On April 6, 2016, the FCC submitted an amicus curiae brief to the U.S. Court of Appeals for the Second Circuit in a TCPA case in which the plaintiff alleges that the defendant violated the TCPA by placing a robocall to a residential phone line (Bank v. Indep. Energy Grp., LLC et al., Case No. 15-2391 (2d Cir. Apr. 6, 2016)). The U.S. District Court for the Eastern District of New York granted summary judgment for the Defendant, finding that the TCPA did not apply because the Plaintiff used the residential line for business purposes. Plaintiff appealed the decision, and then filed a petition with the FCC seeking clarification on the issue of whether “the TCPA’s restrictions on artificial or prerecorded voice calls apply to calls made to a telephone line used for a home business so long as the line is registered with the service provider as a residential line.” Plaintiff then asked the Court to stay its proceeding pending resolution of the FCC petition. In its brief, the FCC acknowledged that the Commission’s rules do not define the term “residential telephone line” and that it has not “resolved the question of whether, or under what circumstances, a telephone line in a home can support business activities and remain a ‘residential’ line.” As such, the Commission supported the Plaintiff’s request for a stay to allow the Commission an opportunity to address these issues.
A federal court in Florida granted an order for partial summary judgment in favor of a plaintiff in a TCPA case against Navient Solutions, Inc. (NSI), and its affiliate, Student Assistance Corporation (SAC) which amounts to an award of over $360,000 with the potential for treble damages if the plaintiff can prove that the two defendants “willfully or knowingly” violated the TCPA.
Plaintiff Willie McCaskill alleged that Defendant NSI placed 249 calls to a cell phone number ending in -6140 and that Defendant SAC placed 478 calls to the same number. Plaintiff claims that the calls violated the TCPA, the Florida Consumer Collection Practices Act, and the Fair Debt Collection Practices Act.
The parties agreed that the calls were made using an ATDS and that the calls were not made for emergency purposes. However, what was in dispute was whether Plaintiff provided “prior express consent.” The calls were made in regards to a student loan that Plaintiff’s daughter was issued. Defendants claim that the daughter confirmed the -6140 number as her own when she requested a voluntary forbearance on her student loan from Sallie Mae, NSI’s predecessor. The daughter testified that she did not enter in the -6140 number into Sallie Mae’s website but rather entered in her own number.
The court found that there was no evidence that Plaintiff, herself, provided prior express consent, and determined that only remaining question was whether somehow the daughter could and had consented on Plaintiff’s behalf. To prove that “consent” the court held that Defendants needed to establish that the daughter 1) had authority to consent on Plaintiff’s behalf, and 2) that the daughter did, in fact, consent. The court found no evidence of such consent.
A Plaintiff filed a lawsuit in the Southern District of Florida against The CBE Group, Inc. (CBE) and Verizon New England, Inc. (Verizon) alleging violations under the TCPA, among others. All parties moved for partial summary judgment arguing that there is no genuine dispute of material fact regarding Defendants’ liability under the TCPA or CBE’s liability under the FDCPA and FCCPA. The parties contest whether Verizon can be vicariously liable under the TCPA claim for CBE’s alleged violations and whether 24 of the 26 calls placed were made using an ATDS.
The Court found that summary judgment should be entered for Plaintiff and against only CBE on the TCPA claims for two calls placed on April 14 and 15, 2014. However, summary judgment was entered in Defendants’ favor on the remaining TCPA claims.
CBE admits that on April 14 and 15, 2014, it placed 2 calls to Plaintiff using a Noble Systems Predictive Dialer under the mistaken belief that the number was a landline. After CBE found out that the number being called was a cell phone, CBE placed the remaining 24 calls to Plaintiff using CBE’s Manual Clicker Application (“MCA”). In order to place a call using the MCA, an agent must manually initiate the call by clicking a computer mouse or pressing a keyboard enter key. The MCA then uses a Noble Systems device to connect the call to a telephone carriers’ network.
