b)(2)(B)(ii)(I)-(II). Because Plaintiff has admitted that her only purpose in using her cell phones is to file TCPA lawsuits, the calls are not “a nuisance and an invasion of privacy.”

The court also reasoned:

Plaintiff has not suffered an injury-in-fact because her privacy and economic interests were not violated when she received calls from Defendant. . . . Similarly, Plaintiff’s interests are not within the zone of interests intended to be protected by the TCPA. Plaintiff’s interests, which include purchasing cell phones with the hope of receiving calls from creditors for the sole purpose of collecting statutory damages, are not “among the sorts of interests [the TCPA was] specifically designed to protect.” Chem Serv., Inc., 12 F.3d at 1262. Given her admissions, which are described above, the Court finds that Plaintiff’s interests “‘are so marginally related to or inconsistent with the purposes implicit in the [TCPA] that it cannot reasonably be assumed that Congress intended to permit the suit.’” Id. (quoting Clarke, 479 U.S. at 399). Indeed, it is unfathomable that Congress considered a consumer who files TCPA actions as a business when it enacted the TCPA as a result of its “outrage over the proliferation of prerecorded telemarketing calls to private residences, which consumers regarded as an intrusive invasion of privacy and a nuisance.” Leyse, 804 F.3d at 325.

Robocalls and TCPAAlthough I certainly understand the court’s skepticism of Stoops, the fact that she went out of her way to catch companies in violation should not be used to find no harm.  The main benefit of a private right of action in a law is to encourage private enforcement of that law.  Often, government agencies lack the resources to enforce a law rigorously and consistently enough.  We need the robocall cops to help us, and they protect all consumers through their actions by ensuring that companies know that there’s a cop on the beat.  Think of them like the police who enforce speeding on the highways.  Imagine if there were no police with radar trying to catch speeders . . . actually, that would be quite nice, so it undercuts my argument a bit . . .

In Stoops’ case, the court also held that “Defendant has failed to meet its burden of establishing that Plaintiff expressly consented to receiving the calls.”  What this means is that the court found that the defendant had violated the TCPA.  The court breezes past this to make Stoops into the villain.  Stoops may have been opportunistic, but this doesn’t mean there was no harm.  You should be able to try to catch someone in the act of harming you so you can avail yourself of the legal protections against that harm.

The Stoops case later settled.

Another district court — this case being one of Jan Konopca’s cases — Konopca v. FDS Bank (D.N.J.) — held that:  “Although it is most probable that (Konopca) manufactured the harm based on his motivation to be awarded monetary awards in the lawsuits, the case is distinguishable . . . by the fact that Plaintiff never gave consent, and he received 612 calls.”  In this case, despite skepticism of the plaintiff, the court permitted the case to proceed.

These serial litigants are often chastised because they go out of their way to attract calls.  They have multiple phone numbers. They are setting traps.  According to one article, there are two strategies for those who want to be robocall cops:

Individuals receiving calls they believe to be in violation have two options to try to maximize recovery.

– Answer the phone, tell the company to stop calling and hope the calls keep coming. Those calls could be construed as “willful” violations of the TCPA and lead to triple damages; or

– Don’t answer the phone, never tell the company to stop calling but chronicle how many times it does. This would lead to only $500 claims but keeps the company calling.

The more popular option, according to TCPA defense attorney Jessica Klander of Bassford Remele in Minneapolis, is to amass as many calls as possible by never answering the phone.

Although these robocall cops are unforgiving, they are also ensnaring violators.  While one way for companies to dry up the robocall litigation business is to stop the robocall cops, perhaps the best way is for companies not to break the law in the first place.

Recent TCPA settlements have been quite sizable.  Here’s a list of numerous multi-million dollar TCPA settlements in just the past few years by well-known companies. The settlement amounts are staggering.

Robocalls

Another argument often made against the litigants is that these costs are passed on to consumers. Moreover, with class actions, plaintiffs attorneys win big, but the average consumer doesn’t see much money.

The consumer is indeed losing.  But the fact that lawyers and robocall cops are getting rich is a necessary side effect of private rights of action.  It’s an unfortunate side effect, but it’s necessary as an incentive to spur private enforcement.  It is this private enforcement that is the primary benefit of the TCPA’s private right of action, not compensating consumers.  Government enforcement of the TCPA is falling short.  Government enforcement of most privacy laws isn’t sufficient because government agencies lack the resources to go after most violators.  The enforcement strategy is typically to go after the most egregious violations, and there are so many of these that even most extreme violations go unpunished. This is why a private right of action is a great tool for privacy laws — it allows people like these robocall cops to fight back when government enforcement isn’t enough.

TCPACompanies must have incentives to follow the law. There must be a meaningful sting to failing to comply with the TCPA. One thing that has become quite evident with privacy laws (and most other types of law for that matter) is that many companies will only take them seriously if there are likely and painful consequences for failing to comply.  Hoping for companies to comply out of inherent goodness is akin to hoping that the lion will lay down with the lamb.  Yes, there may be a few lions out there that may do so, but most lions are going to be lions.

There are certainly some arguments on the defense side that have merit.  As Jeffrey Jacobson (a partner at Kelley Drye & Warren) stated in a quote in a news article: “Most of the spam calls we receive at home and on our mobile phones, however, are coming from intentional bad actors in other countries who are beyond the reach of private lawsuits.”  The TCPA lawsuits are just going after one group of TCPA violators and aren’t touching many of the worst actors.

Another argument is that the US litigation system is incredibly costly, so most companies settle. Lawsuits are a risky gamble in our system — being subjected to a jury trial, a process of deciding cases by plucking random people off the street and forcing them into involuntary labor — a process that leads to unpredictable decisionmaking, often characterized by lawyers as a roll of the dice.  Thus, many cases settle because the risk, uncertainty, and costs of our litigation system are so high. If there’s one thing our litigation system does well, it is to be such a painful and arbitrary way to resolve disputes that nobody wants to use it!

Robocalls continue to escalate.  Robocall cops proliferate. Lawsuits increase.  The robocall wars are underway, and nobody seems to be coming out ahead . . . except for the lawyers.

* * * *

This post was authored by Professor Daniel J. Solove, who through TeachPrivacy develops computer-based privacy and data security training. He also posts at his blog at LinkedIn, which has more than 1 million followers.

Professor Solove is the organizer, along with Paul Schwartz, of the Privacy + Security Forum (Oct. 3-5, 2018 in Washington, DC), an annual event designed for seasoned professionals. 

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