- Business Advisory on The Telephone Consumer Protection Act (TCPA)
- February 18, 2014 | Author: Alfred C. Frawley
- Law Firm: Eaton Peabody - Bangor Office
The Telephone Consumer Protection Act (TCPA) has been around since 1991, but it is growing in importance for a couple of reasons. First, the FCC, which, along with the Federal Trade Commission, interprets and enforces the law, has issued new regulations that change the scope of what kinds of calls and contacts are prohibited under the TCPA. Second, Plaintiffs' class action lawyers have started to file private enforcement lawsuits, with some big penalties attached to them. Class action lawsuits under the TCPA increased 70 per cent year over year from 2012 and 2013.
So what's all the fuss about? The TCPA places limits on unsolicited prerecorded telemarketing calls to landline home telephones, and all autodialed or prerecorded calls to wireless numbers, emergency numbers, and patient rooms at healthcare facilities.
As of Oct. 16, 2013, parties that use prerecorded calls, auto dialers or text messages to advertise goods or services must obtain a consumer’s “prior express written consent” before placing prerecorded telemarketing calls to residential or wireless numbers. In addition, all auto dialer telemarketing calls or text messages to mobile numbers are prohibited unless there is express written consent. So, if you are making calls to customer or prospective customers, chances are you need to focus on what those calls are, what numbers are being called and whether you have consent for that type of call.
The FCC’s new “prior express written consent” definition places a heavy burden on anyone engaged in telemarketing. “Prior express written consent” requires
1. An agreement
2. In writing
3. Bearing the signature of the person called
The consent must clearly authorize the seller advertisements or telemarketing messages; and must specify the telephone number to which the signatory authorizes such advertisements or telemarketing messages to be delivered.
The written agreement must also include a disclosure that the recipient specifically consents to receiving telemarketing calls using an automatic telephone dialing system or an artificial or prerecorded voice, and that the recipient is not required to make any agreement as a condition of purchasing any goods or services.
In addition, the new rules eliminate the “established business relation exception” for calls to residential telephone lines. This means that whether or not you have a prior commercial relationship with the person being called you must now obtain consent to make certain calls.
And, the FCC revised its rules to require parties placing artificial or prerecorded calls to include an interactive opt-out mechanism for the party that receives the call, both at the beginning and during the call.
Violations of the rules carry a stiff penalty. Since private parties can sue for violations, an increasing number of TCPA class actions have been filed. In 2013 the largest settlement in the history of the TCPA was preliminarily approved in 2013 totaling $32 million in payment for over seven million potential class members.