Yesterday morning, the Federal Trade Commission (“FTC”) announced that it had reached a settlement with Lilly Management and Marketing, LLC and its principal, Kevin Lawrence (together, “Defendants”). The FTC commenced an action against Defendants in the Middle District of Florida on March 16, 2016, alleging that the Defendants repeatedly and systematically violated the Telephone Consumer Protection Act (“TCPA”) and the Telemarketing Sales Rule (“TSR”), respectively, by purchasing leads from third-parties and then placing “tens of millions of outbound telephone calls to telephone numbers on the National Do Not Call Registry.” The calls were made using an automated high-speed dialing system to send a pre-recorded message touting vacation packages. Defendants allegedly continued these business practices despite receiving a “Complaint Pattern & Sales Practices” letter from the Better Business Bureau and a Civil Investigative Demand from the FTC.

What are the Terms of the TCPA and TSR Violation Settlement?

FTC Settles TCPA and TSR Violation Charges

The FTC hit Defendants, jointly and severally, with a one million two hundred thousand dollar ($1,200,000.00) civil penalty for the alleged violations. However, due to representations concerning Defendants’ financial condition, they must only pay nineteen thousand dollars ($19,000.00) of the penalty.

Pursuant to the terms of the settlement, Defendants are permanently banned “whether acting directly or through an intermediary” from “initiating, causing others to initiate, or assisting other persons in initiating an Outbound Telephone Call that delivers a prerecorded message.” Defendants are also prohibited from initiating any outbound telephone calls to consumers on the National Do Not Call Registry.

Protect Yourself

As we have previously blogged, the FTC recently amended and strengthened its Do Not Call regulations under the TSR. In this regulatory climate, it is imperative that telemarketers and lead generators retain competent counsel to navigate the various state and federal regulations relating to telemarketing.