Telemarketing companies face a growing threat from serial litigators who exploit the Telephone Consumer Protection Act (TCPA) to extract settlements, even in cases with questionable merit. These repeat plaintiffs file hundreds of lawsuits each year, often with little regard for the underlying facts, posing a significant risk to businesses that rely on outbound calling campaigns.
The TCPA was enacted in 1991 to protect consumers from unwanted robocalls and spam. However, the law’s broad language and steep penalties of $500 to $1,500 per violation have made it a prime target for abuse. Serial litigators scour call logs and databases, looking for any technical violation they can use to file a class action lawsuit.
One notorious example is George Moore, who has filed over 400 TCPA lawsuits in the past decade. In a recent case, Moore sued a company called Call Centrix, which had contracted with a Pakistani telemarketing firm that allegedly made calls without proper consent. Even though Call Centrix was several steps removed from the offending calls, it still faced a potential nationwide class action.
These types of lawsuits put telemarketing companies in a difficult position. Defending a TCPA case can cost hundreds of thousands of dollars, even if the company ultimately prevails. Many choose to settle out of court for tens or hundreds of thousands of dollars to avoid the risk of a catastrophic judgment.
The problem is exacerbated by the fact that the TCPA’s private right of action encourages entrepreneurial plaintiffs’ attorneys to seek out technical violations, knowing they can earn hefty contingency fees. This has led to a cottage industry of serial litigators and “professional plaintiffs” who make a living by suing telemarketing companies.
To combat this threat, telemarketing businesses must be proactive in ensuring strict compliance with TCPA regulations. This includes obtaining proper consent from consumers, maintaining detailed call records, and quickly responding to any consumer opt-out requests. Companies should also consider using services that screen for potential TCPA violations before making calls. You can scrub from repeat litigators by using TCPALitigatorList.com.
Additionally, legislative reform may be necessary to curb abusive TCPA litigation. Proposals include raising the bar for plaintiffs to establish standing, limiting the statute of limitations, and providing a safe harbor for companies that make a good-faith effort to comply with the law.
In conclusion, serial TCPA litigators pose a serious threat to telemarketing businesses, exploiting the law’s broad language and steep penalties to extract settlements. To protect themselves, companies must be vigilant in TCPA compliance and advocate for legislative reforms to curb abusive litigation. Failure to do so could put their very survival at risk.