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Best’s News & Research Service - December 08, 2014 03:39 PM (EST)

Kaiser Agrees to Pay $5.35 Million in Settlement Agreement

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SAN DIEGO //BestWire// - Kaiser Permanente will pay $5.35 million to settle a class-action lawsuit that centers on the company's alleged violations of the Telephone Consumer Protection Act as part of a preliminary settlement approval granted by a California federal district judge.

Class members are those former Kaiser members who received calls made with an automated dialing system or a pre-recorded voice on their cellphones urging them to re-apply for Kaiser health coverage or return at the next opportunity between the dates April 24, 2009, and Dec. 4, 2014. The TCPA contains provisions curtailing use of automated dialers and prerecorded messages to cellphones.

The class action was filed on behalf of San Diego resident Rafael David Sherman and other class members in April 2013. Sherman was allegedly receiving automatic calls on his cellphone from Kaiser Permanente months after the company had terminated his health insurance coverage. The contact from Kaiser to plaintiffs using pre-recorded messages violated the TCPA because the class members incurred cellphone costs, saw cellular telephone times reduced and had their privacy invaded, the original filing said.

Plaintiffs and sought $500 for each class member in statutory damages and $1,500 for each class member in civil damages for each violation of the TCPA respectively, the initial court filing from 2013 states. The proposed settlement said the $5.35 million would be used as a fund to pay all claims and administration costs.

The settlement, if approved, would end uncertainties within the case for each side, the proposed settlement said. For the plaintiffs, they would not have to face the possibility that the court might not certify the class, but if it did so, Kaiser might face damages much higher than the $500 per call proposed.

While the class believes the court would find that Kaiser lacked prior express consent to call class members, Kaiser would deny any wrongdoing as part of the settlement. The proposed settlement said Kaiser believes the calls were valid because consent was obtained when current and former customers provided the company with contact information.

(By Thomas Harman, associate editor, BestWeek: Tom.Harman@ambest.com)



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