Nationwide Reply Brief, Dec. 16, 2000

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STATEMENT OF FACTS The case arises from two telemarketing solicitations made to the Appellant, Michael C. Worsham. On April 22, 1999 the Appellant received a telephone solicitation for insurance from a woman calling from a Nationwide insurance agent. E. 50, 9 and E. 52, 5. Appellant had never made any previous inquiries to Nationwide regarding insurance. E. 51, 21. Appellant alleges the woman who called him identified herself as Lisa and called on behalf of Nationwide. E. 50, 4 and 10. Lisa asked Appellant three questions regarding insurance. E. 50, 5. The Appellant told Lisa he was not interested, and requested that his telephone number be placed on the do-not-call (DNC) list. E. 50, 6. Lisa did not provide an address or telephone number to Appellant during the call. E. 50, 8. On May 18, 1999 the Appellant received a second telephone solicitation for insurance from a woman who identified herself as Charlotte and calling on behalf of Nationwide. E. 51, 11. Charlotte asked Appellant the same three questions regarding insurance that Lisa had asked Appellant during the April 22, 1999 call. E. 51, 12. Appellant requested of Charlotte that he not be called again, and requested a copy of the caller's DNC policy. E. 51, 13 and 15. Charlotte did not provide an address or telephone number of Nationwide to Appellant. E. 51, 17. Appellant never received a copy of the DNC policy. E. 50, 20.

ARGUMENT
I.	THERE ARE DISPUTES OF MATERIAL FACT PRECLUDING SUMMARY JUDGMENT
Appellant has restated his Statement of Facts in the immediately preceding section, because Nationwide Insurance ('Appellee' or 'Nationwide') has misstated the facts of this case, including the fact that there are material issues of fact in dispute. In a footnote to Nationwide's version of the Questions Presented, Nationwide asserts that "In the instant case, there are no material facts in dispute. Instead, the only dispute is the proper interpretation of the TCPA, a question of law." Appellee's Brief at 1. This statement is plainly false in light of Nationwide's own dispute of fact over the making of the second call to Appellant from Charlotte, and the relationship between Nationwide and its insurance agents with respect to marketing and solicitation, discussed further infra. Perhaps in an effort to divert recognition of the disputes of material facts, Nationwide also misstates some facts, and states as fact for the instant Court the 'facts' adopted by the trial court - 'facts' the trial court should not be making determinations of in a motion for summary judgment. A first factual issue to address that may not be in actual dispute, but has been quietly dancing through Nationwide's argument as an unstated assumption, is that at the time of the first call, Nationwide assumes that the Appellant knew that the solicitation came from one of its agents named Rick Gerety. The facts are that Appellant did not know at the time of the first solicitation which one of Nationwide's agent was calling on behalf of Nationwide. See E. 50, especially 4 and 10. Appellant later determined by using and matching information obtained through Caller ID, the phone book, and correspondence from Nationwide that the actual agent who made the first call was named Rick Gerety. However, at and during the time of the first solicitation, the only information Appellant had about the solicitor was that the person was calling on behalf of Nationwide. Thus, the reasonable expectation of a consumer - the Appellant - is based on this underlying factual situation, not the unstated but implied situation of Nationwide that Appellant knew that he was communicating with one of Rick Gerety's agents during the first call. This raises a dispute of fact as to what entity the call was made on behalf of. Among Nationwide's factual assertions which are in dispute to some degree, is that "The purpose of the [first] call was to solicit business for Gerety. (E. 16)." Appellee's Brief at 2. First off, the page E. 16 referred to is the trial court's opinion, and does not even make the statement Nationwide asserts, and the trial court would be making a factual determination even if it had made such a statement. Second, while Appellant asserts that it should axiomatic that a call by any Nationwide insurance agent is made at least in part on behalf of and to the benefit of the Nationwide Insurance Company - after all the call does not benefit Geico, Allstate, State Farm or some other insurance company - Appellant certainly contests that these calls are made wholly on behalf of the particular agent, as Nationwide's putative statement of 'fact' from the trial court's opinion implies. Nationwide also states as 'fact' that "Appellant did not produce evidence of 'Charlotte's identity, where she was calling from, or even a phone number. (E. 50, 51)." Appellee's Brief at 2 (emphasis added). Appellant must assume that Nationwide meant for this statement to say that "Appellee did not produce evidence of . . ." Pages E. 50-51 are Appellant's affidavit in which Appellant swears to Charlotte's failure to identify either herself or the number she was calling from. The TCPA and associated FCC regulations firmly places the identification burden on the calling party (i.e. Appellee Nationwide), not the caller (i.e. Appellant Worsham). 47 C.F.R. § 64.1200(e)(2)(iv). Nevertheless, Nationwide admits there is a dispute of fact regarding Charlotte's call: "Thus, it is unclear who actually made the second call or that caller's relationship with Nationwide." Appellee's Brief at 2.

