Telephone Consumer Protection Act Basics, Washington D.C. 2015
Keith J. Keogh
KEOGH LAW, LTD.
Alexander Burke
BURKE LAW OFFICES, LLC
OVERVIEW OF THE TCPA
Junk Faxes
Autodialed calls
to Cell
Text Message Ads Pre-Records
Do Not Call Violations
Congress found that unwanted automated calls were a “nuisance and an
invasion of privacy, regardless of the type of call” and that banning such calls
was “the only effective means of protecting telephone consumers from this
nuisance and privacy invasion.” Pub. L. No. 102-243, §§ 2(10-13)(Dec. 20, 1991)
codified at 47 U.S.C. § 227.
The TCPA makes it unlawful for any person within the United States . . . 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 . . .”
47 U.S.C. § 227(b)(1)(A)(iii)
The TCPA defines ATDS as “equipment which has the capacity - (A) to store or produce telephone
numbers to be called, using a random or sequential number generator; and (B) to dial such
numbers.” 47 U.S.C § 227(a)(1).
Focus on ATDS is whether it has the capacity and not whether it actually used that capacity.
Satterfield, 569 F. 3d at 951; Lozano, 702 F. Supp. 2d at 1010-1011; Griffith v. Consumer Portfolio
Serv., 2011 U.S. Dist. LEXIS 91231 (N.D. Ill. Aug. 16, 2011); Vance v. Bureau of Collection
Recovery LLC, No. 10-06324, 2011 U.S. Dist. LEXIS 24908 at *6 -7 (N.D.Ill., March 11, 2011);
Lozano v. Twentieth Century Fox Film Corp., 702 F. Supp. 2d 999, 1010-1011 (N.D. Ill. 2010);
Hicks v. Client Services, Inc., 2009 WL 2365637 (S.D.Fla. June 9, 2009); See also Joffe v. Acacia Mtg
Corp., 121 P.3d 831, 839 ( Ariz. App. 2005). Kazemi v. Payless Shoesource, Inc., 2010 U.S. Dist. LEXIS
27666 (N.D. Cal. Mar. 12, 2010).
CAPACITY TO AUTODIAL & CONSENT
Capacity issue is important as virtually no one uses a pure autodialer. Instead, most
most companies use some variation of a predictive dialer, which is simply a more
productive dialer.
The TCPA directed the FCC to prescribe regulations implementing the restrictions on the use of
autodialers. 47 U.S.C. § 227(b)(2). Following Congress’s directive, the FCC has expanded the
definition of an ATDS to include predictive dialers. In the Matter of Rules and Regulations
Implementing the Telephone Consumer Protection Act of 1991, CG Docket No. 02-278, 18 FCC Rcd
14014, 14093 (June 26, 2003) (“2003 Order”).
In 2008, in response to a petition by debt collection trade association ACA International,
the FCC held the TCPA applied to debt collectors and again expressly reaffirmed that predictive
dialers used for collections calls are ATDS when it is “equipment paired with predictive dialing
software and a database of numbers.” In the Matter of Rules and Regulations Implementing the
Telephone Consumer Protection Act of 1991; Request of ACA International for Clarification and
Declaratory Ruling, CG Docket No. 02-278, 23 FCC Rcd 559, 565-566 (Dec. 28, 2007)
Unless the cell was provided by the consumer (not skipped traced) there is no consent even
under the FCC’s 2008 order and the caller has the burden to prove consent.
The FCC’s holdings with respect to predictive dialers are final and controlling under the Hobbs
Act. CE Design, Ltd. v. Prism Business Media, Inc., 606 F. 3d 443, 446 (7th Cir. 2010).
Text Messages are calls under the TCPA. Satterfield v. Simon & Schuster, Inc., 569 F.3d 946
(9th Cir. 2009); Lozano v. Twentieth Century Fox Film Corp., 702 F. Supp. 2d 999, 1010-1011 (N.D. Ill.
2010); Abbas v. Seeling Source, LLC, 2009 WL 4884471, 2009 U.S. Dist. LEXIS 116697 (N.D. Ill. 2009)
(“[N]either the above-quoted dictionary definition nor the TCPA requires that a ‘call’ be ‘oral.’
Indeed, if such a requirement existed, the TCPA’s prohibition on calls to ‘a paging service,’ would be of
little effect.”)
