fcc tcpa 2015 declaratory ruling analysis

Compliance Webinar: FCC TCPA 2015 Declaratory Ruling AnalysisJ U LY 1 5 . 2 0 1 5

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7/15/2015 FCC TCPA 2015 DECLARATORY RULING ANALYSIS 2

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Webinar Agenda

1. Autodialers

2. Texting/Calling apps

3. Consent issues

4. Reassigned phone numbers

5. PEWC Limited Waiver

6. On-Demand Texts

7. Text messages/internet-to-phone technology

8. Exemption for Exigent Financial Calls

9. Exemption for Exigent Healthcare Calls (and other health care issues more generally)

10. Call blocking technology


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The FCC 2015 Declaratory Ruling –Reaffirms/Clarifies TCPA Rules

1. On July 10, 2015, the FCC released its Omnibus Declaratory Ruling and Order (“7/10/15 Order”) in response to 21 Petitions regarding the definition of an ATDS, liability for calls to reassigned numbers and other issues.

◦ The FCC reaffirmed its position that the TCPA is to be construed broadly

◦ The FCC reaffirmed TCPA is to be construed in favor of the consumer and EMPOWER consumers to stop unwanted calls (para. 1)

◦ The FCC reaffirmed TCPA protects consumer privacy and public safety (emergency line)

2. The FCC reaffirmed TCPA’s restrictions to wireless numbers apply to non-telemarketing calls (Ex. informational calls.) (7/10/15 Order, para. 123)

3. Debt collection calls remain within the purview of the TCPA

4. FCC states it was making a Declaratory Ruling that “clarify[ies] existing law or resolves controversy regarding the interpretation or application of existing law and precedents.” (7/10/15 Order, para. 23) NOT ENTIRELY ACCURATE


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TCPA 1991 – Wireless Autodialer BanThe “Auto dialer” Ban:

§ 227(b) Restrictions on use of automated telephone equipment

(1) Prohibitions:

It shall be unlawful for any person within the United States or any person outside the United States if the recipient is within the United States –

A. to make any call (other than a call made for emergency purposes or made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice - …

B. to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call. (Emphasis added)

LANDLINE CALLS – § 227(b)(1)(B) - No liability for artificial/prerecorded informational voice calls – Commercial Call exemption applies - 64.1200(a)(3)(iii)

7/15/2015 5FCC TCPA 2015 DECLARATORY RULING ANALYSIS

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FCC Rules on Auto dialers

Automatic Telephone Dialing System defined by TCPA: 47 USC 227(a)(1): “ATDS”

(a) DEFINITIONS —As used in this section—(1) The term “automatic telephone dialing system” means equipment which has the capacity—

(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and

(B) to dial such numbers.


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1.Reaffirms 2003, 2008 FCC rulings that ALL predictive dialers are autodialers. (7/10/15 Order, para. 12-13). PD’s retain the capacity to dial thousands of numbers in a short period of time and could harm public safety

2.A dialer is equipment which has “capacity to dial numbers without human intervention” – FCC 2003, 2008 Rulings (Note: How the human intervention element applies to a particular equipment involves a case-by-case determination)

3.An ATDS includes when calling a set list of consumers. (para. 10)

4.Equipment is ATDS even if not presently used for that purpose.” Id. (emphasis added)

5.Does not include speed dialing. (7/10/15 Order, para. 17)

FCC 2015 Rules on Autodialers


“CAPACITY” Clarified: the capacity of an autodialer is not limited to its current configuration but also includes its potential functionalities (7/10/15 Order, para. 16)

“Capacity” to be interpreted Broadly (7/10/15 Order, para. 19)

Future software additions are included in capacity◦ There are “outer limits” to capacity - “must be more than a theoretical potential

that the equipment could be modified to satisfy the ‘autodialer’ definition.” Id.

Not all devices are autodialers even if has some capacity to store and dial numbers (7/10/15 Order, para. 18) –

Ex. handset with speed dial is NOT a dialer. Rotary Phone not a dialer

Does broad construction of “capacity” sweep in smartphones ?? No lawsuits filed in this regard

There was “no evidence that friends, relatives, and companies with which consumers do business find those calls unwanted”

FCC will take a “wait and see” approach and monitor issue and further clarify if needed

FCC Rules on CAPACITY


1.Inconsistent definitions of an ATDS in FCC 2015 Ruling

“capacity to store or produce telephone numbers to be called, using a random or sequential number generator” – i.e., the TCPA statutory definition

(7/10/15 Order, para. 109, 111, 112)

“capacity to dial numbers without human intervention” – FCC 2003, 2008 Rulings (Note: How the human intervention element applies to a particular equipment involves a case-by-case determination)

(7/10/15/Order, para. 14)

“dialing equipment that generally has the capacity to store or produce, and dial random or sequential numbers” –

(7/10/15 Order, para. 10)


Additional FCC Rules on Auto dialers“Do Use of Separate Systems In Dialing Process Avoid ATDS Issues?? –

Separate equipment dividing storage and calling functions between two companies could be considered an ATDS. (7/10/15 Order, para. 23)

If the net result of combining operation enables the equipment to have the capacity to store or produce telephone numbers to be called using a random or sequential number generator. (7/10/15 Order, para. 24)

.


Something good for apps and platform providersPetitions filed by several app providers seeking rulings that they were not liable when their users used them to send auto reply texts and text invitations to use the apps.

Legal issue is who “initiates” the call or text.

In the contexts of apps and texting/calling platforms that can be used by others, the FCC says that it will look to the “totality of the facts and circumstances” to determine:

◦ 1. Who took the steps necessary to physically place the call; and

◦ 2. Whether the app or platform provider was so involved in placing the call to be deemed to have initiated it "considering the goals and purposes of the TCPA."


Factors

Who decided whether to send the texts?

Who selected the cell phone numbers to which the texts were sent?

Who supplied the content of the messages?

Can the user be deemed to have “programmed” the app/platform to send the texts?

*KEY IS USER CONTROL EVEN IF SOME INVOLVEMENT BY APP/PLATFORM


Additional Considerations

Did the app/platform willfully enable spoofing?

Did the app/platform willfully enable caller ID blocking

Did the app/platform knowingly allow its users to use the app or platform for unlawful purposes?

HERE FCC SEEMS MORE CONCERNED WITH LEVEL OF INVOLVEMENT IN A LEGAL VIOLATION THAN TECHNCIALLY INITIATING THE CALL


FCC Rules on “Called Party” – Who is Called Party Under TPCA

FRAMEWORK for Ruling:

1. Term “called party” is ambiguous.

2. FCC Rejects “intended recipient” theory (7/10/15 Order, para. 78)

RULE: “Called party” is:

Subscriber - the consumer assigned the telephone number dialed and billed for the call (7/10/15 Order, para. 73); or

Non-subscriber - customary user of a telephone number included in a family or business calling plan. Id.

Above individuals can grant express consent to be called (7/10/15 Order, para. 73)


FCC Reaffirms CONSENT RulesThe FCC does not require any specific method by which a caller must obtain prior express consent. Para. 49 –

Based on Longstanding Rule – “[P]ersons who knowingly release their phone numbers have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary”.

A number in a contact list is not prior express consent in part because consent must be express, not implied. Para. 47, 51, 52

Burden on the caller to prove it obtained necessary prior express consent. Para. 47

FCC says consent ruling should be construed “narrowly” FCC Amicus Brief, June 30, 2014,

Nigro v. Mercantile Adjustment Bureau, 769 F.3d 804 (2nd Cir. 2014)


FCC 2008 Declaratory Ruling - Prior Express Consent – What is Consent?

–Can be verbal or in writing. (Note: TCPA Silent -Clarified by FCC 2/15/12/ Report)

–Via website - Roberts v. PayPal, Inc., 2013 U.S. Dist. LEXIS 76319 (N.D. Cal.)

–placing number on loan app, credit card application, Conditions of Admission forms, patient intake, etc.)

–Can consent be given directly to businesses party

–CRUX – get consent ONLY from consumer/debtor (FCC 2015 Ruling emphasizes this.)


