Collections Firm Agrees to $5 Million Settlement for Allegedly Failing to Disclose Recorded Calls

Debt collection firm Medicredit, Inc. has agreed to a preliminary settlement of $5 million to settle a class action lawsuit that was filed over allegations that they failed to disclose to consumers that calls were being recorded. Many states have call recording and disclosure regulations. As a best practice, businesses should always disclose when calls are being recorded, regardless of which state the calls are being made into. Read a copy of the settlement agreement here. Learn more about telemarketing rules and telemarketing compliance.

New Jersey Judge Rules in Defendant's Favor in TCPA Consent Case

In Nicole Rando v. Edible Arrangements International, Inc., a New Jersey judge has granted the defendant's motion to dismiss. Plaintiff Nicole Rando filed the class action lawsuit after she allegedly received unsolicited text messages from Edible Arrangements. Rando claimed that she continued to receive several messages after she had opted-out. The wording that she used to opt-out included: (1) "Take my contact info off please." (2) "I want to confirm that I have been removed off your contacts." (3) "I asked to be removed from this service a few times. Stop the messages." and (4) "Again I want to stop this service thank you." The automated instructions provided by Edible Arrangements indicated that the proper way to opt-out was to simply say "stop," which Rando never did. The judge held that because Rando had never appropriately opted-out, Edible Arrangements could not be held liable for the unsolicited texts. Although this is a favorable ruling for the industry, businesses should honor all opt-out requests, even if the wording isn't exactly as instructed. Read a copy of the judge's decision here. Contact a TCPA lawyer or telemarketing attorney if you are ever facing a similar TCPA case.

Man Fighting $120 Million FCC Fine 

Last June, the FCC filed a complaint against a man who allegedly made over 96 million illegal robocalls to consumers. The agency claims that at least 80,000 of those calls included spoofed caller ID information, a violation of the Truth in Caller ID Act. The defendant, Adrian Abramovich, appeared before the senate last week and argued that he is “not the kingpin that is alleged.” Read a Newsweek article about this case here. Learn more about telemarketing fines here.

Nevada Federal Court Rules that CBE Group's Product is not ATDS

A Nevada Federal Court has ruled in favor of the defendant in Marshall v. The CBE Group, Inc. The plaintiff in the case filed a TCPA lawsuit alleging that The CBE Group (CBE) had called her using an ATDS. Citing the recent ACA v. FCC decision and stating that it would apply a strict definition of ATDS, the court held that CBE's, "communications infrastructure does not constitute an ATDS." The plaintiff failed to show that CBE's system could make calls without call-by-call human intervention. Read the decision here. Learn more about the definition of ATDS here.

Recent State Law Changes

Three state laws have been passed that will affect telemarketers doing business in certain states: 1) In Florida, "Voicemail Transmissions" will now be viewed the same as "Telephonic Sales Calls" under the state's telemarketing act. A “Voicemail Transmission” will be defined as "technologies that deliver a voice message directly to a voicemail application, service, or device." 2) Florida statute § 501.6175 requires telephone sellers to keep records of their calling information for two years after the date that the information first becomes part of their business records. Call logs, consent and request data, and scripts are all required to be saved for two years under this new statute. 3)  West Virginia has passed House Bill 4150, which "[Prohibits] telemarketing companies from transmitting misleading or inaccurate caller identification information." Make sure you understand all telemarketing regulations so that your business can have full telemarketing compliance. Consult with a telemarketing attorney if you'd like to have a telemarketing audit performed. A telemarketing lawyer can help you understand robocall laws, autodialer laws, cell phone telemarketing laws, etc.

Bill that will Regulate Sending Call Centers Overseas Slowly Gaining Momentum

A bill that will add extra steps and costs for companies that want to move their call centers overseas was introduced in congress last year. While the bill has a long way to go before it becomes law, it has slowly been gaining momentum. It now has 32 co-sponsors. The bill requires businesses with at least 50 call center employees to notify the Department of Labor at least 120 days before moving their call center out of the country. Failure to do so could result in fines up to $10,000 per day. Also included in this bill, businesses with call centers outside of the US must require their agents to disclose their physical location at the beginning of each call. Read a summary and the text of the bill here. Learn about additional telemarketing rules here.
 

