How to make sure you and your third party vendors are compliant
Earlier this year several major companies were hit with significant fines for violating the current Telephone Consumer Protection Act (TCPA) law. Papa John’s agreed to pay a staggering $16.5 million dollars as part of a settlement. TCPA litigation has been increasing in recent years and the new TCPA revisions going into effect on October 16 are likely to fuel more litigious activity. As we all get ready for October 16, it’s important to keep in mind the significant monetary liabilities businesses can face under the TCPA, including liability for actions of third-party marketing partners.
ATDS defined, or is it?
Calls made without the use of an Automatic Telephone Dialing System (ATDS), or a prerecorded message are not subject to the TCPA’s consent requirements; however, there has been some uncertainty in the industry regarding what constitutes an ATDS. The term ATDS is defined 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.” A large portion of the uncertainty stems from the term “capacity” in this definition. The concern has been that courts might interpret the term capacity so broadly that equipment would constitute an ATDS if it could be altered or modified in a manner that would allow it to autodial telephone numbers (even if it did not currently have the ability to do so).
We are beginning to see inconsistency in the case law related to TCPA regulations on cell phones. Of course, InfoCision will maintain the most conservative approach for our clients, as we have a manual dial solution which does not have the capacity to dial predictively.
A recent decision issued by the Northern District of Alabama, in Hunt v. 21st Mortgage Corp., held that a system must have the present capacity, at the time the calls were made, to operate as an autodialer for it to be an ATDS. According to the Court, equipment is not an ATDS if “substantial modification or alteration” is required for the system to have such capacity. This is an important decision for companies that plan to make calls to cell phones using non-ATDS equipment, and it will be interesting to see whether other courts will adopt a similar interpretation when considering this issue in future cases.
What you need to know about obtaining consent
As an industry leader and expert in compliance, we have prepared useful tips and sample consent templates to help organizations get ready for this new requirement. To learn more about the FCC TCPA requirement and to access the tips and sample consent templates click here.
InfoCision has already made all necessary adjustments and we encourage all organizations to review how they obtain cell phone numbers to be used for phone or for text solicitation. We also encourage all organizations to make sure any third party vendors they utilize are compliant.
If you have found this information helpful, please leave a comment or question if you want to discuss further.
Also, we will be at DMA2013 in Chicago from October 13 through October 15. Stop by booth #1019 and say hi!