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The Telephone Consumer Protection Act ("TCPA") reaps extraordinary fines and civil penalties from the often-unknowing business that engages in automated telephone or fax advertising. If the potential damages were not already enough, under the newly enacted TCPA legislation, beginning this summer, fines have been increased from $500 to $11,000 for each violation.
Not only are the potential damages staggering, but the costs to defend such claims can be extraordinary as well because the TCPA can be enforced not only by the Federal Communications Commission ("FCC") and state Attorney General offices but also by any private party who receives a phone call or fax in violation of this statute. Consequently, telemarketers may be forced to defend claims throughout California, or in any other state, because the TCPA authorizes enforcement in state courts.
On Tuesday, March 11, 2003, President Bush signed legislation creating a national "do-not-call" list intended to help consumers block telemarketing calls. To block telemarketing calls, a consumer who receives a solicitation has two options.
When they receive an unwanted telemarketing call, they can tell the telemarketer that they want to be added to the telemarketer's internal "do-not-call" list. The telemarketer must then include the consumer on its own company-specific "do-not-call" list and keep a record of this request for 10 years. The telemarketer cannot make additional calls to the consumer.
Alternatively, the consumer can stop all telemarketing calls by adding his phone number to the national "do-not-call" list. The telemarketer must check the national "do-not-call" list every three months to find out who does not want to be called. Registration on the national "do-not-call" list will not prevent all telemarketing calls. In particular, it will not cover:
- calls from companies in which you have established a business relationship;
- calls from companies in which you have given prior written consent;
- calls which are not commercial or do not include unsolicited advertisements;
- calls by or on behalf of tax-exempt non-profit organizations.
Telemarketers who continue to call consumers on the national "do-not-call" list, and do not meet any of the above criteria, can be fined/penalized $11,000 for each violation.
Telemarketers have challenged this new legislation as a violation of their First Amendment rights to free speech. A lawsuit has been filed by telemarketing groups against the Federal Trade Commission to block implementation of the National "do-not-call" list. In the interim, the Federal Trade Commission has moved forward with creating its national "do-not-call" list. Interested consumers can register their phone numbers at www.donotcall.gov or by calling 1-888-382-1222.
Enforcement of the TCPA is increasing among federal/state agencies and individuals who have the wherewithal to file state lawsuits seeking damages under this federal statute. Businesses looking to advertise their product or service by telemarketing need to consider the TCPA before proceeding with their marketing plan. By implementing the proper policies and procedures, TCPA violations can be successfully avoided.
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