Updates on the TCPA Along with Court Interpretation

The Telephone Consumer Protection Act of 1991 (TCPA)¹ was passed signed into law in 1991, as an amendment to the Communications Act of 1934. The TCPA regulates telephone solicitations² and the use of automated telephone equipment.³  In addition, the TCPA limits the use of automatic dialing systems, artificial or prerecorded voice messages, SMS text messages, and fax machines, to initiate any telephone call to any residential telephone line, for collection or otherwise.

The TCPA sets forth certain technical requirements for fax machines, automatic dialing systems, and voice messaging systems.  In the event of a violation of the TCPA, a subscriber may sue for up to $1,500 for each violation or to recover actual monetary loss, whichever is higher. In addition, the subscriber may seek an injunction.

Pursuant to the TCPA, it is a violation to do the following, without the “express consent” of the call recipient: 

• Calling residences before 8 a.m. or after 9 p.m., local time.
• Soliciting residences using an artificial voice or a recording.
• Making a call using automated telephone equipment or an artificial or prerecorded voice to an emergency line (e.g., "911"), a hospital emergency number, a physician's office, a hospital/health care facility/elderly room, a cellular telephone, or any service for which the recipient is charged for the call.
• Engaging two or more lines of a multi-line business with an automatic dialing system.
• Sending of unsolicited advertising faxes.

Under the TCPA, if a consumer either provides prior express invitation or permission to, or has an established business relationship with any person or business, such as an account on which collection is now being pursued, the cell phone number of the consumer may be called.  However, that number cannot be dialed via an automated dialing system without the prior express consent of the called party.⁴
  
On February 15, 2012, the Federal Communications Commission (FCC) released a Report and Order in CG Docket No. 02–278, FCC 12–21, revising its rules to: (1) require prior express written consent for all autodialed or pre-recorded telemarketing calls to wireless numbers and for all pre-recorded telemarketing calls to residential lines; (2) eliminate the established business relationship exception to the consent requirement for pre-recorded telemarketing calls to residential lines; (3) require telemarketers to include an automated, interactive opt-out mechanism in all pre-recorded telemarketing calls, to allow consumers more easily to opt-out of future robocalls during a robocal itself; and (4) require telemarketers to comply with the 3% limit on abandoned calls during each calling campaign, in order to discourage intrusive calling campaigns.⁵  
Additionally, there are several Amended rules to the TCPA that go into effect this year, including the following:    

• Calls to wireless numbers made via automated dialing equipment will be prohibited without the consumer’s express written permission (effective October 13, 2013).
• Prerecorded and automated voice calls to both wireless and landline phone numbers will be prohibited without express written permission (effective October 13, 2013).
• Prerecorded and automated voice calls must include an interactive opt-out mechanism (effective January 14, 2013).Adopting a “per campaign” standard for measuring the call abandonment rate (effective November 15, 2013).

These updates to the TCPA impose additional opt-out requirements and consent requirements for prerecorded or automated dialing telemarketing calls, harmonizing the FCC's implementation of the TCPA with the Federal Trade Commission's Telemarketing Sales Rule (TSR).  Penalties for these TCPA violations begin at $500 per call and can be tripled to $1,500 per call.

In addition to this, the rules pertaining to the ability to opting out of a call list have changed.  Under the old rule, consumers who do not wish to receive further prerecorded calls, such as collection calls with the use of an automatic dialer, can opt out by dialing a telephone number (required to be provided in the prerecorded message) during regular business hours to make a company-specific Do-Not-Call request.   Under the new rule, artificial or prerecorded messages must include an automated interactive (voice or key press) opt-out mechanism, which is announced at the outset of the message and available throughout the duration of the call, that will allow consumers to opt out of receiving additional calls immediately.  

Now, the opt-out mechanism, when invoked, must automatically add the consumer's number to the seller's do-not-call list and immediately disconnect the call.  Prerecorded telemarketing messages left on answering machines or voicemail services must include a toll-free number that consumers can subsequently call back in order to connect directly to an automated opt-out mechanism.

“Express consent” and “express written permission” have undergone much scrutiny.  In 2008, the FCC issued a declaratory ruling, entitled In re: Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 23 F.C.C.R. 559 (2008) (hereinafter, the “2008 FCC Ruling”), that interpreted the statutory phrase “prior express consent” under the TCPA:

Because we find that autodialed and prerecorded message calls to wireless numbers provided by the called party in connection with an existing debt are made with the “prior express consent” of the called party, we clarify that such calls are permissible. We conclude that the provision of a cell phone number to a creditor, e.g., as part of a credit application, reasonably evidences prior express consent by the cell phone subscriber to be contacted at that number regarding the debt. . . .

