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Courts See Through Scam Setup TCPA Suits

Courts are finally helping to put an end to TCPA scam plaintiffs. In at least two cases earlier this year, courts allowed fraud claims to proceed against serial TCPA plaintiffs.

In Franklin, rather than opt out of messages, the plaintiff sat still and allowed messages to continue. He then sent a demand letter to the defendant in which he misrepresented these facts and filed suit. The defendant argued that sitting still and failing to opt out of the messages was actually a form of fraud by nondisclosure. The court agreed: “Upland alleges that it, and more importantly its third-party client, did indeed rely on the failure to disclose and continued to send text messages to the phone number at issue, as Upland took actions pursuant to its contractual obligations … Upland alleges that it was injured as a result of the nondisclosure and had to incur costs associated with what it views as a spurious and setup lawsuit.” The Franklin court also concluded that a direct claim for misrepresentation was possible under the facts alleged because the plaintiff sent a demand letter to the defendant misrepresenting that he had no knowledge of how the texter had obtained the number, a fact that was allegedly false.

In D’Ottavio, a serial plaintiff sued the defendant for receiving 1,590 or so “unwanted” text messages. The defendant sensed a setup. Early on in the case, they obtained an order from the court requiring the plaintiff to submit his devices for forensic electronic review. That review, allegedly, concluded that the plaintiff had, in fact, signed up for the very text messages he sued the defendant over. The defendant filed a counterclaim against the plaintiff for 1,590 counts of micro-fraud. When the plaintiff filed an answer denying the allegations, the defendant filed a Rule 11 motion seeking sanctions for the meritless denials. In response, the plaintiff’s counsel moved to dismiss the complaint with prejudice! The court dismissed the complaint with prejudice as to the defendant and chose to exercise supplemental jurisdiction over the common law fraud claim rather than dismiss for want of jurisdiction after the federal question concerning the TCPA component evaporated.

These two cases emphasize the importance of conducting an investigation when a serial plaintiff is involved or when the evidence or circumstances suggest a setup. A well-founded complaint based on fraud may be viable and is the best way to discourage serial and enterprising plaintiffs from continuing to abuse the legal system.

©1994-2020 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.National Law Review, Volume IX, Number 350


About this Author

Joshua Briones Litigation Lawyer Mintz
Member / Managing Member, Los Angeles Office

Joshua, Managing Member of the firm’s LA office, is a highly experienced trial lawyer with a national practice. He has received awards and national recognition for his innovative approach and specializes in high-stakes, bet-the-company litigation. He represents clients in such industries as financial services, building products, retail, pharmaceuticals, automotive, professional sports, food and beverage, petroleum, chemical manufacturing, health care, high technology, and higher education. He frequently publishes and lectures before national and local bar and industry...