Lardner v. Diversified Consultants Inc.

Citations: 17 F. Supp. 3d 1215; 2014 U.S. Dist. LEXIS 64205; 2014 WL 1778960Docket: Case No. 1:13-cv-22751-UU

Court: District Court, S.D. Florida; May 1, 2014; Federal District Court

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Plaintiff Angela Lardner filed a Motion for Partial Summary Judgment on January 6, 2014, while Defendant Diversified Consultants, Inc. filed a Motion for Summary Judgment on March 7, 2014. The Court received responses and replies from both parties regarding these motions, making the matters ready for consideration. 

The undisputed facts include that Lardner obtained a new cellular phone number, XXX-XXX-1705, in 2011 after ending her service with T-Mobile, which claimed she owed a balance. T-Mobile hired Defendant to collect this alleged debt. Lardner had not provided her new number to T-Mobile, and there is no evidence supporting Defendant's claim that T-Mobile supplied it. 

Defendant utilized a dialing system called LiveVox for collection calls, which operates through Voice Over Internet Protocol (VoIP). LiveVox allows collectors to call preprogrammed numbers in campaign mode, where numbers are not generated randomly or sequentially. Calls are initiated by collectors pressing a button, and the system connects the call if answered. When a call is connected, an interactive voice response (IVR) message prompts the recipient to identify themselves. Only Defendant’s debt collectors use the LiveVox system to make calls, while LiveVox employees do not initiate calls.

Plaintiff received a total of 132 calls from Defendant, including 109 that played an IVR message. Out of these, 126 calls were made in campaign or manual blend modes between January 24, 2012, and October 9, 2012, with calls occurring on weekdays from 8:00 A.M. to 8:00 P.M. Defendant's Vice President of Compliance stated that Plaintiff did not communicate with Defendant regarding these calls or request to stop them, a fact that Plaintiff does not contest. 

Summary judgment is permitted only when the moving party demonstrates that there is no genuine issue of material fact and is entitled to judgment as a matter of law, per Federal Rule of Civil Procedure 56. The Court must view evidence in favor of the non-moving party, who cannot rely solely on allegations or denials but must establish essential elements of their case. If factual issues remain, the Court must deny summary judgment and proceed to trial. Summary judgment may also be inappropriate when parties agree on basic facts but disagree on inferences from those facts. The non-moving party is not required to respond with evidence unless the moving party has adequately supported their motion. The Court is obligated to resolve ambiguities and draw inferences in favor of the non-moving party.

Parties have cross-moved for summary judgment regarding Defendant's liability under the TCPA, FDCPA, and FCCPA, asserting no genuine issues of material fact exist. Four key issues regarding TCPA liability are identified: (1) whether the LiveVox system qualifies as an automatic telephone dialing system (ATDS); (2) whether Defendant utilizes an artificial or prerecorded voice in collection calls; (3) whether liability can extend to Defendant when LiveVox dials cell phone numbers; and (4) whether Plaintiff provided prior express consent for the calls. Additionally, the parties dispute the legality of Defendant's debt collection practices under the FDCPA and FCCPA. 

The Court grants summary judgment for Plaintiff on the TCPA claim, while ruling in favor of Defendant on the FDCPA and FCCPA claims. The TCPA prohibits calls to cellular numbers using an ATDS or an artificial voice without prior consent, establishing a private right of action for violations. An ATDS is defined as equipment capable of storing or producing numbers to dial, with the FCC clarifying that this includes systems that can dial numbers without human intervention. Plaintiff argues that the LiveVox system meets this definition due to its ability to store and automatically dial preprogrammed numbers. In contrast, Defendant contends that LiveVox does not qualify as an ATDS because it lacks the capacity to use a random or sequential number generator, asserting that the TCPA's language is clear and should not defer to the FCC's 2003 interpretation.

Defendant contends that the LiveVox system is not an Automatic Telephone Dialing System (ATDS) due to its daily deletion of stored telephone numbers. Declarations from employees assert that LiveVox lacks the ability to store or generate numbers randomly or sequentially. However, these employees do not possess comprehensive knowledge of the system's operations. A declaration from LiveVox's Executive Vice President clarifies that customer-provided numbers are temporarily stored, and the law does not stipulate how long numbers must be retained. The statutory definition of an ATDS focuses on the capacity to store or produce numbers, which LiveVox meets, as confirmed by employee usage reports detailing daily downloads of numbers.

The Court finds no factual dispute regarding LiveVox's functionality. The primary issue revolves around statutory interpretation, suitable for summary judgment. The Court examines whether Congress has explicitly addressed the ATDS definition; it concludes that the statute’s language does not specifically cover software that auto-dials from a preprogrammed list, which emerged after the statute's enactment. The FCC has the authority to adapt rules for evolving technologies, as indicated in previous orders. Thus, the Court determines that since Congress did not directly address the specific question regarding the software in question, the FCC's interpretation of what constitutes an ATDS under the Telephone Consumer Protection Act (TCPA) is reasonable and valid.

In its 2003 ruling, the FCC clarified that the Telephone Consumer Protection Act (TCPA) aims to restrict automated calls to specific telephone numbers, notably those assigned to wireless services. The FCC's interpretation, which distinguishes between objectionable automatic dialing calls and those made using arbitrary number generation, is deemed a permissible construction of the statute and warrants judicial deference. Courts, including this one, have upheld the FCC's view that automated dialing systems, such as the LiveVox software involved in this case, qualify as "automatic telephone dialing systems" (ATDS) under the TCPA. Evidence indicates that LiveVox operates without human intervention, thereby functioning as a fully automated dialing service.

