Shyriaa Henderson, on behalf of herself, and all others similarly situated v. UNITED STUDENT AID FUNDS , INC ., DBA USA Funds

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
S HYRIAA HENDERSON, on behalf of
herself, and all others similarly
situated,
Plaintiff-Appellant,
v.
UNITED S TUDENT A ID FUNDS , INC .,
DBA USA Funds,
Defendant-Appellee.
No. 17-55373
D.C. No.
3:13-cv-01845-
JLS-BLM
OPINION
Appeal from the United States District Court
for the Southern District of California
Janis L. Sammartino, District Judge, Presiding
Argued and Submitted October 10, 2018
San Francisco, California
Filed March 22, 2019
Before: Dorothy W. Nelson, William A. Fletcher,
and Jay S. Bybee, Circuit Judges.
Opinion by Judge D.W. Nelson;
Dissent by Judge Bybee

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2 HENDERSON V . U NITED S TUDENT A ID FUNDS
SUMMARY*
Telephone Consumer Protection Act
The panel reversed the district court’s grant of summary
judgment in favor of the defendant, the owner of the
plaintiff’s student loans, and remanded for further
proceedings in an action under the Telephone Consumer
Protection Act.
The panel held that a reasonable jury could hold the
defendant vicariously liable for alleged TCPA violations by
debt collectors. The defendant hired a student loan servicer,
which hired the debt collectors. The panel held that the
defendant was not per se vicariously liable under FCC
orders. Under federal common law, however, there were
genuine issues of material fact as to whether the defendant
ratified the debt collectors’ calling practices and had a
principal-agent relationship with the debt collectors.
Dissenting, Judge Bybee agreed that the FCC orders did
not create per se liability. He wrote that, assuming
ratification may create an agency relationship, he disagreed
with the majority that there was a material issue of fact as to
whether the defendant ratified the debt collectors’ conduct
or granted the debt collectors implied actual authority to
violate the TCPA.
* This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.

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HENDERSON V . U NITED S TUDENT A ID FUNDS 3
COUNSEL
Alexander Glenn Tievsky (argued), Roger Perlstadt, and
Ryan D. Andrews, Edelson PC, Chicago, Illinois; Kas
Gallucci, Alexis Wood, and Ronald A. Marron, Law Offices
of Ronald A. Marron, San Diego, California; for Plaintiff-
Appellant.
Lisa Marie Simonetti (argued), Vedder Price (CA) LLP, Los
Angeles, California; Bryan K. Clark, Vedder Price P.C.,
Chicago, Illinois; for Defendant-Appellee.
OPINION
D.W. NELSON, Circuit Judge:
OVERVIEW
Shyriaa Henderson appeals the district’s order granting
summary judgment in favor of Defendant-Appellee United
Student Aids Funds, Inc. (USA Funds). The district court
incorrectly held that a reasonable jury could not hold USA
Funds vicariously liable for the debt collectors’ alleged
Telephone Consumer Protection Act (TCPA) violations.
Accordingly, we REVERSE and REMAND.
BACKGROUND
Henderson applied for and received a loan to attend
university through the Federal Family Education Loan
Program (FFELP). After experiencing some financial
difficulty, she stopped paying back her loans. Then, five
different debt collection companies started calling her about
the money she had not paid back. Henderson received pre-
recorded messages many times in short intervals on a phone

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4 HENDERSON V . U NITED S TUDENT A ID FUNDS
number she neither provided in connection with her student
loans nor consented to be called on. Henderson contends this
pattern shows that the companies were combining the use of
skip tracers and auto dialers.
Navient Solutions, Inc., a servicer of student loans, hired
these debt collectors to collect on unpaid loans on behalf of
USA Funds, which owned Henderson’s loans. USA Funds
operates under a government program by which it guarantees
student loans made by private lenders and then takes
ownership of those loans if a student-borrower defaults.
Although USA Funds owns billions of dollars in student
loan debt, it does not interact with the borrowers directly
once they stop paying back their loans. Instead, it hires
companies, like Navient, to service its loans, including debt
collection. In turn, Navient hires debt collectors to collect on
defaulted loans. The debt collectors handle many aspects of
collecting and repayment, including making calls to
borrowers, setting up payment plans, granting temporary
delays, and accepting loan payments.
While USA Funds did not have a contractual relationship
with the debt collectors or any day-to-day dealings with
them, USA Funds had access to Navient’s daily, weekly, and
monthly reports tracking the debt collectors’ performance.
Similarly, USA Funds could, and did, review debt
collectors’ calling notes when it had “an issue” with a debt
collector’s calling practices. USA Funds also regularly
reviewed Navient’s operations and performance, including
its regulatory compliance, or lack thereof. Though USA
Funds’ service agreement with Navient did not give USA
Funds the ability to fire debt collectors, USA Funds could
ask Navient to replace underperforming collectors and could
have fired Navient if it did not comply.

