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Judge Allows TCPA Case Filed By Professional Plaintiff to Proceed; Rules Debt Collection Exemption Unconstitutional

The fact that an exemption in the Telephone Consumer Protection Act that spares debt collectors attempting to collect on debts owed to the federal government is unconstitutional is not enough to make the entire TCPA unconstitutional, ruled a District Court judge in Massachusetts, who is allowing portions of a class-action lawsuit to continue. The judge also ruled that a professional plaintiff, who makes a living suing companies for violating the TCPA, still has standing to sue in this case.

A copy of the ruling in the case of Samuel Katz and Lynne Rhodes v. Liberty Power Corp. and Liberty Power Holdings can be accessed by clicking here.

A pair of appeals courts have already ruled that the debt collection exemption in the TCPA is unconstitutional, determining that the exemption is a content-based restriction on free speech. Congress enacted the exemption in 2015 as part of the Bipartisan Budget Act, as a means of allowing collectors who were essentially working on behalf of the federal government to collect student loans and mortgages, for example, to contact individuals on their cell phones using an automated telephone dialing system. 

The defendant is accused of making robocalls and telemarketing calls to individuals using an artificial or pre-recorded voice to individuals whose phone numbers were registered on the national Do Not Call list. The defendant had filed a motion to dismiss and motion for summary judgment in the case.

The defendant argued that the debt collection exemption is unconstitutional, which should render the entire TCPA unconstitutional. But that exemption is severable from the rest of the TCPA, ruled Judge Allison Burroughs of the District Court for the District of Massachusetts.

The defendant also attempted to argue that Katz lacks standing to sue because he “proactively embraces telemarketing calls” and “simply makes money from the statute because he sends TCPA demand letters and files TCPA lawsuits.” Katz maintains that the number the defendant called was a line he kept for “emergencies,” which the judge ruled was sufficient for him to have standing to sue, because the line was not only to attract potential TCPA claims.

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