TCPA Rulings Confirms Criminal Penalties for Failing to Register in Rhode Island

Increasing state regulation has proven to be VERY tricky to navigate for callers these days.

The Troutman Firm obviously has great resources around state registration and calling requirements, but it remains critical to follow state-specific case law trends to see how regulations are being applied.

In Laccinole v. GulfCoast Collection, 2023 WL 157719 (Jan. 11, 2023 D. R.I.) the Court confirmed a debt collector can face CRIMINAL penalties under state law for failing to register as a debt collector with the state under R.I. Gen. Laws § 19–14.9–12 and 19–14.9–13.

And that’s too bad because the rest of the ruling was peaches and cream.

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In Laccinole Plaintiff claims he received calls made with an ATDS and prerecorded voice without consent. But the Court threw out all of the TCPA claims on a motion to dismiss determining the Plaintiff had failed to allege facts demonstrating either an ATDS or prerecorded voice was used. So the case was given the old heave hoe.

The individual defendants–employees of Gulf Coast that Laccinole decided to sue personally “because they are corporate officers at Gulf Coast who have a role in formulating compliance procedures”– were dismissed for lack of personal jurisdiction since they live out of state. So, that’s good too.

And the Court even threw out the common law privacy claim determining that the calls and letters Plaintiff received intended for the former owner of the phone would not be highly offensive to a regular person since all the guy had to do–presumably–was say “stop.”

But then we get to Laccinole’s claim under R.I. Gen. Laws § 9–1–2–a state law provision allowing civil recovery for harms caused by criminal acts–and the wheels fall off the wagon:

"To sufficiently plead a claim under § 9–1–2, Mr. Laccinole must plead an underlying criminal offense. See, e.g., Getty Petroleum Mktg., Inc. v. 2211 Realty, LLC, Civil Action No. 11–40003–FDS, 2012 WL 527655, at *7 (D. Mass. Feb. 16, 2012) (“Although ‘[i]t is not necessary for the [claimant] to allege the commission of the crime, which is the basis of his claim for damages, with the technical accuracy required in the criminal complaint[,] … it must be described sufficiently for identification.’ ” (quoting Williams v. Smith, 68 A. 306, 308–309 (R.I. 1907)). Mr. Laccinole alleges that Gulf Coast acted criminally when it failed to register as a debt collector.

The Court agrees with Mr. Laccinole’s position at this time.3 In light of the fact that his RIFDCPA counts live beyond this Order, the Court DENIES Gulf Coast’s motion as to Count XXII because there are outstanding issues relating to his allegations that Gulf Coast failed to register as a debt collector in Rhode Island. See Laccinole v. Twin Oaks Software Dev., Inc., No. CA 13-716 ML, 2014 WL 2440400, at *7 (D.R.I. May 30, 2014), aff’d (Apr. 27, 2015) (noting that while failure to register as a debt collector does not give rise to a private cause of action, it is a “misdemeanor, which exposes the scofflaw to fines up to $2000 or imprisonment for not more than a year, or both). While Mr. Laccinole’s allegations as to his actual injuries resulting from Gulf Coast’s failure to register are thin, the Court DENIES Defendants’ Motion to Dismiss Count XXII pending resolution of his RIFDCPA claims."

Since the Rhode Island statute allows a debt collector to be tossed in jail for failing to register with the state, Laccinole was allowed to sue the collector in civil court for damages arising out of that failure.

While I see a pretty big causation issue here–the failure to register didn’t CAUSE the harm–the bigger issue is that debt collectors (like marketers and data brokers) need to pay attention to STATE registration laws. They matter–and they could land you in prison if you don’t pay attention!

Read the Order Here.