While annoyance with robocalls and telemarketers is a seemingly universal emotion, a federal chief district judge in San Francisco last week signaled weariness with a serial filer of class action cases brought to address unwanted marketing calls. 

Whether the decision is the start of a trend or just a reaction to the particular case remains to be seen.

The issue arose in a lawsuit brought by Abante Rooter and Plumbing Inc. under the federal Telephone Consumer Protection Act, or TCPA.

The TCPA allows suits for certain unsolicited marketing calls to a cellphone or residential line from a business with whom the recipient did not have an existing business relationship.

Abante is a state-licensed plumbing contractor located in Emeryville.

Abante asserted a claim against Signify Health LLC, described in the complaint as a “data driven health technology company incorporated in Delaware and with its principal place of business in Texas.”

According to the complaint, beginning on June 28, 2023, Signify called a cellphone owned by Abante in an effort “to sell or solicit its services,” and did so using an “artificial or prerecorded voice” without having first obtained Abante’s consent.

The complaint alleged that Abante was not a customer of Signify, had not consented to being called on its cellphone, and had the sort of cellphone service where it was charged for incoming calls.

The calls, the complaint alleged, violated the TCPA and entitled Abante to a statutory award of $500 per call if the violation was negligent and $1,500 per call if the violation was knowing and/or willful.

Abante brought its claims as a class action “on behalf of all others similarly situated” who received illegal calls from Signify in the last four years. Abante said it did not know precisely how many people fell within that class, but advised the court that it believed the class includes thousands of members and its claim was in excess of $5 million.

Abante’s suit was filed Dec. 4, 2023. A few months later, Abante advised the court that it had made a mistake when it filed the complaint; Signify’s calls were not made to Abante’s cellphone as the complaint had represented, but to a residential landline owned by an individual named Fred Heidarpour. Abante said it would like to substitute Heidarpour for Abante and continue the action. No harm, no foul.

Signify opposed that substitution and said that “amending” a complaint to change the plaintiff was not appropriate.

Signify Health LLC is headquartered in Valley View Lane in Texas, Dallas. (Google Street View)

U.S. Chief District Judge Richard Seeborg sided with Signify and denied the amendment. 

While Seeborg’s legal conclusion on substitution was not exceptional, Seeborg’s rationale for his decision was of interest.

Seeborg pointed out that Abante was “a prolific filer of putative class actions” under the TCPA. Seeborg said he identified more than 70 such cases, and in each case Abante was represented by the same firm, the Law Offices of Todd Friedman of Woodland Hills in Southern California. That firm also represented Heidarpour.

Seeborg used the term “putative” to describe Abante’s class actions because “when a complaint is filed that says ‘class action complaint’ on it, it actually isn’t a class action,” according to Sonya Winner, a partner at the national law firm Covington & Burling LLP and co-chair of its class action practice.

It doesn’t actually become a class “until and unless you get to the point in the case where the court certifies it as a class,” Winner said.

Seeborg used the term ‘putative’ to describe Abante’s class actions because ‘when a complaint is filed that says ‘class action complaint’ on it, it actually isn’t a class action.’

Sonya Winner, a partner at the national law firm Covington & Burling LLP

Seeborg said that in reviewing the court records from a sample of Abante’s cases, it “appears virtually all of them have resulted in requests for dismissal pursuant to individual settlements, before any class certification motion has been brought.”

In other words, Seeborg was pointing out that virtually all of Abante’s serially filed class action cases were resolved without ever reaching a determination of whether a class should be certified. Seeborg found that fact relevant to his finding that denying Abante’s claim to amend wouldn’t hurt members of the proposed class “given the track record of Abante and its counsel of settling cases like these on an individual basis.”

While Seeborg left the matter there, his focus on the Abante’s serial filing of TCPA class actions drew attention within the legal industry that has grown up around TCPA cases.

Abante

According to its website, “At Abante Plumbing, Inc. our goal is to be the leading plumbing company throughout the Bay Area region by delivering the highest value and performance — through superior representation, quality, technology, service and support, customization, and financial stability — enabling us to provide YOU with the highest level of satisfaction.”

Yet while a licensed plumbing contractor, its stated place of business in Emeryville is an apartment in an apartment complex. The door to the lobby was locked during the middle of the day and no signage for the Abante business was visible. Nothing in the setting suggested that a retail customer could gain access to the office of a licensed plumbing contractor.

But if Abante’s licensed place of business is not immediately visible, there is no doubt that Abante is a visible and active litigant in TCPA cases. Pagransen found the Abante filed 96 individual cases in U.S. District Court in San Francisco since 2017. A sampling of 10 percent of those cases showed that each case was brought under the TCPA and each was filed as a class action. The average time between the filing of litigation and closing of the case was approximately 170 days, short for class action cases in federal court.

All but one of the cases appears to have been resolved.

Eric Troutman is a defense lawyer, formerly a partner at a national law firm, and now running his own firm. Troutman is a self-avowed TCPA junkie who describes himself as “Czar of the TCPA World.”

He claims to have defended hundreds of clients in TCPA cases over the course of his career, including defending more than 350 TCPA class actions. He says that if you added up his clients’ aggregate exposure in all of those cases, it would exceed a trillion dollars. He says that he follows every TCPA decision in the country and blogs about the significant ones.

The Abante decision drew his attention. His writeup of the decision reflected some skepticism about Abante as a plaintiff.

He wrote, “It is unclear to me whether Abante Rooter is a business at all other than just to collect TCPA revenue.”

He adds “the Abante Rooters of the world cry out for action by Congress to issue in TCPA reform.”

Troutman’s post goes on to mention Fred Heidarpour, the person who Abante wanted to substitute as a result of the mistake in the Signify case.

Heidarpour is the CEO of Abante. He holds a bachelor’s degree in industrial engineering from Central State University in Ohio and a master’s and Ph.D. in health care administration from Pacific Western University, according to his deposition testimony in a 2015 TCPA case in which he was the plaintiff.

The Heidarpours have made TCPA litigation something of a family affair.

In addition to the lawsuits by Abante, according to court records, Heidarpour has himself initiated TCPA cases in federal courts in California, Florida, Georgia, and Pennsylvania.

Heidarpour’s son Andrew is a Washington, D.C.-based lawyer who handles TCPA cases at his own firm. In a 2015 deposition, Andrew said that he grew up in Oakland and started working at Abante Plumbing when he was in college. He was still working there on a part-time basis in 2016.

After law school, he started a business called Legal Advocacy for Victims that was set up to assert TCPA claims on behalf of clients. He claims he left the business because of a disagreement with the others about the contingency fee charged to clients, but as of 2016, he continued to hold an ownership interest in the firm.

Court records show he has personally been counsel in more than a dozen TCPA lawsuits in federal court in California.

The Business of TCPA Litigation

TCPA litigation can be big business.

Marshall Baker is a class action litigator at the national law firm Akin Gump Strauss Hauer & Feld LLP. Baker has defended many class actions brought under TCPA.

Baker says “the TCPA has been up to the Supreme Court and various circuit courts of appeal a number of times in the past several years as the plaintiffs’ class action bar has sought to capitalize on the prospect of potentially crippling statutory damages. At $500 a call for negligent violations, you can imagine just how quickly the potential exposure can become astronomical, particularly for a company that is interacting with thousands or millions of consumers.”

Troutman concurs. He says a major direct-to-consumer marketer could literally be making a million calls a day. A class action against such a telemarketing operation could “easily be worth billions, tens of billions, hundreds of billions of dollars.” Troutman said. “The stakes at issue in TCPA class litigation is higher than any other area of law.”

That not only benefits the plaintiffs, but also their lawyers. Troutman says that “there’s more millionaire plaintiffs lawyers made under the TCPA than any other federal statute. Not even close.”

The cases with the most value are the ones where there is a real risk of a class action being certified and where the plaintiff’s lawyers have a track record of being able to take class action cases all the way to trial.

However, many cases, even though asserted as a class action, are settled before there is a class certification. When that happens, the settlement only resolves the individual plaintiff’s claims but the case, with its class allegations, is dismissed.

Someone else could file against the same company, but only if they had received unauthorized calls from that particular defendant. In the federal courts — where most TCPA cases are filed — a plaintiff does not need to get a judge’s approval to settle and dismiss a case if a class has not yet been certified.

This means that a plaintiff can assert a TCPA claim as a class action but settle it individually without court approval. This opens the possibility that the plaintiff can leverage the risk that the defendant would face if a class were certified to enhance the value of the individual settlement.

Troutman said that settlement amounts in such situations vary significantly depending on the type of violation and number of calls. He said that in routine cases in his experience, minimum amounts tend to be $10,000 but more likely the amount is “around $25,000,” although if the defendant is concerned about the process it followed in making the calls “maybe it’s 40K, maybe 60K.”

Cases brought by attorneys with a reputation for being smart and aggressive — “dangerous attorneys” Troutman calls them — command higher amounts for an individual settlement.

According to Troutman, TCPA cases are not going away. He said, “the TCPA is the crown jewel of the federal response to the robocall epidemic ... the revenue generated for TCPA cases is easily in the hundreds of millions of dollars annually.”

Troutman said national TCPA filings in 2023 were up 11 percent over 2022 and TCPA class actions up 18 percent.

“There’s not that many plaintiffs’ firms that are bringing these cases, you know, these guys are just minting cash.”

In 2016, Troutman litigated a much-cited TCPA case against Wells Fargo Bank in which as counsel for Wells Fargo he introduced evidence that the plaintiff bought more than 35 cellphones for the purpose of getting solicitations she could use to sue the solicitors.

The court found that while the plaintiff “occasionally informed the caller to stop calling, she intended for the calls to continue” so she could argue that they were willful violations of the statute and she could get the higher statutory damages of $1,500 per call.” She conceded that she regarded suing for TCPA claims as a “business.”

According to Troutman, TCPA cases are not going away. He said, ‘the TCPA is the crown jewel of the federal response to the robocall epidemic ... the revenue generated for TCPA cases is easily in the hundreds of millions of dollars annually.’

Wells Fargo challenged the plaintiffs’ claims on a number of grounds, mostly unsuccessfully, but the court agreed with Wells Fargo that the plaintiff did not have standing to sue in federal court because she was not actually injured by the calls.

The court said that the TCPA was created to protect people from the annoyance or invasion of privacy resulting from unsolicited robocalls. The plaintiff was not annoyed by the calls; she was actually pleased because they helped her business. Under those circumstances, the court found that she did not have an injury that would give her “standing” to assert her claims in federal court.

The rationale of that case has been accepted by some — and rejected by other — federal courts around the country. The standing issue remains an open question in many cases, particularly where defendants can prove that the plaintiff has actively tried to attract robocalls to their cellphones or residential lines.

It remains to be seen if the Seeborg decision is a signal that federal judges in Bay Area will be taking a harder look at TCPA cases.

Seeborg did not mention the standing issue in his brief comment on Abante’s case, but after private lawsuits by claimants under the Americans with Disabilities Act skyrocketed in 2022, federal judges in San Francisco began to carefully scrutinize the standing of serial filers to make sure that they satisfied the applicable standing requirements.

Beyond San Francisco, Baker said “these [TCPA] cases are primarily litigated in federal court, and we’ve seen judges in those courts increasingly enter rulings that suggest some serious skepticism about the nature of some of these claims.”

A request to Abante’s counsel for comment on the ruling in the Signify case was not answered.

Joe Dworetzky is a second career journalist. He practiced law in Philadelphia for more than 35 years, representing private and governmental clients in commercial litigation and insolvency proceedings. Joe served as City Solicitor for the City of Philadelphia under Mayor Ed Rendell and from 2009 to 2013 was one of five members of the Philadelphia School Reform Commission with responsibility for managing the city’s 250 public schools. He moved to San Francisco in 2011 and began writing fiction and pursuing a lifelong interest in editorial cartooning. Joe earned a Master’s in Journalism from Stanford University in 2020. He covers Legal Affairs and writes long form Investigative stories. His occasional cartooning can be seen in Bay Area Sketchbook. Joe encourages readers to email him story ideas and leads at [email protected].