Being sued is never fun. Being sued for TCPA violations is another (potentially worse) story. A TCPA suit is particularly troubling because of the uncapped statutory damages and confusing regulations surrounding TCPA compliance. In the wake of any new lawsuit, an obvious first step is to retain litigation counsel. Beyond that, or in the meantime, the homework has been distilled into seven informative steps below.
The entire process of selecting TCPA counsel is beyond the scope of this blog post but the choices include:
- BigLaw mega-firm – expensive and usually heavily staff litigation
- Regional or local firm – lower hourly rates but may not be familiar with the twists and turns of TCPA litigation
- TCPA litigation boutique – lower hourly rates and TCPA litigation experience
The process of retaining counsel—weigh and select the best candidate, check conflicts, and otherwise wade through the engagement process—may take some time. In the meantime, here are some initial steps that your company should take either with interim counsel or on its own:
- Inform management and the investor relations' office if appropriate. Litigation presents a slew of potential legal, financial, and reputational issues. If your company is a public company, litigation might be a material event that needs to be disclosed to the markets quickly. Usually, TCPA cases would not warrant public disclosure but management (or even the Board of Directors) should be informed as quickly as possible.
- Decide whether to waive service. In federal court, where most TCPA cases are filed, a defendant has 21 days to answer a complaint but 60 days if service is waived (90 for international). If your company is subject to service anyway, it might be worth waiving service in exchange for the extra time to respond.
- Ask for an extension even if service is not waived. After service, the parties can still agree on an extension or the defendant can move for an extension. In most cases, the plaintiff will agree to a reasonable extension.
- Preserve relevant evidence. Federal courts, and most state courts, require parties to preserve relevant evidence once litigation is reasonably foreseeable and certainly after a lawsuit is filed. A common way of instituting this is through what is called a “litigation hold notice.” The notice instructs employees to preserve relevant documents, including the suspension of auto-delete functions in the company’s email and document management systems.
- Don't create new evidence. After the litigation is filed, instruct employees not to discuss the lawsuit except with counsel. Most communications with counsel will be protected by the attorney-client privilege. Any memoranda or analyses should be done at the direction of counsel.
- Contact your insurance carrier. Whether or not a TCPA claim is covered by insurance is outside the scope of this post, but it is sound practice to, at the very least, notify the appropriate insurance carriers when the lawsuit is filed.
- Analyze the forum. At the beginning of litigation, there are often opportunities to transfer a case from one forum to another (e.g., state court to federal court, federal court to arbitration) and opportunities to change venue (i.e., to a different geographical location). Although litigation counsel will be able to render advice on whether to challenge the forum or venue, there are some decisions that need to be made promptly. For example, removal from state court to federal court must be made within 30 days (with some exceptions). Likewise, there might be a deadline on compelling arbitration if an arbitration forum is available.
Hopefully this checklist will help kick off the successful resolution of any TCPA litigation your company might be involved with. If you’re looking for more checklists, tips, or tricks to get you through, feel free to check out our TCPA Survival Guide: The Litigation Edition.