Jury Awards $20M Verdict For Violation of National Do-Not-Call Rules

By Joseph C. Wylie II, Molly K. McGinley, Lexi D. Bond

A Greensboro, North Carolina jury handed down a $20.5 million verdict against Dish Network (“Dish”) last week in a class-action lawsuit, Krakauer v. Dish Network L.L.C., case number 1:14-cv-00333, brought under the Telephone Consumer Protection Act (“TCPA”). The verdict came after a five-day trial presided over by U.S. District Judge Catherine Eagles of the Middle District of North Carolina. Class representative Dr. Thomas Krakauer alleged Dish was responsible for telemarketing calls placed by an authorized Dish dealer to persons whose telephone numbers were on the National Do Not Call Registry.

The Federal Trade Commission opened the National Do Not Call Registry in 2003. Since its inception, millions of Americans have entered their telephone numbers on the registry. The plaintiff in the Dish suit, representing 18,000 class members, alleged that he received calls from a Dish retailer despite being on the Do Not Call Registry, and that over 51,000 calls were made to class members in violation of the TCPA.

The calls in question were made by a Dish dealer, Satellite Systems Network (“SSN”). Plaintiffs argued that Dish was responsible for the actions of SSN, despite contractual provisions that sought to place the responsibility for compliance solely on SSN, because the calls were made on Dish’s behalf and Dish allegedly knew of and ultimately benefited from the conduct by obtaining new customers. Plaintiff asserted that Dish turned a blind eye to its dealer’s illegal telemarketing conduct in an attempt to shield itself from liability. After a five-day trial, the jury in the case found that SSN was acting as Dish’s agent when it made the calls at issue and was accordingly responsible for the illegal conduct.

The 10-person jury had the choice of awarding up to $500 for each illegal call made by SSN. Ultimately, the jury awarded $400 per violation of the TCPA, for a total of $20.5 million. This marks one of the first jury verdicts for a class of consumers alleging Do Not Call violations since the enactment of the TCPA in 1991.