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December 2007 - Call Compliance News


On December 4, 2007, the FCC released a Notice of Proposed Rule Making which would extend the period consumer names remain on the “do-not-call” list from its current five year period to an indefinite period.  The FCC has requested comments on this proposal which are due 30 days after the notice is published in the Federal Register (which has not yet occurred).  I urge you to comment to the FCC on this issue if it is relevant to your business. There may be a constitutional problem with retroactive application of this standard.

The FCC has issued a Notice of Apparent Liability for Forfeiture against a window replacement company for violations of the national “do-not-call” list.  The FCC assessed a penalty in the amount of $20,000 for two violations.  This Notice of Apparent Liability for Forfeiture followed an earlier citation to the company.  The FCC can only fine entities under the TCPA if it issues such a citation first, so if you receive a citation from the FCC regarding the TCPA it is important to respond and contest it if possible.  The rule regarding receiving a citation before any fine does not apply to regulated companies such as telecommunication companies.

The FTC and seven state attorneys general have sued a payment processor with violating federal and state laws regarding debiting consumers’ bank accounts on behalf of allegedly fraudulent telemarketers.  The suit alleges the payment processor offered services to a variety of merchants, many of whom allegedly engaged in deceptive telemarketing and internet based schemes.  The FTC’s Telemarketing Sales Rule sets forth a standard of “accomplice liability” which can hold entities which provide services to companies that violate the Telemarketing Sales Rule liable for those violations.  This suit, filed in Pennsylvania, alleges the processing company received information and documentation strongly indicating that their clients were engaged in unauthorized debiting practices, violating the national “do-not-call” list and committing fraud.  The FTC therefore alleges that the payment processor assisted or facilitated the telemarketers in violating the Telemarketing Sales Rule and therefore was liable for those violations.

The U.S. House of Representatives has passed two bills (H.R. 3541 and H.R. 2601) which would make registered numbers on the national “do-not-call” list permanent, cap fees for access to the list at $54.00 per area code, and attempt to improve the accuracy of the list by removing numbers which have been reassigned or disconnected. Currently, numbers on the list expire after five years. The bills would continue to permit businesses to access the first five area codes of data at no charge.

I recently testified before a House committee on the issue of prerecorded political telephone calls. Currently, there are multiple bills before the House on this topic, and the issue of preemption is being considered. If the House preempts state law, prerecorded political calls may be allowed in Indiana and other states where they are currently banned. The members of the panel repeatedly expressed their support for “town hall” uses of this technology.


A bill has been filed in the Arizona Senate (SB 1010) which would apply restrictions to the sale of wireless telephone service and require disclosure to the consumer if the subscriber may be billed for receiving unsolicited calls or text messages from telemarketers at that wireless number.

A bill has been introduced in the Illinois House which urges the Federal Trade Commission to make permanent consumers’ numbers added to the national “do-not-call” list.  Currently, a “do-not-call” registration by a consumer expires five years after the number is added to the list.

A United States district court in Illinois has reviewed the constitutionality of the TCPA in response to a defendant’s claim that it was unconstitutional.  The court concluded that the TCPA’s ban on unsolicited commercial faxes was a permissible restriction on commercial speech not in violation of the First Amendment.  The court also ruled that the damages assessed by the TCPA do not constitute excessive fines or violate due process.

An appellate court ruled that a United States district court should have abstained from exercising jurisdiction over a suit brought against the state of Indiana alleging the state’s prerecorded rules were unconstitutional.  Under the doctrine of Younger abstention, the appellate court ruled that the court below should have allowed the decision to be resolved in a state court action which had been filed previously. Indiana’s law still has not been reviewed on the merits.

A bill has been pre-filed in the Missouri Senate (SB 840) which would prohibit automated calls to persons on the state “do-not-call” list.  Calls to persons with whom the caller has an established business relationship (within the past 180 days) would be exempt.  The bill also contains restrictions on political solicitations which require a statement that “this message is paid for by” the proper identification of the sponsor of the call. 

New Jersey
The New Jersey Department of Law and Public Safety has proposed revisions to existing telemarketing “do-not-call” rules.  The rule would change the fee charged for registration from being based on the number of “telephone numbers” the telemarketer has to the size of the telemarketer’s “simultaneous outgoing call capacity”.  Thus, a business could not avoid increased fees for registration based on the argument that it possessed no “telephone numbers”, but rather used T1 or other direct connection technology.  Comments are due by February 1, 2008 (proposal number: PRN 2007-357).

An Ohio federal court has ruled that an insurance company could not obtain declaratory judgment that it provided no coverage for TCPA class actions in federal court because the TCPA claim was required to be brought in state court.  The federal court therefore declined jurisdiction of the insurance company’s declaratory judgment action.

An appellate court has ruled that a lower court decision requiring an insurance company to provide coverage to a hotel for violations of the Telephone Consumer Protection Act was correct. Another Pennsylvania trial court ruled that an insurance company did have a duty to defend an insured against allegations of violation of the TCPA for unsolicited faxes. Cases in this area usually turn on the language of the specific insurance policy.

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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