A
Monthly Review of Issues Affecting Commercial Telemarketing
by Copilevitz & Canter, LLC, Attorneys at Law
September, 2007
FEDERAL
FCC
The FCC has requested comments regarding the paperwork and compliance burden imposed by its
rules implementing the Telephone Consumer Protection Act. Comments are due on or before
October 9, 2007.
The FCC has made the same request with regard to its regulations implementing CAN-SPAM and
the forms are easiest to accept complaints under the TCPA and CAN-SPAM regulations.
STATE
California
A California appellate court has ruled that an insurance company did not violate the TCPA
when it sent faxes to a business which had purchased health insurance from the company in
the past. The court ruled that the Telephone Consumer Protection Act allowed the calls
and the calls did not violate state consumer protection laws either.
The California Senate has passed a bill (AB 779) which would require notice to customers
when credit card or debit card information is lost. It also requires retailers to assume
all costs of consumer notification and card replacement. The bill now goes back to the
state assembly for ratification.
A California federal court has refused to hear a TCPA case holding that it would properly
be heard only in state court. (Boydston v. Asset Acceptance, LLC). The court also ruled
that there is no private cause of action under the TCPA for technical procedural violations.
Most private plaintiffs include numerous allegations of such procedural violations to increase
the worth of their claims.
Colorado
An appellate court has ruled that a residential telephone subscriber who advertised and
used the number for both personal and business reasons could sign onto Colorado's "do-not-call"
list. Holcomb v. Steven D. Smith, 2007 Colorado App. Lexis 1751 (September 6, 2007). This
case is quite problematic because the protections of "do-not-call" lists are based on
protection of privacy interests. Businesses do not have privacy interests and application of
a "do-not-call" list to a business likely would cause a question to arise regarding the
requirement's constitutionality. Courts do not apply the protections of the Constitution based
on labels (e.g. "residential" or "business" telephone line) rather on the actual use or speech
involved (i.e. business speech is involved here, not residential privacy).
Illinois
An Illinois appellate court overturned a trial court which had previously dismissed a TCPA
claim by a mortgage company against a bank. The court ruled that an Illinois law required
TCPA claims to be heard in state court.
Indiana
The Seventh Circuit Court of Appeals has ruled that a federal court should not have heard
a challenge to the State of Indiana's rules on prerecorded telephone calls. The case will
be heard in state court, for it seems unlikely the plaintiff will be successful in claiming
that state law should be preempted by federal restrictions allowing some prerecorded calls.
Louisiana
A Louisiana appellate court has ruled that a plaintiff could sue a sender of unsolicited
telephone facsimile messages in a class action. The appellate court ruled that even if
the plaintiff had an established business relationship with the sender, the class action
still could be maintained.
Massachusetts
Massachusetts House Bill 3846, which would have required written consumer consent for all
telephone transactions, died in committee and was not voted on by the full state legislature.
Ohio
The Ohio Supreme Court has ruled that an attorney who received an unsolicited fax could not
maintain a cause of action for failure to include identifying information or other violations
of regulation other than receipt of the fax itself. Often plaintiffs attempt to add
allegations of these sorts of violations to TCPA claims multiplying by many times the amount
of damages provided by Congress ($500 per fax).
New York
A New York federal court has dismissed a class action filed under the TCPA for unsolicited
faxes ruling that a claim needed to be filed in state court.
Pennsylvania
A Pennsylvania court has allowed a TCPA case alleging illegal prerecorded messages to continue
against an insurance company. The insurance company argued that the calls were exempt from
the TCPA because they conducted a survey on behalf of a tax exempt organization. The court
found that the call actually was intended to result in the sale of goods or services. The
court found the exemption for calls made by or on behalf of a tax exempt nonprofit organization
applied only to calls made to further the objectives of a tax exempt nonprofit organization.
This is one of the first cases to affirm the FCC's previous statements that "surveys" which
are actually intended to generate sales are not exempt from the TCPA rules. While actual
surveys likely would be exempt, a "survey" intended to generate sales or leads is not
"unsolicited advertisement" and is subject to the prerecorded calling rules. Those calls
would only be allowed with an established business relationship or other exemption.
A bill has been introduced in the Pennsylvania House (HB 1234) which would change the state
"do-not-call" list requirement to adopt the federal five year expiration period for
"do-not-call" requests. The bill would also allow businesses to remove numbers from the list
if the number is no longer valid for that residential or wireless telephone subscriber. The
FTC and FCC likely would adopt the same "scrubbing" procedures for the national list, i.e.
removing numbers from the list when they have been disconnected or transferred to another
provider, although some analysis of the list has shown errors in this respect.
Congressman Mike Doyle is going to introduce legislation to the U.S. Congress removing the
five year expiration period for numbers on the national "do-not-call" list. The bill has
not yet been introduced but the FTC has issued guidance supporting the current 5 year
expiration period. This bill could get coverage in an election year and you likely should
contact your representative to oppose this measure if your business is affected by the national
do not call list.
Virginia
A Virginia court has ruled that an insurance company was required to provide coverage for
a business facing a class action for sending unsolicited faxes.
Other
India
The country of India has implemented a "do-not-call" directive creating a national
"do-not-call" database.
Regulatory
Info
