The Telephone Consumer Protection Act

1. The Telephone Consumer Protection Act Presented by: Raymond F. Moats, Esq. February 27, 2014

2. Overview • Telephone Consumer Protection Act of 1991 • Fair Debt Collection Practices Act

3. TPCA • 47 U.S.C. §227 • Do Not Call Implementation Act • Regulations: 47 C.F.R. §64.1200 • Federal Communications Commission Rules and Orders • Debt Collection • Prior express consent & prior express written consent • Automated telephone dialing equipment (ATDS) • Applies to telephone calls and text messages

4. 47 U.S.C. § 227 • Limits the use of certain technologies to contact consumers • Establishes a do-not- call registry • Proscribes caller identification requirements

5. Definitions • “Automatic Telephone Dialing System” (ATDS) • Equipment which has the capacity – • To store or produce telephone numbers to be called, using a random or sequential number generator; and • To dial such numbers.

6. Restrictions • §227(b) Restrictions on the use of ATDS • (1) It shall be unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States – • (A) to make any call (other than a call made for emergency purposes or made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice – • (iii) to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for this call

7. Restrictions • §227(b)(1)(B) • To initiate any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a message without prior express consent of the called party, unless the call is initiated for emergency purposes or is exempted by rule or order by the Commission under paragraph (2)(B)

8. Regulatory Authority • §227(b)(2) • Provides for the FCC to issue regulations • Shall consider prescribing regulations to allow businesses to avoid receiving calls made by autodialer or prerecorded voice if the business has not given prior express consent • May create rules that exempt from the requirements of paragraph (1)(B) • Call is not made for commercial purpose; and • The call will not adversely affect the privacy rights • The does not transmit an unsolicited advertisement

9. 47 C.F.R. §64.1200(a)(2) • No person or entity may: • (a)(2) call any residential line using an autodial or prerecorded voice to deliver a message without prior express consent unless: • Made for emergency purposes • Not made for commercial purpose • Made for commercial purpose but does not include an unsolicited advertisement or constitute a telephone solicitation • Made by or on behalf of tax-exempt nonprofit entity

10. Exemptions • Commercial calls for non-marketing purposes • Calls from tax exempt, nonprofit entity • Political calls • Loan Servicing Calls • Notices and alerts from: • Airlines • Banks and credit card companies • Schools and universities • Package delivery services • Wireless Carriers (plan usage) • Research calls or surveys

11. Identification standard • Artificial or prerecorded message shall: • Begin with a clear statement of the identity of the caller; and • During the message, the telephone number of the caller other than the autodialer number • The telephone number provided must be a toll free or local number

12. Telephone solicitation • FCC defines “telephone solicitation” as: • The initiation of a telephone call or message for the purpose of encouraging the purchase or rental of, or investment in, property, goods, or services, which is transmitted to any person.”

13. Amended TCPA Rules • Opt-out mechanism • Option announced at beginning of call • If invoked, consumer must be automatically added to caller’s do-not-call list • Call must end. • Prior express written consent • Unambiguous written consent • Exception – calls that are manually dialed and do not contain a pre-recorded message • No “established business relationship”

14. Amended rules • Statutory damages • $500.00 for each non-complying robocall or text message, with no cap on total damages • Can be tripled if offender is a repeat offender • Seller can be vicariously liable under the TCPA for calls made by third-party telemarketers

15. Debt Collection • 47 C.F.R. §64.1200(a)(2)(iii) and (iv) • These regulations apply where a third party places a debt collection call on behalf of the company holding the debt • 1995 Reconsideration Order • Debt collection calls not directed to randomly or sequentially generated telephone numbers do not require an identification message

16. Debt Collection • “Calls made for the purpose of debt collection are not required to identify the caller’s state-registered name in prerecorded messages if doing so would conflict with federal or state laws” In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 20 F.C.C.R. 3788, 20 FCC Rcd. 3788 (Feb. 18, 2005).

17. Debt Collection • Debt collection calls to cell phones • Prior Express Consent • “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.” Rules and Regulations Implementing the Telephone Consumer Protection Act, CC Docket No. 92-90, Report and Order, 7 FCC Rcd 8752,8769, para. 31 (1992). • If the consumer provides a cell phone number to a creditor as part of the credit application, this is reasonable evidence of prior consent by the consumer to be contacted at the number regarding the debt. Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 23 FCC Rcd 559, 564, para. 9 (2007)

18. Prior Express Consent • On October 16, 2103, FCC revised its rules to require prior written consent for autodialed and prerecorded telemarketing calls. It did not change the rules for non-marketing, informational calls made on behalf of tax-exempt non-profit organizations • Calls without telemarketing do not require consent to residential landlines • Calls to wireless consumers require oral or written consent

