Telemarketing

By Ani Gevorkian

Last week, the U.S. District Court for the Southern District of California issued an opinion regarding the definition of  an “Automatic Telephone Dialing System” (“ATDS”) under the Telephone Consumer Protection Act (“TCPA”).  The opinion follows a small but growing number of cases holding that courts have their own ability to interpret the statutory definition of ATDS and need not follow the Federal Communication Commission’s interpretation of that term.

The case, Marks v. Crunch San Diego, involved a class action suit against gym-operator Crunch San Diego (“Crunch”) for its use of a third-party web-based platform to send promotional text messages to current and prospective member mobile phones.  The plaintiff claimed he had received three unwanted text messages from Crunch over the course of about a month, in violation of the TCPA.  The motion for summary judgment turned on the issue of whether the platform Crunch used could be classified as an ATDS.  The court held that it could not.Continue Reading Another Court Finds That an Automated SMS Platform is Not an ATDS

Earlier this week, the FCC announced that mobile wireless company Sprint will pay $7.5 million to resolve allegations that the company failed to honor consumer requests to be placed on Sprint’s entity-specific Do-Not-Call list.  The settlement represents the largest of its kind between the FCC and a carrier.

Through this…

Continue Reading FCC Obtains Record $7.5 Million Settlement With Sprint for Alleged Do-Not-Call Violations

Last week, the Federal Communications Commission announced plans to fine Dialing Services, LLC, nearly $3 million for making illegal “robocalls” to cell phones. The FCC has specific rules for automatic telephone dialing systems, also known as “autodialers,” that have the capacity to produce, store, and dial telephone numbers using a random or sequential number generator. The Telephone Consumer Protection Act (“TCPA”) prohibits the transmission of robocalls to mobile phones except for (1) calls made for emergency purposes, or (2) calls made with the “prior express consent” of the call recipient. (In 2012, the FCC promulgated a rule to require “prior express written consent” for such calls that contain a “telemarketing” or “advertisement” component.) The FCC alleged that Dialing Services transmitted automated or prerecorded voice messages on behalf of political campaigns and candidates without the prior express consent of the call recipients. Neither the TCPA nor the FCC’s rules contains a general exception from the autodialer prohibition for political calls.

This is not the first time that Dialing Services has heard from federal regulators. In March of last year, the FCC issued a citation to Dialing Services for making millions of calls to cell phones during the 2012 election cycle without authorization. The citation required Dialing Services to certify within fifteen days that it had ceased making robocalls without permission. It also came with a clear warning from the FCC Enforcement Bureau that, “These citations set the stage for significant monetary penalties if violations continue,” including fines up to $16,000 per call. Finding that Dialing Services failed to comply with the requirements of the citation and continued its practices by making 184 additional calls, the FCC last week announced plans to fine Dialing Services $2,944,000 – the maximum penalty for those 184 calls.Continue Reading FCC Fines Company $2.9 Million for Political Robocalls to Cell Phones

The Seventh Circuit Court of Appeals recently held that the application of Indiana’s Automated Dialing Machine Statute to interstate calls was not preempted by the federal Telephone Consumer Protection Act or its implementing regulations (“TCPA”).  The case, Patriotic Veterans v. Indiana,  highlights the importance of considering both the TCPA…

Continue Reading Seventh Circuit: Indiana Telemarketing Statute Not Preempted by TCPA

Earlier today, two entities — the Direct Marketing Association (“DMA”) and a Coalition of Mobile Engagement Providers (“Coalition”) — filed petitions at the FCC asking the agency to stay and forbear from enforcing, or clarify, certain aspects of the “prior express written consent” requirement that went into effect yesterday for prerecorded calls…

Continue Reading Petitions to Forbear or Clarify New FCC TCPA Rules Filed

A seller who authorizes a third-party telemarketer to market the seller’s goods or services may be held vicariously liable if the telemarketer violates the Telephone Consumer Protection Act (TCPA), the Federal Communications Commission held in a May 9 declaratory ruling.

The FCC’s ruling interprets two subsections of the TCPA. The first subsection — 47 U.S.C. § 227(b) — includes several restrictions, including a general prohibition on making calls to landline or mobile telephones using a prerecorded message without  the recipient’s prior express consent. Section 227(b)(3) allows individuals or companies to bring private lawsuits “based on a violation of this subsection” or the FCC’s implementing regulations.

A separate portion of the TCPA — 47 U.S.C. § 227(c) — authorizes the FCC to set up a national Do Not Call registry, which the FCC did in coordination with the Federal Trade Commission several years ago. Section 227(c)(5) authorizes private lawsuits by individuals who receive “more than one telephone call within any 12-month period by or on behalf of the same entity” in violation of the Do Not Call rules.

Last week’s declaratory ruling came in response to questions referred to the FCC by two federal courts in two separate TCPA-based lawsuits.Continue Reading FCC Confirms That Sellers Can Be Liable for Telemarketer TCPA Violations

A number of key developments affecting telemarketing emerged over the past week:

1.  The distinction between informational and telemarketing calls was further defined.  The 9th Circuit held that calls intended to impart information about a customer rewards program could be construed as “dual purpose” calls subject to federal and state telemarketing restrictions.  See Chesbro v. Best Buy Co., Inc.

2.  Effective dates were announced for the new requirements on autodialed and prerecorded calls that were adopted by the FCC in February 2012. 

  • Effective immediately:  all prerecorded “heath care” messages subject to HIPAA transmitted to residential lines are exempt from the FCC’s consent, identification, time-of-day, opt-out, and call abandonment requirements.
  • Effective November 15, 2012:  the FCC’s three percent call abandonment rate must be calculated on a 30-day basis for every telemarketing calling campaign.  (It is possible that the FCC will consider delaying this effective date to January 14, 2013, to align it with the interactive opt-out requirement discussed below.)
  • Effective January 14, 2013:  all prerecorded telemarketing calls must include an automated, interactive opt-out mechanism throughout the duration of the call, as well as a toll-free telephone number that can be contacted to opt out when a prerecorded telemarketing message is left on voicemail or an answering machine. 
  • Effective October 16, 2013:  prior express written consent is required to transmit prerecorded or autodialed telemarketing calls to wireless numbers, and the established business relationship exception no longer applies to prerecorded telemarketing calls to residential lines.

Continue Reading Telemarketing Recap: Recent Key Developments at the FCC, FTC and in the Courts

Today, the Federal Communications Commission adopted new rules that strengthen its restrictions on autodialed or prerecorded telemarketing calls.  The FCC billed the new rules as an effort to maintain consistency with the Federal Trade Commission’s telemarketing sales rule, which also governs telemarketing calls, and to give consumers control over the…
Continue Reading FCC Adopts New Telemarketing Restrictions

Last week, President Obama signed into law the “Truth in Caller ID Act,” which prohibits the practice of providing false caller ID information in order to deceive the call recipient (better known as caller ID “spoofing”).  Specifically, the Act prohibits the use of “misleading or inaccurate caller identification information with the intent to defraud…

Continue Reading New Law Prohibits Caller ID “Spoofing”