The FCC has affirmed that predictive dialers fall under the TCPA's regulations, emphasizing that debt collectors are not exempt from its restrictions. Courts have similarly recognized that predictive dialing systems are included among the prohibited devices. Notably, the TCPA's liability extends to the use of artificial or prerecorded voices in calls, regardless of who produces the recordings. The plaintiff asserts that the use of the Interactive Voice Response (IVR) technology by the defendant constitutes a violation, as it involves a prerecorded message. The defendant argues that the messages were provided by LiveVox, not produced by them, which is rejected as irrelevant under the TCPA's clear language. There remains no dispute that the calls made to the plaintiff used a prerecorded message, constituting a violation of the TCPA.

Defendant contends it should not be held vicariously liable under the Telephone Consumer Protection Act (TCPA) for the actions of LiveVox, arguing that LiveVox merely processes preprogrammed telephone numbers and converts them using its voice over internet protocol (SIP) system before passing the calls to carriers. However, this characterization misrepresents the call initiation process, as Defendant's representative confirmed that employees initiate calls by pressing a button labeled 'next call.' The court has previously rejected similar arguments, emphasizing that TCPA liability arises from the use of automatic dialing systems to make calls. Specifically, Defendant used LiveVox to place sixty-seven automated calls to the Plaintiff, thereby exposing itself to TCPA liability.

Regarding prior express consent, which is a defense under the TCPA, the burden of proof lies with the Defendant to demonstrate that the Plaintiff consented to receive calls on her cell phone. The Plaintiff asserts that she did not obtain her phone number until after her relationship with T-Mobile ended and provides an affidavit to support this claim. The Defendant lacks evidence of direct express consent and no testimony from T-Mobile confirms that the Plaintiff provided her number concerning any debt. The only assertion from Defendant's Compliance Vice President indicates that the number was obtained through a 'skip-trace,' which is a method for locating a person's contact information. However, there is no substantiated evidence detailing how T-Mobile sourced the Plaintiff's phone number.

Defendant's cited cases illustrate the necessary evidence for establishing prior express consent for calls made to a debtor. In relevant cases, such as Johnson v. Credit Protection Ass’n and Cavero v. Franklin Collection Serv., recipients provided their cell phone numbers to creditors during transactions. However, in the current matter, there is no evidence indicating how T-Mobile acquired the Plaintiff's cell phone number in relation to the debt. Therefore, Defendant has not established a genuine issue regarding Plaintiff's prior express consent to receive calls. Consequently, the Court should grant summary judgment for Plaintiff on her Telephone Consumer Protection Act (TCPA) claim due to Defendant's use of an automatic dialing system to contact her cell phone, incurring a potential penalty of $63,000 for 126 calls made.

Regarding the Fair Debt Collection Practices Act (FDCPA) and the Florida Consumer Collection Practices Act (FCCPA), the FDCPA prohibits debt collectors from engaging in conduct intended to harass or abuse individuals during debt collection. The FCCPA similarly prohibits debt collectors from willfully communicating in a manner that could be expected to harass. Plaintiff asserts that violations of the TCPA imply violations of the FDCPA. However, Defendant contends that calling Plaintiff 126 times over seven months does not constitute sufficient evidence of harassment. The Court agrees, noting that summary judgment is often granted to debt collectors when the only evidence of harassment is a high volume of calls without additional oppressive behavior. Previous cases support this perspective, indicating that frequency alone does not establish an FDCPA violation.

In Valle v. National Recovery Agency, the court reviewed multiple cases granting summary judgment where high call volume alone was insufficient to establish a violation of the Fair Debt Collection Practices Act (FDCPA). Summary judgment is denied in instances where a recipient shows evidence of high call volume alongside the collector ignoring requests to stop communications or calls occurring at disruptive hours, causing emotional distress. The court referenced Meadows v. Franklin Collection Service, where emotional stress and repeated calls after requests to cease were considered sufficient evidence of FDCPA violation, and Dunning v. Portfolio Recovery Associates, where harassment claims based on repeated calls after multiple requests to stop were acknowledged.

In the current case, the plaintiff relied on evidence of 132 automated calls over eight months but did not demonstrate further evidence of harassing behavior or requests to stop communications. The call logs confirmed calls were made intermittently during standard hours, and the plaintiff did not present evidence of abusive practices as defined by the FDCPA. The plaintiff argued that a violation of the Telephone Consumer Protection Act (TCPA) should equate to a violation of the FDCPA, but the court clarified that while both are consumer protection laws, they serve different purposes and should not be interpreted interchangeably.

The court highlighted that intrusive phone calls do not inherently constitute abusive debt collection practices. It noted that previous rulings allowing a TCPA violation to support an FDCPA claim occurred at the pleading stage, and further evidence was necessary here. Ultimately, the court found no genuine issue of material fact indicating a violation of the FDCPA or the Florida Consumer Collection Practices Act (FCCPA), as the plaintiff did not engage with the defendant in a way that would support claims of harassment or abusive practices. The court concluded that the defendant's calls did not constitute a violation of either statute.

The Motion, D.E. 18, and Motion, D.E. 30, are each granted in part and denied in part. A separate final judgment of $63,000.00 will be entered. All other motions are denied as moot. Precedent from the Fifth Circuit prior to October 1, 1981, is binding in the Eleventh Circuit, as established in Bonner v. City of Prichard. The plaintiff contends that failure to mitigate cannot be used as a defense against TCPA liability, a position the defendant does not contest, making it clear that the defendant is barred from asserting this defense, supported by Fillichio v. M.R.S. Assoc. Inc. Jamie Sullivan and Rafal Lescynski both declare that all numbers are erased from the system by 1:00 a.m., indicating temporary storage until that time, which aligns with Michael Leraris' declaration. Statutory damages of $500 per TCPA violation are awarded, as the plaintiff has not provided evidence of any actual monetary loss from the violations.