A “telephone solicitation” is defined 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,
but such term does not include a call or message (A) to any person with that person’s
prior express invitation or permission, (B) to any person with whom the caller has an
established business relationship, or (C) by a tax- exempt nonprofit organization. ”
47 U.S.C. § 227(a)(3); 47 C.F.R. § 64.1200(f)(12).
A “prerecorded messages containing free offers and information about goods and services that
are commercially available are prohibited to residential telephone subscribers, if not otherwise
exempt.” TCPA Revisions Report and Order, 18 FCC Rcd 14097-98 (2003).
Telemarketing to phone numbers (residential or cell) on the federal or company
specific do-not-call list strictly prohibited.
Does not matter if prerecorded or automatic.
Anyone who is on the DNC list that has received two telemarketing calls within
a twelve month period can sue (for both calls).
No PROA if just one call. 47 U.S.C. 227(c)(5).
47 U.S.C. § 227(b) Restrictions on use of automated telephone equipment (1) Prohibitions 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—
(i) to any emergency telephone line (including any “911” line and any emergency line of a
hospital, medical physician or service office, health care facility, poison control center, or
fire protection or law enforcement agency);
(ii) to the telephone line of any guest room or patient room of a hospital, health care
facility, elderly home, or similar establishment; or
(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 the call;
(B) to initiate any telephone call to any residential telephone line using an artificial or
prerecorded voice to deliver a message without the 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);
Telemarketing EBR: 47 CFR
64.1200(f)(5)
•
(5) The term established business relationship for purposes of telephone
solicitations means a prior or existing relationship formed by a voluntary two-way
communication between a person or entity and a residential subscriber with or
without an exchange of consideration, on the basis of the subscriber's purchase or
transaction with the entity within the eighteen (18) months immediately
preceding the date of the telephone call or on the basis of the subscriber's inquiry
or application regarding products or services offered by the entity within the three
months immediately preceding the date of the call, which relationship has not
been previously terminated by either party.
•
(i) The subscriber's seller-specific do-not-call request, as set forth in paragraph
(d)(3) of this section, terminates an established business relationship for purposes
of telemarketing and telephone solicitation even if the subscriber continues to do
business with the seller.
•
(ii) The subscriber's established business relationship with a particular business
entity does not extend to affiliated entities unless the subscriber would reasonably
expect them to be included given the nature and type of goods or services offered
by the affiliate and the identity of the affiliate.
Section 227(b)(3)(B) provides a minimum of $500.00 in statutory damages per fax, call or message.
Hinman v. M and M Rental Center Inc., 596 F. Supp. 2d 1152 (N.D. Ill. 2009). Awarding $500 per
facsimile for a total of $3,862,500 based on the total of 7,725 unsolicited advertisements that
defendant sent to the class. The TCPA prohibits the sending of unsolicited fax advertisements and
make no reference at all to receipt. Id. at 1159.
If a violation was “willful or knowing”, the court can treble the amount under 227(b)(3)(c).
The FCC has held:
It is irrelevant to a finding of willfully or knowingly whether the junkfaxer intended to violate
federal law. FCC Staff Opinion (letter from Acting Chief of the Enforcement Division, Common
Carrier Bureau, Glenn T. Reynolds to Robert Biggerstaff, dated July 27, 1999).
Sengenberger v. Credit Control Services, Inc., 2010 U.S. Dist. LEXIS 43874 (N.D. Ill. May 5, 2010)
(granting summary judgment on TCPA claim and finding that an intentional act equates to willfully
or knowingly); See Nicholson v. Hooters of Augusta, Inc., 95-RCCV-616, Richmond County, Ga
(Judge Brown, April 25, 2001), Jury awarded $3,000 for each of the 1,321 class members for the
transmitting of six unsolicited facsimile advertisements. The Court tripled that amount to $9,000
per class member for a total of $11,889,000.
In re Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, GC
Doc. 02-278, 23 FCC Rcd. 559, 565 (January 4, 2008) predictive dialers are ATDS and creditor on
whose behalf debt collector is calling is liable for calls.
On February 15, 2012, the FCC issued a new Report and Order that redefined “prior express
consent” for all telemarketing calls.
- Debt collection calls and several other categories of calls are not affected.
- signed by the consumer and be sufficient to show that he or she:
- (1) received “clear and conspicuous disclosure” of the consequences of providing the
requested consent, i.e., that the consumer will receive future calls that deliver
prerecorded messages by or on behalf of a specific seller; and
- (2) having received this information, agrees unambiguously to receive such calls at a
telephone number the consumer designates.
