Good Consent-Based TCPA Win for Lead Generators

Volkswagen launched a marketing campaign.  It paid dealerships nationwide to retain a third party to place service reminder calls to their customers.  Automated technologies were purportedly used to make calls to plaintiff without consent.

The Central District of California decertified a class of these TCPA plaintiffs because consent issues were so individualized that the plaintiffs could not satisfy the predominance requirement. Trenz v. On-Line Administrators, Inc., No. 15-8356, 2020 WL 5823565 (C.D. Cal. Aug. 10, 2020).

In order for a class to be certified by a court, there is a requirement that common issues of law and fact must “predominate” over individual issues.  There is no single test to determine when the “predominance” standard is met.  Different courts have created different tests and standards for determining when certification is appropriate.  For example, some decisions have followed the historical standard that the predominance requirement is met if the common question is at the heart of the litigation.  In using the “predominance” analysis to bar class certification, courts often focus on whether the class will promote efficiency and judicial economy.

Here, after a class was certified, the court found that the defendants would need to produce “significantly more” evidence to show that customers had provided “actual consent to be contact by an autodialer” such that “individualized inquiries actually predominated over the common questions.”

The defendants moved to decertify and argued that that they had developed the “requisite . . . evidence of consent” that the court’s certification order had found lacking.  The defendants alleged that certification was improper because records obtained from a handful of the dealerships showed “a variety of circumstances across the class bearing on whether individual class members consented to receiving phone calls under the program.

The defendants then argued that the individual transactional context in which the class member’s phone number was provided and whether they consented under the TCPA, would vary  depending on whether the class member: (i) would reasonably expect to be contacted about future servicing of their vehicle; (ii) was provided with varying disclosure forms with notice regarding use of contact information; and (iii) was provided with additional, varying privacy notices and contracts wherein the class member consented to being contacted about future vehicle servicing, for ‘marketing’ purposes, and for the sale of additional products and services.

Finally, the defendants argued that due to the foregoing, the consent issue would have to be litigated “on a class member-by-class member basis, meaning that individual questions predominate.”

The court agreed with the defendants and decertified the class.

The court held that “the necessity of individual inquiries is a clear bar to class certification in TCPA matters.”

The court concluded that the defendants correctly identified factual circumstances relevant to “whether any individual [c]lass [m]ember provided consent . . . and if they did, the scope of that consent.”

The court also noted that the plaintiffs could not establish predominance because of the ‘“nearly endless’ permutations of the transactional contexts” under which consumers had “provided prior express consent to the receipt of … calls.”

 Takeaway:  The case should be of interest to online lead generators because, here, the defendant defeated certification by showing that class members provided their numbers in different “transactional contexts.”  This resulted in individualized issues regarding the existence and scope of consent.  Arguably, seemingly minor, subtle differences in the provision of a telephone number could potentially give rise to individualized issues regarding the existence and scope of consent.

Richard B. Newman is a TCPA defense attorney at Hinch Newman LLP. Follow him on Twitter @ FTC defense attorney

Informational purposes only. Not legal advice. May be considered attorney advertising.

Richard B. Newman

Richard B. Newman is a nationally recognized FTC advertising compliance, CID investigation and regulatory enforcemetn attorney. He regularly provides advertising counsel and represents clients in high-profile investigations and enforcement proceedings initiated by the Federal Trade Commission, state attorneys general, departments of consumer affairs, and other federal and state agencies with jurisdiction over advertising and marketing practices. Richard is also an ecommerce lawyer and spam defense attorney. His practice additionally focuses upon false advertising defense, data privacy, cybersquatting, intellectual property law and transactional matters relating to the dissemination of national advertising campaigns, including the gamut of affiliate marketing, telemarketing, lead generation, list management and licensing agreements. Richard advises clients on how to minimize the legal risks associated with digital marketing, email marketing, telemarketing, social media influencer campaigns, endorsements and testimonials, negative option marketing models, native advertising, online promotions and comparative advertising,

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