19. Prior Express Consent • In the revised rules, prior express consent means: • An agreement in writing, bearing the signature of the person called that clearly authorizes the seller to deliver or cause to be delivered to the person called advertising or telemarketing messages using ATDS or prerecorded voice and the telephone number to which the consumer agrees to receive such advertisements. • Consumer is not required to sign the agreement as a condition to purchase any property, goods or services. • “Signature” includes electronic or digital form of signature

20. Prior Express Consent • Meadows v. Franklin Collection Serv., Inc., 414 Fed App x 230 (11th Cir. 2011) • Collection calls to debtor’s mother’s landline were not violations of TCPA • Franklin had established business relationship with debtor and the call were made for a commercial, non-solicitation purpose, the calls are exempt from TCPA’s prohibitions of prerecorded calls to residence. • FCC has determined that all debt collection calls are excluded from TCPA coverage.

21. Express Prior Consent • Soppet v. Enhanced Recovery Co., LLC, 679 F.3d 637 (7th Cir. 2012) • Debt collector used an ATDS to call telephones number provided by debtor to creditor. However, the telephone number had been reassigned to a new user. New owner sues debt collector for TCPA violations. • Debt collector argues the “called party” is the debtor / prior user of the telephone number • Court ruled that the current user/subscriber of the telephone number is the “called party”

22. Prior Express Consent • Consent must be clear and specific • Satterfield v. Simon & Schuster, 569 F.3d 946 (9th Cir. 2009) • Simon & Schuster purchased an opt-in list from a ringtone company. Simon & Schuster used the list to send text messages to advertise a Steven King book. • Plaintiff has opt in to receive promotional offers from the ringtone company. • Court determined it was reasonable under the TCPA that “call” includes both voice calls and text messages. • Court held that plaintiff could not have given prior express consent to receive promotional materials from Simon & Schuster because it is not affiliated with the ringtone company.

23. Prior Express Consent • Pinkard v. Wal-Mart Stores, Inc., 2012 U.S. Dist. Lexis 160938 (N.D. Ala. Nov. 9 2012) • Pinkard provided her cell phone number when she dropped off her prescription. She received unsolicited text messages from Wal-Mart. • Plaintiff claimed that she didn’t give her written consent, however, the court determined that written consent rule wouldn’t go into effect until October 2013. • Therefore, by providing her cell number to Wal-Mart, Pinkard had consented to receive messages from Wal-Mart.

24. Prior Express Consent • Mais v. Gulf Coast Collection Bureau, Inc., 2013 U.S. Dist. LEXIS 65603 (S.D. Fla. May 8, 2013) • Wife provided plaintiff’s cell number to hospital during trip to the ER. Plaintiff was contacted by debt collector for failure to pay a bill. • Court held that wife didn’t give “prior express consent” because it was not reasonable that plaintiff or wife would expect to receive collection calls.

25. Revocation of Consent • Gager c. Dell Financial Services, LLC, 2013 U.S. App. LEXIS 17579 (3rd Cir. Aug. 22, 2013 • Plaintiff purchased a computer from Dell. She provided her cell telephone number on the application. She defaulted on the loan. Dell attempted to contact her with prerecorded messages on her cell phone. Gager sent a letter to Dell requesting Dell to stop calling her. Dell continued calling. • The court held that an individual should be allowed to withdraw consent at any time • Dell can contact Gager about the delinquent account but use manual dialing.

26. Text Messages • Emanuel v. L.A. Lakers, Inc., 2013 U.S. Dist. LEXIS 58842 (C.D. Cal. April 18, 2013) • Mr. Emanuel was attending a Lakers game. A message was posted on the score requesting patrons to text messages to the Lakers to be displayed on the score board. Mr. Emanuel sent a text of “I love you Facey. Happy Date Night.” He received a confirmatory text from the Lakers which said that not all texts will be displayed and if he wants to be removed from the text system to text “stop.” • The court held that since plaintiff voluntarily texted the Lakers for the purpose of displaying a personal message, he consented to receive a confirmatory text.

27. Fair Debt Collection Practices Act • FDCPA • It is the purpose of this title to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses. • The FDCPA provides rules for debtor collectors in the areas of: acquisition of location information, communication in connection with debt collection, unfair practices, misleading or false representations, harassment and validation of debt.

28. FDCPA • Recent amendments • §1692g(b) - Collection activities and communications can continue during the 30 day period unless the consumer notifies the debt collector in writing that the debt or any portion of the debt is deputed or the consumer requests the name and address of the original creditor. The activities may not overshadow or be inconsistent with the consumer’s right to dispute the debt. • §1692g(d) – Legal pleadings shall not be treated as an intitial communication. • §1692g(e) – The sending of a notice which does not relate to the collection of debt and is expressly required the IRS code, Gramm-Leach-Bliley Act are not initial communications.

29. Questions & Answers • Any questions?

30. Questions & Answers Thank you for your time. Raymond Moats, Esq. rmoats@weltman.com | 614-801-2767