contact center compliance april 11 2012 fcc webinar
TRANSCRIPT
New FCC Rules:
Expert Legal Analysis with Q&A
Compliance Webinar
April 11, 2012
David J. Kaminski
Carlson & Messer LLP
Joe Sanscrainte
Offices of Joe Sanscrainte
Ryan Thurman
Contact Center Compliance
FCC Compliance Webinar
Ryan Thurman
Director of Sales & Marketing
866-362-5478 ext. 116
David Kaminski, Esq.
Partner
Carlson & Messer LLP
(310) 242-2204
Carlson & Messer LLP
Joseph Sanscrainte
Law Office of
Joseph W. Sanscrainte
212-626-6934
Issues
• When do I need to comply with the new FCC rules and
the law re: dialers?
• Are pre-recorded calls totally off the table?
• What do I need to scrub for telemarketing and collection
calls?
• What impact do the rules have on the call abandonment
rate and abandoned call message?
• What is an automatic telephone dialing system under the
TCPA and what impact does the FCC have on dialers? 3
BACKGROUND
• 2008: FTC changes its prerecorded rules
– prerecorded telemarketing messages require express written consent
– Opt-out via automated keypress or voice-activated mechanism
– Technology “agnostic” – doesn’t matter how you make the call; doesn’t matter if its to a landline or wireless
– Successive, 30 day, per campaign standard for abandonment
• January 2010: FCC NPRM
– FCC correctly concludes its prerecorded rules are different
– Proposed rules keep existing FCC framework – NOT agnostic
– “Rolling” v. “successive” abandonment measurement 4
ISSUE 1: PRED DIAL/PREREC (PD/PR) CALLS TO CELL PHONES
• Old rule: no PD/PR to cell phones w/out PEC (PDQ)
• New rule: FCC creates two categories: – Category 1: telemarketing PD/PR calls to cell phones
– Category 2: all other PD/PR calls cell phones
• Category 1 - FCC divides THESE calls into:– Calls that constitute telemarketing generally: prior express
WRITTEN consent required
– Telemarketing calls made by tax-exempt non-profit orgs – PEC (i.e., no writing) sufficient
– HIPAA calls
• Category 2 – “catch-all”– All PD/PR calls to cells OTHER than above – PEC only
– Informational, non-telemarketing calls
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ISSUE 2: PR CALLS TO RESIDENTIAL LINES
• Old rule: PEC to deliver PR TM call to residential line– UNLESS you have an EBR – then no PEC required
– FTC removed EBR exemption in August, 2008 AND required EWC
• New rule: FCC follows FTC rule– You can not rely on EBR when delivering a PR TM call
to a residential line
– You must obtain EWC for ANY such call
– FCC makes clear this ONLY applies to TM, and NOT informational and non-telemarketing calls
– New rule does not apply to HIPAA calls6
ISSUE 3: ABANDONED CALL CHANGES
• Old rule: measure abandonment rate every 30 days across all calling campaigns– FTC requires measurement on a 30 day
successive day basis per campaign
• New rule: Same as FTC– Ok, almost . . . Seller has to disclose that the call
was for “telemarketing purposes” along with name and telephone number of the seller
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ISSUE 4: AUTOMATED OPT-OUTS
• FTC rule: – PR TM calls that “could be answered by a person”
must have interactive voice or keypress opt-out
– PR TM calls that “could be answered by an answering machine” require toll-free # disclosure
• FCC rule: see above, but . . . – Unlike FTC, FCC requires opt-out during
ABANDONED CALL message
– Toll-free # disclosure must be made during PR TM messages that are in fact left on answering machines
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ISSUE 5: IMPLEMENTATION
• “Start” point: publication of OMB’s approval
• FCC establishes:– 30-day period for abandoned call rule
– 90-day period for opt-out mechanism for PR TM calls and abandoned messages
– 12-month period for phasing out EBR exemption for PR TM calls to residential lines
– 12-month period for implementing rule that PEC be in writing for predictive dialer calls to cell phones
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• The TCPA defines the term Automatic Telephone Dialing System (“ATDS") as: 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." 47 U.S.C. §227(a)(1)(emphasis added).
• Under the FCC’s 2008 ruling, the “ATDS” definition in TCPA is expanded. FCC holds predictive dialer is an ATDS under the TCPA. FCC’s 2008 Ruling re dialers includes devices with “the capacity to dial numbers without human intervention”.
• The FCC’s 2003 and 2008 Orders: The TCPA’s ban re the use of dialers to call cell phones and other numbers was because such practices were determined to threaten public safety and inappropriately shift marketing costs from sellers to consumers.
• Note: FCC’s reason for autodialer ban, i.e., threat to public safety due to calls to emergency and healthcare numbers, shifting costs to consumers, and dialers that can dial thousands of numbers in succession which tie up telephone lines – not relevant today. Note: All dialer technologies should not be painted with the same definition of an ATDS, even under the FCC’s 2008 Ruling.
Automatic Telephone Dialing Systems and Predictive
Dialers – 47 USC Section 227(a)(1)
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• The Ninth Circuit Court of Appeals’ decision in Satterfield v. Simon & Schuster, 569 F.3d. 946 (9th Cir. 2009) did not rely on the FCC’s 2008 Ruling in its interpretation of the definition of an ATDS. The key points from the decision are as follows:
• Court holds that the phrase “automatic telephone dialing system ”(“ATDS”) as defined by § 227(a)(1) in the TCPA is clear and unambiguous. If a dialing system has the “capacity” to store or produce numbers to be called using a random or sequential number generator, such system may constitute an ATDS under the TCPA.
