A
Monthly Review of Issues Affecting Commercial Telemarketing
by Copilevitz & Canter, LLC, Attorneys at Law
May, 2007
FEDERAL
ATA
The ATA has outlined its legislative and advocacy priorities with regard to regulation and "do-not-call"
issues. Protecting the established business relationship exemption is at the top of the list. As you know,
Indiana currently has no exemption for established business relationships from its "do-not-call" list.
FCC
The FCC has issued a Report and Order regarding "pretexting" and unauthorized access to customer at work
information derived from a consumer's relationship with a telecommunications company. In the proposed
rules, telephone companies would be prohibited from disclosing details regarding customer calls over the
telephone without a password and telecommunication carriers are required to take reasonable measures to
protect their data from unauthorized access. Carriers would be required to obtain opt-in consent from
a customer prior to disclosing usage information to joint venturers or independent contractors for the
purposes of marketing.
FTC
A federal district court in Illinois has entered final orders against three Canadian telemarketers who
allegedly defrauded U.S. consumers in an advance fee credit card scheme. The case involved more than
$9,000,000 in consumer charges.
The FTC has settled a case involving alleged violation of the Telemarketing Sales Rule against several
corporate defendants and individuals in the state of Washington. The settlement requires compliance
with the national "do-not-call" list, the Telemarketing Sales Rule, and state law, as well as a monetary
judgment exceeding $20,000,000.
Senator Barack Obama (D-IL) has requested the Federal Trade Commission to increase efforts to protect
elderly consumers from telemarketing fraud.
The FTC has filed suit against several Pennsylvania based defendants alleging violation of the
Telemarketing Sales Rule in a magazine sales effort. The calls involve claims that the consumers
would receive coupons worth more than $1,000 with magazine subscription purchases.
A Las Vegas individual and company have been permanently enjoined from telemarketing or selling
business opportunity programs in the future pursuant to the court order which found the defendant in
civil contempt of a previous settlement. Most FTC settlements include guarantees regarding future
compliance and the potential for contempt penalties if applicable law is not complied with in the
future.
STATE
Illinois
The Illinois Senate is considering a bill (SB 34) which would require immediate release of the line,
for calls made by an autodialer, once the call is disconnected and require a disclosure of the name,
address, and return telephone number within the prerecorded message. Caller ID would also be required
to be projected for prerecorded calls and the message must contain an option to allow the consumer
to press a button on the key pad to connect with a live operator at any time. This bill has passed
the Senate and been referred to the House for consideration.
Maryland
Maryland's governor has signed a Consumer Protection of Personal Information Act revision which
specifies the contents of a notification a business must make when its records regarding consumers
are stolen or otherwise accessed in an unauthorized fashion. Businesses are also required to
provide notice of breach to the attorney general based on the new law which is to take effect
January 1, 2008.
Minnesota
A federal judge has entered an injunction against Ryan Swanberg prohibiting him from making TCPA
claims against companies which have not called him. In a newspaper article, Swanberg wrote that
he spends his earnings from these suits on gambling, junk, and Las Vegas Casinos. In a 2005
radio interview he said he has eight telephone numbers and he does not put them on the national
"do-not-call" list because "it's in my best interest to get as many phone calls as I can."
Missouri
The Missouri Senate continues to debate legislation concerning prerecorded telephone calls (SB 49).
This bill would add all prerecorded calls, including political calls, to those regulated by the
Missouri "do-not-call" list.
New Jersey
The New Jersey General Assembly is considering a bill (AB 3765) which would amend the state's
telemarketing law to specifically include prerecorded messages, and would specifically prohibit
political party affiliation from being used to determine whether an established business
relationship exists between the caller and the consumer receiving the call. No recorded call
would be permitted to any consumer whose name was included on the telemarketing "do-not-call"
list in New Jersey.
North Carolina
North Carolina's attorney general, Roy Cooper, has announced an action against a company which
placed prerecorded calls to North Carolina residents and was the largest source of "do-not-call"
complaints to his office so far this year.
North Carolina state law is more restrictive than the federal standards on prerecorded calls
and bans most calls.
Rhode Island
The Rhode Island Senate is considering a bill (SB 104) which would amend the state's mortgage
solicitation law to specifically exclude telemarketing lead generation from the definition of
"loan solicitation" such that a mortgage broker or originator license is required. "Telemarketing"
is defined narrowly as "contacting a person by telephone with the intention of collecting such
person's name, address, and telephone number, for the sole purpose of allowing a mortgage loan
originator to fulfill a loan inquiry." Several states' mortgage laws are unclear regarding
whether lead generation alone constitutes activities such that a mortgage license is required
in that state and you should review the state statutes prior to engaging in mortgage lead
generation activity.
South Dakota
South Dakota has revised its telemarketing law to define established business relationship as a
call to a person who has made a purchase from the caller in the past eighteen months or an
inquiry regarding the caller's goods or services in the past three months. The standard is now
the same as the federal standard.
Texas
The Texas House is considering a bill (HB 143) which would include text messages within the
definition of "telephone call" subject to the Texas "do-not-call" list.
The Texas Public Utilities Commission has proposed repelling certain rules for telephone
solicitation for telecommunications providers.
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