In Heard v. Nationstar Mortgage, LLC, 2018 WL 4028116 (N.D. Ala. August 23, 2018), Judge Haikala found that a mortgage company’s dialer was an ATDS under the TCPA.
Nationstar argues that its system is not an automatic dialer because it does not “store” caller information. That information, Nationstar argues, is located on a separate “host system.” (Doc. 51, p. 6). But Nationstar’s own representatives indicate that the information necessary for predictive calling is uploaded onto the Avaya/iAssist system daily. (Doc. 48-16, p. 38). The uploaded information is stored on Nationstar’s dialing system until it is removed. This conclusion is supported by the fact that Mr. Heard received several calls in the course of one day. Thus, his caller information was stored in Nationstar’s dialer throughout that day. (See, e.g., Doc. 48-7, pp. 21–23). . . .The TCPA does not require that the automatic dialer be the primary or permanent storage location for caller information. . . Next, to avoid Mr. Heard’s TCPA claim, Nationstar seizes on the statutory requirement that an automatic dialer have “the capacity to store or produce telephone numbers to be called, using a random or sequential number generator.” (Doc 51, p. 9) (emphasis in Nationstar’s brief). As the D.C. Circuit noted in ACA International, this phrase “has generated substantial questions over the years.” . . . The phrase bolded above applies neatly in the context of telemarketing where the targets of automated calls are groups of individuals rather than specifically identified individuals. The application may be less clear in the collections context. An entity attempting to collect a debt will not generate phone numbers randomly or sequentially without regard to whether the person being called owes the company money. In that regard, an entity like Nationstar will always make its collection calls with reference to a relatively narrow, predetermined list of telephone numbers. But this fact does not prevent the TCPA from applying to Nationstar’s predictive collection calls. Again, Nationstar’s proposed interpretation of the TCPA is too restrictive. As discussed, Nationstar’s system produces from the inputted call data a list of numbers that the iAssist software sequences according to a borrower’s predicted availability to receive calls. iAssist then dials the numbers as sequenced and connects the call to a Nationstar representative only if someone answers the call that iAssist initiated. Yes, Nationstar’s system is limited by the daily informational inputs of Nationstar employees, but the system orders sequentially the many numbers to call by analyzing customer information and assigning times for Nationstar to contact particular numbers. (Doc. 48-16, pp. 31–32, 38; Doc. 48-17, p. 18); 42 U.S.C. § 227(a)(1)(B). Although a collections representative must log in before the system begins dialing, that does not detract from the fact that the representative does not choose whom to call or dial the outgoing calls. Cf. Strauss v. CBE Grp., Inc., 173 F.Supp.3d 1302-11 (S.D. Fla. 2016) (holding that a system in which a representative used a manual clicker to initiate each call was not an automatic dialer because “human intervention [was] essential at the point and time that the number is dialed”). Additionally, the fact that Nationstar employees “scrub” and input loan data for the system’s use does not obviate the role that Nationstar’s iAssist software plays in selecting the numbers to call and initiating each call. (Doc. 48-16, p. 38). To hold that a system is not an automatic dialer whenever an employee examines and transfers information from an external database onto the dialing system would unnecessarily limit the TCPA’s application. Although the language Congress enacted in the TCPA may not anticipate and expressly address each new innovation in the telecommunications field, defendants should not be able to circumvent the TCPA’s prohibitions simply by disaggregating the functions of an automatic dialer into nominally separate, but functionally complimentary systems. Again, the TCPA is a remedial statute, and the Court may not harness its remedial power by applying the statute narrowly. Based on the facts in the record, the Court concludes that Nationstar’s system satisfies the TCPA’s definition of an automatic dialer.
The District Court found enough evidence to hold the Plaintiff’s FCRA claim to trial, too.
Nationstar argues that the notices sent to them by the agencies were vague and indicated only that the Heards generally disputed the reporting of their payment history. (Doc. 51, p. 6). In light of this, Nationstar claims that it was reasonable for its personnel to simply check the Heards’ payment history and perhaps the original note. (Doc. 51, pp. 25–27). But a furnisher may not “truncate its investigation simply because the [credit reporting agency] failed to exhaustively describe the dispute in its § 1681i(a)(2) notice.” Hinkle, 827 F.3d at 1306 (citing Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1157 n. 11 (9th Cir. 2009)). Even if the credit agencies gave a less than detailed description of the Heards’ dispute, this did not relieve Nationstar of its responsibility to review documents in its possession. Id. Under the circumstances, it was not reasonable for Nationstar to simply cross-reference the Heards’ payment history with the information in the Heards’ credit report when the credit dispute concerned a more specific factual issue that Mr. Heard had raised many times with Nationstar. The evidence in the record indicates that Nationstar did not investigate the dispute further before verifying the Heards’ credit information to the reporting agencies. Therefore, the Court enters judgment in Mr. and Ms. Heard’s favor on their FCRA claims. The Court leaves the issue of damages for trial.