FCC Publishes Second Further Notice of Proposed Rulemaking

After several weeks of anticipation, the FCC has officially published its Second Further Notice of Proposed Rulemaking regarding Advanced Methods to Target and Eliminate Unlawful Robocalls. As stated in the press release, "In this Second Further Notice of Proposed Rulemaking, as part of our multiple-front battle against unwanted calls, we propose and seek comment on ways to address the problem of unwanted calls to reassigned numbers. This problem subjects the recipient of the reassigned number to annoyance and wastes the time and effort of the caller while potentially subjecting the caller to liability." Read the press release, which includes instructions for commenting, here. Learn more about FCC Telemarketing Laws, new FCC Rules, and telemarketing regulations.
 

Florida Bill will Regulate Ringless Voicemail

The Governor of Florida has signed a bill that will regulate ringless voicemail by expanding the definition of a "telephonic sales call" to include "voicemail transmissions." As defined in the bill, "voicemail transmissions" are "technologies that deliver a voice message directly to a voicemail application, service, or device." Read the full text of the bill here. To learn more about ringless voicemail compliance, contact a telemarketing attorney who can perform a full telemarketing compliance audit of your business's telemarketing compliance. 

ACA Int'l v. FCC

Last Friday, March 16, the D.C. Circuit published its significant decision in ACA Int'l v. FCC regarding, among other things, what an autodialer (ATDS) is.  While the appeal involved 4 separate issues, the industry prevailed on 2 of the 4 - the more important 2 in our view: autodialers and reassigned numbers.  Before you get too excited, the D.C. Circuit did not invalidate the general prohibition on autodialing cells without consent.  Rather, it set aside the FCC's overly broad "capacity" ATDS definition.  The Court's primary argument was that under such a standard, every smartphone would be an autodialer because they could all potentially be used to download autodialing apps.  This was the same argument our industry made when the FCC order was published in July of 2015.  The Court agreed, stating this would create an "unreasonable and impermissible standard."  The rule remains, however, that you may not use an autodialer to call/text a cell phone without consent.  So nothing about this new decision expressly allows us to use a predictive dialer to cold call cells.  Individual courts will now need to look back at the statute and decide whether they believe the language covers predictive dialers or not - some will find in our favor and some will not.  It is very possible that the new leadership at the FCC will make further positive changes to ATDS standards, now that the D.C. Circuit has ruled. Companies will need their calling systems re-reviewed at this time to ensure they have no significant ATDS exposure, despite this ruling.  It will, no doubt, be easier going forward to establish that manual calling systems are not autodialers merely because they could potentially be upgraded to have ATDS capacity.  This is a very welcome legal development.  We will publish more on the other 3 issues involved in the appeal in the coming days: reassigned numbers, consent revocation, and the scope of the healthcare exemption.  There is not room to address all of these issues here, especially where other important legal updates need to be made today as well (below). This is a major breakthrough in the telemarketing industry. Schedule a consultation with a telemarketing attorney if you'd like to discuss it further. Learn more about telemarketing compliance, telemarketing regulations, ATDS definition, and autodialer laws.

Feature Films For Families Settles FTC Case Involving Alleged DNC Violations

In 2016, a federal jury found that three Utah-based companies had illegally called more than 117 million consumers to pitch movies - equating to a potential fine over 1 trillion dollars.  Last week, the defendants agreed to voluntarily settle the case (already had verdict but no judgment) against them. The final stipulated judgment imposes a $45.5 million civil penalty, of which the defendants will only be required to pay $487,735 unless they are found to have misrepresented their financial condition. This is a lot better than a trillion dollars, of course.  Read the FTC's press release here. Learn more about cell phone telemarketing laws and do-not-call regulations.