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HENDERSON V . U NITED S TUDENT A ID FUNDS 5
USA Funds also conducted an annual audit of the debt
collectors. The audit focused on the various repayment
programs that borrowers had a right to use in the FFELP.
TCPA compliance was not one of the FFELP audit
parameters. However, during each of USA Funds’ audits
from 2000, 2009, and 2010, debt collectors called borrowers
on phone numbers that they did not consent to be called on,
prompting USA Funds to note “improper collection
practices” and to recommend “corrective action.” Navient,
however, continued to use these debt collectors, and USA
Funds did not object when the same debt collectors were
used in the following years. Moreover, USA Funds was
aware that debt collectors handling USA Funds’ loans had
been sued regarding their calling practices but USA Funds
did nothing to ensure TCPA compliance.
Henderson sued USA Funds for alleged TCPA violations
related to the collection of her student loan debt. Though
Henderson also sued Navient and several debt collectors,
those defendants were dismissed for lack of personal
jurisdiction.
STANDARD OF REVIEW
We “review a district court’s grant of summary judgment
de novo” to determine “whether there are any genuine issues
of material fact and whether the district court correctly
applied the relevant substantive law.” Oklevueha Native Am.
Church Of Haw., Inc. v. Lynch, 828 F.3d 1012, 1015 (9th
Cir. 2016). We view the facts “as a whole and in the light
most favorable to the party opposing the motion.” Pavoni v.
Chrysler Grp., LLC, 789 F.3d 1095, 1098 (9th Cir. 2015).
“An issue of material fact is genuine ‘if the evidence is such
that a reasonable jury could return a verdict for the
nonmoving party.’” Id. (quoting Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986)).

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6 HENDERSON V . U NITED S TUDENT A ID FUNDS
DISCUSSION
Henderson challenges the district court order granting
USA Funds’ summary judgment motion on two grounds.
First, Henderson argues that under an FCC order, USA
Funds is per se vicariously liable for the debt collectors’
TCPA violations. Second, she argues that USA Funds is
similarly liable under the federal common law agency
principles of ratification and implied actual authority.
Henderson’s theory of liability is that USA Funds has a
principal-agent relationship with the debt collectors and that
a court may hold it liable for their TCPA violations. We
agree. We, therefore, reverse the district court’s summary
judgment order because there are “genuine issues of material
fact” as to whether USA Funds ratified the debt collectors
calling practices. We remand for further proceedings.
I. TCPA Liability
Under the TCPA, it is unlawful to “to make any call
(other than . . . with the prior express consent of the called
party) using any automatic telephone dialing system or an
artificial or prerecorded voice . . . to any telephone number
assigned to a . . . cellular telephone service.” 47 U.S.C.
§ 227(b)(1)(A)(iii). Telemarketers, debt collectors, and
others obtain phone numbers consumers did not consent to
be called on through skip tracing.1 Because consumers did
not provide these callers with their phone numbers, the
consumers have not given “prior express consent” to be
1 Skip tracing is the process of obtaining previously-unknown phone
numbers associated with the name on an account, such as by contracting
with “third-party database services” or by “calling an individual’s
relatives [and] known acquaintances.” (Deposition of Mark A.
Verbrugge, senior director of operations within portfolio management at
Navient).

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HENDERSON V . U NITED S TUDENT A ID FUNDS 7
called on those numbers. Therefore, if the numbers were also
auto dialed, the calls violated the TCPA. 47 U.S.C.
§ 227(b)(1)(A)(iii).
Debt collectors that auto dialed Henderson on a phone
number she did not provide in connection with her student
loan would be liable under this section. For USA Funds to
be liable under this section, Henderson must show that there
is an agency relationship between USA Funds and these
liable debt collectors.
II. FCC Orders Do Not Create Per Se TCPA Liability
Henderson argues that USA Funds is per se vicariously
liable for the debt collectors’ alleged TCPA violations. She
bases this conclusion on her analysis of In re Rules &
Regulations Implementing the Tel. Consumer Prot. Act
of 1991, 23 F.C.C. Rcd. 559, 565 (2008) (“2008 FCC
Order”), which states, “[c]alls placed by a third party
collector on behalf of that creditor are treated as if the
creditor itself placed the call.” Because Congress has not
acted directly on this issue and because the 2008 FCC Order
is a fully adjudicated declaratory ruling, the panel must
afford it Chevron deference. See Chevron, U.S.A., Inc. v.
Natural Res. Def. Council, 467 U.S. 837, 843 (1984).
Though the 2008 FCC Order implies a creditor could be
liable for a debt collector’s TCPA violations, the Order does
not make such liability per se or automatic, as Henderson
argues. To the contrary, in a 2013 order, the FCC clarified
that a court should determine whether a defendant is
vicariously liable for the TCPA violations of a third-party
caller by using federal common law agency principles. In re
Joint Petition Filed by Dish Network, LLC, 28 F.C.C. Rcd.
6574, 6574 (2013) (“2013 FCC Order”).

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8 HENDERSON V . U NITED S TUDENT A ID FUNDS
Henderson’s per se liability argument also ignores
Gomez v. Campbell-Ewald Co., which held that “a defendant
may be [] vicariously liable for TCPA violations where the
plaintiff establishes an agency relationship, as defined by
federal common law, between the defendant and a third-
party caller.” 768 F.3d 871, 879 (9th Cir. 2014), aff’d, 136 S.
Ct. 663 (2016), as revised (Feb. 9, 2016). To reach this
conclusion, Gomez interpreted the 2013 FCC Order. Id. at
878.
Gomez makes clear that a court may not automatically
attribute a third-party caller’s TCPA violations to a
defendant. Id. In other words, there is no per se liability. A
plaintiff, according to Gomez, must show that there is an
agency relationship between a defendant and a third-party
caller for there to be vicarious liability for TCPA violations.
Id. Accordingly, under both FCC Orders and our precedent,
the per se liability argument fails.
III. Federal Common Law Agency Principles
A court may hold lenders, like USA Funds, vicariously
liable for the TCPA violations of third party callers, like the
debt collectors, “where the plaintiff establishes an agency
relationship, as defined by federal common law, between the
defendant and [the] third-party caller.” Gomez, 768 F.3d
at 879. We rely on the Restatement (Third) of Agency for
common law agency principles. See, e.g., Mavrix
Photographs, LLC v. LiveJournal, Inc., 873 F.3d 1045, 1054
(9th Cir. 2017). “Agency is the fiduciary relationship that
arises when one person (a ‘principal’) manifests assent to
another person (an ‘agent’) that the agent shall act on the
principal’s behalf and subject to the principal’s control, and
the agent manifests assent or otherwise consents so to act.”
Restatement § 1.01. There are several ways to establish an

