September 15, 2013

Court finds in favor of Honesdale woman in robocall case

The Third U.S. Circuit Court of Appeals sided with a Honesdale woman's challenge to the debt collection practices of a major U.S. computer manufacturer, earning a precedent-setting decision from the appellate court involving Dell's use of "robocalls" to try to coax payments from past due accounts.

The case leading to the ruling on Aug. 22 began in 2011, when attorneys for Ashley Gager sued Dell Financial Services, the lending arm of the Texas-based electronics company, claiming their debt collectors repeatedly called her cell phone to try to collect a debt related to a computer purchase she made despite her informing them to stop calling her.

U.S. District Judge Robert D. Mariani sided with Dell, finding that the Telephone Consumer Protection Act of 1991 did not prohibit their use of automated calling in part because the calls were for debt collection and not subject to the law.

Gager also gave Dell consent to contact her when she put down her cellphone number on the lending application, Dell argued.

Dell further argued that the law did not spell out if consumers could opt out of "robocalls" if they provided notice.

At the time of the suit when Mariani took up the case, the consumer protection law was not clearly defined whether consumers had the right to revoke their prior consent to receive the calls.

Also, the Federal Communications Commission - the agency charged with enforcing the law and shaping new regulations from it - at that point provided little guidance for companies and consumers.

Gager's attorneys, one of whom is Dunmore attorney Carlo Sabatini, appealed Mariani's decision to the Philadelphia-based circuit court.

A three-judge panel found in favor of Gager, reversing Mariani's decision and remanding the case back to the district court in Scranton for further proceedings.

They determined that the automated calls to her cellphone violate the spirit of the consumer protection law and contradict more recent FCC rulings that provided some clarity for consumers looking for recourse to put a stop to the calls.

The law was "intended to protect consumer rights, not restrict them," according to the circuit court opinion. " ... An individual should be allowed (to) withdraw consent at any time if she no longer wishes to continue with a particular course of action."

"If someone is in your house ... it doesn't mean they can stay there even after you ask them to leave," Sabatini said, referring to the common law understanding of consent on which the circuit court based part of their opinion.

Dell can still pursue debt collection - through person to person calls, however.

In Sabatini's eyes, it's common sense.

His client fell behind on her debt payments because of a problematic pregnancy. She was bedridden and unemployed.

Dell called her cellphone nearly 40 times over a three-week period, using an automated calling system, the suit stated.

That volume is unacceptable, Sabatini said, and could affect anyone trying to go about their job or lives with a cellphone incessantly ringing by their side.

"We are glad consumers have that protection again," he said.

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