On October 18, the Florida Federal Court approved a $9.8 million settlement in the ACE American Insurance TCPA class action. According to the lawsuit, ACE allegedly used contact lists provided by two banks which resulted in them calling consumers who were registered on the Do Not Call Registry. The calls began on October 16, 2013. Many of the consumers were contacted multiple times. In their settlement, ACE made no admissions of liability or wrongdoing. They claimed to have chosen to settle in order to avoid the expense and inconvenience of further litigation.
The plaintiff, Justin Mark Boise alleged that he received two unsolicited marketing telephone calls to his residential line from ACE in 2015. The lawsuit claims that the calls, offering hazard insurance, were in violation of the Telephone Consumer Protection Act (TCPA) because Mr. Boise had not provided “prior express written consent” to receive such calls. He also claimed to have been registered on the National Do Not Call Registry since 2006. Additionally, Mr. Boise accused ACE of failure to institute procedures that allowed for them to maintain a list of people who request not to receive further telemarketing calls.
It should also be noted that Nationstar Mortgage and BB&T Bank, the two mortgage lenders that provided ACE with their phone lists of mortgage holders, were not named as defendants in this case.
The Settlement Class
The class benefiting from the settlement includes all individuals in the United States who are or were customers of Nationstar Mortgage or BB&T Bank, on or after October 16, 2013 who:
- Received more than one telephone call made by or on behalf of Defendant within a 12-month period; and
- To a telephone number that had been registered with the National Do Not Call Registry for at least 30 days.
All totaled, more than 107,000 claims have been received. Lawyers for the plaintiff had published notice of the settlement in USA Today and People magazine. Additional notifications were made through direct mail and a website that accepted electronic claims.
Odd Twist - Attorney Fees Challenged
The court approved payment of $2.9 million in attorney fees which is 30% of the $9.8 million settlement fund. The lead plaintiff, Mr. Boise, will be awarded $10,000. Class members are expected to receive at least $55 each.
In an odd twist prior to the court’s settlement approval, one of the members of the class hired lawyers who formally objected to the request for $2.9 million in attorney fees. The plaintiff’s attorneys were accused of providing a cookie-cutter brief filed by a serial litigator, calling it “generic” and “sloppy”. The class member’s lawyers argued that the court should limit the award to an amount between 20% and 25% of the total settlement, which they stated was the more common fee amount requested in TCPA class actions.
The plaintiff’s attorneys defended their position by arguing that a 30% fee is less than a typical contingency fee. They also suggested that if the case had not settled, it could have resulted in $491 million in damages. That would have resulted in a $9.76 million fee and that their requested amount should not be reduced further.
All sides did agree that any unclaimed funds from the settlement should go toward rebuilding the areas damaged by Hurricanes Harvey and Irma.
This case reminds us of the importance of obtaining “prior written consent” before initiating calls using an ATDS. A common problem for most businesses is understanding which of the TCPA “consent” requirements is correct for their calling data. Contact Center Compliance has developed the simple solution for your business. Download our free Quick Reference Guide for easy identification of the correct “consent” requirements under the TCPA based on the specific Call and Line Type of your lead data.
Contact Center Compliance is an award winning cloud-based compliance solutions provider. Our team will work with your business to identifying solutions that enable your call center to easily adhere to the latest DNC and TCPA regulations in a cost effective manner.