By Richard D. Milone and Emily Gianetta – Insurance Policyholder Advocate
The Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227, et seq., restricts certain forms of telemarketing and limits in many instances the use of automatic dialing systems, prerecorded voice messages, SMS text messages, and faxes. The TCPA provides consumers with a private right of action that enables them to recover up to $500 for a single violation, and up to $1,500 for each willful violation, of the TCPA. Because TCPA lawsuits are often brought as class actions and can involve thousands of alleged individual violations, purported damages can pile up very quickly. Not surprisingly, the legal bills incurred by companies defending against TCPA litigation can be also be very significant.
As with any sizable and unexpected potential liability, companies frequently turn to their insurance policies to seek coverage for their defense costs and their potential liability under the TCPA. Claims are most frequently asserted under commercial general liability (“CGL”), Directors’ and Officers’ (“D&O”), and professional liability/errors and omissions (E&O) insurance policies.
With respect to CGL insurance policies, policyholders typically argue that the “advertising injury” provisions of their insurance policies, which often cover any “oral or written publication that violates a person’s right to privacy.” There are strong arguments that this wording includes claims alleging violations of the TCPA. This is because most TCPA claims allege that the policyholder company violated the plaintiffs’ right to seclusion, which is one form of the right to privacy. Because CGL policies do not, however, typically include a clear definition of the “right to privacy,” whether alleged TCPA violation are covered under the privacy wording may be left to judicial interpretation.
D&O and E&O policies also may cover TCPA liability under provisions providing coverage for claims arising out of a “wrongful act.” While a “wrongful act” in policies sold to publicly-traded companies is often limited to securities suits, a “wrongful act” for privately held companies may include a wide variety of commercial liability, including TCPA claims. In addition, D&O policies cover individual directors and officers, to the extent that they are not indemnified by the company, and also cover the company for the costs of indemnifying its directors and officers. Thus, where a suit alleging violations of the TCPA names an individual “director” or “officer” (terms which generally are broadly defined and include any senior level employee), the D&O policy may cover the individual’s TCPA liability too. [read more]
By Jason Notte – The Street
Credit card debt is a national concern but also an increasingly local problem.
Recently, the folks CreditCards.com looked at the balance on the average person’s credit cards in the 25 largest U.S. metro areas, based on credit report data from credit bureau Experian. Across the nation, they discovered that the average $4,410 balance in 2014 would take the typical working person 13 months to pay off, costing $327 in interest. The time it takes to pay that balance was calculated using 15% of the median earnings for each city (a rule of thumb used by credit counselors setting up debt repayment plans), according to Census Bureau figures.
However, that debt varied widely by location. Among the 25 metro areas surveyed, New York City (11 months, $293 interest), Minneapolis/St. Paul (11 months, $266 interest), Washington, D.C. (10 months, $286 interest) and Boston (10 months, $267 interest) ranked near the bottom of the debt pile. The leanest of the bunch? The San Francisco/Oakland/San Jose area, which takes just nine months to pay down its credit card bills, earning just $234 in interest).
“It’s interesting that the metro areas with the highest average credit card debt don’t necessarily have the highest debt burdens when adjusted for income,” said Matt Schulz, CreditCards.com’s senior industry analyst. “For example, Washington, D.C. has the nation’s highest average credit card debt [$5,046 per card], but since it has the highest median income in the U.S., its debt burden is lower than all but two metros.”
Granted, San Franciscans have to deal with median home price of $748,300, more than four times the price of a home in the city with the worst credit card debt, according to the National Association of Realtors. However, paying off credit card debt quickly has far more positive implications than stringing out payments while sitting on a pile of equity. [read more]
By Catherine Curan – New York Post
Buying a house is supposed to usher in a happy new phase — not a lengthy legal battle that puts your life in a deep freeze for years.
Foreclosure cases that drag on for years without resolution, however, have become a quiet crisis in New York, particularly for homeowners who have dared to fight back against dubious foreclosure claims by banks and investors.
Drawn-out foreclosures are forcing families to double up on housing, curtailing work opportunities outside New York, depleting savings accounts, blighting neighborhoods with vacant and abandoned properties, and draining hopes and dreams.
New Yorker Ron D., who declined to give his full name out of concern for his family’s privacy, has been struggling for more than five years to sort out who owns the loan on his metro-area home. He and his wife now live with their adult child, and don’t know when they will be able to sell their former dream house and pay their debts.
“This thing has become an itch that won’t go away,” he said. [read more]
By WWYN TV
New York’s comptroller says the foreclosure crisis persists in the state, even worsening in some upstate areas.
Comptroller Thomas DiNapoli says there are still too many New Yorkers losing their homes.
A report released Monday notes filings against homeowners unable to make mortgage payments spiked after the housing bubble burst in the 2008-2009 recession.
New cases nearly doubled from 27,706 statewide in 2006 to 47,664 three years later. [read more]
By The Island Packet
Do you need a feel-good story about justice today? Of course you do – who doesn’t? This one is particularly satisfying to anyone who has ever been wrongfully harassed by a debt collector seeking payment on an old debt.
Earlier this year, the Federal Trade Commission (FTC) reached a settlement with the former Asset Capital and Management Group, a California debt-collection group that violated both the Federal Trade Commission Act and the Fair Debt Collection Practices Act (FDCPA). As a result of the settlement, almost $4 million in refunds are being sent to more than 95,000 consumers that were harmed by the group’s practices.
The $4 million comes from personal assets of the four defendants (Thai Han, Jim Tran Phelps, Keith Hua and James Novella), as well as assets frozen from Asset Capital and its network. According to the FTC press release, Asset Capital and Management used “a sprawling network of intertwined companies and dozens of fictitious names” in their efforts to recover debts they had purchased from various creditors.
The group used a series of belligerent and threatening tactics to attempt to recover the debts, all in violation of the above acts. [read more]
By Chris Morran – Consumerist
Imagine you wake up one day to find out that you suddenly owe nearly $100,000 on a house you’ve never owned, in a city where you’ve never resided. Should be easy enough to sort that out, right? Tell that to the Florida man who has spent the better part of two decades trying to convince creditors he didn’t buy property in Philadelphia when he was 12 years old.
The man’s saga, according to the Philadelphia Inquirer, goes back to 1998, when he learned of a $98,293 judgement against him from a bank. The money was related to a property in Northeast Philadelphia that had gone into foreclosure.
The building had apparently been purchased by someone with a similar name, but in 1972, when the alleged debtor wasn’t even a teenager, let alone trying to invest in real estate.
He was the victim of lazy “skip tracers,” who do their best to connect names and dates and locations in the hopes of tracking down the correct person, but who sometimes fail miserably by, for example, not taking into account that this man could not possibly have ever owned this property.
Through a little research on his own, the man believes he may have found the correct debtor with his same name. Unfortunately, that man died back in the 1970s. [read more]