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HENDERSON V . U NITED S TUDENT A ID FUNDS 9
agency relationship, including actual authority and
ratification. Restatement §§ 2.01, 4.01.
Whether an agency relationship exists is for a court to
decide based on an assessment of the facts of the relationship
and not based on how the parties define their relationship.
Restatement § 1.02; see also U.S. v. Milovanovic, 678 F.3d
713, 725 (9th Cir 2012) (finding an agency relationship even
though the parties’ agreements labeled them as independent
contractors). Thus, it is not dispositive, as USA Funds
argues, that the agreements between USA Funds, Navient,
and the debt collectors define their relationships as
independent contractors.
Moreover, it is appropriate to consider whether the
parties are trying to limit or prevent liability by
characterizing their relationship as something other than an
agency relationship. Restatement § 1.02 cmt. b. Henderson
alleges that USA Funds is doing just that. More specifically,
she argues that USA Funds, Navient, and the debt collectors
had a “wink-and-a-nudge” agreement to use unlawful calling
practices notwithstanding their independent contractor
agreements.
Finally, Henderson has the burden of establishing that an
agency relationship exists. Restatement § 1.02 cmt. d.; see
also, e.g., Romak USA, Inc. v. Rich, 384 F.3d 979, 985 (8th
Cir. 2004); Bridas S.A.P.I.C. v. Government of
Turkmenistan, 345 F.3d 347, 356 (5th Cir. 2003); E.I.
DuPont de Nemours & Co. v. Rhone Poulenc Fiber & Resin
Intermediates, S.A.S., 269 F.3d 187, 198 (3d Cir. 2001).
Henderson advances two agency principles that she believes
makes USA Funds liable for the debt collectors’ TCPA
violations—ratification and implied actual authority.

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10 HENDERSON V . U NITED S TUDENT A ID FUNDS
A. Ratification
“Ratification is the affirmance of a prior act done by
another, whereby the act is given effect as if done by an agent
acting with actual authority.” Restatement § 4.01.
Ratification is both an act and a set of effects. Restatement
§ 4.01 cmt. b. As an act, ratification is the principal’s assent
(or conduct that justifies a reasonable assumption of assent)
to be bound by the prior action of another person or entity.
Restatement § 4.01. As a set of effects, ratification creates
consequences of actual authority, including, in some
circumstances, creating an agency relationship when none
existed before. Restatement § 4.01 cmt. b.
There are two ways to ratify a third party’s acts. The first
is by a “knowing acceptance of the benefit.” To prove this
form of ratification, there must be “an objectively or
externally observable indication . . . that the principal has
exercised choice and has consented” to the acts of the
purported agent. Restatement § 4.01 cmt. d. That means that
the principal must have “knowledge of material facts,” also
described as “actual knowledge.” Restatement § 4.06. The
second way a principal can ratify the acts of a third party is
through “willful ignorance.” Under the “willful ignorance”
theory, the principal may not know the material facts, but has
“ratified with awareness that such knowledge was lacking.”
Restatement § 4.01 cmt. b. In effect, the principal can ratify
the act of a third party—thereby making the third party the
principal’s agent—even if it does not know all the material
facts, but it must be aware that it does not know the material
facts and ratify anyway.

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HENDERSON V . U NITED S TUDENT A ID FUNDS 11
1. Ratification May Create An Agency
Relationship When None Existed Before
USA Funds argues it could not have ratified the actions
of the debt collectors because there is no agency relationship
between it and the debt collectors. We disagree. Restatement
§ 4.01 cmt. b makes clear that, in most jurisdictions,
ratification may create an agency relationship when none
existed before if the acts are “done by an actor . . . who is not
an agent but pretends to be.”
Kristensen v. Credit Payment Servs. Inc. is the only case
in our circuit, or any circuit, that analyzes in what
circumstances ratification may create an agency relationship
when none existed before as described in the Restatement
(Third) of Agency. 879 F.3d 1010 (9th Cir. 2018). It also
happens to be a TCPA case. In Kristensen, Plaintiff
Kristensen received a text message from a texting publisher,
AC Referral, on his cell phone without his prior consent. Id.
at 1012. AC Referral sent the text messages as part of a
marketing campaign for payday lenders. Id.
Kristensen brought a TCPA class action against the
lenders and marketing companies but not AC Referral, the
entity that sent the texts. Id. at 1013. The district court
granted summary judgment in favor of the defendants,
rejecting Kristensen’s theories of vicarious liability,
including his theory that the defendants ratified AC
Referral’s unlawful texting campaign by accepting customer
leads while knowing that AC Referral was using texts to
generate those leads. Id. We affirmed the district court’s
grant of summary judgment, holding that “[b]ecause AC
Referral (which is not a party to the suit) was neither the
agent nor purported agent [ ] of the defendants, they could
not have ratified AC Referral’s acts.” Id. at 1012.

