So I’m fresh off my Soltice break and have tons to do. But I wanted to start the year off with a blog about why TCPA class actions—particularly DNC cases which are so important with the shadow of Facebook hanging over us—are never properly certified.

Interesting, there is nothing new in the analysis of Hirsch v. Ushealth Advisors, Civil Action No. 4:18-cv-00245-P, 2020 U.S. Dist. LEXIS 228936 (N,D. Tx.  December 7, 2020)—indeed its primary analysis comes straight from Gene & Gene –a case from 2008! Back then TCPA certification was pretty simple to analyze—if the numbers came from multiple sources then certification was not possible because consent would need to be evaluated for each source separately. And where calls stemmed from individual interactions between agents and consumers—like where consumers filled out online forms or provided information to an agent over the phone—then each and every individual interaction would need to be reviewed for consent, making certification quite impossible. On the other hand when numbers came from a single source—like a lead list—it would be possible to certify TCPA cases, at least as long as consent could be monolithically established for the list (one way or the other.) Pretty simple stuff.

But as time has worn on here in TCPAWorld many courts have lost their way and began certifying multi-source cases in special settings (i.e. skip trace classes or wrong number classes) and some even went so far as to certify multi-source cases outright, reasoning that the Defendant has some special burden to affirmatively prove consent by class members at the certification stage. Ridiculous.

In Hirsch the court reached back to the Gene & Gene era and simplified matters for TCPAWorld, once again. In a TCPA DNC case—the Court reasoned— there are three principle issues that will drive the outcome of the litigation: i) whether calls were made without consent; ii) whether the calls are made to residential numbers; and iii) whether Defendant is liable for the calls on vicarious liability theory.  Either Plaintiff has common evidence on all three of those issues—in which case the case might be certified—or he/she does not—in which the case the case may not be certified.

Elegant. Straightforward. Correct.

In Hirsch the Plaintiff failed to make the required showing.

As to consent, the phone calls at issue arose from various and different interactions between consumers and third-parties. In short, the phone numbers originated from multiple sources and, as a result “consent could not be proven by general evidence—each number had its own story.” The Hirsch court found that Defendants and Defendants’ Agents used various methods to obtain consent, “including personal relationships, existing business relationships, explicit requests, and multiple lead-generation vendors.” These multiple sources meant many customers afforded consent and—even if some did not—determining who did, and who did not, was a case by case review. This is true even though some of the numbers were obtained via lead generation:

from leads Defendants bought from lead-generation vendors, there is evidence that at least some of those were screened or verified for TCPA.

As to identifying residential numbers—remember only calls to residential cell phone numbers are actionable in TCPA DNC class actions—plaintiff’s plan to review potential class members against a database of business numbers was “unreliable.” No single source of information definitively  answers this question for each phone number. Even if a database suggests that a number is (or is not) a business number, the Defendant is entitled to offer proof to the contrary and the Court need not merely accept any database’s determination. Instead, “[e]ach must be tested individually.”

The Court finds the needed number by number review to be a “Herculean task at best.”

As to vicarious liability, the mere fact that Defendant’s agents signed common agreements was not dispositive. The evidence showed that each Agent engages with the Defendant to different degrees, suggesting different levels of “control” from an agency perspective. The Court found the following facts useful to the analysis:  “Some Agents work from an office with many Agents, and other Agents work from their homes. Each Regional Manager may take different levels of oversight and control. And then there are the lead-generation vendors. They may work directly with Defendants, but also with Regional Managers and individual Agents. Each relationship, and Defendants’ control over each relationship, could be different.”

Finally—and importantly—the Hirsch court comes very close to holding that repeat-players cannot serve as TCPA class action representatives. This is especially true where the plaintiff invites return phone calls.

Backing up, it has become common practice for repeat or serial TCPA to invite calls from marketers to pierce through the first layer of marketing call to determine who the call was made “on behalf of.” That is to say, Plaintiffs feign interest in a product during a call from a marketer in order to get connected with the ultimate seller. The seller then makes an outbound call—seemingly with consent to an interested purchaser—only to get sued for making the original call without consent.

Here the Hirsch analysis is a bit less elegant. The proper analysis in this situation is: i) whether the third-party making the initial call was an “agent” of the Defendant (almost never the case); and ii) whether the seller had an inquiry EBR for its own subsequent call (almost always the case). In Hirsch, however, the Court determined there would not have been a lawsuit but for Plaintiff’s feigned interest in the product—so he was atypical of the class. The Court noted the Defendant’s counterclaim against Plaintiff for fraud (critical and good move by Defendant) as highlighting individualized and atypical issues. “ In this case’s trial, Hirsch will play as much defense as offense. “This involves more than just defending the counterclaims—although that is a consideration. Hirsch created the case’s factual foundation by scheduling the calls. But for his actions, there would not be a case.”

The court also affords this gem that comes very close to barring repeat plaintiff’s from representing classes:

his records and behavior make his status as a professional plaintiff unavoidable. For some potential jurors, this may be decisive.

How sweet is that?

Hirsch is a great little decision and every TCPA class action defense lawyer ought to have this one handy. Note in particular the huge hurdle that identifying residential numbers pose in DNC class actions. That issue alone really should be decisive—commonality can never be achieved in these cases, outside of very narrow circumstances where all numbers dialed are presumptively residential in nature.

For callers and sellers, notice how critical it was that vendors were vetted at the onboarding for TCPA compliance. Because the vendors were representing and proving consent at the front end, the Court credited that the seller was not just making illegal calls to sell its product. Moreover, even if a few bad eggs slipped in there would have to be a file by file review to determine who they were.

One note of caution, however, the Plaintiff’s lawyers appeared to have pigged out a bit in this case. They swung for the fences and wanted a class of every call made by every “agent” regardless of source. If they had dialed back their class and focused n particular sources—i.e. specific lead sources—things might have been different. For callers and sellers that means that you need to carefully vet your lead sources and shut them off if you suspect fraud at any point.