The Court focused on the discussion of human intervention. Plaintiff provided zero evidence that CBE’s ATDS was used and CBE argued that its MCA was used in placing the later 24 calls. This Court cited cases explaining its “primary consideration” in determining what an ATDS is. “To determine whether a dialer is a predictive dialing system, and therefore an ATDS, ‘the primary consideration . . . is whether human intervention is required at the point in time at which the number is dialed.” Brown v. NRA Grp., LLC, No. 6:14-CV-610-ORL-31, 2015 WL 3562740, at *2 (M.D. Fla. June 5, 2015); see also Legg v. Voice Media Grp., Inc., 20 F. Supp. 3d 1370, 1374 (S.D. Fla. 2014) (explaining that “defining characteristic” of ATDS is “capacity to dial numbers without human intervention”).
First, the Court held that “Plaintiff has not created a genuine dispute as to whether Verizon may be held vicariously liable.” Then, the Court said “Plaintiff has not established that a “clear and unequivocal” agency relationship exists between CBE and Verizon.” The Court later addressed the issue of whether the MCA was an ATDS and held that 1) it was not connected to a predictive dialer, 2) the “MCA utilized Noble connecting devices called Corphost1 and Corpost2, which ‘only allow for pass-throughs particularly coming from the MCA application’ and are 'incapable of doing any type of automatic outbound dialing.’” 3) The “Corphost1 and Corpost2 are ‘completely independent and separate from the Noble predictive dialer,’ and such equipment ‘cannot dial predictively, does not use a random or sequential number generator, and does not have the capacity to store, produce, or dial numbers using a random or sequential number generator.’”
2016 PACE National Conference & Expo
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Implementing comprehensive TCPA compliance across a contact center enterprise can be complicated without a trusted compliance provider. Fortunately, Contact Center Compliance has developed innovative TCPA solutions such as Litigator Scrub combined with wireless and VoIP identification, plus wireless owner verification to avoid wrong number liability under TCPA.
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We all remember Lynn v. Monarch Recovery Services, in which the 4th Circuit Court of Appeals decided calls made to a residential VoIP number where the owner was charged for the call, were illegal, just as if they had been made to a wireless phone without written consent.
Separately, in the recent 5th Circuit case of Rivero v. America's Recovery Solutions, we find a similarly devastating result. The Court held that American Recovery's calls violated the TCPA because his plan was not unlimited. Specifically, the Court held that, "Plaintiff's VoIP service is not an unlimited calls/flat fee plan as the TCPA presumes is generally the case with a traditional residential telephone line...[r]ather, it is 'a service for which the party is charged for the call...because each call by Defendant depletes Plaintiff's store of limited minutes.
There is no regulatory exemption to this provision because the TCPA permits the FCC to create limited exemptions only to the prohibition of calls to certain cell phones (under subsection (A)) and to residential lines (under subsection (B)). Accordingly, Defendant's calls to Plaintiff's VoIP phone line violated the TCPA."
Contact Center Compliance's scrub plans include an option to enable VoIP scrubbing for TCPA to help you mitigate risk in this heightened state of litigation.
In this very charged election year, numerous candidates and political non-profits are turning to the telephones as a means of spreading their message, encouraging voter turnout, and of course, raising money. Remember that political calls are exempt from some, but not all, telemarketing laws and regulations. The FTC has no direct jurisdiction over political non-profit entities so long as they are truly conducted not for the profit of the owners and operators. In 2015, however, the FTC filed a major DNC case against a so-called non-profit when the Commission determined it was actually being conducted for the profit of its owners, despite what the formation documents claimed.
Either way, under the Patriot Act, the FTC does have jurisdiction over for-profit telefunders trying to raise money for political campaigns. Regarding the FCC, calls by or on behalf of a tax exempt political non-profit are exempt from many TCPA restrictions, but not all. For example, non-profit political calls are exempt from scrubbing against the national DNC list, but are still required to obtain "express consent" (not written) before autodialing a cell phone. Political organizations who reach out over the telephone should avoid the temptation to believe they are exempt from telemarketing law and should ensure they are suppressing the proper lists - cells and litigators, for example. Political organizations who autodial cell phones with prior consent should perform wrong/reassigned number scrubbing so they don't call the wrong party. Also remember that most states have some form of professional solicitor license requirement, which normally applies even when the caller is exempt from the state's telemarketing license.