II.

LIABILITY ATTACHES TO THE FIRST CALL MADE IN VIOLATION OF THE TCPA

Nationwide recognizes one of Appellant's main points, that TCPA liability attaches once the threshold of a second call containing violations is reached. Nationwide states that a private right of action accrues "against the telephone solicitor if he/she receives a second telephone solicitation by the same telephone solicitor within twelve months after making the do-not-call request. 47 U.S.C. § 227(c)(5)." Appellee's Brief at 4. Where Nationwide disagrees is whether the violations that occurred during the first solicitation call are actionable, once the second call threshold has been reached. Nationwide has continuously disputed that violations of the FCC regulations, as opposed to the TCPA itself, are actionable , despite its assertion in two footnotes that it does not contest this point. See Appellee's Brief at 4, n. 2, and at 18, n. 18 (falsely stating that "Appellee has never disputed this point."). Nationwide quotes the trial court on page 7 of its Brief for the proposition that violations made during the first call are not actionable. The trial court correctly recognizes there is little case law on point. However, the trial court passage cited by Nationwide has a glaring internal inconsistency, which also appears in the main case relied upon there to support Nationwide's contention. The trial court's inconsistency is displayed by its correct statement that "What is prohibited, however, is a telephone solicitor's failure to adhere to the regulations prescribed under the TCPA," followed in the very next paragraph by its incorrect assertion that "Pursuant to § 227(c)(5) infra, it is the telephone call itself that is the actionable violation, not each individual violation of the FCC regulations." See E. 13. This obvious problem which the trial court had in recognizing that it is violations of the regulations that are actionable, may account for the trial court's difficultly in recognizing that violations during the first call are actionable. Appellant recognizes the decision of the court in Charvat v. ATW, Inc., 712 N.E.2d 805, 712 N.E.2d 805 (Ohio App. 1998) , which held that violations during the first call are not actionable, the only known reported case to address the issue and so hold. However, that court based part of its decision on a previous case by the same pro se plaintiff (Charvat): [T]he phrase 'in violation of the regulations prescribed under this subsection' modifies 'telephone call.' *** It is the therefore the 'telephone call' that is the actionable violation. Charvat v. Colorado Prime (Sept. 2, 1997), Franklin Cty. M.C. No. M9609CVI-029273, unreported, at 3-4, 1998 WL 634922. Charvat v. ATW, at 807. The Charvat courts were laboring under the same confusion evident in the trial court's opinion in this case, namely, whether a right of action arises from violations of the regulations (which it does) or arises from calls made in violation of the regulation. The Charvat court, and the trial court in the instant case, wrongly extrapolated their logic that it is telephone calls - rather than regulatory violations - that are actionable to then conclude that there is no cause of action for violations of the regulations occurring during the first call. When the same Ohio court revisited the TCPA in a case involving the same pro se plaintiff, Charvat v. Colorado Prime, Inc., No. 97AP 609-1277, 1998 WL 634922 (Ohio App. Sept. 17, 1998), cert. denied 704 N.E.2d 578, 84 Ohio St. 3d 1470 (1999), there was a sharp dissent on this precise issue, while the majority still clung to its incorrect interpretation of the law that telephone calls, rather than regulatory violations, are what is actionable. In Charvat v. Colorado Prime, the majority analyzed the dispute over whether the phrase 'for each such violation' in 47 U.S.C. § 227(c)(5)(B) refers to a 'violation of the regulations,' as the plaintiff in that case argued and Appellant now argues, or refers to 'telephone call." Id. at 5. It came to the wrong conclusion: ". . . this court finds that 'such' refers to telephone calls in violation of the regulations. Therefore, compensation should be based on the number of telephone calls in violation of the regulations." Id. This is a clear misinterpretation of the law and FCC regulations, which even Nationwide has apparently and belatedly conceded. Appellee's Brief at 4, n.2 A simple example of why this reasoning is faulty is to consider the regulatory requirements for providing a do-not-call (DNC) policy on demand, or to train personnel engaged in telephone solicitation. 47 C.F.R. §§ 64.1200(e)(2)(i) and (ii). These requirements for providing a policy and to train personnel are obviously not 'telephone calls,' but would nonetheless be actionable if violated by a telemarketer. The faulty reasoning of the Charvat v. Colorado Prime majority opinion regarding a private right of action for violations of the regulations throws into question any aspect of its interpretation of the TCPA, and specifically its analysis of whether there is a cause of action for regulatory violations during the first call. Appellant argued in his Brief that the dissent in Charvat v. Colorado Prime, Inc. has the better reasoning regarding first call violations being actionable. Appellant also adds that the dissent came out after the opinion in Charvat v. ATW, Inc., and as the contemporaneous dissent to Charvat v. Colorado Prime, Inc. Importantly, the dissent does not depend on the faulty reasoning of the majority on the basic fact that it is regulatory violations, and not telephone calls, that are actionable, as discussed above. As the Charvat v. Colorado Prime dissent pointed out, to hold as the Charvat majority held would "render large sections of the regulations largely unenforceable through a private cause of action, which itself constitutes an effective means of enforcing the statutory and regulatory provisions." Id. at 6 (Bryant, J., dissenting). The examples cited by Appellant in the preceding paragraph of providing a DNC policy or training personnel are two such examples of what the dissent is referring to. Setting aside Nationwide's argument regarding liability for independent contracting and affiliated entities, Appellant's cause of action arises from a failure that occurred during the first call, namely when the telemarketer identified to him as Lisa allegedly failed to record and maintain his DNC request, as required by 47 C.F.R. § 64.1200(e)(2)(iii). This regulation requires that a telemarketer place a residential "subscriber's name and telephone number on the do-not-call list at the time the request is made," in other words, during the first call Id. (emphasis added). To prevent a cause of action for a failure by a telemarketer to record a DNC request that occurred during the first call would defeat the purposes of the TCPA and the FCC's regulations. In summary, the TCPA and FCC regulations do provide liability for violations made during the first call, once the second call threshold has been reached. Interpreting the law this way would not in any way cripple a legitimate business activity, as Nationwide suggests. Appellee's Brief at 8. Telemarketers could still engage in telemarketing, and make multiple violations during the first call, and no cause of action would lie, if a second call in violation is not also made. In fact, this interpretation would further the goals of the TCPA, one of which even Nationwide recognizes "was to prevent second unwanted intrusion upon a person who made a do-not-call request." Id. The FCC decided the best way to achieve this goal was by promulgating telemarketing identification, training and DNC policy requirements, which if followed, prevent further unwanted calls. If not followed, they present the situation now before this Court. Allowing a cause of action for violations of these requirements, whether made during the first or subsequent calls, furthers the goals of the TCPA.

III.

