Hale v. Teladoc Health, Inc.

Background

April Hale and Len Cline brought a proposed class action against Teledoc Health, Inc. under the Telephone Consumer Protection Act, a federal law regulating certain telemarketing calls. They alleged that Teledoc contracted with Health Insurance Innovation, Inc. (HII) to market Teledoc’s services through calls made without consumers’ consent.

Hale and Cline alleged that they had placed their cell phone numbers on the national Do Not Call Registry but nevertheless received numerous prerecorded calls from multiple numbers between March 2018 and July 2019. They claimed that they answered calls, asked live agents to stop calling, and used prerecorded prompts to opt out of future calls. They said they pretended to be interested in the marketed product to identify the caller. The insurance product they were offered, MyBenefitsKeeper, allegedly included a membership in Teledoc’s remote medical services.

The complaint alleged that HII operated an outbound call center and lead generator for Teledoc, acted as Teledoc’s agent, and had actual and apparent authority to represent Teledoc. It also alleged that Teledoc ratified HII’s conduct by accepting benefits from HII’s telemarketing. The plaintiffs did not allege that the callers specifically mentioned Teledoc or its services during the calls. Neither plaintiff alleged signing up for HII’s insurance package or paying for Teledoc’s services as a result of the calls.

Teledoc moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint states a legally plausible claim. In the alternative, Teledoc moved to stay the case. After being offered an opportunity to amend, the plaintiffs declined and said they would rely on their existing complaint.

Court’s Analysis

The court explained that Teledoc could be held responsible for HII’s calls only if the complaint plausibly alleged an agency relationship. It considered three possible bases for such responsibility: actual authority, apparent authority, and ratification.

Actual authority. Actual authority requires facts supporting an inference that the alleged principal authorized and controlled the alleged agent’s conduct. The court found no such facts. The complaint did not allege that Teledoc directed HII to make the calls, wrote or approved call scripts, or exercised interim control over HII’s callers. The fact that Teledoc’s services were included in HII’s insurance package was not enough to support an inference that HII made the calls at Teledoc’s direction or subject to its control.

Apparent authority. Apparent authority can exist when a principal’s words or conduct reasonably cause a third party to believe that another person is acting as the principal’s agent. The court found that the complaint did not identify any statement or action by Teledoc that created such a belief. Although HII allegedly listed Teledoc’s services in information about the insurance package, the complaint did not connect that representation to any conduct or manifestation by Teledoc.

Ratification. Ratification occurs when a principal accepts an agent’s unauthorized conduct with knowledge of the relevant facts and in circumstances showing an intent to adopt that conduct. The court found the allegation that Teledoc accepted benefits from HII’s unlawful marketing to be conclusory. The complaint did not allege facts showing that Teledoc actually received benefits from calls to these plaintiffs or that any customer purchased Teledoc’s services through an unlawful call. It also did not allege an observable act by Teledoc showing consent to HII’s conduct. Finally, HII’s prior lawsuits, without more, did not plausibly show that Teledoc knew or should have known about the allegedly unlawful calls.

Disposition

Judge Vincent L. Briccetti granted Teledoc’s motion to dismiss. He denied the motion to stay as moot. The Clerk was instructed to terminate the motion and close the case. The opinion does not state that the dismissal was with or without prejudice.