DNC Policy Trips Up TCPA Defendant

TCPA Connect

A Telephone Consumer Protection Act (TCPA) defendant’s do not call (DNC) policy was not enough to avoid potential TCPA liability, an Illinois federal court recently held.

Adam Ailion filed suit against Healthcare Solutions Team (HST) and National General Holdings Corporation (Nat Gen) after he allegedly received telemarketing calls from HST for the purpose of selling Nat Gen insurance policies.

Ailion, whose number was registered on the National DNC Registry, claimed that he requested that both defendants put his residential number on their internal DNC lists.

Nat Gen’s DNC policy stated: “When placing a Sales Call, you must scrub the individual’s number against the Federal, State and your Company Do Not Call List. If the number appears on any of the lists, do not call that customer[,]” but added that “[t]his requirement does not apply if [prior express consent] has been obtained.”

Both defendants filed motions to dismiss.

U.S. District Court Judge Harry D. Leinenweber issued a mixed decision.

Analyzing the DNC policy at issue, the court granted the motion with respect to Nat Gen but allowed the TCPA claims against HST to move forward.

Ailion argued that HST had express authority, implied authority and that HST’s actions were ratified by Nat Gen, but the court disagreed.

“A principal is not responsible for the actions of an agent which are made in direct contradiction to the principal’s instructions,” the court wrote.

Nat Gen’s policy states that a caller may call an individual on a DNC list if the individual has given their prior express consent, but Ailion alleged that he didn’t provide his consent to be called and his number is on the National DNC list.

“Taking all these facts as true, the court finds that when HST employees called [Ailion], they were in violation of Nat Gen’s do not call policy,” the court said. “Thus, Nat Gen cannot be held vicariously liable for HST’s actions.”

Ailion also contended that Nat Gen’s policy ran afoul of the TCPA because it does not require coordination of DNC lists.

Noting that the Seventh U.S. Circuit Court of Appeals has held that the TCPA requires coordination of an affiliate’s DNC lists when an agent makes a call on behalf of a principal, the court denied the motion to dismiss on this claim.

“Plaintiff argues that HST was an agent of Nat Gen and HST employees made phone calls on behalf of Nat Gen,” the court said. “The existence of an agency relationship is a ‘notoriously fact-bound question.’ At this stage, the court must resolve all factual disputes in the favor of the plaintiff. Accordingly, the court finds that the plaintiff has sufficiently pled the existence of an agency relationship. As such, plaintiff’s argument that Nat Gen’s policy violates the TCPA because it does not require coordination of affiliates’ do not call lists will move forward.”

To read the memorandum opinion and order in Ailion v. Healthcare Solutions Team, LLC, click here.

Why it matters

Nat Gen’s DNC policy led the court to a mixed decision. While the court dismissed the vicarious liability claims against Nat Gen based on the language of the policy—holding that a principal is not responsible for actions of an agent made in direct contradiction to its instructions—the policy also failed to require coordination of affiliates’ DNC lists, leaving a TCPA violation claim on the table.



pursuant to New York DR 2-101(f)

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