NATIONWIDE AGENTS ARE NOT INDEPENDENT CONTRACTORS FOR ADVERTISING PURPOSES

Although Appellant has pointed out that whether Nationwide's insurance agents are independent contractors is not relevant to liability under the TCPA, see Appellant's Brief at 10-13, whether Nationwide's agents are independent contractors with respect to advertising and marketing is still an issue of material fact in dispute. Nationwide cites three case for its proposition that its agents have an independent contractor relationship with them. However, the cases cite, Barnes v. Fotheringham, 1997 U.S. Dist. Lexis 16082 (W.D. N.C. 1997), Strange v. Nationwide Mutual Ins. Co., 1997 U.S. Dist. Lexis 13034 (E.D. Pa. 1997), and Robinson v. Ladd Furniture, Inc., 872 F.Supp 248, 254 (M.D. N.C. 1994), only address whether Nationwide agents are employees or contractors overall, as opposed to with respect to advertising. Strange is the only case to discuss advertising. The Strange court found that "Nationwide did provide plaintiffs with some office supplies, such as pre-printed forms, stationery, memo pads, rubber stamps, paper, camera, film, manuals, directories, and sales literature, all of which were considered the property of Nationwide and had to be returned upon cancellation of the Agent's Agreement. Id. at 16 (emphasis added). The court also noted that while Nationwide agents had some latitude in making advertising decisions, there was an important exception to this: "Nationwide offered a separate 'cooperative advertising' program, which, if elected by plaintiffs, provided fifty percent reimbursement for advertisements that were approved by Nationwide and that met certain requirements." Id. at 18. In a footnote, the court detailed the extensive list of the materials Nationwide controlled through this program: Plaintiffs would have to comply with the following requirements under the cooperative advertising program: Newspapers and Magazines- daily, weekly, or monthly; they must have home delivery (carrier or mail) and have a paid circulation base that can be verified by an independent source. Radio and TV- requires prior approval from our Agent Advertising Department on all contracts (13 weeks or longer). Billboards- 30-sheet and 8-sheet posters require contracts from only full-service outdoor advertising companies. Shelterall Signs- can be used only in accordance with advertising companies that offer Shelterall Signs. (Shelterall Signs are not available in all states.) Publications-sports and theatrical programs; real estate, bank, school, church, neighborhood, civic, and fraternal publications. Pls. Exh. 10 (1991-92 Advertising Guide).   Id. at 19. The existence of such cooperative agreements between Nationwide and its agents which are firmly in the control of Nationwide raise a factual dispute in the instant case of whether Nationwide's agents are really independent contractors for advertising purposes and with respect to the TCPA. These cooperative agreements also raise a factual dispute as to whether Nationwide agents are affiliated entities of Nationwide under the TCPA. To allow telemarketers like Nationwide to escape liability by simply contracting out their statutory duty would defeat the purpose of the entire TCPA statute. Liability under the TCPA extends to 'affiliated entities' of the telemarketer, a term not defined by the statute. Appellant has previously argued why Nationwide's agents are 'affiliated entities' of Nationwide. Appellant's Brief at 13-16. In particular, if a consumer was solicited by a person only identifying themselves as being with Nationwide, they would reasonably expect not to be called by Nationwide again. If the instant court for some reason believes that telemarketers can contract out their liability under the TCPA, then the issue of whether Nationwide agents are independent contractors for advertising purposes becomes a material dispute, and it was therefore an error for the trial court to have made a factual determination on this issue on a motion for summary judgment.

IV.

THE SECOND CALL TO APPELLANT CAN BE ADEQUATELY AUTHENTICATED UNDER 'SUNDRY CIRCUMSTANCES'