The FCC emphasized that prior express consent is deemed to be granted only if the wireless number was provided by the consumer to the creditor, and that such number was provided during the transaction that resulted in the debt owed.  Thus, the FCC has determined that “prior express consent” will be found whenever a person has provided his cell number to a creditor in connection with the transaction that resulted in the debt.

In early May of this year, the U.S. District Court for the Southern District of Florida, Mais v. Gulf Coast Collection Bureau, et al., released a crucial decision regarding the use of a predictive dialer (automated dialer system).  The issue in this case was whether Defendants complied with the TCPA.  The TCPA plainly requires such “prior express consent” before a party may be called; mere “implied consent” will not do.

Again, because the TCPA does not define the term “prior express consent,” the Court had to look to the common usage of those words to discern their meaning⁶  “Courts often look to the dictionary definitions of terms to determine their common usage.⁷ ” Black’s Law Dictionary defines “express consent” as “[c]onsent that is clearly and unmistakably stated.⁸ ” It also defines “express” as “[c]learly and unmistakably communicated; directly stated.⁹ ” By contrast, “implied consent” is defined as “[c]onsent inferred from one’s conduct rather than from one’s direct expression,” or “[c]onsent imputed as a result of circumstances that arise, such as when a surgeon removing a gall bladder discovers and removes colon cancer."¹⁰

In Mais, the underlying facts provided that in 2009, plaintiff Mais went to the emergency room at which time his wife interacted with the admissions staff on his behalf, providing his cellular telephone number to the admissions representative, identifying it as a residential line.  The wife signed additional paperwork for her husband, including a “Notice of Privacy Practices” which stated that the hospital “may use and disclose health information about [Mais’] treatment and services to bill and collect payment ….”

Neither Mais nor his wife ever provided his number to any other provider/creditor related to his hospital stay; rather, another provider, electronically retrieved his cellular telephone number and other information from the hospital. After not fully paying the charges, the account was forwarded to a third party for collection, who uses a predictive dialer to dial telephone numbers through automated technology without human involvement.

Using its predictive dialer, the third party vendor placed calls to Mais in an effort to collect the medical debt owed.  This vendor attempted between 15 and 30 debt collection calls to Mais cellular telephone and left four messages relating to the debt. 

The court in Mais held that the third party vendor did not have “express written consent” as required under the TCPA, to contact Mais using his cellular telephone, with an automatic dialer system.  The court declined to hold the original creditors/providers liable for the acts of the third party vendor, stating “it will employ the statute as written and find that only those who make calls in violation of section 227(b)(1)(A) may be held liable.”  The court did, however, find that Mais had not provided “prior express consent” to the creditors/providers, by his wife’s actions in listing the cellular telephone number on the admission paperwork, opining that unlike on a credit application, the provision of a number in a health care situation is more likely for health related follow up, not implied for use in debt collection.

In the world of utilities, obtaining anything in writing is difficult, at best.  That said, with the use of internet bill pay and e-signature options, it is recommended that language indicating the customer has provided “express consent” or “express written consent” to be contacted at any telephone number provided, be included on every transaction with a consumer, with a requirement to provide a phone number, to complete any online transactions. Vague language may impact the ability to rely on such consent as an affirmative defense in any subsequent litigation.

Weltman is here to help navigate the TCPA and its applicability to utility providers.  If you have any further questions about this article please contact us at WWR-Utilities@weltman.com.

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1  The TCPA is codified as 47 U.S.C. 227.
2  SEC. 227. [47 U.S.C. 227] RESTRICTIONS ON THE USE OF TELEPHONE EQUIPMENT – see (a)(4)
3  Id. see (a)(1)
4  47 USC 227(b)(1)(A)(iii).
5  http://www.gpo.gov/fdsys/pkg/FR-2012-10-16/pdf/2012-25316.pdf
6  See CBS Inc. v. PrimeTime 24 Joint Venture, 245 F.3d 1217, 1222 (11th Cir. 2001).
7  Koch Foods, 2013 WL 869645, at *4. 
8  Black’s Law Dictionary 346 (9th ed. 2004).
9  Id. at 661. 
10  Id. at 346.