The “Hobbs Act” a/k/a “Administrative Orders Review Act” 28 USC 2342(1); 47 USC 402(a)
provides specific remedies for reviewing FCC orders, which do not include District Court review.
CE Design, Ltd. v. Prism Bus. Media, Inc., 606 F.3d 443 (7th Cir. 2011), but compare Leyse v. Clear
Channel Broad., Inc., 2012 FED App. 0307P (6th Cir.) (6th Cir. Ohio 2012) holding that same FCC
Regulations regarding the TCPA is only entitled to Chevron deference and Hobbs Act does not
prevent court from reviewing.
Debt Collection Calls to Cell
The FCC’s rules do not discriminate based on the content of any autodialed call to a cell
phone. Rather, the broad prohibitions of § 227(b)(1)(A)(iii) apply “regardless of the
content of the call. 2008 Ruling.
The 2008 Ruling did excluded debt collection calls for calls to land lines and held must be
telemarketing. Not surprisingly, courts have followed suit. i.e. Meadows v. Franklin
Collection Serv., 414 Fed. Appx. 230 (11th Cir. 2011) (“…47 U.S.C. § 227(b)(1)(B). That
section makes it unlawful ‘to initiate any telephone call to any residential telephone line
using…’”).
The fact that the FCC and the Eleventh Circuit recognizes that § 227(b)(1)(B) held limited
to telemarketing calls to land lines is unremarkable and wholly irrelevant to a violation of
227(b)(1)(A)(iii). See also Mims v. Arrow Fin. Serv., LLC, 132 S. Ct. 740 (2012), which
involved debt collection calls to a cell phone under the TCPA.
Gager v Dell, 3rd Circuit-rejected creditor's argument that its autodialed debt collection
calls should be exempt from TCPA liability based on their content, as the particular calls
were placed to the debtor's cell phone. Held debt collection exemptions "do not apply
to cellular phones; rather, these exemptionsKeogh
apply
only to autodialed calls made to landLaw, Ltd.
lines"
“The plain language of section 227(b)(1) makes it clear that the "recipient" of a
call violative of that provision may sue — not merely, as ERC argues, the
"intended recipient."
Soppet v. Enhanced Recovery Co., LLC, 679 F.3d 637 (7th Cir. 2012)
“Wrong Number” calls, where plaintiff inherited a debtor’s phone
number, are actionable because not made with “prior express consent”
of recipient.
Use of cell phone airtime minutes constitutes “out of pocket” loss.
The court made loose use of the term subscriber, which some defendants are
now arguing that the end user of the cell phone must be the
“subscriber” on the bill in order to have standing.
Standing to Sue
DON’T NEED TO BE A CALLED PARTY
The TCPA uses the term “called party,” only when setting forth an exception to liability,
stating that a person does not violate the TCPA if the call is “made for emergency
purposes or made with the prior express consent of the called party.”See47 U.S.C. §
227(b)(1)(A). The statute does not use the term “called party” when defining who may
assert a TCPA claim.
1. Page v. Regions Bank, 2012 U.S. Dist. LEXIS 185440 (N.D. Ala. Aug. 22, 2012)
2. Page collects the following cases that support this holding:
Harris v. World Fin. Network Nat'l Bank, 867 F.Supp.2d 888, 2012 WL 1110003, at *5
(E.D.Mich. Apr. 3, 2012); Anderson v. AFNI, Inc., No. 10–4064, 2011 WL 1808779, at *7
(E.D.Pa. May 11, 2011); D.G. ex rel Tang v. William W. Siegel & Assocs., Attorneys at Law,
LLC, 791 F.Supp.2d 622, 625 (N.D.Ill.2011); Tang v. Med. Recovery Specialists, LLC, No. 11–
C2109, 2011 WL 6019221, at *2 (N.D.Ill. July 7, 2011) (slip op.); Kane v. Nat'l Action Fin.
Servs., No. 11–cv–11505, 2011 WL 6018403, at *7 (E.D.Mich. Nov. 7, 2011) (slip op.)
Keogh Law, Ltd.
The burden is on the caller to show that the wireless number was provided by the consumer to
the creditor, and that such number was provided during the transaction that resulted in the debt
owed. See In the Matter of Rules and Regulations Implementing the Telephone Consumer
Protection Act of 1991 (“2008 FCC Ruling”), 23 F.C.C.R. 559 at ¶ 10 (Dec. 28, 2007)(Emphases added).
