Whether Royal Seas Cruises can be held vicariously liable for illegal robocalls made on its behalf using bad leads from an online lead generator.
If you’ve ever filled out an online form hoping to receive quotes for insurance or information on discounted items, you are probably already familiar with the robocall bonanza caused by lead generators. Online lead generation is the process of cultivating new customer leads by enticing people to fill out online forms, often through deceptive or misleading means. The contact information submitted through these forms is then sold to tens, hundreds, or even thousands of other companies, which then use third-party call centers to robocall people incessantly.
Receiving a barrage of robocalls for filling out one online form is bad enough, but sometimes, the targets of robocalling campaigns don’t give anyone their contact information. Instead, someone else—or something else, like a bot—enters their phone number into an online form. Many online lead generators fail to validate their data sets, which leads to robocalls to people who never consented to be called.
In this case, Royal Seas Cruises contracted with a telemarketing company, Prospects DM, to robocall new customer leads on their behalf. Prospects DM then contracted with a slew of web publishers to collect leads for Royal Seas Cruises such as diabeteshealth.info, which has nothing to do with cruises or travel. No one in the lead supply chain validated the contact information or their consent to be robocalled. As a result, the named plaintiffs in this case were robocalled by Prospects DM and passed on to Royal Seas Cruises to hear an unsolicited pitch for a vacation package.
The plaintiffs sued Royal Seas Cruises on behalf of the tens of thousands of people who allegedly never consented to be robocalled by Royal Seas Cruises or Prospects DM. A district court tossed the case, finding that Royal Seas Cruises couldn’t be held liable because it didn’t have specific knowledge about the bad leads and it included a provision in its contract with Prospects DM requiring the company to comply with the TCPA, the federal anti-robocall law. The plaintiffs have appealed to the Ninth Circuit.
EPIC, joined by the National Consumer Law Center, filed an amicus brief supporting the plaintiff’s fight to hold Royal Seas Cruises accountable for its illegal robocall campaign. EPIC and NCLC explain how companies like Royal Seas Cruises use webs of contractors to insulate themselves from liability for illegal robocalls made on their behalf. We also describe the lawsuits, FTC actions, and general information about the lead generation industry that show that employing online lead generators to obtain TCPA-compliant consent to be robocalled is an inherently risky decision. The brief closes by arguing that holding Royal Seas Cruises accountable promotes the consumer protection goals of the TCPA—and letting Royal Seas Cruises off the hook would dramatically weaken TCPA enforcement and compliance.
United States Court of Appeals for the Ninth Circuit (No. 21-550099)