Nationwide's assertion that the identity of the second caller can not be authenticated is not accurate, the cases it cites are distinguishable from the instant case, and any lack of authentication is due to Nationwide's alleged violation of the TCPA, which as a matter of fairness should not be a bar to authenticating the evidence of the second call. The cases cited by Nationwide, Knoedler v. State, 69 MD. App. 764, (1987), and Mutyambizi v. State, 33 Md. App. 55 (1976), both point out that a telephone call may be authenticated in the absence of recognition of the voice of the alleged caller by 'sundry circumstances,' including admissions and the like. Knoedler at 773 (citing 7 Wigmore On Evidence § 2155(1) (1978)). Appellant submits that the details within the second call in the instant case amount to 'sundry evidence.' The second caller identified herself and as calling on behalf of Nationwide, see E. 51, 11, a level of identification similar to that of most telemarketing calls - providing the caller's first name and company name - and was similar if not identical to the manner of identification of the caller in the first call. According to the Appellant's affidavit, which must be inferred favorably in a motion for summary judgment, the second caller further identified and authenticated the calling entity by asking three insurance questions, questions that Appellant has sworn are identical to the questions asked by the first caller, E. at 51, 12. Nationwide agrees the first caller was calling on behalf of a Nationwide agent. It can be reasonably inferred that the second caller was calling on behalf of a Nationwide agent. However, whether Nationwide or one of its agents made the second call is "a matter for determination by the trier of the facts." Mutyambizi at 62. The cases cited by Nationwide applying the 'sundry circumstances' test are distinguishable from the instant case. In those cases, which were criminal cases, the caller was the defendant, whose personal identification was necessary to prove the state's case. In the instant case, the full and actual identification of the individual telemarketer who made the call is not critical to Appellant's case. Whether the call was made by someone named Charlotte, or Bill, or Susan, or Wayne, or anyone else is not relevant to identifying and authenticating the call as coming from Nationwide. If Charlotte, the second caller to solicit Appellant, had provided Appellant with her life story, instead of saying that she was calling on behalf of Nationwide and asking Appellant three insurance questions (E. 51, 11-12), her life's details would obviously have authenticated the call with respect to her personally as being the actual caller, but would not have told Appellant anything about Nationwide. What is ultimately relevant is who they were calling on behalf of - Nationwide. In a TCPA case, the 'sundry circumstances' test should be applied to whether adequate identification has been made of the ultimate calling entity. In this case the ultimate calling entity of interest is not the individual telemarketing agent, but rather, Nationwide. Here, the facts sworn by the Plaintiff are that Charlotte provided information about Nationwide and insurance, and not herself. Here, the second caller did identify herself as being with Nationwide, and furthermore, asked three questions similar or identical to those asked of Appellant by a previous telemarketer calling to sell Nationwide insurance. This meets the 'sundry circumstances' test applied to identifying Nationwide, the real entity of concern here, even if the information exchanged during the second call does not adequately identify the specific caller. The operative language in the FCC's regulations extends a DNC request to an affiliated entity if "the consumer reasonably would expect them to be included given the identification of the caller and the product being advertised." 47 C.F.R. § 64.1200(e)(2)(v) (emphasis added). Here the identification of the caller was Nationwide, and the product advertised was insurance. Appellant points out that even if there is a failure to authenticate, it is a result of the alleged violations of the TCPA by Nationwide or its agents. The whole point of the FCC's identification requirements in 47 C.F.R. § 64.1200(e)(2)(iv) is to prevent the dispute that is now being argued. A telemarketer should not escape liability by claiming that the victim can not authenticate the call, when the victim's authentication disability is brought about by the defendant's failure to adequately identify itself as the FCC regulations require. 	Followed to its logical conclusion, Nationwide's argument would preclude any Plaintiff from ever winning a claim for the failure of a telemarketer to identify themselves: if the telemarketer can not be identified, the defendant will claim that the call and/or caller can not be authenticated or identified, but if the telemarketer is identified, then the defendant will claim there has been no violation of the statute. This can not be the correct interpretation or application of the TCPA, which is, after all, a consumer protection statute, not a statute to protect telemarketers from having to properly identify themselves. Nationwide has made references to Caller ID in its Brief, and argued in its Conclusion that unwanted telephone solicitation "can be avoided by less drastic methods such as caller identification." Appellee's Brief at 18. Appellant points out that a fee is charged for Caller ID, and to invoke a requirement for a consumer to have Caller ID could run afoul of the TCPA's provision prohibiting certain calls to a telephone number for which the called party is charged. 47 U.S.C. § 227(b)(1)(A)(iii). It does certainly run afoul of the FCC's carefully weighed decision, that the burden of providing identification is on the soliciting caller: 7. Decision. We continue to believe that it is in the best interest of residential subscribers and telemarketers that full identification of the soliciting caller be provided in the course of a telephone solicitation. We do not agree with the commenters' contention that providing this information is burdensome to telemarketers, who in any event have an interest in providing at least enough information to link the telemarketer with the product or service offered. Residents should receive the information without having to demand it or to remember to ask for it. The burden of determining precisely which office within a telemarketing entity, or which office among several affiliated entities, has placed a call would otherwise fall to the resident. In the event that a call were placed to a subscriber who has requested not to be called, difficulties in obtaining the telemarketer's identification or telephone number would be an obstacle to swift resolution of the problem or to proving a violation of the TCPA. DMA's concern over telemarketers' ability to comply with the identification requirement in instances in which the call is terminated by the resident prior to completion of the identification announcement is not persuasive. As discussed above, the telemarketer bears the burden of ensuring that identification is given. We recognize that a resident's hang-up on a solicitation call could thwart telemarketer identification. Determinations of compliance will be made on a case by case basis, taking into account the telemarketer's efforts to ensure the information is included in a solicitation call. In sum, we find that the rule strikes the proper balance between the resident's interest in choosing whether to receive further solicitations from a telemarketer and the interest of telemarketers in soliciting by telephone. Thus, we will continue to require that a telephone solicitation include either a telephone number or mailing address at which the solicitor can be reached. In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 7, Memorandum Opinion and Order, 10 FCC Rcd 12391 (1995). Nationwide's suggestion that the consumer should use Caller ID to overcome the telemarketer's failure to identify themselves is clearly contrary to the FCC's decision that the burden is on the telemarketer to provide this information regardless of whether the consumer asks for it. Finally, Appellant subpoenaed Bell Atlantic, but was told there were no call records available. Through his persistence in other litigation involving the TCPA, Worsham v. John Doe, Circuit Court for Harford County Case No. 12-C-00-807, Appellant discovered that Bell Atlantic keeps up to about four months of records on tape. E. 38. However, Bell Atlantic claims that this information is not kept in the normal course of business, and for such a search Bell Atlantic wants advance payment of $500 per day searched. Thus, although in the instant case Appellant's subpoena was issued too late, because it was issued over four months after the incoming solicitation calls were made, the cost of even a timely search would have been prohibitive. More importantly, the Bell Atlantic records are not essential to prove the call was made, but would only be additional proof of the origination of the call. Appellant should not have his timely made claim barred simply because he did not know of or meet Bell Atlantic's four month tape destruction cycle. TCPA plaintiff's have at least three years under Maryland's general statute of limitations statute to file a claim. Md. Code Ann., Cts. & Jud. Proc., § 5-101 (1999). Plaintiff can still take discovery of Nationwide's agents to find out who was making telemarketing calls during this period.

