Miller, et al. v. Merchants Credit Adjusters, Inc.: Judge Nixes Attempt to Rope Creditors into TCPA Robocall Suit Against Collection Agency

The judge ruled that the consumer does not have a TCPA claim against the creditors because no facts were alleged showing that the collection agency worked on behalf of and under control of its creditor clients.

In a May 6, 2015 ruling, Magistrate Judge Thomas D. Thalken for the U.S. District Court for the District of Nebraska denied a motion to amend a complaint to add original creditors for which a collection agency made alleged unauthorized robocalls to a consumer in an effort to collect debts and to assert Telephone Consumer Protection Act claims against them. The magistrate judge found that the consumer’s proposed TCPA claims against the creditors were not viable and would ultimately fail. 

In the case, Miller, et al. v. Merchants Credit Adjusters, Inc., 14-00359, 2015 WL ----- (D. Neb., May 6, 2015), the consumer filed a lawsuit against the collection agency alleging that it violated the TCPA by making numerous purported automated robocalls to the consumer’s cellphone, without his prior express consent, in an attempt to collect a debt not owed by the consumer. Almost five months after the consumer initiated the suit, the consumer brought a motion to amend the complaint. The consumer asked the court to allow him to include two creditors as additional defendants because the collection agency made the calls on their behalf.

The consumer argued that the creditors he sought to add to the complaint have the same legal liability as the collection agency under the TCPA for the collection agency’s alleged unconsented robocalls pursuant to the 2008 Federal Communications Commission Order. In opposition, the collection agency argued that the creditors are not vicariously liable for its actions because it is an independent contractor and the creditors do not exercise any control over it. 

The magistrate judge agreed with the collection agency. The magistrate ruled that the consumer failed to allege sufficient facts to show that the collection agency was the agent of the creditors such that derivative liability under the TCPA would attach to them for the alleged collection robocalls made by the collection agency to the consumer’s cell phone without his prior express consent. The magistrate found that the proposed amended complaint lacked any factual allegations that the creditors controlled the collection agency’s activities. The magistrate also said that even if there is a contract between the collection agency and the creditors and the creditors are the collection agency’s clients, it does not automatically imply an agency relationship and control over the collection agency’s operations. 

On May 20, 2015, the consumer filed an objection to the magistrate’s decision in the case asking the district court in Nebraska to overrule it.