This is big news, especially for struggling college grads who are delinquent on their government-backed student loans. The latest congressional budget deal allows private debt collectors who collect on debts guaranteed by the government to autodial cell phones, despite the TCPA ban. That same legislation required the FCC to pass new behavioral rules for such calls by August 2, 2016. On Thursday, the FCC proposed the following rules (not yet in effect) regarding calls about government backed debts:
- Only calls made after a debtor has become delinquent are covered;
- Limit the calls to creditors and those calling on their behalf, including debt servicers;
- Robocalls can only be made to the debtor, so as to prevent unwanted robocalls to relatives, friends, and other acquaintances of debtors;
- Limit the number of calls to 3 monthly per delinquent account; and
- Empower debtors with the right to stop calls from a federal creditor at any time and to require callers to inform debtors of this right.
This week, the FTC sued Francisco Salvat and a number of his business entities for making an alleged 1.3 million illegal robocalls. The calls pitched solar panel installation products and services. The Complaint, filed in Federal Court, alleges that the defendants called numbers on the national DNC list, called numbers of those who had asked calls to cease, failed to display truthful caller ID information, and were also illegal as being prohibited robocalls without consent. “Mr. Salvat’s companies ignored the Do Not Call Registry and made illegal robocalls,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “Breaking the law isn’t a great way for a company to introduce itself to potential customers.”
Also in the news this week, Chase Bank settled a significant TCPA class action lawsuit to the tune of 34 million dollars. The suit alleged that Chase caused millions of illegal, non-emergency marketing robocalls to be sent without consent. The fact that Chase had a prior relationship with the individuals who were called did not save them. Chase will pay the amount of $34,000,000 into a Settlement Fund, which will cover: (1) cash payments to eligible persons in the Settlement Class who submitted valid Claim Forms; (2) a dedicated distribution of $50,000 to the Consumer Federation of America; (3) settlement administration expenses of $5,152,929.51; (4) court-approved incentive awards to the five class representatives in the amount of $1,500 each ($7,500 total); and (5) court-approved attorney fees and costs of $7,257,914.10.
Earlier this month a disgruntled Facebook user filed a class action lawsuit against Facebook, Inc. arguing that while he had provided Facebook with his phone number, he had never consented to receive text messages of any kind from Facebook.
The text messages in question state “Today is [Facebook friend’s] birthday. Reply to post a wish on his Timeline or reply with 1 to post “Happy Birthday!” This case will most likely turn on whether or not the court is willing to interpret such messages as “marketing” as opposed to messages for informational purposes only. The plaintiffs make an interesting argument for why these messages should fall under the “marketing” category. As pointed out in the complaint, Facebook defines each time a user engages on the Facebook platform as a “revenue-generating activity.” According to the compliant, Facebook earns revenue when its users interact with the website. Thus, any invitation to post a message on Facebook is meant to promote Facebook’s service and entice users to take an action that results in financial benefit to Facebook. It will be interesting how the court rules on this one.
As this case demonstrates, TCPA compliance is becoming ever more complicated. The line between what is a marketing communication as opposed to information only, is in many cases quite blurry. It is imperative for companies to stay on top of the ever changing compliance and regulatory environments. The compliance summits and webinars provided by Contact Center Compliance are an excellent tool that businesses should seriously consider.
Earlier this month the 9th Circuit upheld the district court’s grant of summary judgment in the case of Shaya Baird v. Sabre, Inc., et al. The case concerned an unsolicited text message that was sent to the plaintiff’s cell phone. However, the court found that the plaintiff had provided “prior express consent” to the defendant by releasing her phone number to Hawaiian airlines while making a reservation.
This ruling reaffirms the position that if you knowingly release your phone number to a business, without providing any instructions to the contrary, you have provided “prior express consent” to be contacted at that number. Note of course that this is not the same level of “prior express written consent” needed for marketing texts and calls.