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12 HENDERSON V . U NITED S TUDENT A ID FUNDS
Unlike the texting publisher in Kristensen, here, a
reasonable jury could find that the debt collectors pretended
and demonstrably assumed to act as USA Funds’ agents. See
Restatement § 4.01 cmt b. As previously described, the debt
collectors collected on unpaid loans by calling the student-
borrowers. The collectors told the borrowers that they were
calling about a loan owned by USA Funds. Without needing
USA Funds’ approval, the collectors negotiated, deferred,
and took payments on USA Funds’ behalf. In Kristensen, the
texting publisher did not pretend to be the lenders’ agent
because the publisher did not identify itself in the text
message. Id. at 1012. Rather, the text message simply
included a link to the lenders’ website. Id. Before the
litigation, none of the text message recipients knew that AC
Referral had sent the text messages. Kristensen v. Credit
Payment Servs. Inc., 12 F. Supp. 3d 1292, 1297 (D. Nev.
2014). Because here, unlike in Kristensen, the debt
collectors did purport to act as agents of USA Funds,
Kristensen’s material facts are distinguishable from the facts
in this case, and therefore, its holding is not binding here.
2. USA Funds May Have Ratified The Debt
Collectors’ Calling Practices
Because Kristensen’s holding does not apply in this case,
we must resolve whether a triable issue of fact exists as to
whether USA Funds’ conduct “justifies a reasonable
assumption” that it assented to the debt collectors’ allegedly
unlawful calling practices. Restatement § 4.01. Comment d
explains the kind of conduct that constitutes ratification,
including “conduct justifiable only on the assumption that
[a] person consents to be bound by [an] act’s legal
consequences.” § 4.01 cmt. d. The illustration to comment d
illuminates this point.

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HENDERSON V . U NITED S TUDENT A ID FUNDS 13
In the illustration, a used car dealer (the principal)
employs a retail salesperson (the agent) not authorized to
make public statements for the dealer. When the salesperson
defames the dealer’s competitor on TV, and the dealer
congratulates the salesperson’s TV appearance, the dealer
ratified the salesperson’s tortious conduct. To constitute
ratification, therefore, a principal need not explicitly
communicate consent to an agent. Similarly, failure to object
to or repudiate an action may indicate approval when an
agent is likely to draw such an inference from a principal’s
silence. § 4.01 cmt. f. The focal point of ratification is an
observable indication that a principal has exercised an
explicit or implicit choice to consent to the purported agent’s
acts. § 4.01 cmt. d.
For example, “[a] person may ratify an act . . . by
receiving or retaining benefits it generates if the person has
knowledge of material facts.” § 4.01 cmt. g. Here, a
reasonable jury could conclude that USA Funds accepted the
benefits—loan payments—of the collectors’ calls while
knowing some of the calls may have violated the TCPA. If a
jury concluded that USA Funds also had “knowledge of
material facts,” USA Funds’ acceptance of the benefits of
the collector’s unlawful practices would constitute
ratification.
Restatement § 4.06 requires that a principal knows of the
material facts involved in the act it is ratifying. This
knowledge requirement is met if the principal either has
“actual knowledge” or “choose[s] to affirm without knowing
the material facts.” § 4.06 cmt. b. Comment d adds that “a
factfinder may conclude that a principal has made such a
choice when the principal is shown to have had knowledge
of facts that would have led a reasonable person to
investigate further, but the principal ratified without further

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14 HENDERSON V . U NITED S TUDENT A ID FUNDS
investigation.” § 4.06 cmt. d. This can also be described as
“willful ignorance.”
Here, there is evidence that USA Funds communicated
consent to the debt collectors through acquiescence in their
calling practices that allegedly violated the TCPA. In other
words, a reasonable jury could find that USA Funds ratified
the debt collectors’ calling practices by remaining silent and
continuing to accept the benefits of the collectors’ tortious
conduct despite knowing what the collectors were doing or,
at the very least, knowing of facts that would have led a
reasonable person to investigate further.
i. Actual Knowledge
There is evidence in the record that USA Funds had
actual knowledge of the debt collectors’ allegedly unlawful
calling practices. “The fact that the principal had knowledge
may be inferred” by circumstantial evidence. Restatement
§ 4.06 cmt. b. Henderson claims that starting in 2009, debt
collectors called her every 30 to 40 minutes on a number she
did not provide in connection with her student loans. The
calling practice described by Henderson is consistent with
several of USA Funds’ audit findings and its general
understanding of the debt collection industry.
USA Funds does not dispute that it knew that some of
the debt collectors used auto dialers. Evidence in the record
shows that USA Funds knew that both auto dialing and skip
tracing are ubiquitous in the debt collection industry. While
collectors may legally use each method separately, several
of USA Funds’ audits found that its debt collectors might
have violated the TCPA by combining these methods.
Despite these findings, USA Funds made no effort to end its
relationship with any of these debt collectors or to ensure
future TCPA compliance. Instead, it continued to accept the

