So you all may remember some time ago Navient–the big student loan collector–sued a guy named Jeff Lohman for manufacturing fake TCPA lawsuits.

The alleged scam went like this. Someone would come into Lohman’s office with a debt issue. He would allegedly encourage the new client to stop paying their bill and then use a tricky script to have the consumer ask for calls to stop, but sometimes no very clearly.

For instance the consumer might say “stop calling me on all of my accounts” and then hang up–knowing that the creditor would have trouble executing across multiple accounts and collectors they may be working with. Other times the script would be even fuzzier like “I don’t think you need to be calling me anymore about this.”

These are not precise quotes BTW–just exemplars of the types of things you might see.

Regardless, Navient was pretty upset that Lohman was encouraging people to stop paying their debts AND simultaneously actively looking to trap Navient in TCPA suits that would result the debtor collecting from the creditor instead of vice versa.

So Navient sued–and won! Rather impressively I might add.

The jury determined that Lohman and a few co-defendants owed Navient over $1.14MM dollars for the scheme. And it was an incredibly cool thing to see.

But…

Actually before I get to the but let me note something pretty important. In basically every case I have these days the Defendant is pissed they are being sued–which I suppose is hardly surprising. But while I am used to dealing with big institutional clients who understand that being sued is just part of business in America many of my new smaller clients really feel like there is a massive injustice here.

And they’re not necessarily wrong-its just that injustice is hardwired into the American class action system. You can quote me on that.

So I always counsel my clients against throwing good money after bad and doing things like countersuing a Plaintiff for fraud–unless there is really really clear evidence of it.

And this Lohman/Navient debacle demonstrates why my advice is so prudent and sage.

In Navient v. Lohman, 19-cv-461, Doc. No. 568 (E.D. Va. Oct. 6, 2023) the Court just threw out the jury’s verdict against Lohman entirely.

Reasoning that Navient only sued Lohman for fake TCPA claims it ignored the evidence related to Lohman counseling individuals to stop making payments to Navient–which seemingly was an interference with contractual relations. Instead it focused solely on whether the TCPA suits against Navient were meritless–it concluded they were not.

Lohman brought 61 TCPA suits against Navient between 2017 and 2019–the heyday of “revocation” style TCPA suits against collectors. As a result of those suits Navient won 4 cases, earned 20 dismissals and settled 37 for a total of about $1.4MM in cash and prizes to Lohman and his clients.

As the Court pointed out there was “no evidence” any false testimony was supplied in any tribunal or that any consumer bringing suit did not receive value from the lawsuit.

The Court also rejected Navient’s argument that Lohman essentially manufactured the TCPA lawsuits BLASTING Navient with a one liner noting that it, alone, is responsible for failing to abide the TCPA:

The problem with Navient’s argument is that it was Navient’s conduct violating the TCPA that caused its damages.

Ohhhh, the burn.

But also, pause.

All of you TCPA defendants out there that want to countersue or hammer a Plaintiff please keep this one line in mind–courts are NOT sympathetic to claims of “litigator” abuse where the ultimate fault for failing to honor TCPA requirements are on you.

BTW the Court goes on about Navient’s conduct thusly:

Had Navient abided by the borrower’s revocation of Navient’s right to call them, and not made the significant number of calls– sometimes amounting to 48 in a week–Navient would not have been vulnerable to the lawsuits which were the cause of its own damages. 

Ultimately the court determined Lohman’s conduct was not the “proximate cause” of any damages suffered by Navient. So it reversed the entire judgment.

You can read the ruling here: Navient Lohman Reversal

So there you go folks. Another seemingly great ruling against a TCPA manufacturer has been reversed (just like the Barton ruling). And can you imagine how many resources Navient invested in this RICO jury trial? I am sure they are out over 7 figures on this–and for nothing.

Except, maybe it wasn’t for nothing. Lohman was certain sidelined for a long time here and the news got out about what Navient did and all the other debt shops seemed to have stopped counseling people to set up TCPA suits. So maybe Navient built a lighthouse that everyone could use to get to harbor safely for a while, even if it was eventually torn down.

Lessons here– make sure you’re a good actor.

Navient tried to play the victim but the Court was unimpressed, deeming its conduct of making too many calls and not honoring debtor revocation efforts as the proximate cause of its damage from the lawsuits. I’ll bet the result would have been different if Navient had tighter controls in place here.

The other big take away– don’t throw good money after bad unless you REALLY have enough coin to sink seven figures into a result that may end up being a goose egg.

But speaking of revocation of consent, remember the FCC is considering BIG rule changes that you can hear about here: