An Illinois federal district court judge recently held that State Farm Mutual Automobile Insurance Company (“State Farm”) may be vicariously liable for alleged Telephone Consumer Protection Act (“TCPA”) violations. In Nater v. State Farm Mutual Insurance Co., Plaintiff alleged that he received an unsolicited call from a third-party agency inquiring as to Plaintiff’s interest in automotive insurance. The next day, Plaintiff received a text message from a third-party following up on his purported interest in auto insurance. State Farm moved to dismiss the complaint on several grounds, including that Plaintiff failed to state a colorable claim against State Farm. On May 14, 2024, the Court denied State Farm’s motion.
Facts Alleged in Nater’s TCPA Vicarious Liability Complaint
Plaintiff Gabriel Bou Nater (“Nater” or “Plaintiff”) sued State Farm on behalf of himself and two putative classes of consumers. Specifically, Plaintiff alleged that he received an unsolicited call that used an artificial or pre-recorded voice on May 23, 2023 (“Robocall”). The subject Robocall inquired as to Nater’s interest in auto insurance and requested his demographic information, which Nater provided. The Robocall then informed Nater that an insurance rate specialist would be following up. The next day, Nater received a text message from an individual with Aaron Franklin State Farm (“Franklin Agency”) concerning auto insurance. The text message indicated that an individual with Franklin Agency would be calling him soon. Nater sued State Farm and alleged several alternative theories of liability, including that State Farm: (1) placed the Robocall; (2) was vicariously liable for an unknown third-party that placed the Robocall; and (3) was liable for the actions of Franklin Agency because Franklin Agency was an agent of State Farm acting within the scope of its authority when it had placed the Robocall. State Farm moved to dismiss the complaint for lack of subject matter jurisdiction and for failure to state a claim.
In support of its argument that the court lacked subject matter jurisdiction, State Farm alleged that Nater lacked standing because he had not established that the Robocall was fairly traceable to State Farm. Specifically, State Farm alleged that Franklin Agency purchased a lead that included Plaintiff’s name and phone number from a third-party lead vendor, MediaAlpha. MediaAlpha obtained the Nater lead from a website operator known as Ads Logistix, which operates the website https://1nsurancerates.com/. The Court denied State Farm’s motion to dismiss finding that the proximity between the Robocall and Franklin Agency’s text the following day “goes to the very heart of the causal requirement that is read into the ‘fairly traceable’ element of standing.”
In denying State Farm’s motion to dismiss for failure to state a claim, the Court found that Plaintiff plausibly pled that State Farm was vicariously liable for the Robocall by “alleging a chain of agency relationships based on actual authority.” In its decision, the Court found that Plaintiff had adequately alleged that State Farm gave insurance agents authority to: (1) place the Robocall; (2) hire third parties for marketing purposes; (3) contract with third parties to place calls to consumers; and (4) solicit insurance business while maintaining direction and control regarding advertising, telemarketing, and geographic placement. At the motion to dismiss stage, the Court found that these allegations were sufficient to plausibly plead a vicarious liability TCPA claim against State Farm.
Hire Experienced TCPA Attorneys
Numerous TCPA complaints are filed every day. In this rapidly evolving TCPA legal landscape, businesses should hire experienced TCPA attorneys who stay up to date with the most recent case law and regulatory changes. Seasoned TCPA attorneys can help to: (1) ensure telemarketing law compliance; and (2) explore all avenues to a successful litigation defense.
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