Avid Executives Deny They Facilitated Illegal Robocall Traffic on Their VoIP Network

A telemarketing fraud suit filed May 23, 2023, by 48 states and the District of Columbia against VoIP service provider Avid Telecom for allegedly facilitating illegal robocall traffic on its network (see 2305230065), “does not contain a scintilla of evidence” that Avid ever initiated "even a single illegal robocall,” said the defendant's answer (docket 4:23-cv-00233) to the complaint Friday in U.S. District Court for Arizona in Tucson. Nor does the complaint have evidence that Avid knew “that any of the calls that it received from an originating aggregator or carrier was an illegal robocall," it said.

The complaint alleges violations of the Telemarketing and Consumer Fraud and Abuse Prevention Act, the FTC’s Telemarketing Sales Rule and the Telephone Consumer Protection Act.

The plaintiffs’ “entire case is premised on innuendo, rather than fact, and the facially absurd premise” that the issuance of 329 tracebacks “out of billions of alleged calls (fewer than one hundred millionth of one percent) somehow put” defendants Avid, CEO Michael Lansky and Manager Stacey Reeves “on notice that they were transiting illegal robocalls,” said the answer.

A traceback is “nothing more than a request” by the Industry Traceback Group (ITG) to trace a call path so that a regulatory authority with jurisdiction can understand where a call originated and its path through the telecommunication network, said the answer.

The Pallone-Thune Traced Act described a traceback as “a registration process for a single consortium that conducts private-led efforts to trace back the origin of suspected unlawful robocalls,” said the answer. A traceback “does not authorize the FCC to grant the 'consortium' with any authority to determine the legality of any call nor does it give this 'private-led consortium' any enforcement authority,” it said. The Traced Act also mandates that the consortium be “neutral,” it said.

The consortium’s authority is “expressly limited to conduct[ing] private-led efforts to trace back the origin of suspected unlawful robocalls,” the answer said. “Nor did the FCC grant the ITG such authority in its implement orders,” said the complaint. The ITG recognizes the limitations of its role, that it is “not a law enforcement agency,” said the complaint: “Nor is it or any cooperating voice service provider -- an agent of law enforcement,” it said. The entity designated as the official Traceback Consortium, “must explicitly be a private entity,” it said, referencing the Traced Act.

Not only does the complaint lack direct evidence of wrongdoing, it's “replete with allegations of fact” that the plaintiffs know, or should know, aren't true, “but much of the so-called evidence also presented was, on information and belief, obtained through illegal or otherwise improper means,” said the answer.

The defendants deny they “ever knowingly transited any calls that were harassing, annoying, threatening, or malicious,” said the answer. The only such calls they’re aware of are “dozens of harassing, annoying, threatening, and/or malicious calls” Lansky and Reeves have received, including dozens of calls with death threats aimed at them, their families and their outside counsel, said the answer.

The defendants denied claims that they provided “substantial assistance or support to sellers and telemarketers that were violating the TSR through any of the identified actions.” They also denied allegations that they violated the TCPA by not choosing to regularly, if at all, block calls made from telephone numbers that the FCC has authorized could be blocked, so that the calls don't reach a called party, the answer said. They added that Avid Telecom blocked over 2.3 billion calls in 2022.

The defendants deny they violated 47 C.F.R. § 64.1200(n)(3) by failing to take effective measures to prevent new and renewing customers from using its network to originate illegal calls, including knowing its customers and exercising due diligence in ensuring that its services aren't used to originate illegal traffic. They also denied the allegation that they engaged in a practice of “initiating or causing telephone calls to be initiated that include or introduce advertisements or constitute telemarketing to cellular telephone lines using artificial or prerecorded voices to deliver messages without the prior express written consent of the called parties.”

Because Avid “never initiates a call, is never involved in setting the content of a call or the phone number called, it cannot and does not create or apply an artificial or prerecorded voice to deliver messages,” said the answer. It also is never involved in "setting the content of a call or the phone number called, so it cannot and does not create or apply an artificial or prerecorded voices to deliver messages,” the answer said. “As Avid Telecom never initiates a call, it cannot and does not meet the requirements for a violation of the TCPA,” it said.

On alleged spoofing violations of the Truth in Caller ID Act, the defendants denied that they knew they “accepted and profited from illegal robocalls with misleading or inaccurate spoofed phone numbers, which sought to defraud, cause harm, or wrongfully obtain things of value from the call recipients.”

In response to allegations of California unfair competition violations, the defendants said the company has been out of business for nearly a year and thus “could not have engaged in unfair competition during that period.” For their past services, they deny they have provided substantial assistance to telemarketers they should have known were engaged in deceptive or abusive telemarketing acts or practices; failed to take affirmative, measures to prevent new and renewing customers from using their network to originate illegal calls; or initiated solicitations to cellular and residential telephone lines, including lines in California, using artificial or prerecorded voices to deliver a message "without the prior express consent of the called party.”

On Florida statute violations, the defendants said they don’t provide records of calls allegedly transmitted, so they don’t have the knowledge or information required to respond to the allegation that some 1.2 billion calls were directed to phone numbers with area codes assigned to Florida, the answer said. Avid doesn’t have the information required to respond to allegations about average duration of calls, or to provide any basis that it transmitted spoofed calls into Florida, Indiana, Maryland or other plaintiff states, it said.