Businesses that engage in telemarketing or the delivery of text messages, take note: the already tough rules of the Telephone Consumer Protection Act (TCPA) are about to get tougher.
The Federal Communications Commission (FCC) recently revised its TCPA rule1 to make the consent requirements stricter for the delivery of certain autodialed and prerecorded telemarketing calls and marketing text messages.2 The revised rule takes effect on October 16, 2013. In light of the Act’s draconian penalties of up to $1500 per violating call or text, and plaintiffs’ attorneys’ aggressive and expansive use of the Act, it is critical that businesses conform their calling and text messaging practices to the revised rule, as described below.
New consent requirements for certain telemarketing calls and marketing text messages
The revised rule requires prior express written consent from the call or text message recipient for:
- Autodialed3 or prerecorded telemarketing calls and text messages delivered to a cell phone.4 For autodialed or prerecorded calls and text messages delivered to a cell phone that do not constitute telemarketing, the rule remains the same: only prior express consent (rather than prior express written consent) is required.
- Prerecorded telemarketing calls to residential landlines.5 The revision eliminates the exception allowing sellers to place prerecorded telemarketing calls to landlines of persons with whom they have an established business relationship, thus conforming the FCC’s rule to the Federal Trade Commission’s Telemarketing Sales Rule.6
The rule’s new consent requirements apply only to advertising and telemarketing calls or messages, and not to purely informational or transactional calls or messages, such as flight updates, debt collection calls, surveys or bank account fraud alerts (the rule for which, when autodialed to a cell phone or prerecorded, remains the same — it requires prior express consent).7 If, however, any portion of an otherwise informational call includes advertising or telemarketing, the prior express written consent requirement applies.8
What is “prior express written consent”?
The revised rule defines “prior express written consent” as a written agreement signed by the called party, in which he or she “clearly authorizes” receiving prerecorded or autodialed telemarketing calls or messages from the specific seller.9 The agreement must include “clear and conspicuous” disclosures that:
- By signing the agreement, the individual authorizes the seller to deliver, to a designated phone number, telemarketing calls or messages using an autodialer or an artificial or prerecorded voice; and
- The individual is not required to sign the agreement or agree to enter into it as a condition of purchasing any property, goods or services.10
Electronic or digital signatures suffice for purposes of the rule, provided that they are recognized as valid under applicable federal law (e.g., the E-SIGN Act) or state contract law. This may include, for example, signatures obtained via e-mail, website form, text message, telephone key press or voice recording.11
Many companies obtain consent to deliver telemarketing calls or text messages online. When doing so, we suggest taking the following steps and otherwise complying with the E-SIGN Act or applicable state contract law, to help ensure compliance:
- Require an individual to check an unchecked box to indicate his or her agreement;
- Include language next to the unchecked box that explicitly states that the individual is agreeing to the disclosures described above. For example: By checking this box, I agree to receive [prerecorded/autodialed telemarketing messages/autodialed marketing text messages] from or on behalf of [company] at the mobile number I have provided. I understand that consent is not a condition of purchase;
- If the company is sending text messages, clearly and conspicuously make the customary additional disclosures (e.g., message frequency, “message and data rates may apply,” unsubscribe instructions and help instructions);
- Include the following statement on the consent form: Please print for your records; and
- Retain the consent forms.
The penalties for violating the revised rule are severe, and the prospect of recovering millions of dollars in damages has made autodialed calls or text messages an attractive target for class action suits. To help minimize litigation risk, businesses that engage in telemarketing or the delivery of text messages must ensure that their methods for obtaining consent comply with the FCC’s requirements.