1. Impact to Credit and Collections
The Strauss Decision:
Impact to Credit and Collections

2. Speaker Bios Dale Golden Mike Frost Attorney, Golden Scaz Gagain, PLLC
Dale is the managing member of Golden Scaz Gagain in Tampa, Florida, and has defended creditors, debt collectors, and debt buyers in more than 1,000 consumer cases in various state and federal courts over the past 20 years. In June, Dale received ACA International’s Judicial Advocacy Award.
Mike Frost
Chief Compliance, Sales Officer & General Counsel
Mike joined CBE in Mike manages compliance policy and a team of professionals including legal, quality assurance, regulatory compliance, legislative affairs, litigation defense, corporate governance and enterprise risk. Mike is a trusted industry expert, serving in leadership roles and as a speaker for many associations.
Chad

3. Risk Impact

4. FDCPA & TCPA Litigation Cost Trend
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
TCPA Litigation 14 16 39
354
830
1,102
1,904
2,558
3,710
3,914
4,671
FDCPA Litigation
4,316
6,140
9,403
11,151
12,237
11,342
10,391
10,071
11,697
10,498
10,551
Actual # of Claims
Projected # of Claims
Cost of TCPA claims estimated at $7,000 per claim & cost of FDCPA estimated at $2,000 per claim
Proprietary Information of CBE Companies, Inc.

5. Post-Strauss Risk Impact
Since the Strauss ruling, CBE has experienced significant reduction in TCPA claims presented by plaintiff’s counsel (PC).
TCPA claims have reduced 40% in comparison to the prior 6 month average.
TCPA claims since the Strauss ruling have reduced by 54% in comparison to prior 5 month average.
Confidential & Proprietary

6. Overview of MCA Dialing

7. Manual Clicker Application (MCA) 3 Hurdles to Compliance Approach
Random/Sequential
Number Generation
“Future Capacity”
Human Intervention
Human “clicks” to generate
the call, no “queue” is built to
initiate calls throughout the day
Predictive Algorithm
Command Center
manages pacing,
agent availability and other key
performance indicators manually
and prior to human intervention, not
post-human intervention
Phone server does not
have capacity to dial randomly or sequentially and would need complete rebuild to quality as an ATDS
Mike
Confidential & Proprietary

8. Clicker Process Overview1
Scheduler runs during night processing and account workflow determines the numbers to call for the next day. 2
Authorized cell phone numbers are separated from land line numbers.
CRM 3
Number is dialed/initiated by a human agent that clicks number to pass through the phone line. (no predictive algorithm; no capacity) 4
PBX connects call.
MCA 6
CRM is updated with call disposition data. 5
Agents are connected to calls when the attempts are connected.
User
User
User
Confidential & Proprietary

9. Litigation Climate post-FCC order
Higher claim volume
Larger and more aggressive plaintiff’s bar
Operate under the assumption that all call centers utilize automatic dialing equipment when calling consumers
Plaintiffs are emboldened by the FCC’s expansive definition of ATDS
High volume shops will threaten TCPA with no intent to litigate in an attempt to gain leverage in advancing other frivolous claims
Shark effect
We are confident our solution is compliant
The only way to stem the tide was to take a stand and fight
Dan
Proprietary Information of CBE Companies, Inc.

10. Overview of Case
Dale

11. Strauss v. CBE Group Facts of the case
Non-debtor files suit alleging CBE violated TCPA/FDCPA by placing calls to cellphone from April 2014 through September 2014
According to CBE’s account notes, number was provided by creditor Verizon and initially was identified as landline
CBE acknowledges first two calls were placed using Noble’s Predictive Dialer – Serves offer of judgment for $2,500
Dale
Proprietary Information of CBE Companies, Inc.

12. Strauss v. CBE Group Evidence from discovery
CBE’s corporate representative testifies all calls other than initial two were placed using CBE’s Manual Clicker Application (MCA)
MCA calls initiated by “point and click” performed by CBE employee
Noble and later, LiveVox provided “pass-through” connectivity to telephone network
Dale
Proprietary Information of CBE Companies, Inc.

13. Strauss v. CBE Group Plaintiff hires Hansen
Jeffrey Hansen has issued expert opinions in other CBE TCPA cases
Hansen admits that MCA is not an ATDS under TCPA
Hansen admits that MCA connected through combined Livevox is not ATDS under TCPA
Hansen conflates Noble Predictive Dialer and Noble pass-through and opines that MCA connected through Noble Dialer is ATDS under TCPA
LiveVox is voluntarily dismissed from the case by Plaintiff (no judicial decision is therefore rendered in Strauss v. CBE Group that applies to LiveVox equipment)
Dale
Proprietary Information of CBE Companies, Inc.

14. Strauss v. CBE Group CBE wins summary judgment
“There appears to be no disagreement that the MCA, by itself, lacks the capacity to predictively dial.”
“CBE has presented substantial evidence that human intervention is essential at the point and time that the number is dialed using the MCA and that the Noble equipment used does not have the functionalities required to classify it as a predictive dialer.”
Hansen’s “report merely assumes that CBE was using the same Noble Dialing Equipment to make all calls to plaintiff and switching that equipment between ‘predictive and manual mode’’’
Dale
Proprietary Information of CBE Companies, Inc.

15. Q&A
Mike

16. Thank You!
Lindy