UNITED STATES – A telemarketing campaign can be an effective means to reach out to a large number of potential or existing customers quickly, efficiently, and in a cost-effective manner. However, not strictly following federal guidelines can quickly turn such a campaign into a huge legal liability that can cost a company a significant amount of time and resources. And with newer, stricter guidelines in force, it is important to once again make certain that compliance with guidelines is up-to-date.
The Telephone Consumer Protection Act (“TCPA”), enacted in 1991, is designed to protect consumers, partly from being flooded by unwanted telemarketing messages. The TCPA details what companies sending telemarketing messages to consumers can and cannot do. If a company calls or texts consumers on their cellular phones using 1) an automated telephone dialing system, or 2) artificial or prerecorded voice, or 3) places calls to residential land lines using artificial or prerecorded voice, then it needs prior express consent from the party receiving the calls or texts. While the TCPA does not define what constitutes “prior express consent,” the Federal Communications Commission (“FCC”) provides some guidance. In 1992, the FCC interpreted “prior express consent” to mean that “persons who knowingly give their phone number have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary.” In re Rules and Regulations Implementing the TCPA, 7 FCC Rcd. 8752, 8769 (Oct. 16, 1992). In 2008, the FCC further clarified “prior express consent” and explained providing a cell phone number “as part of a credit application, reasonably evidences prior express consent by the cell phone subscriber to be contacted at that number regarding the debt.” In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 23 FCC Rcd 559, 566 (Jan. 4, 2008).
In 2012, however, the FCC published an order changing the definition of “prior express consent.” This order went into effect on October 16, 2013 and contains a stricter requirement of “prior express written consent.” As the addition of “written” in “prior express written consent” suggests, a written agreement must exist, signed by the consumer who will receive telemarking calls or texts (e-signatures are acceptable). The written agreement also has to identify the specific number that can be contacted. But more importantly, the requirement for “express” has become more stringent: there has to be a “clear and conspicuous disclosure” that specifically authorizes companies to send telemarketing communications using an automatic telephone dialing system or an artificial or prerecorded voice. In addition, the written agreement must be obtained “without requiring, directly or indirectly, that the agreement be executed as a condition of purchasing any good or service.”
Recently, an Illinois federal district court made a ruling reversing its earlier grant of a motion to dismiss in a TCPA class action lawsuit in light of the 2012 order. There the district court, applying the new “prior express written consent” definition, held that because the plaintiff only provided his number in response to a request from the defendant for identity verification purposes, he did not necessarily consent to “robocalls” made to remind him to revisit the defendant’s place of business.
Similarly, another Illinois federal district court, recently denied defendant’s motion to dismiss a TCPA class action lawsuit. In that case, the plaintiff alleged that she provided her phone number to a company while placing an online order for the purpose of providing contact information to answer any questions about the order. She later received a call from an individual who said he was calling to verify her address for the order, but who then attempted to sell her a membership in a discount program. The district court found that defendant’s call qualified as a sales call, or at least a call with the dual purpose of marketing, to which plaintiff did not consent.
Most courts considering this issue since the 2012 order became effective have not yet construed the more stringent definition of “prior express written consent.” For example, in an order published as recently as January 7, 2015, a Florida federal district court deciding the issue of prior express consent in a motion to dismiss did not consider the 2012 order, only the 2008 order.
But as more litigants and courts cite to and interpret the 2012 order, those companies who have not checked their policy on prior express consent may face a rude awakening. As recent case law indicates, it will be harder to defend and ultimately succeed in TCPA class action lawsuits under the new rules governing what constitutes “prior written express consent.”
Companies continuing to utilize telemarketing campaigns that use automatic dialing systems or artificial or prerecorded messages should obtain 1) written agreement 2) signed by the consumer 3) containing a number that can be called 4) agreeing specifically to receive telemarketing calls 5) not directly or indirectly in conjunction with the purchase of any goods or services. Companies simply cannot continue to rely on previously obtained consents.