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HENDERSON V . U NITED S TUDENT A ID FUNDS 15
benefits of the collectors’ conduct. Under these
circumstances, the debt collectors were “likely to draw [the]
inference” that USA Funds’ silence manifested its assent to
these practices. § 4.01 cmt. f.
Hodgin v. UTC is the only circuit case, other than
Kristensen, to apply ratification in the TCPA context.
885 F.3d 243 (4th Cir. 2018). In Hodgin, home security
system manufacturers entered into sales agreements with
retailers through distributors. Id. at 246–48. When the
manufacturers received multiple complaints about their
retailers’ telemarketing practices from consumers, including
practices that allegedly violated the TCPA, the
manufacturers investigated those complaints and ultimately
terminated the sales agreements with the offending retailers.
Id. Unlike the defendant in Hodgin, which fired the retailers
that had allegedly violated the TCPA, USA Funds did not
direct Navient to fire the debt collectors it knew were using
calling practices that allegedly violated the TCPA despite
having directed Navient to fire underperforming debt
collectors. Nor did USA Funds terminate its contract with
Navient. USA Funds’ objective was clear—collect as much
money as possible.
This evidence suggests that USA Funds consented—
with material knowledge—to the debt collectors’ likely
unlawful calling practices. Therefore, a triable issue of fact
exists as to Restatement § 4.06’s actual knowledge
requirement.
ii. Willful Ignorance
Even if the facts are insufficient to infer actual
knowledge by USA Funds that the debt collectors were
violating the TCPA, USA Funds at a minimum “had
knowledge of facts that would have led a reasonable person

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16 HENDERSON V . U NITED S TUDENT A ID FUNDS
to investigate further.” § 4.06 cmt. d. USA Funds’ audit
findings combined with its knowledge about common
practices in the industry should have alerted USA Funds that
it needed to investigate further. Instead, USA Funds
continued to accept the benefits of the debt collectors’
violations and to remain silent about the collectors’ legal
obligations under the TCPA.
Indeed, the record suggests that USA Funds set up the
collection structure between itself, Navient, and the debt
collectors to remain willfully ignorant and avoid liability.
For example, USA Funds’ directions to Navient and the debt
collectors were general and open-ended. USA Funds did not
set performance or operational standards for Navient or the
debt collectors. Nor did USA Funds or Navient have policies
or procedures in place to ensure their debt collectors’ calling
practices complied with the TCPA. USA Funds did not
receive information about the debt collectors’ calling
practices, and it did not monitor the debt collectors’ skip
tracing activities. USA Funds forwarded all consumer
complaints about the debt collectors to Navient, including
alleged TCPA violations. Triable issues of fact exist,
therefore, as to whether USA Funds ratified the debt
collectors’ actions through willful ignorance.
Accordingly, based on the evidence in the record, we
hold that a reasonable jury could find that USA Funds
ratified the debt collectors’ calling practices that allegedly
violated the TCPA. We, therefore, need not address whether
the debt collectors acted with implied actual authority.
CONCLUSION
For the preceding reasons, we REVERSE the district
court’s grant of summary judgment in favor of Defendant-

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HENDERSON V . U NITED S TUDENT A ID FUNDS 17
Appellee USA Funds and REMAND for further
proceedings.
BYBEE, Circuit Judge, dissenting:
I agree with the majority that FCC Orders do not create
per se liability under the Telephone Consumer Protection
Act (TCPA), 47 U.S.C. § 227. Maj. Op. at 7; Gomez v.
Campbell-Ewald Co., 768 F.3d 871, 879 (9th Cir. 2014),
aff’d, 136 S. Ct. 663 (2016). I am also willing to assume for
purposes of this case that ratification may create an agency
relationship when none existed before. Maj. Op. at 10;
Restatement (Third) of Agency § 4.01 cmt. b (2006). I
disagree with the majority, however, that there is a material
issue of fact as to whether USA Funds ratified the debt
collectors’ conduct or whether USA Funds granted the debt
collectors implied actual authority to violate the TCPA. I
would affirm the judgment of the district court.
I
Under the TCPA, it is unlawful “to make any call (other
than . . . with the prior express consent of the called party)
using any automatic telephone dialing system or an artificial
or prerecorded voice . . . to any telephone number assigned
to a . . . cellular telephone service.” 47 U.S.C.
§ 227(b)(1)(A)(iii). Any debt collector who autodialed
Henderson in this case would be liable under this section,
because she was called on a phone number she had not
provided in connection with her loan. However, we are not
addressing the liability of the debt collectors , nor that of
Navient Solutions, Inc., the company that contracted with
the debt collectors. Instead, this case concerns USA Funds
alone, which acquired Henderson’s student loan debt from

