A
Monthly Review of Issues Affecting Commercial Telemarketing
by Copilevitz & Canter, LLC, Attorneys at Law
July, 2007
FEDERAL
FCC
The FCC has become increasingly active with regard to issuance of citations for violations of the Telephone
Consumer Protection Act. You should be aware that the FCC will issue a citation if a consumer complains
about your telemarketing activities. The citation does not involve a fine, but after receipt of your first
citation, you can be fined for later violations. Thus, it is very important to respond promptly to these
citations and contest them if possible.
The FCC has proposed a new form to be used to gather complaints from consumers. The proposed FCC Form 2000
will be available on the internet and will use six categories for complaints:
Deceptive or Unlawful Advertising or Marketing,
Billing Privacy or Service Quality,
Disability Access,
Emergency or Public Safety,
General Media Issues, or
Other Complaints.
Federal Reserve
The Federal Reserve has proposed an amendment in its Regulation Z regarding truth in lending to adopt the
FTC's guidance regarding oral disclosures. Oral disclosures would be considered to be reasonably understandable
when they are given at a volume and speed sufficient for the consumer to hear and comprehend the disclosures.
TCPA
I spoke with a private plaintiff today who indicated that he "pretends" to be an answering machine when
answering the phone to illicit illegal prerecorded messages. You should be aware that prerecorded messages
are forbidden under federal law unless you have an established business relationship, whether or not the call
is received by a live person. If you abandon live answers, the illegality is compounded and the campaign
likely violates multiple provisions of the Telemarketing Sales Rule, Telephone Consumer Protection Act, and
state law.
STATE
Colorado
A Colorado court has affirmed the trial court's ruling that a private plaintiff does not have a private right
of action against a sender of a fax for failure to include identifying information in a facsimile advertisement.
Private Plaintiff's often attempt to "add on" other alleged violations of the regulations or the TCPA to their
TCPA claims. This court affirms that the private plaintiff's actions are limited to the receipt of the
violative messages, and not other technical violations of the regulations or laws.
A Colorado state appellate court has affirmed a ruling of a trial court against a private plaintiff in a TCPA
case. The plaintiff had not actually received faxes but was assigned its claims from the recipients of the
faxes. The Colorado court ruled that claims are not assignable in that state.
Georgia
A suit brought by Cingular against alleged senders of unsolicited prerecorded messages was dismissed based
on lack of personal jurisdiction over the defendant. The court found that the defendants did not purposely
consummate a transaction in the state of Georgia.
Massachusetts
A bill has been introduced in the Massachusetts House (HB 3846) which would require written confirmation of
all telephone sales. Telephone solicitors would be required to send and receive back from the customer written
consent that a customer agreed to a transaction made over the telephone. Some states have written contract
requirements for telemarketing but often limit application of those requirements to nonexempt entities or
specify that failure to obtain a written agreement makes the contract voidable by the customer, rather than
outright illegal. This bill would not have any similar exemptions.
Michigan
A bill has been introduced in the Michigan House (HB 5011) which would modify the state's home solicitation
sales law to specifically exempt sales of securities subject to Michigan securities laws from the Home
Solicitation Sales Act.
New Jersey
The New Jersey Senate is considering a bill which would establish civil and criminal penalties for transmission
of e-mail involving false or deceptive titles of subject matter. Federal law governs interstate commercial
e-mail issues (CAN-SPAM) so this bill, if passed, would have limited applicability.
New York
A federal court in New York has dismissed a class action under the TCPA. The court noted that federal courts
lack jurisdiction over claims brought under the TCPA and that the plaintiff could only bring the action in
New York state court if permitted by state court rules.
Rhode Island
Rhode Island has passed a law (HB 5300) which amends its mortgage broker statute to specifically
exclude telemarketing lead generation so long as the lead only involves collecting a person's name,
address, and telephone number for later follow up by a licensed mortgage company. You should be
aware that some states take the opposite approach and consider any telemarketing lead generation for
mortgage purposes to be "mortgage brokering" such that licensure is required.
Texas
Texas Board of Chiropractic Examiners has proposed new regulations regarding telemarketing for
chiropractors. The Rule is modeled after a New Mexico rule and prohibits misrepresentations and
promises regarding the efficacy of treatment.
A Texas appeals court has ruled that a private plaintiff had no cause of action for receipt of one
telephone call alleged illegal under the TCPA.
Washington
A federal court in Washington is reviewing whether a company can be held liable for the actions of
its agents for violation of the state's law regarding automatic dialing and announcing devices.
No Washington Court has determined whether the ADAD statute encompasses agency liability (i.e.
that the client of a prerecorded message company could be held liable for violations by that
prerecorded message company). Under the TCPA and state law, you should actively monitor the
compliance of your agents based on the likelihood that plaintiff will seek liability against
the service bureau and the entity whose goods or services are being sold during a telephone call.
Regulatory
Info
