What you need to know about the new TCPA rules effective 10/16/13

What you need to know about the new TCPA rules effective 10/16/13
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On October 16th, 2013 new rules will go into effect regarding the Telephone Consumer Protection Act. To educate our customers and readers, we want to make sure you know exactly what rights you have as consumers and as direct marketers.

Instead of CAS trying to explain this, it’s best to leave this to the experts. David O. Klein, partner with the firm of Klein Moynihan Turco LLP in New York, NY, explains the new requirements in detail on his firm’s website. With his permission, here is how the new rules will impact direct marketing:

What is the Telephone Consumer Protection Act (“TCPA”)?

The TCPA[1] was passed into law in 1991. The Federal Communications Commission (“FCC”) is empowered to issue rules and regulations implementing the TCPA.  Among other things, the TCPA allows individuals to file lawsuits and collect damages for receiving unsolicited telemarketing calls, faxes, pre-recorded calls or auto-dialed calls.

What is a Telemarketing Call?

“Telemarketing” calls include those made by advertisers[2] that offer or market products/services to consumers. Purely informational calls and calls for non-commercial purposes are exempt from the FCC’s regulations.

What is an Auto-dialed Call?

An auto-dialed call is a phone call, involving a live person or pre-recorded message, that is placed using an “auto-dialer,” or automatic telephone dialing system, that can produce, store and call telephone numbers using a random or sequential number generator.[3]  The auto-dialed call definition should be broadly construed in an effort to avoid unwanted litigation and regulatory action.  For instance, if you are utilizing any type of call center software as part of your telemarketing operations, you may be using an auto-dialer within the FCC’s definition.  If you are unsure, we recommend that you consult with an attorney who has expertise in telemarketing law.

What is a Robocall?

A robocall is a phone call that uses an “auto-dialer” system to deliver a pre-recorded telemarketing message.

Are SMS text messages to cell phones considered “calls” under the TCPA?

Yes. The TCPA applies to both voice and short message service (SMS) text messages, if they are transmitted for marketing purposes. The TCPA has been interpreted in recent years to prohibit the sending of unsolicited commercial text messages to cell phones – with limited exceptions (i.e., messages sent for emergency purposes).

What are the new TCPA Rules?

In a Report and Order approved on February 15, 2012, the FCC adopted additional protections for consumers concerning unwanted auto-dialed and/or robocalls.  The changes to the TCPA are as follows:[4]

New Rule


What is the new requirement?

Prior express written consent October 16, 2013 Unambiguous written consent required before telemarketing call or text message.  Exception: calls that are manually dialed and do not contain a pre-recorded message are exempt from the TCPA.
No “established business relationship” exemption October 16, 2013 Established business relationship no longer relieves advertisers of prior unambiguous written consent requirement.

1)     Beginning October 16, 2013, prior express written consent will be required for all autodialed and/or pre-recorded calls/texts sent/made to cell phone and pre-recorded calls made to residential land lines for marketing purposes.

Compliance with the E-SIGN Act satisfies this requirement, meaning that electronic or digital forms of signature are acceptable (i.e., agreements obtained via email, website form, text message, telephone keypress or voice recording).

Consumer consent must be unambiguous, meaning that the consumer must receive a “clear and conspicuous disclosure” that he/she will receive future calls that deliver auto-dialed and/or pre-recorded telemarketing messages on behalf of a specific advertiser; that his/her consent is not a condition of purchase; and he/she must designate a phone number at which to be reached (which should not be pre-populated by the advertiser in an online form).  Limited exceptions apply to this requirement, such as calls/texts from the consumer’s cellular carrier, debt collectors, schools, informational notices and healthcare-related calls.

If a dispute concerning consent arises, the advertiser bears the burden of proof to demonstrate that a clear and conspicuous disclosure was provided and that the consumer unambiguously consented to receive telemarketing calls to the number he/she specifically provided.  It is a best practice for advertisers to maintain each consumer’s written consent for at least four (4) years, which is the federal statute of limitations to bring an action under the TCPA.  Evidence of Internet-provided written consent includes, but is not limited to, website pages that contain consumer consent language and fields, associated screenshot of the consent webpage as seen by the consumer where the phone number was inputted, complete data record submitted by the consumer (with time and date stamp), together with the applicable consumer IP address.

2)     Beginning October 16, 2013, the “established business relationship” exemption for pre-recorded telemarketing calls to residential landlines will be eliminated.

In the past, advertisers could rely on an established business relationship (such as a previous purchase) to circumvent the need to obtain a consumer’s written consent to receive telemarketing calls.  That exception to the consent requirement will no longer exist after this year.  Advertisers will have to obtain written consumer consent, outlined above, even if they previously had a business relationship with the consumer.

What are the penalties for failing to comply with the TCPA?

The TCPA provides for either actual damages or statutory damages ranging from $500.00 to $1,500.00 per unsolicited call/message.   In determining the final amount of statutory damages to award, courts analyze whether the defendant “willfully” or “knowingly” violated the TCPA.  Considering that telemarketing campaigns often involve thousands to, in some cases, millions, of calls/text messages, potential damages under the TCPA may escalate very quickly.

Sample Website

Consent Language

I hereby consent to receive auto-dialed and/or pre-recorded telemarketing calls from or on behalf of [ADVERTISER] at the telephone number provided above.[5]I understand that consent is not a condition of purchase.

If you are in need of legal advice/assistance in connection with a prospective marketing campaign, we would be happy to speak with you.  Please contact David O. Klein at 212.246.0900 or via e-mail at dklein@kleinmoynihan.com.

The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney.  Each marketing situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced telemarketing attorney.

[1] 42 U.S.C. §§ 227 et seq.

[2] For simplicity, the term “advertisers”, as contained herein, include sellers and those telemarketing companies that market sellers’ goods/services.

[3] 47 U.S.C. § 227(a)(1).

[4] Please note that two new TCPA regulations have already gone into effect: 1) interactive opt-out mechanisms must be announced at the outset of the message and be available throughout the duration of the call; and 2) advertisers must keep records of “abandoned calls” and average no more than 3% for each campaign over a 30-day period.

[5] The checkbox and phone number should not be pre-populated and the consumer’s phone number should appear on the same page as the consent.

David O. Klein is the managing partner of the law firm of Klein Moynihan Turco LLP in New York, NY, where he practices Telemarketing and Internet Marketing Law. He can be reached at (212) 246-0900 or via e-mail at dklein@kleinmoynihan.com


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