Navient Class Action Settlement Proposed in TCPA Lawsuit

A $2.5 million Navient class action settlement has been reached, settling allegations that the student loan company used an autodialing system to place harassing calls to consumers.

Plaintiff Denise Baker and Navient Solutions LLC have reached a $2.5 million settlement, putting an end to a TCPA lawsuit which accused Navient of using an autodialer to place calls. Baker filed the class action in October and, after Navient moved for summary judgement in May, the two parties settled the case before the court could rule.

Under the Navient class action settlement, the student loan company must pay $2.5 million into a cash settlement fund which will be dispersed among 300,000 Class Members. Current estimates place individual rewards around $50, should eligible Class Members submit a timely claim.

“The settlement provides substantial benefits to the settlement class and, if approved, will result in the potential for approximately 300,000 settlement class members — who would never have pursued TCPA claims on their own — to receive a recovery,” Baker states in the motion for preliminary approval. “Given the complexity of this case and the significant risks that the settlement class would face if the claims were to proceed, plaintiff and plaintiff’s counsel believe that the settlement is fair and reasonable [and] represents a good result for the settlement class members.”

The risks for further litigation include a recent decision in a Washington D.C. TCPA lawsuit. In ACA International v. Federal Communications Commission, the court overruled the FCC’s 2015 order which widened the definition of an autodialing system. The court justified their decision stating that the FCC’s newer interpretation “would appear to subject ordinary calls from any conventional smartphone to the act’s coverage, an unreasonably expansive interpretation of the statute.” Baker argues that the decision would strengthen Navient’s argument that they had not violated the TCPA, making a Navient class action settlement an attractive outcome for the plaintiffs.

Before the Navient class action settlement was proposed, Navient had fiercely challenged Baker’s bid for class certification, alleging that she cannot represent Class Members who received calls about federal loans opposed to private student loans.

“Navient has raised several noteworthy merits and certification-related arguments that plaintiff cannot ignore, and which present significant litigation risk that plaintiff and the settlement class could recover nothing were this action to proceed,” the motion for preliminary approval states. “This settlement, thus, enables plaintiff and the settlement class members to receive immediate and certain relief now, rather than face the uncertainty attendant to continued litigation.”

Baker, who allegedly received harassing calls regarding her brother’s delinquent student loan, will represent Class Members who were listed as a credit reference on a student loan application and received calls placed by an autodialing system. In addition to a request for a conditional class certification, the preliminary approval motion for the Navient class action lawsuit contains a plan to notify potential Class Members of the potential settlement fund.

The Navient Class Action Settlement is Baker v. Navient Solutions LLC, Case No. 1:17-cv-01160, in the United States District Court for the Eastern District of Virginia.

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