FTC Shuts Down Cryptocurrency Promoters

The FTC has obtained a court order shutting down a defendant for allegedly promoting deceptive money-making opportunities involving cryptocurrencies. The FTC's complaint alleges that the defendants, "promoted chain referral schemes known as Bitcoin Funding Team and My7Network. Using websites, YouTube videos, social media and conference calls, the defendants allegedly promised big rewards for a small payment of bitcoin or Litecoin."  The complaint continues to allege that, "the structure of the schemes ensured that few would benefit. In fact, the majority of participants would fail to recoup their initial investments." Read the FTC's press release here.

10th Circuit Court of Appeals Rejects TCPA Coverage for Dish Network

You may recall that in June of 2017, Dish Network was hit with a $280 million fine for Do-Not-Call list violations. Dish Network argued that its insurance carrier, ACE American Insurance Company (ACE), should have covered such "damages" under their general liability policy. Unfortunately, a Colorado District Court held that ACE had no duty to defend Dish Network, as the fine falls under the category of uninsurable  "penalties" and not "damages." On February 21st, the 10th Circuit of Appeals affirmed that decision. Read the full decision here. Contact a TCPA attorney if you are faced with a similar situation. Consider having a telemarketing lawyer perform a telemarketing audit of your call center business.

Petition to FCC Hopes to Change Certain Health Care Fax Rules Under the TCPA

A new petition has been filed with the FCC by Inovalon, Inc., a healthcare data and technology company. The petition asks the FCC to declare two things:

1. Faxes sent by a health insurance plan’s designee to a patient’s medical provider, pursuant to an established business relationship between the health plan and provider, requesting patient medical records are not advertisements under the TCPA; and
2. Faxes that offer the free collection and/or digitization of patient medical records, and which do not offer any commercially available product or service to the recipients are not advertisements under the TCPA.

Read a copy of the petition here. Learn about telemarketing rules and telemarketing compliance. Contact a telemarketing attorney or TCPA lawyer if you need additional legal counsel.

Telephone Dialing System Found Not to be an ATDS

In Ferrer v. Bayview Loan Servicing, LLC, plaintiff Maria Ferrer alleged, among other things, that Bayview used an ATDS to call her cell phone 44 times. The Southern District of Florida has found that the system used by Bayview to make the calls to the plaintiff was not an Automatic Telephone Dialing System (ATDS) because it requires call-by-call human intervention. The system used by the defendants was the Avaya X1 platform. Read the court's order granting summary judgment in favor of the defendants here. Learn more about the ATDS definition and Robocall laws.

Zacks Investment Research Inc. Settles TCPA Class Action Settlement

Zacks Investment Management Inc. (Zacks Investment) has agreed to settle a TCPA class action lawsuit for $5.38 million. The plaintiffs in the case alleged that Zacks Investment and their marketing partners made unsolicited calls to consumers in order to sell books and seminar tickets. They also allege that Zacks Investments recorded calls with California consumers without their consent, which is a violation of the California Invasion of Privacy Act. Marketers should make sure that they have the proper consent to make and record marketing phone calls to consumers. Read more here. Contact a telemarketing attorney or TCPA lawyer if you need additional legal consulting to help with the TCPA lawsuit you are facing.

Florida Bill Would Classify Ringless Voicemail Drops as Telephone Solicitations

A proposed Florida bill would regulate ringless voicemail by expanding the definition of a "telephonic sales call" to include "voicemail transmissions." As defined in the bill, "voicemail transmissions" are "technologies that deliver a voice message directly to a voicemail application, service, or device." Read the full text of the bill here. Learn about additional telemarketing rules and telemarketing regulations.

Talent Search Firm in Trouble for Alleged COPPA Violations

The FTC has filed a complaint against online talent search firm Explore Talent for allegedly violating the Children's Online Privacy Protection Act (COPPA). The complaint states that Explore Talent would allow children under the age of 13 to create accounts without the proper parental consent. To create an account, the children were also asked to provide information about their body type and to upload a picture of themselves onto the website. The FTC's order imposes a $500,000 fine on Explore Talent, which could be suspended based on their inability to pay. Read the FTC's release about this issue here.