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18 HENDERSON V . U NITED S TUDENT A ID FUNDS
the Department of Education and contracted with Navient to
hire and manage the debt collectors. Henderson would have
had a much stronger case against the debt collector that
called her, and, perhaps, even against Navient. But because
that issue is outside the scope of our review, Henderson has
to show that USA Funds either (1) ratified practices that
violated the TCPA or (2) granted the debt collectors
authority to violate the TCPA. I can’t get to either
proposition from the evidence Henderson has mustered.
Before addressing the merits of Henderson’s arguments,
however, let’s start with what we know about skip-tracing
and autodialing. First, skip-tracing is the “[t]he action or
practice of locating people who are missing or have
defaulted on a debt,” typically through online resources.
Skip-tracing, Oxford Dictionary (2019). It is a perfectly
lawful means of obtaining debtors’ additional phone
numbers that they did not provide to the lender. Indeed,
Department of Education regulations not only approve the
practice, they require it. The relevant provision states that
“within 10 days of its receipt of information indicating that
it does not know the borrower’s current address, the lender
must begin to diligently attempt to locate the borrower
through the use of effective commercial skip-tracing
techniques.” 34 C.F.R. § 682.411(h)(1) (emphasis added).
Autodialing refers to the process by which a mechanical
device or software dials telephone numbers automatically.
When the recipient answers the call, the device or software
plays a recorded message or connects the recipient to a real
person. As anyone who has received these automated calls
can attest, autodialing can be an obnoxious practice. That
said, it is not, in and of itself, unlawful. Autodialing to
collect a debt does not violate the TCPA if the phone number
is one that the debtor provided. In fact, the TCPA
specifically authorizes autodialed calls if the call “is made

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HENDERSON V . U NITED S TUDENT A ID FUNDS 19
solely to collect a debt owed to or guaranteed by the United
States.” 47 U.S.C. § 227(b)(1)(A)(iii); see also In the Matter
of Rules and Regulations Implementing the Telephone
Consumer Protection Act of 1991, 31 FCC Rcd. 9074, 9082–
83 & n.54 (2016) (limiting the provision to debts owed to or
guaranteed by the United States). The TCPA thus prohibits
an autodialer from calling a phone number that the debtor
did not provide—for example, a number obtained through
skip-tracing.
Henderson alleges that debt collectors used skip-tracing
to obtain a phone number she did not provide and then
repeatedly autodialed her on that number. She argues that
USA Funds is liable for these violations because it
(1) ratified the debt collectors’ TCPA violations or (2) gave
the debt collectors implied actual authority to violate the
TCPA. The majority addressed the first question alone; I am
going to address both.
A. Ratification
Under the Restatement of Agency, “[a] person ratifies an
act by . . . conduct that justifies a reasonable assumption that
the person so consents.” Restatement (Third) of Agency
§ 4.01(2)(b). There are two ways to ratify a third party’s
acts. The first is by a “knowing acceptance of a benefit,”
which requires “an objectively or externally observable
indication . . . that the principal has exercised choice and has
consented.” Id. § 401 cmt. d. This means that the principal
must have “knowledge of material facts.” Id. § 4.06. The
second is through a form of “willful ignorance.” Under this
theory, the principal may not know the material facts but
“ratified [the conduct] with awareness that such knowledge
was lacking.” Id. § 4.01 cmt. b. In other words, the principal
is aware that it does not know the material facts, and yet it
ratifies the conduct anyway.

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20 HENDERSON V . U NITED S TUDENT A ID FUNDS
The majority concludes that Henderson put forth
sufficient facts, that if accepted by a jury, prove either theory
of ratification: “USA Funds ratified the debt collectors’
calling practices by remaining silent and continuing to
accept the benefits of the collectors’ tortious conduct despite
knowing what the collectors were doing or, at the very least,
knowing of facts that would have led a reasonable person to
investigate further.” Maj. Op. at 14. I will address each
theory of ratification in turn.
1. Actual Knowledge
The majority first holds that there are sufficient facts in
the record on summary judgment to prove that “USA Funds
had actual knowledge of the debt collectors’ allegedly
unlawful calling practices.” Id. (emphasis added). The
majority recites two facts: “USA Funds knew that both auto
dialing and skip tracing are ubiquitous in the debt collection
industry” and “USA Funds’ audits found that its debt
collectors might have violated the TCPA.” Id. at 14–15.
From these two claims, the majority deduces that USA
Funds knew that debt collectors “violated the TCPA by
combining [skip-tracing and autodialing]” and “assent[ed] to
these practices.” Id. There is no support in the record for
this conclusion. As I have pointed out (and the majority
concedes), skip-tracing and autodialing are lawful collection
techniques, so their ubiquity is not surprising. It is only
when they are used in tandem that the practice violates the
TCPA. There is some evidence that USA Funds knew that
debt collectors employed by Navient had used improper
practices, but scant evidence they knew the debt collectors
used skip-tracing and autodialing in combination. And there
is no evidence whatsoever that USA Funds approved of such
practices. In fact, the only evidence in the record is to the
contrary: when USA Funds learned of wrongful practices, it

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HENDERSON V . U NITED S TUDENT A ID FUNDS 21
reported them to Navient and asked Navient to correct the
problem.
Here is what the record shows us. USA Funds’
agreement with Navient required that Navient and its
vendors comply with all federal regulations. For its part,
USA Funds maintains an 800-number to receive customer
complaints and has an email on its website for complaints or
inquiries. USA Funds also conducts regular audits of its
accounts, as required by statute and regulation. See
20 U.S.C. § 1094(c)(1)(C)(i); 34 C.F.R. § 682.410(b)(1).
When USA Funds learns of possible TCPA violations
through an audit or customer complaint, it reports them to
Navient, and asks Navient to take corrective action. All of
the information we have on USA Funds’ audits comes from
the deposition of one USA Funds employee—Kevin Tharp,
the manager of the delinquency and default management
section, who had been employed at USA Funds for thirty-
seven years and had been the section head for twenty years.
Under the audit guidelines, USA Funds examines at least
150 randomly selected accounts for compliance with
repayment programs, such as loan rehabilitation and wage
garnishment. In the process of reviewing the selected
accounts, USA Funds reviews collection efforts and, in
particular, skip-tracing, because it is required by Department
of Education regulations. 34 C.F.R. § 682.411(h)(1).
Tharp explained that USA Funds has no contractual
relationship with the debt collectors and no authority to hire,
fire, or discipline them. What USA Funds did when it
learned of potential violations was “recommend corrective
action” to Navient. This corrective action might range from
Navient directing the debt collector to remove the phone
number from the autodialer to withholding payment from the
debt collector. Tharp was asked if he knew of any instance

