Jewel Team     Serving the Central IL region from Dunlap, IL     Local: 309.243.8100

Telemarketing: Know the New Rules

Telemarketing Today: Know the New Rules

$5,254,500. That’s how much Pennsylvania-based Lake City Industrial Products last year was ordered to pay in a class-action suit in which the company sent fax solicitations to 10,500+ businesses who hadn’t agreed to receive them. Well, actually the company paid a third-party marketer about $92 to send those faxes. As it turns out, that was one expensive mistake. The fine, if you haven't already done the math, was about $500 per fax.

And that was under the “old rules.” The Telecommunications Consumer Protection Act (TCPA) of 1991 required only verbal permission or even an “established business relationship” to make telemarketing to another business or individual legal.

As of Oct. 16, 2013, new, more stringent rules up the ante. And according to Martha Buyer, telecommunication attorney for the STC and other end-users of telecommunications services “Anyone who…might even consider making any form of robocalls or texts—even to important customers for ‘all the right reasons’—is well-advised to pay careful attention.”

Buyer notes that class-action suits like the one noted above have become more common. Even high-profile businesses like Steve Madden (shoes), Coca-Cola and Papa John’s (pizza) have been caught with their hands in the proverbial cookie jar and have or likely will pay handsome settlements. And with the new TCPA rules, she predicts the number of such class-action suits is about to expand exponentially.

So take heed! Whether you’re tired of receiving unsolicited telemarketing or want to be sure your (perfectly well-intentioned) telemarketing doesn't run afoul of the new rules, you need to understand the changes now in effect:

Prior express written consent: Unambiguous written consent—which may be either a hand-written or digital signature—is required before making a pre-recorded or autodialed telemarketing call to cell or land lines or a text message to a cell number. The exception: Calls that are manually dialed that do not contain a pre-recorded message.

No “established business relationship” exemption: Having previously had a business connection—such as a previous purchase from a solicited party—no longer relieves advertisers of requiring unambiguous (now written) consent.

Unambiguous means what it says: The consumer must receive a “clear and conspicuous disclosure” that he or she will receive future calls that deliver autodialed and/or pre-recorded telemarketing messages on behalf of a specific advertiser. That consent may not be a condition of purchase and the consumer must designate a phone number at which to be reached (and that phone number should not be pre-populated by the advertiser in an online form).

Limited exceptions apply: A few types of communications are exempt, including calls/texts from the consumer’s cellular carrier, debt collectors, schools, informational notices and healthcare-related calls.

Advertisers bear the burden of proof: Should a dispute arise, the advertiser must demonstrate proof of consumer consent. It’s considered “best practice” for advertisers to maintain each consumer’s written consent for at least four years, the federal statute of limitations to bring action under TCPA.

Penalties are stiff: As noted earlier, penalties can add up quickly. The TCPA provides for either actual damages or statutory damages ranging from $500 to $1,500 per unsolicited call/message, depending on whether the defendant “willfully” or “knowingly” violated the TCPA. Telemarketing campaigns often involve thousands of calls/texts, so potential damages can add up quickly.

The advertiser is responsible, no matter what. If you hire a third party to conduct your telemarketing, you, the advertiser, is the sole liable party. So it’s important to use only reputable telemarketers or call centers that demonstrate a clear understanding of these new rules and keep excellent records.

No “grandfathering” is allowed. That means, if you already have a telemarketing list established under the old “verbal ok” rule, you need to go back to each person on the list and get written consent as noted earlier.

The good news: If you’re a personal or business consumer, these new rules will keep you from receiving unsolicited telemarketing. And if you do, you can sue the sender alone or join a class of others who were similarly illegally solicited.

The bad news: If you’re a business that relies on telemarketing, your job just got a lot tougher. However, in situations like this, necessity truly is the mother of invention. Faced with the daunting task of gaining written consent, many advertisers will likely shift more focus to other means of getting their messages out—particularly the burgeoning area of social network marketing. What’s next? Time will tell.


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