CONCLUSION Nationwide has attempted to avoid liability for telemarketing calls made by persons using its name and for which Nationwide benefits. If Nationwide's arguments were accepted by this Court, the Telephone Consumer Protection Act would be eviscerated into a worthless Act that would allow Nationwide and any telemarketer to simply contract out all their telephone solicitation work and avoid liability. Even worse, as Nationwide attempts to do in this case, a telemarketer could conveniently whip out an agreement over ten years old that claims its agents are independent contractors, and attach it to a motion for summary judgment, and have a case brought by a consumer dismissed before the actual relationship with respect to advertising of these supposedly independent contractors is known. This is not the goal Congress had when passing the TCPA, and a holding this way would be inconsistent with both the language of the Act and the FCC's regulations. The Court of Special Appeals should reverse the Circuit Court's granting of the Appellee's Motion for Summary Judgment. Respectfully submitted,   Michael C. Worsham, Esq., Appellant 1916 Cosner Road Forest Hill, Maryland 21050 (410) 557-6192 December 16, 2000 Original Appellant's Brief was printed in Times New Roman in 13 point font.

CERTIFICATE OF SERVICE I CERTIFY that on the 16th day of December, 2000, two copies of the Appellant's Reply Brief were mailed, first class postage prepaid, to: Patricia McHugh Lambert, Esq., Hodes, Ulman, Pessin & Katz, P.A., attorneys for Defendant Nationwide Mutual Insurance Company, 901 Dulaney Valley Road, Suite 400, Towson, Maryland, 21204, 410-938-8800. Michael C. Worsham, Esq., Appellant, Pro Se