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22 HENDERSON V . U NITED S TUDENT A ID FUNDS
in which a debtor complained to USA Funds of being
autodialed or even called on a number he or she did not
consent to be called on. Here is the exchange:
Q: “Has USA Funds ever received a
complaint from a borrower . . . about the
borrower being called on a cellular telephone
that they hadn’t consented to being called on
by a collections agent calling about a USA
Funds’ guaranteed loan?”
A: “Not that I’m aware of.”
He was then asked about auto-dialing:
Q: “Do you know whether USA Funds has
ever received a complaint from a borrower
relating to the use of a dialer on a USA
Funds’ guaranteed loan?”
A: “None that I’m aware of [aside from this
case].”
The only examples of “improper” efforts that Tharp was
questioned about do not reveal any information about the use
of skip-tracing and autodialing. The first was a 2010 audit
by USA Funds, which identified what was described as the
“calling of an incorrect phone number.” Although the
majority assumes the worst, Tharp was never asked whether
the phone number was obtained through skip-tracing. In
fact, there is no evidence that the “incorrect phone number”
was even another phone number of the debtor’s or was just
a wrong number entirely. The only other “improper
collection effort[]” identified in the deposition reflects the
same lack of information. A 2000 audit revealed that a

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HENDERSON V . U NITED S TUDENT A ID FUNDS 23
phone “not associated with the borrower was repeatedly
called.” However, again, it is unclear whether it was a
number the debtor did not consent to or just a wrong number.
The questioning, in fact, suggests that it was not even an
additional number of the debtors’: “the repeat finding was
that there had been a number called that wasn’t the
borrower.” This questioning of Tharp yielded no evidence
that numbers were obtained through skip-tracing or called
with autodialers. There is simply no support for the
majority’s conclusion that USA Funds knew that the
collectors were using autodialers in combination with skip-
tracing and approved of the practice.
Henderson also deposed Mark Verbrugge, senior
director of operations for Navient, but his answers don’t help
her either. Verbrugge testified that Navient conducts its own
audits. It monitors whether the debt collectors were
autodialing or manually dialing phone numbers through on-
site visits. Navient also reviews customer complaints,
including those made directly to Navient, or through an
ombudsman or an agency, such as the Better Business
Bureau. Navient has taken corrective action, including
directing the debt collector to change its collection methods
and cease all contact. Verbrugge also testified that Navient
did not typically inform USA Funds of what dialers the debt
collectors used, and he did not know of any instances where
Navient informed USA Funds that autodialers were used to
call skip-traced numbers. Nor did he know whether USA
Funds was able to obtain that information through its own
audits.
Nothing here shows that USA Funds ratified “improper
collection efforts.” The sum of Henderson’s evidence
regarding USA Funds’ ratification of improper dialing
consists of USA Funds’ own audit that shows that it

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24 HENDERSON V . U NITED S TUDENT A ID FUNDS
disapproved of general TCPA violations and took
affirmative steps to discourage it. That is not ratification
under any fair reading of the Restatement of Agency. The
whole point of the audits by USA Funds and Navient is to
ensure compliance with federal law. Both Tharp and
Verbrugge testified that when their audits disclosed
improper collection efforts, Navient—sometimes on its own
initiative and sometimes at the direction of USA Funds—
took corrective action, such as withholding payment,
suspending a debt collector, or reducing its placements with
the collector. The only record evidence shows that USA
Funds took steps to ameliorate any TCPA violations, not to
ratify them. The majority’s claim that “USA Funds made no
effort to end its relationship with any of these debt collectors
or to ensure future TCPA compliance” is thus contrary to all
the evidence in the record. Maj. Op. at 14–15. In the end,
the only evidence Henderson has of an unlawful practice is
her own testimony that she was autodialed on a phone
number she didn’t provide to her lender. That might be
sufficient to show that someone violated the TCPA, but it
doesn’t prove a thing about USA Funds’ complicity any
violations. But under the majority’s theory of ratification, if
a debt guarantor like USA Funds knows that there are
violations “in the debt collection industry,” id., it is liable for
the debt collectors’ actions, even if USA Funds has taken
corrective action. That is not a theory of ratification—it is
strict liability, and nothing in the TCPA authorizes such a
broad theory.
2. Willful Ignorance
The majority holds, in the alternative, that “[e]ven if the
facts are insufficient to infer actual knowledge by USA
Funds that the debt collectors were violating the TCPA, USA
Funds at a minimum ‘had knowledge of facts that would

