Alert: Effective October 16, New Consent Requirements Apply to Telemarketing Robocalls and Text MessagesPrint PDFShare
An important change in the FCC’s rules goes into effect on October 16: before placing an auto-dialed telemarketing call or sending a marketing text message to a consumer, a business must obtain the consumer’s “prior express written consent.”
By way of background, the Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227, provides that various practices relating to telemarketing, auto-dialed calls, and junk faxes are unlawful. The FCC has issued detailed rules implementing the TCPA. A person who has received calls in violation of the TCPA may bring an action seeking $500 for each violation, or $1500 for each willful violation. Over the last few years, especially after the Ninth Circuit ruled in 2009 that text messages are “calls” for purposes of the TCPA, many class actions have been brought for alleged violations of the TCPA. Some have resulted in large settlements–for example, last month a large bank agreed to settle six cases for a combined $32 million.
The FCC’s rules used to allow a caller to make auto-dialed telemarketing calls (aka robocalls) to a residential consumer even if the consumer had not expressly consented to receive such calls, so long as the caller had an “established business relationship” with the consumer. In an effort to protect consumers, the FCC released an Order on February 15, 2012 changing its rules relating to consent. Several of the rule changes–for example, a new requirement that telemarketing robocalls must include an automated interactive mechanism by which the consumer can immediately opt out of such calls–became effective months ago.
The most important changes, however, become effective on October 16, 2013: the “established business relationship” exemption is eliminated, and instead, for telemarketing robocalls to wireless numbers and residential lines, “prior express written consent” is required. Prior express written consent means that the consumer has received “clear and conspicuous disclosure” that he or she will receive prerecorded sales calls, and agrees unambiguously to receive such calls at a telephone number the consumer designates. The business may not obtain consent by requiring it as a condition of purchasing any good or service. The burden of demonstrating consent lies with the caller. Consent can be established via e-mail or a website.
Any business that routinely contacts customers by telephone, or through mobile marketing such as text messages, should take heed of this new “prior written express consent” requirement. Going forward, businesses that engage in promotional text message or telephone campaigns, or that hire marketing companies to provide such services for them, will have to be very careful not to contact consumers who have not provided “prior express written consent.” In order to undertake such campaigns, a business will have to develop written consent forms and maintain records documenting consent. Any company that sells to individual consumers should develop internal policies governing telemarketing/text message contacts with its customers, closely analyze potential liability when teaming up with a marketing company that will be contacting its consumers, and consider whether its liability insurance covers TCPA violations.
There are a few important exceptions to the new heightened consent requirement. For example, informational or noncommercial calls, such as calls made by nonprofits, calls for political purposes, and calls advising of school closings, require no prior consent if made to residential wireline numbers, and require only oral consent if made to wireless numbers. And, prerecorded healthcare related calls made subject to HIPAA, such as a reminder of a doctor’s appointment, or a health risk assessment survey conducted on behalf of a health insurance company, are exempt from the heightened consent requirement and several other TCPA requirements.
Considering the already large number of class actions brought under the TCPA, the new heightened consent requirements will likely ensnare many businesses. Briggs and Morgan’s Telecommunications Practice Group can help you comply with the new requirements, and can defend you if you are sued for a violation of the TCPA.