During Transaction may not be limited to Initial Contract
"during the transaction that resulted in the debt owed," includes voluntary providing the cell
sometime after the account is opened. Moore v. Firstsource Advantage, LLC, 2011 U.S. Dist.
LEXIS 104517, 30-31 (W.D.N.Y. Sept. 15, 2011). Also held revocation of consent must be in writing.
FCC “CLARIFIES” CONSENT
On February 15, 2012, the FCC issued a new Report and Order that redefined “prior
express consent” for all telemarketing calls.
- Debt collection calls and several other categories of calls are not affected.
- signed by the consumer and be sufficient to show that he or she:
- (1) received “clear and conspicuous disclosure” of the consequences of
providing the requested consent, i.e., that the consumer will receive future
calls that deliver prerecorded messages by or on behalf of a specific seller; and
- (2) having received this information, agrees unambiguously to receive such
calls at a telephone number the consumer designates.
The FCC unequivocally held that consumers may effectively revoke consent under the
TCPA In re Rules and Regulations Implementing the Telephone Consumer Protection Act of
1991, Declaratory Ruling as to Petition of SoundBite Communications, Inc., CG Docket No.
20-278 (Nov. 29, 2012) (“SoundBite Ruling”).
Recognizing “neither the text of the TCPA nor its legislative history directly addresses the
circumstances under which prior express consent is deemed revoked,” the FCC, citing its
powers to interpret the TCPA, held that a consumer can opt-out of “prior express consent”
under §227(b)(1)(A). A one-time text message confirming a consumer’s request to opt out
of autodialed text messages to her cell phone would not violate the TCPA, but additional
Keogh Law, Ltd.
messages would violate the TCPA because consent
to call has been revoked
Nigro v. Mercantile Adjustment Bureau, LLC., 2014 U.S. App. LEXIS 19817 (2nd Cir. 2014)
No Consent-nephew provided cell electric company to turn off relative’s service. Number
was not during the transaction that resulted in the debt owed.“
FCC filed an Amicus urging no consent. FCC Amicus 2014 2014 WL 2959062
Mais v. Gulf Coast Collection Bureau, Inc., 2014 U.S. App. LEXIS 18554(11th Cir. 2014)
FCC interpretation controls under Hobbs Act and Mais, through his wife, gave
the hospital his cell and therefore consent to call.
Osorio v. State Farm Bank, F.S.B., 746 F.3d 1242, 1255-56 (11th Cir. 2014)
Can revoke consent. Called party is subscriber and not intended recipient.
Breslow v. Wells Fargo Bank, N.A., 755 F.3d 1265 (11th Cir. 2014)
called party," for purposes of § 227(b)(1)(A)(iii), means the
phone service and not the intended recipient.
subscriber to the cell
Brenner v. Am. Educ. Servs., 575 Fed. Appx. 703 (8th Cir. 2014)
remanded to determine if Brenner effectively revoked his consent and if did,
summary judgment was not proper.
Gager v. Dell Fin. Servs., LLC, 2013 U.S. App. LEXIS 17579 (3d Cir. Pa. Aug. 22, 2013)
Can revoke consent. Relied on FCC and common law.
TCPA Discovery – Key Points
• Dialer Records – sometimes show calls missing from
account notes. Date/time, call scripts, recordings. Vendor?
• Account Notes – show collector notes and other important
indicia, such as triple tones and requests to stop calling.
• Consent –
– Factual: where/when/how did D obtain number?
– Contention: what’s D’s contention as to consent?
• Dialing System – Focus on capacity of system, and how it is
used.
• Knowledge of the TCPA – relevant to willfulness
– (Purpose of the calls is important, if not debt collector/creditor
case).
Don’t Settle without:
• Dialer Records.
• Vendor Records.
• Account Notes.
If D claims it made “manual” calls, then get an
explanation of what they mean. Some types of
equipment I think usually constitutes an ATDS:
Avaya, Aspect, LiveVox, Soundbite, anything
Asterisk or ViciDial - based. Then, find out how they
used the system. The more automated the system,
the stronger your case is.
ON BEHALF OF LIABILITY
FCC Orders Previously held: Party “on whose behalf” a telephone solicitation is made
bears ultimate responsibility for any violations of the TCPA.
Previously debate whether this was strict liability or vicarious liability
2013 FCC ORDER
FCC clarified its prior orders and held that “the prohibitions contained in section 227(b)
incorporate the federal common law of agency and that such vicarious liability principles
reasonably advance the goals of the TCPA.” 2013 FCC Order at p. 14, ¶ 35.
