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TCPA Litigation Update — No Payday for Deceptive Conduct

Plaintiff Kenneth Johansen “admits that he believes that engaging in deception is appropriate behavior for a class representative,” observed the Southern District of Florida on its way to denying class certification in Johansen v. Bluegreen Vacations Unlimited, Inc., No. 9:20-cv-81076-RS, Dkt. No. 95 (S.D. Fla. Sept. 30, 2021). Mr. Johansen’s TCPA class action started like many others. He allegedly received calls from the defendant, engaged with the caller, and posed as an interested customer. He apparently verified information the caller had on file and requested additional information. He then allegedly received more calls before finally notifying a representative that his telephone number was registered on the National Do Not Call Registry. This conduct, concluded the Court, confirmed that Mr. Johansen was not a typical class member and demonstrated inadequacy.

To start, Mr. Johansen’s claim-generating conduct was not typical of putative class members’ claims:

Plaintiff’s claim differs from those of putative class members’ claims. The record clearly demonstrates the deceptive and dishonest tactics employed by Plaintiff to establish his claim. Thus, Plaintiff’s claim is inherently different [from those] who presumably did not use similarly deceitful methods.

As a result of his conduct, concluded the Court, additional inquiries regarding standing, consent, and damages, specific to Mr. Johansen, would be necessary.

Driving its point home on the issue of deceptive behavior, the Court added the following on adequacy:

Plaintiff readily admits that his conduct during the May 27, 2020 and June 2, 2020 telephone conversations was deceptive. . . . Plaintiff has what appears to be an extensive and profitable history with lawsuits involving TCPA claims. Plaintiff acknowledges that he has developed a ‘typical practice’ of deceitful conduct used to succeed in prosecuting TCPA claims. Plaintiff poses as a customer of the entity . . . and induces the representative into believing that he is, in fact, an established customer and genuinely interested . . ., thereby prolonging the purported injury . . . and increasing the potential damages that he could, in theory, recover.

Most concerning, during his deposition . . . Plaintiff admits that he believes that engaging in deception is appropriate behavior for a class representative. . . . Based on the foregoing, the Court has serious concerns about the Plaintiff’s credibility, honesty, trustworthiness, and motives in bringing forth this putative class action.

As the Court noted, it is not the first court to discount this plaintiff on the basis of his claim-generating conduct. While this Court did so at class certification in Bluegreen, the Southern District of Ohio found his conduct sufficient to dismiss his case outright in Johansen v. Nat’l Gas & Elc. LLC. Prompted by facts that came to light during briefing on a motion to compel arbitration, the Southern District of Ohio issued an Order to Show Cause due to “statements of Johansen in his affidavit and the representations of his legal counsel [which] reveal[ed] that this lawsuit is based on a ruse.”[1] Reviewing the plaintiff’s response to the show cause order under a summary judgment standard, the Southern District of Ohio dismissed the complaint in its entirety.[2]

Unfortunately, Bluegreen is a common fact pattern in TCPA litigation. The decision, however, is an encouraging addition to a growing body of case law, in which courts have rebuked claim-generating conduct, and that defendants should keep in their holster.[3]

 
[1] Johansen v. Nat’l Gas & Elec. LLC, No. 2:17-cv-587, 2017 U.S. Dist. LEXIS 208878, *8 (S.D. Ohio Dec. 20, 2017).
[2] Johansen v. Nat’l Gas & Elec. LLC, No. 2:17-cv-587, 2018 U.S. Dist. LEXIS 138785 (S.D. Ohio Aug. 16, 2018).
[3] See e.g. Adamcik v. Credit Control Servs., 832 F. Supp. 2d 744, 754 (W.D. Tex. Dec. 19, 2011) (denying request for trebled damages and describing statutory damages as an “undeserved windfall . . . which is not merited due to [plaintiff’s] scarcely concealed bad faith actions”); Dobronnski v. Total Ins. Brokers, LLC, No. 21-10035, 2021 U.S. Dist. LEXIS 186528, *10 (E.D. Mich. Sept. 29, 2021) (adopting report and recommendation holding that plaintiff was not entitled to damages for “willful” conduct where plaintiff induced additional calls); Stoops v. Wells Fargo Bank N.A., 197 F. Supp. 3d 782 (2016) (dismissing TCPA claim where plaintiff kept phones for the purpose of generating TCPA cases).

 

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Authors

Joshua Briones

Member / Managing Member, Los Angeles Office

Joshua Briones is a commercial litigator who defends consumer class actions for Mintz. He's represented clients in a wide range of industries, including financial services, life sciences, manufacturing, and retail, in cases involving false advertising, unfair trade practices, and other claims.

Esteban Morales

Associate

Esteban Morales is a Mintz litigator who handles class action defense and financial services litigation for companies of all sizes. He defends clients targeted in class action suits, and the results include dismissals at the pleading stage. Esteban practices in Mintz's Sports Law Practice.