Court Finds Insurer Not Liable for TCPA Subagent’s Violation
By Don R. Sampen, published, Chicago Daily Law Bulletin, August 4, 2026
The 7th U.S. Circuit Court of Appeals recently held that an insurance company that authorized agents to hire a telemarketing firm to call consumers was not liable for violations of the Telephone Consumer Protection Act committed by a subagent of the telemarketing firm.
The case is Hossfeld v. Allstate Insurance Co., 2026 U.S. App. Lexis 18430. The plaintiff, Robert Hossfeld, the recipient of the calls, was represented by Burke Law Offices LLC of Evanston. Akin Gump Strauss Hauer & Feld LLP of Washington, D.C., represented Allstate.
In 2020, Allstate authorized two of its agents, Jason Fleming and Daniel Gilmond, to solicit customers for Allstate insurance products through telemarketing calls. The authorization was conditioned on the two agents, and any “external providers” they might hire, to comply with the requirements of the TCPA.
That Act of Congress prohibits, among other things, telemarketers from placing calls to individuals who request not to receive them. Pursuant to the legislation, Allstate maintained a do-not-call listing of persons who had requested not to be called in the absence of express consent. The name of the plaintiff in this case, Hossfeld, was on Allstate’s internal do-not-call list.
The two agents retained a telemarketer, Transfer Kings, to place calls to potential customers and to transfer anyone who was interested to an Allstate agent. Instead of placing the calls itself, however, Transfer Kings subcontracted the marketing calls to yet another telemarketing company, Atlantic, without informing Fleming and Gilmond.
Atlantic then started placing calls based on a list of prospective customers it received from yet another company, and in the process it placed 12 calls to Hossfeld during a three-month period. Hossfeld, it turned out, did what he could to attract the calls by misrepresenting his identity on some occasions and feigning interest in insurance products.
Hossfeld, in any event, sued Allstate for TCPA violations under 47 U.S.C. Secs. 227-227b-2 based on the calls he received and sought class certification. He claimed Allstate failed to maintain a sufficient do-not-call policy.
On cross-motions for summary judgment, the district court judge agreed with Hossfeld and found Allstate vicariously liable for Atlantic’s TCPA violations. The court did, however, deny class certification. Allstate took this appeal, and Hossfeld cross-appealed on the class certification issue.
Analysis
In an opinion by Judge Amy St. Eve, the 7th Circuit reversed on summary judgment and affirmed the denial of class certification. She began by explaining basic agency principles, noting, among other things, that some agency relationships involve a subagent who can, on occasion, implicate the principal.
Hossfeld here argued that Allstate was liable because Atlantic was its subagent. St. Eve noted three legal theories by which a principal could become liable for the actions of its agent or subagent: actual authority, apparent authority and ratification. She further observed that, for Atlantic’s conduct to bind Allstate, appointing authority must have existed at each level of the subagency relationship.
Regarding actual authority, Hossfeld relied on language from Allstate’s contracts with Fleming and Gilmond that referenced “external suppliers” and required compliance with relevant laws when “placing any calls for Allstate.” St. Eve wrote, however, that the issue was not whether Allstate authorized Fleming and Gilmond to hire subagents, but whether it had authorized Transfer Kings to appoint the subagent, Atlantic.
Here, Transfer Kings had no contract with Allstate referencing external suppliers, and there was no evidence Allstate otherwise authorized subagents appointed by Transfer Kings.
She also found it insufficient that Allstate’s contractual language did not expressly limit appointment of subagents to a single level of delegation. Agency relationships are not the default, so affirmative authorization must be present. Thus, Transfer Kings had neither express nor implied actual authority to appoint Atlantic as subagent, and Allstate could not be liable for Atlantic’s conduct based on an actual authority theory.
As for apparent authority, it is created, according to St. Eve, only by the manifestation of authority by the principal directly to the third party claiming agency, in this case Hossfeld. And he offered no evidence that Allstate interacted with him in any way.
Nor could Allstate be said to have ratified Atlantic’s calls by accepting benefits arising from the non-compliant calls, for Hossfeld never purchased insurance from Allstate. St. Eve said it was not sufficient that Allstate continued to accept benefits from the telemarketing programs generally.
Finally, St. Eve stated that even if Allstate had known Atlantic was calling Hossfeld’s number, he had not demonstrated that Allstate ratified the calls through inaction. The reason was that, upon learning of the calls, Allstate immediately began an investigation to determine the source of the calls, and it then prohibited its insurance agents from further contracting with either Transfer Kings or Atlantic.
The court therefore reversed the summary judgment in favor of Hossfeld and ordered that judgment be entered for Allstate.
Key Point
For a principal to be vicariously liable for the conduct of a subagent, the subagent’s authority to act must have been actually or apparently authorized or ratified by the principal.