Keogh Law, Ltd.
To provide guidance, the 2013 Order stated:
“apparent authority may be supported by evidence that the seller allows the outside
sales entity access to information and systems that normally would be within the
seller’s exclusive control, including: access to detailed information regarding the
nature and pricing of the seller’s products and services or to the seller’s customer
information. The ability by the outside sales entity to enter consumer information into
the seller’s sales or customer systems, as well as the authority to use the seller’s trade
name, trademark and service mark may also be relevant.” 2013 Order p. 19, ¶ 46.
“a seller may be bound by the unauthorized conduct of a telemarketer if the seller is
aware of ongoing conduct encompassing numerous acts by the telemarketer and the
seller fails to terminate, or, in some circumstances, promotes or celebrates the
telemarketer.” Id at p. 14, n. 104.
In summary, the FCC stated that: “we see no reason that a seller should not be liable
under [227(b)] for calls made by a third-party telemarketer when it has authorized
that telemarketer to market its goods or services.” p. 20, ¶ 47 (emphasis added).
Keogh Law, Ltd.
NEED TO ALLEGE AGENCY
Smith v. State Farm Mut. Auto. Ins. Co., 2013 U.S. Dist. LEXIS 135230 (N.D. Ill. Sept. 23,
2013) (Granting motion to dismiss for failure to sufficiently allege agency.)
Defendant can be vicariously liable for a third-party telemarketer's behavior under (1)
formal agency, (2) apparent authority, and (3) ratification theories.
Smith found that plaintiff needs to specifically identify which theory of liability applies
here, and sufficiently allege facts to support any of those theories.
Creates pleading problem when you need discovery before you can allege facts to
support agency.
Expect to see more motions to dismiss especially from debt collectors where contracts
disclaim agency.
Keogh Law, Ltd.
AGENCY
Gomez v. Campbell-Ewald Co., 2014 U.S. App. LEXIS 18019 (9th Cir. 2014)
Confirmed FCC authority that vicarious liability is imposed under federal
common law principles of agency for violations of either section 227(b) or
section 227(c) that are committed by third-party telemarketers.
Thomas v. Taco Bell Corp., 2014 U.S. App. LEXIS 12547 (9th Cir. Cal. 2014) (Unpublished)
Vicarious liability requires: 1. acted as agent; 2 Defendant controlled or had
the right to control them -the manner and means of the text message
campaign they conducted. In this case, the control was excercised by the
[Chicago] Association, but TB.
Ratification still requires an agency relationship first.
Dish Network, L.L.C. v. FCC, 552 Fed. Appx. 1 (D.C. Cir. 2014)
The FCC agrees that the "guidance" in question has no binding effect on
courts, that it is not entitled to deference under Chevron U.S.A. Inc. v. NRDC,
Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L. Ed. 2d 694 (1984), and that "its force
is dependent entirely on its power to persuade." [**4] FCC Br. 16; see id. at
19-20; Oral Arg. Recording at 21:17-56. This court therefore lacks jurisdiction
to review that guidance.
Keogh Law, Ltd.
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4 Years Default SOL Applies
Hawk Valley, Inc. v. Taylor, Civ. A. No. 10-cv-00804, 2012 U.S. Dist. LEXIS 47024, at *20 (E.D. Pa.
Mar. 30, 2012) (the court concluded that based on Mims, the TCPA claim was "subject to the
federal four-year 'catch-all' statute of limitations.") See also City Select Auto Sales, Inc. v. David
Randall Assocs., Civ. A. No. 11-2658, 2012 U.S. Dist. LEXIS 16118, at *2-3 (D.N.J. Feb. 7, 2012)
("[A] four-year statute of limitations applies to actions under the Telephone Consumer
Protection Act.");
Still litigated because of prior split in authority, but should not survive
Sawyer v. Atlas Heating and Sheet Metal Works, Inc., 642 F.3d 560, 561 (7th Cir. 2011)
applied federal default SoL 28 U.S.C. 1658. 2nd Circuit found state law SOL applicable and not 4
years under 28 U.S.C. § 1658(a). Giovanniello v. ALM Media, LLC, 660 F.3d 587, 591-592 (2d Cir.
2011)
The 2nd Cir. construed the TCPA's "otherwise permitted" provision, to mean TCPA claim
"cannot be brought if not permitted by state law. Reasoning based on cases holding
that there was no federal jurisdiction under the TCPA.