A recent federal district court ruling provides more guidance on how courts define “express consent” under the Telephone Consumer Protection Act (“TCPA”) in the debt collection setting.  In Sharp v. Allied Interstate Inc., the court relied on earlier Federal Communications Commission (“FCC”) rulings that had found that prior express consent had been provided by consumers in situations where they had supplied their respective contact telephone numbers to creditors “during the transaction that resulted in the debt[s].”  As detailed below, businesses must be careful in when and how they outsource debt collection calls to be made to consumers.

Verizon TCPA Debt Collection Calls Case

Sharp v. Allied Interstate Inc. involved TCPA debt collection calls to a consumer that ordered a “bundled” package of services offered by the telecommunications provider Verizon.  The package included telephone services provided by Verizon and television services provided by DirecTV.  The plaintiff canceled his bundled package subscription 2 years after ordering it.  DirecTV believed that the plaintiff owed an outstanding debt of $86.96.  Accordingly, DirecTV retained the services of the defendant, a debt collection agency.  Between April and August 2011, the defendant placed 381 automated telephone calls to the plaintiff’s cellular telephone in an attempt to collect on the debt.  Although all of the parties agreed that at some point the plaintiff had provided his cellular telephone number to Verizon, none of the parties could conclusively prove where the defendant debt-collector had obtained plaintiff’s cellular telephone number.

Court Rules the TCPA Debt Collection Calls Did Not Obtain Express Consent

The court denied the defendant’s motion for summary judgment.  The defendant argued, among other things, that because it does not “harvest,” or independently seek out telephone numbers, it must have acquired the number from the plaintiff himself or from Verizon.  The defendant suggested this this fact was sufficient to meet its burden of proving express consent.   The court rejected this argument, noting that the burden is on the defendant, and not the plaintiff, to prove prior express consent.  The court suggested that an argument could have been made that providing prior express consent to Verizon was also providing express consent to DirecTV, but the defendant never introduced such an argument.

Additionally, the court noted that the plaintiff had been a Verizon telephone service customer before he had ordered the bundled package.  Therefore, the court reasoned, the plaintiff may have provided his contact information previously, and not “during the transaction that resulted in the debt owed.”  As a result, the court denied summary judgment to the defendant.

Readers of this blog should bear in mind that the material facts at issue in this case arose prior to October 16, 2013.  On that date, amended TCPA regulations went into effect that require that the calling party obtain expresswritten consent prior to placing automated telephone calls to cellular telephone subscribers.  If the fact pattern at issue in Sharp had occurred after October 16, 2013, summary judgment would have been awarded in favor of the plaintiff because express written consent was not obtained from the plaintiff prior to calling him.

Protect Yourself

To protect against TCPA liability, it is imperative that businesses receive express written consent from consumers prior to placing automated telephone calls to cellular telephones.  Additionally, it is important that entities attempting to collect on debts (either on their own or through an agent) are the entities that contracted with the consumers that resulted in the subject debt.