Lead Sales: ‘Possible’ Not Enough for Personal Jurisdiction in a TCPA Case

TCPA Connect

Explaining the difference between something that is possible and something that is probable, a Pennsylvania federal court found it lacked jurisdiction over a plaintiff’s claims of Telephone Consumer Protection Act (TCPA) violations.

In the first seven months of 2020, Ryan Lacon received a number of autodialed calls. At the end of July 2020, he feigned interest during one of the calls in an effort to determine who was calling.

Lacon was transferred to Dennis from “college support” and then transferred to South University, Savannah LLC’s “student support line.” He filed suit alleging violations of the TCPA against South University, Double Positive Marketing Group, Graspy, Yodel Technologies and JobsFlag.

According to the complaint, South University partnered with Double Positive for marketing services. Double Positive then contracted with Graspy to obtain leads and run telemarketing campaigns, which in turn subcontracted with Yodel to place calls, run the telemarketing campaign and deliver live leads.

Both Graspy and Yodel further contracted with JobsFlag to purchase lead packets, which contained the consumer telephone numbers used to make the calls, Lacon told the court.

JobsFlag moved to dismiss. The Nevada limited liability company, with a principal place of business in Utah, argued that the Pennsylvania federal court lacked personal jurisdiction over it.

U.S. District Court Judge Joshua D. Wolson applied the three-part test used in the U.S. Court of Appeals for the Third Circuit to determine whether the court had sufficient minimum contacts to establish personal jurisdiction. The judge focused on whether JobsFlag, as a nonresident defendant, “purposefully direct[ed]” its activities at Lacon within the state of Pennsylvania.

“JobsFlag’s role in the telemarketing scheme was to compile lead packets that it sold to Graspy and Yodel,” he wrote. “JobsFlag had no control over what Graspy and Yodel did with those lead packets. It knew, of course, that they might call some or all of the individuals listed. But it was also possible that they would mail or email, rather than call. Or they might have compared the list to other marketing materials to winnow the universe of people they called.”

JobsFlag had no control over what Graspy and Yodel did with the contacts and did not monitor what they did; nor was its compensation tied to the calls in any way, the court pointed out.

“Once it sent the lead packets, its role ended,” Judge Wolson said. “Because JobsFlag did not place calls to Pennsylvania, supervise or direct the companies that made those calls, or even monitor whether those companies made calls at all, the cases on which Mr. Lacon relies, in which a company directed a third party to make a call, do not apply.”

Lacon contended that because the lead packets included phone numbers with Pennsylvania area codes, JobsFlag knew that Graspy or Yodel would make calls to the state.

“But in an era of mobile phones, area codes do not always tie geographically to the user’s location,” Judge Wolson noted. “Those Pennsylvania area codes could have users in New Jersey, California, or Alabama. And it bears repeating that JobsFlag did not know that Graspy or Yodel would call any particular individual in the lead packets. Just as websites that collect information nationally do not target a particular jurisdiction where they are active, the provision of a national list of leads does not target every jurisdiction included in the lead packet.”

While JobsFlag might have made it possible for Graspy or Yodel to call someone in Pennsylvania, it did not make it probable or otherwise engage in conduct that targeted the state, the court held.

“There’s a difference between something that is possible and something that is probable,” Judge Wolson wrote. “In the context of telemarketing calls, conduct that makes a phone call into a jurisdiction possible often will not be enough, but conduct that makes a call probable likely will. … JobsFlag’s attenuated, indirect contacts with Pennsylvania, taken together, do not rise to the level of activity targeted at Pennsylvania.”

Lacking personal jurisdiction, the court dismissed the claim against JobsFlag.

To read the memorandum in Lacon v. Education Principle Foundation, click here.

Why it matters: The court was clear: In the context of telemarketing calls, conduct that makes a phone call into a jurisdiction possible often will not be enough to establish personal jurisdiction there, but conduct that makes a call probable likely will. In the case at hand, the defendant’s sale of lists with possible leads did not do anything to make it probable that any particular call would happen or specifically target the plaintiff located in Pennsylvania.

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