Congress passed the Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227, with the intention of protecting consumers from unwanted calls, text messages, and faxes. There has been a significant increase in the number of TCPA claims and enforcement actions filed in recent years, and yet there remain many unsettled legal questions. Through this update, we hope to provide you with a quick overview of some recent TCPA litigation and regulatory compliance developments and tips for minimizing your risk.
Those who have had any involvement with TCPA litigation in the last year will likely be unsurprised to learn that TCPA lawsuits are on the rise. There were 160 TCPA cases filed in January 2013 and 208 filed in the same month this year – a 30 percent increase.
There was also yet another reminder recently that almost anyone can suddenly find themselves facing TCPA class action allegations. Just a few weeks ago, a Florida federal district court judge denied Obama for America’s motion to dismiss TCPA claims and motion to strike class allegations. Plaintiff Lori Shamblin alleged that the president’s campaign targeted voter cell phones with auto-dialed calls and pre-recorded messages leading up to the November 2012 election. The court rejected Obama for America’s early arguments that Shamblin’s claims implicate First Amendment concerns. The case is Shamblin v. Obama for America, No. 8:13-cv-2428, 2014 WL 631931 (M.D. Fla. Feb. 18, 2014).
Despite an increase in TCPA cases filed, there are positive developments relating to a consent defense for non-telemarketing calls (and pre-October 16, 2013 telemarketing calls). A Northern District of Illinois judge has added to the growing number of cases confirming that providing your telephone number is enough to give express consent to receive calls under the TCPA. See Kolinek v. Walgreen Co., No. 13 C 4806, 2014 WL 418174 (N.D. Ill. Feb. 10, 2014). Plaintiff Robert Kolinek brought a putative class action against Walgreens, alleging that the pharmacy called him on his cell phone to remind him to fill his prescriptions. Kolinek argued that he did not give his consent to receive calls, although he admitted in his complaint that he gave Walgreens his phone number for verification purposes 10 years before he received the calls.
Relying on the same 1992 FCC decision cited by the Baird v. Sabrecourt that we discussed during our webinar "The Telephone Consumer Protection Act: Recent Developments and Key Litigation Defense and Compliance Challenges for 2014," the Illinois court held that Kolinek’s claim was barred by the “general rule” that “persons who knowingly release their phone numbers have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary.” Even the 10 years between when Kolinek gave his phone number and received calls was irrelevant to a consent determination because, as the court noted, “consent under the TCPA does not expire on its own.” This opinion joins recent district court decisions out of the Ninth and Eleventh Circuits holding similarly. SeeBaird v. Sabre, Inc., No. CV 13-999, 2014 WL 320205 (C.D. Cal. Jan. 28, 2014) (consent where plaintiff gave his phone number on an airline Web form); Murphy v. DCI Biologicals Orlando, LLC, No. 6:12-cv-1459, 2013 WL 6865772 (M.D. Fla. Dec. 31, 2013) (consent where plaintiff gave his phone number on a blood donor information sheet).
Organizations need to know about the latest developments and prepare appropriate compliance strategies to minimize the risk of a TCPA claim or enforcement action. For example, the FCC modified its TCPA rules in 2012, and the last of those changes went into effect this past October. Under the new rules, companies must obtain “prior express written consent” before making certain telemarketing calls, and they must include specific disclosures in their consent requests. These new requirements created a number of compliance challenges for organizations, especially those that had obtained some form of written consent from individuals prior to the effective date of the FCC’s new rules. Several petitions have been filed with the FCC asking the agency to clarify how the new rules apply to those consents.
In addition, there is a lot of confusion over what types of equipment constitute an “automatic telephone dialing system” (autodialer) under the TCPA and the FCC’s TCPA rules. Numerous parties have asked the FCC to clarify the extent to which certain technologies, such as predictive dialing and previewing dialing systems, video calling, group text messaging, and virtual receptionist services, may involve the use of an autodialer (if at all). We expect that the FCC will start to clarify some of these issues over the next few months. Any decision by the FCC is likely to have wide-ranging impact on a variety of innovative technologies and services, and organizations will need to be ready to adjust their compliance strategies in response.
Another important step for a company to reduce the likelihood of facing a TCPA class action or enforcement action is to exercise good calling list hygiene. This includes ensuring that calling lists are appropriately scrubbed against the National Do Not Call Registry, state do-not-call lists (a few states may not upload their registrants into the National Registry), and the company’s own Do Not Call opt-out list. Many of the recent TCPA class action filings we have reviewed involve allegations that the defendants placed telemarketing calls to the plaintiffs when the plaintiffs claimed that their numbers were registered on do-not-call lists or had previously requested that the defendants no longer call them. Companies should synchronize their calling lists with the national and state do-not-call lists per the required schedules or make sure an appropriate exemption applies.
When processing express requests from consumers to no longer receive calls, companies should also take steps to ensure that the scope of the opt-out is clear and reflects reasonable consumer expectations. A consumer’s request to not receive calls from an alarm system manufacturer likely would not apply to an affiliate that makes kitchen appliances. However, a consumer might expect that the opt out would apply to an affiliate that makes security cameras. Taking stock of consumer expectations based on line of business, branding, and other similar considerations and designing practices in light of those expectations is an effective way to minimize legal risks in telemarketing and other activities that raise privacy concerns.