In re Monitronics International, Inc., pending in the Northern District of West Virginia, is a consolidated class action lawsuit brought under the Telephone Consumer Protection Act.  After years of contentious litigation, this past week the Court preliminarily approved a class action settlement of $28 million.  This significant settlement serves as another example of the high stakes involved in TCPA class actions, especially in states regarded as plaintiff-friendly such as West Virginia.

According to the preliminary approval paperwork filed with the Court, Monitronics provides alarm monitoring and customer service for home security customers nationwide.  Monitronics provides these services through a network of “Authorized Dealers.”  In a series of lawsuits filed across the country, over 30 plaintiffs sued Monitronics for alleged violations of the TCPA.  In these lawsuits, the plaintiffs alleged both direct liability against Monitronics and vicarious liability based on conduct of its authorized dealers and third parties placing calls on its behalf.  These cases were ultimately consolidated by the Judicial Panel on Multidistrict Litigation into In re Monitronics.

On September 18, the District Court for the Northern District of West Virginia approved a class action settlement in the case.  Under the terms of the settlement, Monitronics agreed to pay $28 million to those members of a 7,858,232-member settlement class who file a claim.  The parties estimate that this will result in approximately $17 per class member, based on anticipated claim rates.  The $28 million will also be used to pay approximately $9 million in attorneys’ fees and approximately $4.7 million in notice and administration costs.  The settlement also includes $50,000 payments to two of the class representatives.

The fact that Monitronics chose to settle this lawsuit for nearly $30 million demonstrates the risks that defendants face in TCPA litigation.  Plaintiffs in TCPA actions also face significant hurdles in proving liability on a class basis, including, among other things, proving a lack of consent across the class.  If a plaintiff is successful, though, defendants potentially face annihilative liability.  The Monitronics settlement is just one of a number of high-dollar TCPA settlements in recent years.