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HENDERSON V . U NITED S TUDENT A ID FUNDS 25
have led a reasonable person to investigate further.’” Id. at
15–16 (quoting Restatement (Third) of Agency § 4.06 cmt.
d). It states that “USA Funds’ audit findings combined with
its knowledge about common practices in the industry
should have alerted USA Funds that it needed to investigate
further,” but it willfully chose not to. Id. Once again, the
record does not support this holding.
As discussed above, the only evidence in the record
shows that when USA Funds discovered TCPA violations
through an audit or customer complaint, it reported the
complaint to Navient and recommended corrective action—
it did not “willfully ignore” anything. The debt collectors
were not USA Funds’ vendors to hire and fire; they were
hired and supervised by Navient. It was then Navient’s
responsibility to ensure the offending debt collector
corrected its actions. Henderson provided no evidence that
Navient failed to follow up on USA Funds’ requests for
action, or that USA Funds made these requests and then
looked the other way. The majority emphasizes that USA
Funds did not “terminate its contact with Navient,” id. at 15;
however, there is no evidence in the record that USA
believed—or even had reason to believe—that Navient was
mishandling the complaints or ignoring USA Funds’
recommended corrective action. To the contrary, the
undisputed testimony from the only Navient witness
(Verbrugge) is that Navient took USA Funds’ requests
“under strong consideration.”
The majority asserts that because USA Funds did not
instruct Navient to fire the collectors and “made no effort . . .
to ensure future TCPA compliance,” the debt collectors were
“‘likely to draw [the] inference’ that USA Funds’ silence
manifested its assent” to the TCPA violations. Id. at 14–15
(quoting Restatement of Agency § 4.01 cmt. f). But USA

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Funds had no contractual relationship with the debt
collectors—it could not fire them because it never hired
them in the first place. Rather, it reported any complaints to
Navient and gave Navient full authority to handle them—
including the authority to fire offending debt collectors
without USA Funds’ interference. But in any event, the
majority’s minor premise—that USA Funds “made no
effort”—is contrary to the only evidence in the record, and
its conclusion—that debt collectors would “infer[] . . .
assent”—is pure speculation, because Henderson did not
sue, or even depose, any debt collector. Id. I simply do not
see how USA Funds can be deemed to have willfully ignored
wrongful practices if the only evidence provided shows that
it consistently tried to correct them.
Lastly, the majority asserts that the “collection structure”
between USA Funds and Navient allowed USA Funds “to
remain willfully ignorant and avoid liability.” Id. at 16. I
am not naive about what is going on here, and the majority
may have a broader point to make. The way that USA Funds
structured its collection efforts—hiring Navient to manage
the hiring of collection agencies—may suggest that USA
Funds is trying to shield itself from the dark underbelly of
the debt-collection business. But unless we are prepared to
indict the entire industry and hold everyone involved
responsible based solely on general industry violations and
collection structures (which likely would include the
Department of Education itself), I do not see the evidence to
satisfy agency principles. I repeat that the majority’s holding
sounds in strict liability, and I think this decision will send
shudders through the industry. Maybe that is a good thing,
but I don’t see our mandate in the TCPA to cause such
disruption. It is better for the Department of Education, the
FCC, or Congress to address the matter.

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HENDERSON V . U NITED S TUDENT A ID FUNDS 27
B. Implied Actual Authority
Because I find that Henderson did not create a genuine
issue of material fact that USA Funds ratified the debt
collectors’ actions, I must also briefly address her claim that
USA Funds gave the debt collectors implied actual authority
to violate the TCPA. This argument fails for much the same
reasons as her ratification theory. “The legal consequences
of an agent’s actions may be attributed to a principal when
the agent has actual authority (express or implied) or
apparent authority.” Salyers v. Metro. Life Ins. Co., 871 F.3d
934, 940 (9th Cir. 2017) (citing Restatement (Third) of
Agency § 2 intro. note). “Implied actual authority comes
from a general statement of what the agent is supposed to do;
an agent is said to have the implied authority to do acts
consistent with that direction.” NLRB v. Dist. Council of
Iron Workers of Cal. & Vicinity, 124 F.3d 1094, 1098 (9th
Cir. 1997).
Henderson argues that the debt collectors acted with
implied actual authority from USA Funds because they
“reasonably believed, based on USA Funds’ manifestations
and actions, that they had authority to act as USA Funds’
agent in all aspects of the transactions with debtors.” We
have no evidence in this record from any debt collector as to
what the debt collector believed about USA Funds or why
that belief was reasonable. Henderson’s speculative
assertions are insufficient to create a genuine issue of
material fact that the debt collectors reasonably believed that
USA Funds approved of their TCPA violations—
particularly when the only evidence in the record is that
Navient would withhold payment or cease working with the
debt collectors if TCPA violations occurred. Any debt
collector who believed that USA Funds approved of TCPA
violations would do so unreasonably. See Restatement

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28 HENDERSON V . U NITED S TUDENT A ID FUNDS
(Third) of Agency § 2.01 (requiring the agent’s belief be
reasonable); see id. cmt. c (“The focal point for determining
whether an agent acted with actual authority is the agent’s
reasonable understanding at the time the agent takes
action.”).
Although a “smoking gun may not be needed” to
overcome a motion for summary judgment, Ms. Henderson
still must provide “something more than speculative,
conclusory allegations.” Towers v. Iger, 912 F.3d 523, 532
(9th Cir. 2018).
II
Henderson has not provided sufficient evidence to create
a genuine issue of material fact that USA funds knew or
willfully ignored TCPA violations, nor that it granted
implied actual authority to the debt collectors to violate the
TCPA. For these reasons, I respectfully dissent. I would
affirm the judgment of the district court.

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