In a ruling with negative implications for defendants in TCPA suits, the Court of Appeals for the Eleventh Circuit reversed a lower court’s grant of summary judgment and said a jury should decide whether the plaintiff consented to the defendant’s phone calls.

Florida resident Clara Betancourt applied for a car insurance policy and opened a credit card account with State Farm in 2007. During the application process, she provided a phone number with the last four digits 8626—a phone number that belonged to her housemate, Fredy D. Osorio, with whom she shared a cell phone plan and an adult son.

When Betancourt failed to make a payment on her credit card account in 2010, a debt collector retained by State Farm placed 327 autodialed calls to the above number in a six-month span in an attempt to collect the minimum due. The calls intended to reach Betancourt at a number she had provided instead went to Osorio, who responded with a TCPA lawsuit. State Farm fought back by filing a third-party complaint against Betancourt for the balance owed on her account, as well as its legal expenses in defending itself against Osorio’s suit, premised on Betancourt’s negligent misrepresentation regarding the telephone number she provided the company.

A federal district court ruled in State Farm’s favor on cross-motions for summary judgment and awarded State Farm all requested damages, including $132,000 in legal fees the company incurred in defending the TCPA action.

But the Eleventh Circuit has now reversed, holding that a jury should determine whether Betancourt consented to receive the calls made to Osorio’s phone.

The panel first followed a Seventh U.S. Circuit Court of Appeals decision to find that an “intended recipient” is not the same thing as a “called party” under the statute. Osorio was the “called party,” the court said, as the subscriber to No. 8626, and would have standing to bring suit. Next, the Eleventh Circuit indicated that consent could be provided by an “authorized agent” other than the subscriber, but said that State Farm failed to demonstrate that Betancourt had an agency relationship with Osorio that permitted her to consent. Therefore, the issue could not be decided on summary judgment.

“[T]he key facts regarding agency are clearly in dispute,” the three-judge panel wrote. “Betancourt and Osorio testified in their respective depositions that they have never given each other authority to consent to phone calls from third parties. State Farm nevertheless contends that the court should infer such authority because Osorio and Betancourt have an adult son and shared both a home and a cellphone plan. But State Farm’s argument, if accepted, proves too much.”

The court continued: “Parents and cohabitants everywhere would be shocked to learn that every adult in their household is legally entitled to consent to having autodialing debt collectors call any of their cell phones,” the panel added. A jury could find that Betancourt had the requisite authority to provide consent, or alternatively, that she exercised “only a limited scope of agency” to use the number for emergency purposes.

The court also found that a genuine issue of fact existed with regard to revocation of consent. First, the court rejected the district court’s finding that written permission was required to consent. The TCPA does not contain an “in-writing” requirement to revoke consent for calls, and follows common-law notions of consent, which allow for oral revocation.

Because Osorio claimed he twice asked State Farm to “stop calling,” a contention challenged by State Farm, summary judgment was inappropriate, the panel said.

Turning to State Farm’s third-party negligent misrepresentation complaint, the court similarly found that factual issues precluded summary judgment.

To read the decision in Osorio v. State Farm Bank, click here.

Why it matters: TCPA defendants take note. While agency may form the basis for consent in a TCPA suit, it could be very difficult to prove an agency relationship exists. Here, the court found that summary judgment was not appropriate to determine agency for a cohabiting couple sharing a cell phone plan and child. The ruling also underscores the importance of good recordkeeping to resolve factual issues on summary judgment: although consent could be orally revoked, the court found that there were genuine issues of fact surrounding the revocation here.