• 9th Circuit says no need for FCC to interpret what is an ATDS since statute clear and unambiguous on its face.
• Satterfield holds that a text message to a cell phone constitutes a “call” under 47 U.S.C. § 227(b)(1)(A).
• “Call” defined in Satterfield – To communicate with or try to get in communication with a person by telephone.
Automatic Telephone Dialing Systems and Predictive
Dialers – Satterfield Decision
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Automatic Telephone Dialing Systems and Predictive
Dialers – Satterfield Decision• Satterfield held: “summary judgment was inappropriate” - issue of material fact
whether equipment has the requisite capacity under the TCPA. Case sent back to lower district court to determine whether equipment had “capacity” (Id. at 952)
• Satterfield favors limiting scope of devices that would be considered an ATDS. Primary issue is: can dialer argument prevail on summary judgment. Issue more difficult if outside Ninth Circuit. See Griffith case (ATDS includes devices that dial “without human intervention”).
• The determination of an ATDS - will involve FCC Rulings unless within 9th
Circuit; the technical nature of dialers will likely require competing expert testimony (which may present jury question). See Satterfield, supra; see also Sears, Roebuck & Co. v. Gen. Servs. Admin., 553 F.2d 1378, 1381-83 (D.C. Cir. 1977)
• A TCPA defendant will have to weigh: risk losing on summary judgment and going to trial on the issue of whether dialer is an ATDS, which may invoke considerable exposure.
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Automatic Telephone Dialing Systems and Predictive Dialers
After Satterfield, questions remain: What constitutes the “capacity” to store or produce numbers to be called using a random or sequential number generator? Issue never decided. Case settled.
- Based upon Satterfield, the question is: what impact does 9th Circuit decision have on interpretation of “automatic telephone dialing system” as set forth in the FCC’s 2008 Ruling?
• Can FCC’s 2008 Ruling be challenged? - FCC’s 2008 Ruling may be a final order for the purposes of U.S. Supreme Court Chevron deference analysis and the Hobbs Act. See United States v. Mead Corp., 533 U.S. 218, 229 (U.S. 2001) (FCC's conformance with notice-and-comment procedures serves as a "very good indicator of delegation meriting Chevron treatment.") See also Wilson v. A.H. Belo Corp., 87 F.3d 393, 395-399 (FCC Declaratory Ruling is a “final order” under the Hobbs Act; reviewing cases from “[a]ll other circuits that have decided the issue, except the Eleventh”)
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Automatic Telephone Dialing Systems and
Predictive Dialers• Argument in favor of defense - Pursuant to Satterfield, reference to the FCC’s
2008 Ruling should be barred because the definition of an ATDS is clear and unambiguous. See Chevron USA, Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L. Ed. 2d 694 (1984) (if Congress has directly spoken to the precise question at issue, “Congress's intent must be enforced and that is the end of the matter.”)
• U.S. District Court Decision Re Predictive Dialer – Federal District Ct. held: a predictive dialer that automatically dialed numbers from a database constituted an ATDS. Griffith v. Consumer Portfolio Serv., 2011 U.S. Dist. LEXIS 91231 (N.D. Ill. Aug. 16, 2011). Crux: dialer had "capacity" to dial numbers "without human intervention". (following 2003 and 2008 Orders); Ct. rejects Satterfield: “The Satterfield court did not analyze or even cite the relevant provisions of the FCC's 2003 and 2008 orders.” Ct. not bound by Satterfield.
• Manually Dialed Calls Attached to Dialer - Where call is manually dialed, even if phone is attached to an ATDS, no TCPA liability. See Dobbin v. Wells Fargo Auto Fin., Inc., 2011 U.S. Dist. LEXIS 63856 (N.D. Ill. June 14, 2011)(although desk phone was connected to ATDS that had capacity to autodial, because desk phone calls were manually dialed, no TCPA liability because not “using” the ATDS as required under TCPA).
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Automatic Telephone Dialing Systems - Dialing in
“Preview Mode”
• In “preview” dialing mode, numbers to be called are sent to a live agent by dialer or software before the number is dialed by the dialer. Agent has the option to place a call to the telephone number. If agent chooses to place the call, agent instructs dialer by a command and the dialer makes the call.
• Does dialing in preview mode violate the TCPA? - Under Satterfield and the TCPA’s ATDS definition, if agent intervenes to place a call from specific debtor accounts, and if the dialer does not have the “capacity” to store or produce numbers to be called via a random or sequential number generator program, maybe no TCPA liability.
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Automatic Telephone Dialing Systems – Dialing in “Preview Mode”
• FCC Impact on Preview Dialing - FCC’s 2008 Ruling regarding dialers includes devices with “the capacity to dial numbers without human intervention”. (See Griffith) Argue - Dialing in preview mode does not constitute an ATDS under the FCC Ruling because preview mode dialing requires human intervention to dial the call.
• Caveat: central issue in preview mode is: capacity to dial without human intervention!!!! If the dialer at issue is configured such that it cannot place calls without the human element, maybe dialer does not have “capacity” to dial without human intervention.
• Distinguish 2003 and 2008 FCC Rulings and purpose of autodialer ban.
• Caveat: Even if dialer not an ATDS under TCPA, caution re using artificial or prerecorded voice without prior express consent. 227(b)(1)(A).
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David Kaminski, Esq.
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