United States: Bank Of America Settles TCPA Lawsuit For Over $32 Million

Bank of America Corporation ("Bank of America") and FIA Card Service, N.A. ("FIA") (collectively, the "Defendants") have agreed to pay one of the largest Telephone Consumer Protection Act ("TCPA") settlement amounts in recent memory.  According to the settlement agreement, the Defendants have agreed to pay over $32 million to settle a consolidated TCPA class action.  The settlement concludes a class action lawsuit against the Defendants that was filed in the United States District Court for the Northern District of California.  The present case against the Defendants is a collective  microcosm of a nationwide movement to hold companies liable under the TCPA for using autodialers and/or prerecorded messages to contact consumers on their cellular telephones without proper consent.

TCPA Allegations

According to the underlying complaint, Defendants violated the TCPA by contacting consumers on their cellular telephones via an "automatic telephone dialing system" and/or by using "an artificial or prerecorded voice" message without obtaining their prior express consent within the meaning of the TCPA.  Specifically, the calls from Defendants were related to existing Bank of America credit card accounts or residential mortgage loans.  While the calls may arguably be considered debt collection calls, as our readers may  remember, under the TCPA, debt collection calls are exempt from the prior express written consent requirement, but they do require a lesser form of consent – prior express consent.  Prior express consent may be obtained if a consumer provides the caller with his/her telephone number or conspicuously publishes his/her phone number to the public without any limiting language.

In the present case, the Plaintiffs alleged that no consent was ever obtained by the Defendants.

The TCPA Class Action Settlement

The Defendants negotiated the TCPA class action settlement terms over the course of many months and, on August 29, 2014, negotiated a settlement amount of $32 million to stop the case from proceeding to trial.  After court expenses and fees are deducted from the settlement fund, the settlement amount will be disbursed to consumers around the country that received a call from either of the Defendants between 2007 through 2013.  Additionally, the settlement agreement requires that the Defendants overhaul their respective telemarketing practices to ensure compliance with the TCPA on a prospective basis.

Protect Yourself against TCPA Class Action Claims

The TCPA has become the new favorite statute of class action plaintiff's lawyers across the country.  We have been following a  number of class action TCPA  cases on a nationwide basis.  This wave of TCPA litigation has resulted in a number of  substantial settlement awards.  Because of this, it is becoming increasingly important for businesses to understand the scope of the TCPA and act affirmatively to protect themselves against class action claims and regulatory investigation.

To that end, it should be noted that courts in TCPA actions often look to the affirmative efforts of an officer/owner to determine whether he/she directed the acts that resulted in the alleged TCPA violations.  Where the officer/owner undertook deliberate efforts to implement TCPA compliant policies, courts will often rely upon this fact in denying personal liability and dismissing the TCPA action.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.