On the Horizon: FCC’s New Telemarketing Rules

On October 16, 2013, the Federal Communications Commission’s (“FCC”) new rule implementing the Telephone Consumer Protection Act (“TCPA”) will go into effect.

These are rules with teeth, as the TCPA allows recovery of anywhere between $500 and $1,500 for each improper communication and does not require a showing of actual injury. This makes the TCPA a particularly attractive vehicle for class actions. Accordingly, we highlight some of the more salient changes in the new rule below.

Currently, except in an emergency, FCC regulations require businesses to obtain “prior express consent” before making any type of call or sending any text message using autodialers or prerecorded voices to cellphones, pagers, emergency lines, or hospital room lines. Further, the regulations also require for-profit businesses to obtain prior express consent before making commercial advertisement or telemarketing calls or messages using a prerecorded voice to any residential line absent an emergency and absent an established business relationship with the person called.

Under the new rule, however, the established business relationship exemption disappears. For-profit businesses will have to acquire “prior express written consent” before making advertisement or telemarketing calls or sending text messages using autodialers or prerecorded voices to a cellphone, pager, emergency line, or hospital room line. Absent an emergency, prior express written consent will also be required for commercial advertisement or telemarketing calls or messages using a prerecorded voice made to a residential line, whether or not there is a prior business relationship with the recipient.

The written consent must be “clear and conspicuous.” In other words, the written consent must specify the phone number for which consent is given, that the consent is not on condition of purchase, and that the consent encompasses future autodialed or prerecorded telemarketing messages. The written consent can be electronic – for example, through e-mail, website forms, text messages, or telephone keypad functions.

The new rule also requires prerecorded telemarketing calls to include an interactive, automated opt-out mechanism that is announced at the beginning of the message and is available at any time during the call. If a call could be answered by an answering machine or voicemail, the message must include a toll-free number the consumer can call to opt out. The existing three-percent limit on abandoned calls is also revised to apply to calls within a single calling campaign rather than all calls made across all calling campaigns. Finally, the new rule exempts HIPAA-covered entities from the requirements on prerecorded calls to residential lines.

Many businesses may already have the necessary procedures in place to comply with the new rule, as many of the new requirements, including the written consent requirement, are designed to harmonize FCC regulations with those of the Federal Trade Commission. Still, though the new rule does not go into effect until October 16, 2013, the clock is ticking.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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