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Federal Deception Law: 7.5.3.1.5 Pleading of claims involving do-not-call rule or calls to residential lines

For a call based on a violation of the nationwide do-not-call rule, pleading that the plaintiff had placed the number on the registry more than 30 days before the calls were made is sufficient, and it is not necessary to plead the date the number was registered.602 The plaintiff must plead that the phone that was called was being used as a residential phone.603 For protections that apply only to residenti

Federal Deception Law: 7.5.3.1.5a Allegations regarding consent

Since consent is an affirmative defense,606 it should not be necessary for the plaintiff to plead the absence of consent.607 However, if a suit is based on the plaintiff’s revocation of consent, it is wise to plead at least the approximate date of the revocation, and that the actionable calls occurred after that date.608

Federal Deception Law: 7.5.3.1.6 Pleading willfulness

The Federal Rules of Civil Procedure allow malice, intent, knowledge, and other conditions of a person’s mind to be alleged generally.609 However, pleading facts to support an allegation of willfulness—for example, that the defendant continued to make calls after requests to stop610—is always helpful. Pleading that the called party’s telephone number has always been a cell phone, that the caller’s website says its infrastructure a

Federal Deception Law: 7.5.3.2 Counterclaims and Third-Party Claims

Although some courts have disagreed,613 courts have generally declined to exercise supplemental jurisdiction over defendants’ counterclaims against TCPA plaintiffs to collect on an underlying debt to which a debt collection call related.614 One of the reasons that courts often cite is that exercising jurisdiction over these counterclaims would contradict federal policy concerns against automated telephone calls.615

Federal Deception Law: 7.5.4.5 Formal Discovery

Discovery should begin as soon as possible after filing a case because obtaining records regarding calls and consent will be crucial to the case and some businesses purge data on a regular schedule.

Consumer Arbitration Agreements: 5.5.3.1 Overview

Courts sometimes find that a party not mentioned in the arbitration agreement can still enforce the agreement based on the doctrine of equitable estoppel. This is the doctrine most commonly invoked by non-signatories to contracts seeking to benefit from arbitration clauses.

Consumer Arbitration Agreements: 5.5.3.2.1 Detrimental reliance of the movant

While the Supreme Court has held that the applicability of an arbitration agreement to a particular dispute is determined by “ordinary state-law principles that govern the formation of contracts,”280 many courts have failed to apply the state law of equitable estoppel to arbitration clauses in the same way that they would apply it in other circumstances.

Consumer Arbitration Agreements: 5.5.3.2.3 Relationship between signatory-plaintiff’s claims and the underlying contract

According to many courts, estoppel applies when “the signatory to a written agreement containing an arbitration clause must rely on the terms of the agreement in asserting claims against the non-signatory.”290 In some jurisdictions this type of equitable estoppel is called “direct benefits estoppel,” because it focuses on the ways in which the signatory and their claims benefit from the agreement.291 Courts have utilized a number of different, and sometimes conflicting, tests to determine whethe

Consumer Arbitration Agreements: 5.5.3.2.4 Relationship between non-signatory defendant’s misconduct and a signatory’s misconduct

Some courts hold that equitable estoppel may also apply “when the signatory to the contract containing an arbitration clause raises allegations of substantially interdependent and concerted misconduct by both the nonsignatory and one or more of the signatories to the contract.”314 Similarly, estoppel will likely apply if the plaintiff’s claims against the non-signatory defendant are “inherently inseparable” from claims against a signatory that is a defendant in the same action.315

Consumer Arbitration Agreements: 5.5.5.2 Implication for Agent When Signing Arbitration Agreement on Behalf of Principal

In contrast to a principal, an agent generally can neither enforce nor be bound by an arbitration agreement that it signed on behalf of a principal.366 An agent is normally not liable under a contract executed on behalf of the principal.367 Thus, in cases in which a consumer signs a contract with a company containing an arbitration clause, although the company has the right to enforce the contract’s arbitration clause, that right does not necessarily extend to th

Consumer Arbitration Agreements: 5.6.1 Assignees and Successors-in-Interest

An assignee of a contract generally has the same rights under the contract as the assignor, and courts have allowed assignees to take advantage of arbitration clauses in assigned contracts.394 Successors-in-interest may also be able to enforce an arbitration clause.395 A non-signatory who is an alter ego of a signatory to an arbitration clause also may be subject to the clause.396 Of course, debt buyers and other assignees and successors-in-interes

Consumer Arbitration Agreements: 5.6.3.1 Debt Buyer or Collector Must Produce the Arbitration Agreement

Because debt buyers and debt collectors deal with consumer accounts on a mass production basis, they rarely possess detailed documentation about a consumer account, including the arbitration agreement. Debt buyers and others wishing to take advantage of an arbitration agreement have the burden of showing that the consumer has agreed to an arbitration requirement. Thus a debt buyer or any other party wishing to force a consumer’s lawsuit into arbitration must produce evidence of an arbitration agreement and that the consumer has consented to that agreement.

Consumer Arbitration Agreements: 5.6.3.3.2 Agency as grounds to enforce the creditor’s arbitration agreement

Under state law an agent, based solely on their status as an agent, may not be able to enforce a contractual arbitration clause entered into by their principal, unless the dispute at issue arises under the contract in question. Claims concerning debt collection abuse do not arise under the original contract establishing the debt, so a debt collector’s status as an agent is insufficient to allow them to rely on their principal’s arbitration agreement.444

Consumer Arbitration Agreements: 5.6.3.3.3 Equitable estoppel or third-party beneficiary status as grounds to enforce arbitration requirement

When the language of an arbitration agreement does not allow debt collectors and collection attorneys to enforce the arbitration requirement, they may try to enforce the arbitration agreement under an equitable estoppel argument. However, courts find this doctrine generally applies only when the consumer has alleged interdependent and concerted misconduct between the creditor (who is a signatory to and can enforce the arbitration requirement) and the non-signatory collection agency.455

Consumer Arbitration Agreements: 5.6.3a.2 CRA Use of a Furnisher or User’s Arbitration Agreement

A consumer reporting agency may try to take advantage of an arbitration agreement between the consumer and another party, such as a user of the agency’s credit reports or a furnisher of information to the CRA. When the user or furnisher’s typical arbitration agreement only extends to agents or assignees, this should not extend to a consumer reporting agency.469 The CRA is not an agent or assignee.

Consumer Arbitration Agreements: 7.7 CMS Rule Concerning Nursing Home and Other Long-Term Care Agreements

The Department of Health and Human Services’ Centers for Medicare and Medicaid Services (CMS) issued a final rule, effective September 16, 2019, that places restrictions on arbitration agreements involving nursing homes and other long-term care facilities that receive Medicare or Medicaid funding.147 If a facility chooses to ask a resident or their representative to enter into an agreement for binding arbitration, the facility must comply with all of the following: