S3 E5: Protecting Your Business From Professional Plaintiffs

Audio version

Protecting Your Business From Professional Plaintiffs

Transcript

Jordan Eisner: Here we are. Welcome back to another episode of Compliance Pointers, joined by Steve Gniadek this time. Steve, say hello to everybody.

Steve Gniadek: Hello, everybody.

Jordan Eisner: Yeah. Now you’re on video so they can see.

Steve Gniadek: That’s true.

Jordan Eisner: The man, the myth, the legend, the voice behind all these cutting-edge marketing compliance podcasts. The legend from Pittsfield, Massachusetts. Pittsfield?

Steve Gniadek: That is correct.

Jordan Eisner: I won’t bring up anything. We’ll get it straight into the topic.

Steve Gniadek: You’re the only one that ever mentions that or remembers that.

Jordan Eisner: Aside from you. You still remember.

Steve Gniadek: Yeah, I remember.

Jordan Eisner: For the time being. Yeah. Well, I want to see it. I want to see western Massachusetts one day. Yeah. You speak very fondly of it, despite having been in Atlanta.

Steve Gniadek: Just don’t want to go there in the winter.

Jordan Eisner: That’s right. It always is for the northerners. They love it. They reminisce, cherish being there, but I’m never going to move back there because of the winters.

Steve Gniadek: Or the expenses. It’s very expensive.

Jordan Eisner: That’s true. Even Western Mass?

Steve Gniadek: Oh, yeah.

Jordan Eisner: Okay. Well, for those of you listening and watching and don’t know, Steve, he’s got over 20 years experience at CompliancePoint, working on telemarketing compliance. Do not call compliance, wireless rules, email, any direct to consumer marketing, or sometimes just direct to consumer contact. Because there are other instances where even if it’s not for marketing purposes, it can get organizations in trouble.

This is a topic that you’re very familiar with. You’ve been warning clients to steer clear of for a long time, and that’s professional plaintiffs, how they operate, and just that. How businesses can protect themselves.

We’re going to expand it out beyond our client base. For those of you unaware, Steve and consultants like Steve work with a great number of clients on an ongoing basis through a service we call a retainer service, where basically it’s a phone of friends, phone of an expert, sounding board, advice on a whole number of things. It’s much more than that. I’m dumbing it down quite a bit. But in a sense, you’re an extension of their compliance outfit or the risk management group in a lot of times and help support these pretty niche areas.

When I throw out professional plaintiffs, when I’m talking to people that aren’t in this industry or they’re not work with it, they got to turn their head a little bit. What’s a professional plaintiff?

We say it all the time. We say it all the time, like everybody should know what it means. I think most people probably get the gist of what it is. But maybe sometimes we take that for granted. Let’s start there. When we’re talking about marketing compliance and TCPA, do not call in this realm, what’s a professional plaintiff and what’s their impact on the industry?

Steve Gniadek: I don’t know that I even heard that term professional plaintiff before 2013, probably it’s when the cell phone rules change that you need express written consent to call cell phone with an ATDS. I think that’s where we see a lot of professional plaintiffs.

Unfortunately, a lot of our clients are being hit by these professional plaintiffs and they use a lot of different tactics. Their tactics evolve, they change things, they’re hard to keep up with, they’re buying hundreds of burner phones and using those phone numbers.

But essentially, they’re just trying to intentionally receive quote unquote unsolicited communications that would violate the TCPA, and they’re trying to generate lawsuits. Or I think there’s a lot out there that are really just not even hiring lawyers, they’re just reaching directly out to companies, filling out lead forms and trying to generate calls to them, and then they’ll reach back out to not necessarily our client, but everyone in the industry, any sellers or telemarketers and say, hey, you called me, you didn’t have consent and send me typically anywhere from 2000 to $10,000. They’re trying to get money and they’re trying to get paid off, so it doesn’t have to go to the next level.

Unfortunately, a lot of sellers in this space will pay them that money, usually if it’s on the lower end, just to make it go away because it’s going to cost them a lot more to try to fight it.

So these lawsuits are creating challenges for businesses, they’re increased litigation costs. You have to defend yourselves against these lawsuits, it can be expensive. Even if the business wins the case, they’ve still spent all that time, money, energy, and resources to try to defend themselves.

Also reputational damage. We hear about these violations and they’re posted all over the Internet, they’re on the news, even could happen before they won or lost a case. It does hurt your reputation out there and causes damage.

Jordan Eisner: Even if they’re alleged, even if they’re not actually violations.

Steve Gniadek: Even if they’re alleged, exactly. That information will be put out there before the case is even final.

Then obviously operational changes as you have to invest, these businesses have to invest in compliance measures, robust consent management systems to mitigate this risk.

Jordan Eisner: You talked about it a little bit, you threw up burner phones, which you might have to define too. I think a lot of people have a good idea of burner phones, but you talked about different ways of filling out lead forms, trying to get calls. These are strategies and name more strategies that the professional plaintiffs use to try and trigger these calls, but more importantly, how they can justify lawsuits with these strategies.

Steve Gniadek: Well, they feel that their privacy has been violated or that they’re due, or like I said, it’s really just a money grab. They’re going out and filling out these forms, subscribing to services, and trying to engage with businesses to get more communications. They’re using, and when I say burner phones, obviously, phones that they’re going to get a phone number, use it for 30 days and then toss it and get a different line. They’ll see hundreds of those burner phones and numbers, multiple phone lines, it’s going to increase their likelihood of getting calls.

Then once they’re called, they’re documenting everything, saying I was called at this date, this time, this is what it was about. They’ll even engage with clients. I have one of my clients that had conversations, the person went through the process like they were interested, call ended, they didn’t sign anything, they didn’t complete a sale. They’re just trying to generate more calls. Four or five calls after trying to get a hold of the person, the professional plaintiff’s just taking notes, adding up, they called me on this date and this time, they didn’t have my consent. Then they’ll reach out to the seller and say, hey, you called me why.

I even have an instance of a client that was able to find the lead form that the consumer field, the professional plaintiff filled out, saw him fill out his name, address, phone number, because it was video recorded. Then he claimed, well, it wasn’t me, this lead was from Oklahoma and I’m in New York. But we addressed those concerns and he came back with different issues and just keeps trying to get money out of them.

Then even once we thought it was done, they’re on the DNC list, this person was no longer going to get any calls or text messages or anything. He gets a new phone number five months later and one that wasn’t recognized because they put his old numbers on their DNC list and continues to try to say, they’re still calling me.

Jordan Eisner: Well, I guess that’s my point. To be a professional plaintiff, you’re doing this on purpose to try and create these cases. You’re doing it all the time, you’re giving your phone number out left and right, you’re not really interested in the product. So why does their case stand up? Why is it not just thrown out? Why is it like, hey, we see what you’re doing here?

Steve Gniadek: Well, like I said, a lot of times they’re just trying to get the payout from the seller directly without getting to the next level. But then unfortunately, a lot of, not necessarily our clients, but a lot of sellers won’t have the evidence or the record keeping to back it up, to be able to defend themselves. That’s why we always push for record keeping that you maintain instances of web forms where a consumer might’ve gone out and filled out information and that you keep it for a lengthy amount of time, at least five years, and that you keep version control of it too. So in other words, if a professional plaintiff’s claiming, I never called you, but you find a website from two, it was two years ago where they filled it out, you have what that version of that website looked like when they filled it out at that time to prove that, yes, I had clear and conspicuous express written consent disclosure language, this is where you went, this is where you filled it out.

Jordan Eisner: Yeah, that’s a big task.

Steve Gniadek: It is a big task, but again, you need evidence. You know, a court, it’s not gonna take your word for it that you didn’t call that person. They wanna see evidence.

Jordan Eisner: Well, let’s get to that. I think that’s the meat of this podcast, how can businesses protect themselves, the good guys, right, from professional plaintiffs. But before, one more question on professional plaintiffs. I mean, how active is this? How widespread is this? Is this rare? Probably not gonna happen to your industry or is it more likely?

I mean, I know our parent company offers a list that organizations can scrub against for known litigators, so how active are they?

Steve Gniadek: They’re very active. I mean, we did some analysis of TCPA lawsuit data and out of approximately 1700 cases filed, more than 30% of those were from people that have filed multiple lawsuits. And when I say multiple lawsuits, I mean, I’m talking over 50.

I mean, we had one professional plaintiff that we were made aware of about a month ago, did some research on it, and he had filed 129 lawsuits within the last year.

So we asked for clients to help us with this as well. I mean, you mentioned the litigator list rather from PossibleNow. And one of the ways we populate that litigator list is from help with clients too. Anytime someone becomes aware of one of these professional plaintiffs, they reach out to us and ask us to see if they filed any other cases, that kind of thing. But then we’ll also put those additional phone numbers that we have. Again, we might not have the burner phones, but any numbers that we have that we know professional plaintiffs are using, we’ll put that on the litigator list.

So, I mean, these clients really just need to familiarize themselves with the TCPA requirements. They should be auditing their contact list, have vetting any third parties that are generating leads for them. They have to make sure that they have robust consent practices, and leverage technology.

Jordan Eisner: Robust consent practices, so talk about that.

Steve Gniadek: Well, I mean, obviously this isn’t about the one-to-one consent. That ruling just, that’s a whole another podcast topic.

Jordan Eisner: Yeah, I have no idea what you’re talking about. That doesn’t exist anymore.

Steve Gniadek: It doesn’t, but it’s not gonna stop these professional plaintiffs from going on. And so you still have to be careful with that.

But I kind of lost track. What was your question again?

Jordan Eisner: So, one of the things is consent, right? Have robust consent, audit your contact list, familiarize your TCPA requirements.

I think robust consent, right? And understanding consent and how that works. I mean, that’s big with TCPA, especially if you’re using automated technology or texting consumers directly. So just expand on consent and what we mean when we say consent, not just, hey, call me.

Steve Gniadek: There’s layers to this. When you get the valid express written consent, you have to have very clear and conspicuous disclosure language, right? It can’t be in small, fine print that’s grayed out at the bottom of a page. It needs to be above a submit button or an unchecked checkbox where you’re having the proper and full disclosure that they are giving consent to receive marketing calls at a specific number. And that consent is not a condition of doing business with them, right?

So way back when, and I don’t think there’s many people doing this now, but it was always that strategy. You’re on the phone with someone and you have an agent ask them, if we happen to get disconnected, do I have permission to call you back? Well, that might work with about one call back if the call gets disconnected, but that’s not valid express written consent continue to call them about your products and services.

So really just making sure it’s clear and conspicuous. That’s the big thing. We see a lot of times it might be in scrolling font or sort of scroll box where you read the disclosure language, that’s not clear and conspicuous. Or even one of those disclosures says, you’re agreeing to receive calls from our partners and partners a link. And then you click that link and it opens up and there’s 2000 different company names listed there, right? I mean, that’s not very good consent and you’d have a hard time defending yourselves against that.

So, try to make it where it’s specifically mentions your company name when you’re getting consent. And if that’s not possible, go to a list where they can pick which. So even though this one-to-one consent got struck down, it’s still a good idea to try to specifically list who is getting the consent. That makes sense?

Jordan Eisner: Yeah, it does. And I don’t own a business that places plenty of outbound calls or generates leads and calls on them from web forms, but I know enough. I’m fortunate enough to know about professional places. And so if I did in this hypothetical, own a business, and I’m looking for your validation on this, basically for our listeners, or was a manager of some sort of outbound efforts or lead gen or something direct to consumer where we had web forms or some sort of way that we were gathering intent and leads from consumers, seems like a real priority from a compliance program and avoiding professional plaintiffs would be robust consent language, to your point. You just described that, right?
All the different layers, keeping that updated, saving different versions of my lead forms as we change them, but making sure that T’s are crossed, I’s are dotted on the consent form. But then that’s not where it ends. You get it, you call on it, but there’s a lot you gotta keep up with after that. The records, the versions of those, revocation of consent, how you disposition it, and so on and so on. Those seem to be two really big pillars in protecting your business against professional plaintiffs.

Steve Gniadek: Yeah, absolutely. And you’re right. I mean, even once you get the consent, the second piece of that is some of these tactics.

Let’s say it was a text message campaign, for example, you got the consent, it was the proper consent, you had the right to text that person, but then they’ll put, you’ll have opt out instructions on that text message that says to no longer receive text messages, please reply, stop, all in caps, right?

So a lot of these professional plaintiffs figured out, well, a lot of those companies that are doing this, it’s an automated system. So you have your platform or your tools looking for that word stop. And if they get it, they’ll add it to the do not text list. But what some of these professional plaintiffs will do instead of stop, they’ll put, take me off your list or STIP or even, you know, there’s a special character. If you have an iPhone and you’re texting someone and you hold down your finger on the S, you’ll have different types of S’s come up, different versions. So it’ll be a S with a tilde above it that says S stop, which these systems won’t recognize. And then they’ll claim, well, I did reply stop and you kept texting me. So it’s things like that.

So even when texting opt out instructions, you know, yes, put stop in there, direct them on how to do it. But then we usually advise them, build a dictionary of other terms and phrases that they might use and honor them. Well, you know, take me off your list or don’t text me anymore or things like that. And just kind of build on that and try to automate that.

Jordan Eisner: Good points. So takeaways for our listeners. There are lists out there. If you’re worried about professional plaintiffs, there are scrubbing providers PossibleNow. Our parent company is one where you can subscribe to a known litigators list that they’re updating regularly and you can suppress those numbers out of your calling files.

You can even build in rules, I think, where if one of those numbers hits one of your lead forms, it just triggers it out automatically. You know, it never even goes into your system. So that would be something to look at.

CompliancePoint, we provide services. Steve has provided his expertise here and all the different pitfalls and the ways that these professional plaintiffs try and, I guess, you know, dupe organizations, right? And to paint them out. And so we’ve been seeing, he’s been seeing it for 20 years. So if our listeners have questions on that or concerns or an open book, you know, feel free to reach out to us.
Steve’s on LinkedIn, I’m on LinkedIn. Steve, when’s the last time you checked your LinkedIn? Be honest.

Steve Gniadek: I was on it today.

Jordan Eisner: Yeah, come on. You remember the password?

Steve Gniadek: Oh yeah, I don’t know what it’s auto-save passwords. Well, it’s on my own computer.

Jordan Eisner: But yeah, or find us on compliancepoint.com. We’d love to have a conversation.

Steve Gniadek: Also, one additional thing, because it sounds like you’re trying to wrap up, which is we’re all in this together. CompliancePoint, PossibleNow all of our clients are in this together, right? So if you are a client, a seller, and you become aware of a new professional plaintiff, share it with us so we can add it to the list.

And you know, cause that’s one thing, you know, we talk about these burner phones and we might not have all phone numbers that these people are using on a litigator list. So anytime one of our clients becomes aware of it, let us know, we’ll research it, see if there’s other cases, see if it’s already on our list, or if it’s not, make sure we add it to the list to help others down the road.

Jordan Eisner: People helping people, good call out, Steve. So, I’ll leave it there. If you’ve got any concerns and you wanna bolster your program and reduce some of the risk around professional plaintiffs, we’re open to it, but take some of these strategies and things from this call as well.

Check out other resources online. There’s plenty and good luck.

Thanks for coming on, Steve. I’m sure we’ll do another one another time. Until then.