January 2020 - Call Compliance News
Eleventh Circuit Court of Appeals
The Eleventh Circuit Court of Appeals has ruled that a dialing system must have a random or sequential number generator (used or not used on a given call) to qualify as an automatic telephone dialing system (“ATDS”). Glasser v. Hilton Grand Vacations Co.
Comment: This sets up a conflict between the circuits as the Ninth Circuit has ruled otherwise. The Supreme Court is set to hear a Telephone Consumer Protection Act (“TCPA”) case in April, and, in our opinion, likely will find the TCPA to be unconstitutional, at least in part.
Federal Communications Commission
The Federal Communications Commission (“FCC”) has proposed a fine of almost $13 million against Scott Rhodes alleging he made more than 6,000 illegal robocalls using false caller ID between May and December 2018. Some calls attempted to influence the 2018 California U.S. Senate primary and include comments about Senator Diane Feinstein’s Jewish heritage. The FCC alleged Rhodes made other political calls also using spoofed caller ID.
Comment: The fine amounts to more than $2,000 per telephone call.
Federal Trade Commission
The Federal Trade Commission (“FTC”) has sent 19 letters to voice over internet protocol (“VoIP”) service providers warning them regarding the “accomplice liability” standards in the Telemarketing Sales Rule (“TSR”), i.e. they can be held liable for the actions of their customers if they know, have reason to know, or consciously avoid knowing of those customers’ illegal activities.
In the letters, the FTC claims that “each illegal call is subject to a maximum civil penalty of $43,280.”
Comment: If you receive a checklist or affidavit from your vendors for you to complete regarding compliance with the TSR or other law, this may have been the cause. You should review your responses with counsel carefully.
A California court has approved a $2.4 million TCPA settlement against HSBC Bank. Ahmed v. HSBC Bank. Ahmed alleged he’d been called on his cell phone using an ATDS without prior express consent.
Comment: Class counsel was awarded $600,000 in fees. The average plaintiff will receive $92.
A bill has been proposed in the South Dakota House (HB 1131) which would add texts to the state no-call statute and require transmission of the telemarketer’s authentic name and telephone number in caller ID.
A court in Texas has issued final approval of a TCPA class action against Sirius XM Radio. The judge approved legal fees in the amount of $6.4 million. Buchanan v. Sirius XM Radio. It involved allegations of the national “do-not-call” list and Sirius’ internal “do-not-call” list.
Comment: This is a huge settlement for a “do-not-call” class as most “do-not-call” list cases have been defeated because of the safe harbor for calls placed as the result of error if the caller meets certain other requirements.
A bill is being considered by the Utah House (HB 158) which would create affirmative defenses to certain private causes of action for data breach. Entities which comply with a written cyber security program that is designed to protect the security and confidentiality of personal information and meet other restrictions would have an affirmative defense if their systems are breached.
A bill has been introduced in the Virginia Senate (SB 695) to direct the attorney general to work with a state department of aging to combat financial elder fraud including telemarketing fraud.