The FTC has a telemarketing sales rule which requires do not call telemarketer compliance
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National Do Not Call Registry and List Compliance News

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State Do Not Call

July 2006 - Call Compliance News

The Federal Communications Commission has proposed forfeiture against a company which offered, on its website, to sell consumers’ private telephone records.  The company did not respond to a subpoena issued by the FCC regarding these services and was therefore fined.

A seller of discount health and prescription drug cards has agreed to pay a $300,000 penalty to the FTC for violation of the national “do-not-call” list.  The telemarketer for the business also agreed to pay a $50,000 settlement.  The case involved whether an established business relationship extended to an affiliate.  It extends only if the consumer would reasonably expect the relationship to extend.  So you should carefully review affiliate calls if you intend them to fall under the Established Business Relationship exemption.

A California mortgage broker will pay a $50,000 penalty after the FTC alleged violations of the national “do-not-call” list.  The mortgage company relied on a service bureau for compliance with the “do-not-call” rules but still was found liable for these calls.  A total penalty of over $1,000,000 was assessed with all but $50,000 suspended due to inability to pay.

The FTC has issued a news release regarding cell phones on the national “do-not-call” registry.  It is attempting to clear up various e-mails which falsely claim that cell phone numbers will soon be released to telemarketers.  Cell phone numbers can be added to the national “do-not-call” list and telemarketers are generally barred from calling them without express consent.

A debt collection company has agreed to settle with the FTC regarding charges that it violated federal laws.  The settlement involved a $150,000 judgment and an agreement to ensure that statements made on the telephone complied with the Fair Debt Collection Practices Act.  All but $30,000 of the judgment was suspended based on the defendant’s inability to pay.

Class Actions are still being filed with regard to unsolicited faxes sent in violation of the TCPA.  Because the TCPA provides for a private cause of action, it is often
used by private plaintiffs and, in some cases, class action attorneys.  You should carefully review your compliance with the TCPA if you deliver prerecorded messages to consumers, or send faxes to anyone.

A Colorado court has stayed resolution of a TCPA case pending resolution of the appeal previously described in this newsletter.  In that case, a Colorado court ruled that TCPA claims were not assignable to other entities.  A notorious TCPA plaintiff in Colorado purchases faxes from many businesses then pursues TCPA claims on its own.  This was rejected in Colorado but the plaintiff is appealing.

A United States District Judge in the Eastern District of New York has ruled that there is no established business relationship exemption to the ban on unsolicited faxes found in the TCPA.  The court ruled that as a matter of law the established business relationship exemption does not apply to facsimile advertisements governed by the TCPA.  This is in direct conflict with the FCC’s previous interpretations on the topic and will undoubtedly cause more actions under the statute for unsolicited faxes.

An Indiana court has ruled that an insurance company had no duty to defend an insured against a TCPA case.  There are cases on both sides of this issue.

An appellate court in Arizona has affirmed dismissal of a TCPA claim.  The lower court ruled that TCPA claims can not be assigned to third parties because they are an invasion of privacy toward a claim held only by the recipient of the facsimile and not some third party.

The Supreme Court in California has ruled that its state law regarding monitoring of conversations applies to entities calling outside the state into California.  This ruling is at odds with previous decisions which have held that it is the law of the place where the interception takes place that controls whether the monitoring is legal or not.  As you know, there are several states which have monitoring laws more restrictive than the federal one- party standard.  California is one of those states if the context of the conversation is confidential. Kearney v. Salomon Smith Barney. This case has far reaching consequences, and could affect how every business which contacts consumers by telephone, inbound or outbound, scripts calls and implements quality control and security procedures.

Recently, I had a conversation with Brenda Headlee who administers the Louisiana “do-not-call” list program.  She said she moved the Louisiana legislature to amend the state’s do-not-call law to make the bond optional to improve the ability of small businesses to comply with the law.  In my experience, Ms. Headlee is one of the most thoughtful regulators in this field.  This is the first instance that I know of where the associated cost for a “do-not-call” list decreased rather than increased as time passed.

Louisiana has enacted revisions to its telemarketing statute to automatically include unlisted numbers on the state “do-not-call” list and to allow telemarketers to post an optional bond, rather than a required bond.

The bill also specifies certain types of telemarketing exempt from the state’s ban on calling during times of emergency.  Established Business Relationship calls are now permitted during times of emergency in certain circumstances.

Tennessee has revised its state “do-not-call” list law so a “do-not-call” enrollment on the state list takes about 30 days after the first day of the succeeding month of enrollment rather than 60 days.  This Act takes effect July 1, 2006.

The Texas Public Utilities Commission has adopted amendments to the Texas “do-not-call” list which specifically provides that a statute can be enforced even against entities which are not normally regulated by the Public Service Commission. The list also will now incorporate all Texas numbers included on the national “do-not-call” list.

Texas has also passed a regulation amending its electric no-call registration which will be limited to non residential electric customers after May 27, 2005.  As the no-call list is specifically based on the privacy right of the recipient of telephone calls, and because businesses have no privacy rights, the constitutionality of this limited list is questionable. Because Texas is the only state which has such a specific “do-not-call” list, it is likely that this would not draw a constitutional challenge from any regulated entity.

The authors make every attempt to provide current, accurate information, but Telemarketing ConnectionS® is not intended to be a substitute for legal counsel, and readers should not use it in lieu of obtaining knowledgeable legal, or other professional, counsel expert in the field of commercial telemarketing law. References in Telemarketing ConnectionS® do not constitute endorsement by Copilevitz & Canter, L.L.C. or Telemarketing ConnectionS®. January 1, 2005, Copilevitz & Canter, L.L.C.
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