Iowa Bill Would Impose $40,000 Fine on Caller-ID Spoofers

Iowa State Senator Ken Rozenboom has introduced a bill that would impose a civil penalty of up to $40,000 upon businesses that are believed to be using caller-ID "spoofing" tactics. Caller-ID spoofing is when the caller uses technology to make a local or familiar number appear on a call recipient's caller-ID. Last year, the FCC proposed a $120 million fine against a company that allegedly used this tactic. Telemarketers should only display numbers that they actually own. Read a local news story about the Iowa bill here.  Learn about telemarketing rules and consider signing up for an online telemarketing compliance course.

Telemarketing is Number One Consumer Complaint in Wisconsin

The Wisconsin Department of Agriculture, Trade and Consumer Protection has announced that unwanted telemarketing calls were the number one consumer complaint that residents of the state had during 2017. This is also the case at the national level, and likely in most states. Telemarketing complaints totaled nearly four times as many as the next highest category. Regulatory enforcement at both the State and Federal levels is complaint driven. Telemarketing businesses should make reducing and resolving consumer complaints a priority. Read a local news story about the announcement here. Learn about state by state telemarketing compliance. For example, make sure you understand state telemarketing license and telemarketing bond requirements. Learn more about FCC telemarketing laws, cell phone telemarketing laws, and do-not-call regulations. Contact a TCPA lawyer if you would like help understanding telemarketing regulations.

FTC Obtains Court Order Against Alleged Business Coaching Scheme

At the request of the FTC, a federal court has halted operations of a business that allegedly misrepresented its business coaching program and took over $14 million from consumers. According to the FTC's complaint, "The defendants induced consumers to pay for a series of tiered memberships with increasing fees, falsely claiming that consumers would learn how to make substantial income with an online business. They promised consumers they would receive individualized coaching from successful marketers that would provide what they needed to build a successful business, but, in reality, these were merely salespeople selling higher membership levels in the defendants’ program." Read the FTC's press release here.

Serial TCPA Plaintiff Has Received Over $800K In Settlements

A Forbes article published this week discusses a recent TCPA settlement between serial litigator Jan Konopca and FDS Bank. The article states that before this suit, Konopca had filed 30 other TCPA suits and received over $800,000 from settlements in those cases. Konopca owns three phone numbers, one of which was originally a landline but was transferred to a cell line after he claimed squirrels chewed through the line's wires. Konopca is one of thousands of serial litigators who have filed multiple TCPA cases. Some serial plaintiffs seem to invite calls by obtaining multiple phone lines. Read the full article here. Conact a TCPA lawyer if your business is being sued in a TCPA case. Mitigate the risks of facing such a case by understanding telemarketing compliance, robocall laws, cell phone telemarketing laws, Do-Not-Call regulations, and autodialer laws.

Ninth Circuit Exonerates Business That Purchased Leads From Alleged TCPA Violator

The Ninth Circuit Court of Appeals has ruled that Click Media cannot be held liable for TCPA violations for purchasing a lead that was allegedly generated illegally. Click Media was several levels removed from the generation of the lead and had no way of knowing that a violation had taken place. The lead was allegedly illegally generated by AC Referral. According to the Court's opinion:
"[Plaintiff] Kristensen points to the fact that Click Media’s contract with AC Referral stated that AC Referral could use text message marketing and required AC Referral to comply with the TCPA. According to Kristensen, this was sufficient to trigger Click Media’s duty to investigate whether AC Referral was acting in compliance with law. We disagree. The knowledge that an agent is engaged in an otherwise commonplace marketing activity is not the sort of red flag that would lead a reasonable person to investigate whether the agent was engaging in unlawful activities. Because Click Media had no 'knowledge of facts that would have led a reasonable person to investigate further,' Click Media cannot be deemed to have ratified AC Referral’s actions and therefore is not vicariously liable." 
Read the full opinion here. Learn more about vicarious telemarketing liability. Telemarketing rules and telemarketing regulations are complex. Contact a telemarketing attorney to telemarketing compliance support and telemarketing compliance audits.