FCC Rules on Revocation of ConsentRULE: “A caller may not limit the manner in which revocation may occur” (7/10/15 Order, para. 47, 64-70) –

Revocation can be made via any “reasonable means.” para. 55, 64 (reasonable means not defined)

FCC states it is unfair for called party to bear burden of showing revocation. Id., para. 70

Porting number does not revoke consent. Id., para. 54

Have Prior Express Consent to Call Landline

You Have Consent

Prior Express Consent to Call Wireless and that number is ported to another wireless

You have Consent

Calls to landline without prior express consent and that number is ported to wireless - Must get prior express consent Id., para.

52


Additional Information on RevocationRevocation is the same for informational and telemarketing calls. Para. 69

Caller’s burden to prove consent. Have ability to do so. Para. 70

Callers should maintain proper business records tracking consent. Para. 70 - The well-established evidentiary value of business records means that callers have reasonable ways to carry their burden of proving consent.)

PROVING ORAL CONSENT – Difficult, and documenting in account records could fact dispute. Solution: RECORD, RECORD, RECORD


Reassigned Wireless Telephone Numbers

“Called party” = current subscriber OR non-subscriber customary user of phone

One-free pass rule—one liability-free call after reassignment• To qualify, caller bears the burden of showing it had no knowledge of

reassignment and had a reasonable basis to believe there was valid consent

• Purpose of one call is to gain actual or constructive knowledge of the reassignment

• Unlimited period of time to make one-free call

• The one call does not need to connect to a person or voicemail

• “If this one additional call does not yield actual knowledge of reassignment, we deem the caller to have constructive knowledge of such.” (¶ 72)



Single-caller rule—a “single caller” gets one-free pass.• Single caller defined as “any company affiliates, including subsidiaries.”

• “Two affiliated entities may not make one call each, but rather one call in total.” (¶72, n.261)

Wrong/misdialed number calls? One-free pass does not apply.

Bad faith defense? NONE, even if called party purposely and unreasonably waited to notify the calling party regarding reassignment in order to accrue statutory penalties

How is this practical? FCC believes the existence of database tools combined with best practices, and a one-free pass rule, “together make compliance feasible.” (¶83)



How to Comply (according to FCC)• Make manually dialed call to confirm identity

• Listen to name on voicemail

• Send email or mail request to confirm telephone numbers or update contact information

• Database tools such as Neustar’s “Verification for TCPA” product

• Strong support for “full participation from carriers to make this type of option more effective”

• Require consumers to notify businesses when they switch numbers via contractual agreements and seek recourse for violation of the agreement

• Include an interactive opt-mechanism in prerecorded calls so that recipients can easily report a reassigned or wrong number



How to Comply (Cont’d)• Implement procedures for recording wrong number/reassigned number

reports received by customer services reps placing outbound calls

• Implement processes for allowing customer service agents to record new telephone numbers when receiving calls from customers

• Utilize an autodialer, manual dialer, and/or live caller to recognize triple-tones that identify and record disconnected numbers

• Establish policies for determining whether a number has been reassigned if there has been no response to a two-way call after a period of attempting to contact a consumer

• Enable customers to update contact info by responding to any text message they receive


“Old” Written Consent Is Not EnoughThe Coalition of Mobile Engagement Providers and the Direct Marketing Association filed petitions seeking rulings that their members could rely upon written consent provided prior to October 16, 2013.

Prior express written consent regulation for telemarketing calls and text to wireless numbers and all telemarketing artificial or prerecorded voice calls was not clear as to whether new consent required for all such calls made after regulation became effective.

FCC says you must get new consent consistent with disclosure requirements.

Clarifies that disclosures must be given and for ongoing campaigns disclosures in a call to action will not suffice; they must be in the written agreement.


