These days it REALLY sucks to be an autodialer telephone system vendor or a telemarketer that depends on one.
On July 10, the Federal Communications Commission released the long-awaited Declaratory Ruling and Order intended to clarify its controversial interpretation of the Telephone Consumer Protection Act’s autodialer definition. TCPA compliance is a significant issue for telemarketers because the TCPA allows individuals to file lawsuits and collect damages for receiving unsolicited telemarketing calls, faxes, pre-recorded calls or autodialed calls.
While the TCPA’s autodialer definitions were under the FCC’s review, some marketers thought they were in compliance if they manually dialed mobile numbers on autodialer systems. The Declarative Ruling and Order removes that fig leaf.
Internet marketing law expert David Klein of Klein Moynihan Turco has this assessment and caution about the FCC’s latest move:
“The ruling solidifies the FCC’s expansive stance that dialing equipment generally meets the TCPA’s autodialer definition, even if it is not presently used for that purpose. The expansive regime labels practically every telemarketing device on the market as an autodialer, subject to regulation under the TCPA.
“The Commission’s latest interpretation of the TCPA autodialer definition is broader than ever before. Accordingly, we advise that companies involved in telemarketing should take precautions whenever using automated technology to place calls or send texts to consumers, or face potential liability under the TCPA.”
Red Meat for Plaintiff Attorneys?
Without proof of consumers’ prior express written consent to be contacted, the TCPA provides for either actual damages or statutory damages ranging from $500.00 to $1,500.00 per unsolicited call/message. To put that in perspective, a Manhattan federal judge recently ordered Time Warner Cable Inc to pay a Texas woman $229,500 for placing 153 automated calls meant for someone else to her cellphone in less than a year, even after she told it to stop.
Now, with all telemarketing calls essentially in play, plaintiff attorneys might be further emboldened to pursue actions against deep-pocket companies. Lawsuits have been filed across many industries, including against social networking companies (Twitter Inc., GroupMe), sports franchises (Los Angeles Clippers, Buffalo Bills), pharmacies (CVS Pharmacy Inc., Rite Aid Corp.), travel and entertainment companies (Cirque du Soleil Co.), retailers (Best Buy Co., J.C. Penney Co.) and online service providers (29 Prime Inc.).
Given the proliferation of TCPA class actions and uncapped statutory damages, it’s not surprising that TCPA settlement amounts are hitting record highs. For example, in February a federal court in Chicago granted final approval for a class action settlement with Capital One Financial Corp. and affiliates totaling approximately $75.5 million.
What Corporate Counsels Can Do: TCPA Compliance Oversight
In TCPA cases, the burden of proof is on the marketer to show it obtained the necessary prior express written consent before making marketing call(s). It’s up to corporate counsels to ensure that their marketing colleagues 1) design web registration forms to ensure that they clearly and conspicuously include proper disclosure of what respondents are agreeing to and 2) have a systematic way to capture and retain that consent for telemarketing purposes.
But your oversight role doesn’t stop there because consent under TCPA is fluid and ephemeral.
- A called party may revoke consent at any time and through any reasonable means;
- Called parties can provide and revoke consent multiple times serially, and it’s the marketer’s responsibility to keep track whether the most recent consent is valid;
- Marketers cannot restrict how potential called parties opt-out; and
- If the phone number has been reassigned, consent must be obtained from the current subscriber.
How Marketing Automation Technology Can Help in TCPA Compliance
Online marketing software solutions like LeadiD capture “lead generation events,” creating virtual certificates of authenticity for consumer telemarketing consent.
To be on the safe side, lead certification records should be stored for at least four years — the TCPA’s statute of limitations for filing suit.
Proof of internet-provided written consent includes, but is not limited to:
- Website pages that contain consumer consent language and fields;
- An associated screenshot of the consent webpage as seen by the consumer where the phone number was input;
- A complete data record submitted by the consumer (with time and date stamp), together with the applicable consumer IP address.
Services like LeadiD also offer visual capture/playback of the consumer’s interaction with the registration form in question.
More TCPA Tips to Come
As a marketer myself, I’m personally invested in TCPA compliance, so watch this blog for future posts on news, best practices and resources.