Beware: TCPA Litigation is Growing

By Steve Brubaker, InfoCision Chief of Staff

We see this problem occur time and again: In an effort to drive sales and improve brand awareness, companies increase their outbound communication efforts. Along the way, they wind up going too far and illegally reaching out to consumers who do not give expressed consent to be contacted.

When this happens, it’s a direct violation of the Telephone Consumer Protection Act (TCPA), a complex set of rules and regulations that govern exactly how companies are allowed to communicate with consumers. First passed into law in 1991, the TCPA restricts the use of automated dialing systems, short message service (SMS)-based text messages, faxes and prerecorded voice messages.

Two major TCPA rules, for instance, prohibit actions like contacting consumers after 9 p.m. or people who are listed in the National Do Not Call Registry. As you can see, these two violations could be easily overlooked by people who are unfamiliar with the law.

What can happen if you violate the TCPA? First and foremost, it can anger customers and tarnish your brand’s reputation. There are also strict financial penalties to be aware of, too. A consumer, for instance, can sue your organization for each TCPA violation, or to recover financial loss stemming from a TCPA violation. Oftentimes, customers will band together and fire back against companies with major class action lawsuits following TCPA violations.

This recently happened to a major cruise line, which now must pay out settlements of up to $900 to customers who were contacted by the company.

Don’t make the mistake of thinking you can fly under the radar and avoid a TCPA violation, either. Consumers are quick to report possible TCPA violations, and are doing so more than ever. According to a new study, there has been a major uptick in TPCA violations since 2015. In fact, TCPA violations have increased by a whopping 50 percent since this time.

The study, TCPA Litigation Sprawl, revealed that there has been 3,121 TCPA cases between August 1, 2015 and December 31, 2016. And more than 1,000 of these cases are nationwide class action lawsuits seeking tens of millions, or even billions of dollars in compensation. Companies have been affected across more than 40 different industries.

The industries with the most lawsuits included the health, retail and education sectors. Combined, those sectors represented more than 20 percent of all defendants.

Businesses must therefore operate with extreme caution when reaching out to consumers with offers and promotions. Oftentimes, organizations get into trouble when they do not understand TCPA law well. As such, it’s very beneficial to have access to an onsite legal team who can offer advice and recommendations during outbound marketing campaigns.

It makes much more sense to partner with a third party contact center solutions provider offering onsite legal services.

 

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