Limited Waiver of Prior Express Written Consent Regulation

Grants a retroactive waiver of the prior express written consent regulations

Duration of waiver: October 16, 2013 through 89 days following release of Order

Waiver applies to Petitioners and their members as of July 10, 2015

Expectations during remaining duration of waiver: obtain for any future marketing calls/texts prior express written consent in the manner required by the current rule

Clarifies that disclosures in definition of “prior express written consent” are required

Says for the first time that including disclosures in call to action is not sufficient for ongoing campaigns; must have disclosures in the written agreement itself.


Exemptions for Certain Financial MessagesThe TCPA allows the FCC to exempt certain calls that the call recipient is not charged for (“Free-to-End-User” Calls). Responding to a request by the American Bankers Association, the FCC granted exemptions for:

(1) Fraud and identity theft alerts;

(2) Data breach alerts;

(3) Messages informing victims of a data breach about remedial measures;

and

(4) Instructions for pending money transfers.


Conditions1) Must be sent only to the wireless number provided by the

customer;

2) Must state the name and contact information of the financial institution;

3) Must not include any marketing or debt collection;

4) Must be “concise” and generally 1 minute or less for calls and 160 characters for texts;

5) No more than 3 messages per event over a 3-day period for an affected account;

6) Must have an easy means to opt-out; and

7) Must honor opt-outs immediately.


Exemptions for Certain Healthcare MessagesIn response to the AAHAM petition, the FCC also exempted certain Free-to-End-User Calls made by the healthcare industry:

1) Appointment and exam confirmations and reminders;

2) Wellness checkups;

3) Hospital pre-registration instructions;

4) Pre-operative instructions;

5) Lab results;

6) Post-discharge follow-up intended to prevent readmission;

7) Prescription notifications; and

8) Home healthcare instructions.


Conditions1) Must be sent only to the wireless telephone number provided by

the patient;

2) Must state the name and contact info of the healthcare provider;

3) Must not include any marketing, collection/accounting/billing, and must comply with HIPAA privacy rules;

4) Must be “concise” and generally 1 minute or less for calls and 160 characters for texts;

5) Only 1 message per day, up to 3 calls or text messages combined per week from a specific provider;

6) Must offer recipients an easy means to opt-out; and

7) Must honor the opt-outs immediately.


On-Demand Text Messages

One-time text message sent immediately after a consumer request does NOT violate the TCPA.

• Not telemarketing but “fulfillment of the consumer’s request.”

• E.g., consumer sees advertisement or call-to-action display and responds by texting “discount” and gets a reply text with a coupon.

Conditions:• Must be requested by consumer

• Single text in response (more than a single text requires PEWC)

• Sent immediately in response to a specific request

• Contains only the information requested by the consumer with no other marketing


Text Messages/Internet-to-Phone Technology

Text messages are calls under the TCPA.

Equipment that sends internet-to-phone text messages is an autodialer under the TCPA. (e.g., [email protected] )

“[W]e clarify that other types of text messages that pose the same consumer harms are subject to TCPA consumer protections. Specifically, consumer consent is required for text messages sent from text messaging apps that enable entities to send text messages to all or substantially all text-capable U.S. telephone numbers, including through the use of autodialer applications downloaded or otherwise installed on mobile phones. Consumers face the same privacy impact and may incur data costs from such texts. To free these texts from the TCPA’sprotection would leave a glaring gap in the statute’s coverage.” (¶116)


mailto:[email protected]

Call-Blocking TechnologyResponding to a letter from the NAAG:

1) Nothing in rules prohibits carriers or VoIP providers from implementing call-blocking technology that can help consumers who choose to use such technology to stop unwanted robocalls.

2) Encompasses both residential or individual customers as well as business customers of the service providers.

3) FCC encourages carriers to provide blocking services, but to avoid blocking robocalls from public safety and law enforcement.

4) Must disclose risk that certain desired calls may be blocked.


Contact info

Eric Allen

[email protected]

TelemarketingLawyer.com

Christine M. Reilly

[email protected]

310-312-4237


Tonia Klausner

[email protected]

Follow me on Twitter: @TCPAlawyer

Ryan ThurmanTCPAscrub.com866-362-5478 x [email protected]

David J. Kaminski, PartnerCARLSON & MESSER LLP

Dir: (310) 242–[email protected]





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