telephone consumer protection act advocacy update...nov 04, 2014 · tcpaadvocacy update as...

U . S . C H A M B E R O F C O M M E R C E

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Telephone Consumer Protection ActAdvocacy Update

2014 National Council of Higher Education Resources(NCHER) Knowledge Symposium – November 4, 2014

Jason GoldmanSenior Telecommunications Policy Counsel and Managing DirectorEnvironment, Technology & Regulatory Affairs DivisionU.S. Chamber of Commerce


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Background on the TelephoneConsumer Protection Act(TCPA)


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TCPA Was Passed 23 Years Ago

In response to complaints about unwanted phone calls,especially during dinner time, Congress passed theTelephone Consumer Protection Act (TCPA) in 1991.

“Computer telephone calls are invading our homes anddestroying our privacy….They wake us up in themorning; they interrupt our dinner at night; they forcethe sick and elderly out of bed; they hound us until wewant to rip the telephone right out of the wall. Thesemachines are out of control….[I]t has got to stop.” –Sen. Ernest “Fritz” Hollings (D-SC)

Source: 137 Cong. Rec. S16204 at *S16205‐ S16206, 1991 WL 229525 (Nov. 7, 1991)(Remarks of Sen. E. Hollings)


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How Technology Looked in 1991

At the time the TCPA was passed, cellphonesresembled bricks and were often connected to abag.

Wireless phones were a luxury item and thelandline was the dominant consumertelecommunications device.


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TCPA Restrictions on Calls to Cell Phones

Thus, certain restrictions in the TCPA are onlyapplicable to calls made to cell phones.

Specifically, the TCPA prohibits the use of anautomatic telephone dialing system (ATDS) to callor send texts to mobile phones without the consentof the recipient.


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SEC. 227. [47 U.S.C. 227] RESTRICTIONS ON THE USEOF TELEPHONE EQUIPMENT

(b) Restrictions on use of automated telephone equipment(1) Prohibitions – It shall be unlawful for any person within theUnited States, or any person outside the United States if therecipient is within the United States–

(A) to make any call (other than a call made for emergencypurposes or made with the prior express consent of the calledparty) using any automatic telephone dialing system or anartificial or prerecorded voice–

(iii) to any telephone number assigned to a paging service,cellular telephone service, specialized mobile radio service,or other radio common carrier service, or any service forwhich the called party is charged for the call.


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SEC. 227. [47 U.S.C. 227] RESTRICTIONS ON THE USEOF TELEPHONE EQUIPMENT (continued)

(a) DEFINITIONS. – As used in this section–

(1) The term “automatic telephone dialing system” means

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.


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Statutory Damages for TCPA Non-Compliance

TCPA provides that a consumer can receive $500per call for a negligent violation and up to$1500.00 per call for a willful violation.

Damages are assessed per call or text message.

The TCPA does not include a cap on statutorydamages.


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Why Does the TCPA Need tobe Updated?


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Wireless Usage has Changed Dramatically

In today’s mobile world, consumers expect anddemand important information instantly no matter whenor where they are located.

There have been more U.S. wireless subscribers thanresidents since 2011, according to CTIA-The WirelessAssociation.


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Wireless Usage has Changed Dramatically

According to a recent CDC National Center forHealth Statistics' report, in the second half of 2013:

- 41.0% of U.S. households were “wireless-only.”

- An additional 16.1% were “wireless-mostly” (i.e., thehousehold has a landline but receives all or most calls ona wireless phone).

- Thus, 57.1 percent of U.S. households rely eitherexclusively or predominantly on wireless telephoneservice.

Source: Stephen J. Blumberg & Julian V. Luke, Div. of Health Interview Statistics, Nat’l Ctr. for HealthStatistics, Centers for Disease Control and Prevention, Wireless Substitution: Early Release ofEstimates From the National Health Interview Survey, July–December 2013, at 1 (July 2014).


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TCPA Litigation is Surging

At the time the TCPA was created, its sponsor,Sen. Hollings explained the law was intended tofacilitate actions in state small claims courts, whichinvolve smaller sums and often do not require (oreven allow) the participation of attorneys.

But today, TCPA cases are anything but small.Trial lawyers have used the law to file large classaction lawsuits.


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TCPA Litigation is Surging

The defendants in these cases are no longer justabusive telemarketers.

They are businesses, big and small alike, forced todecide whether to reach a settlement with theplaintiff’s counsel or to accept the risk and spendsignificant resources defending itself against anaction where the alleged statutory damages maybe in the millions or even billions of dollars.


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1,908 TCPA lawsuits have been filed in 2014 (as of 9/30), anincrease of 29.9% over the same period last year.

24 (13.6%) of the 193 TCPA lawsuits filed in September 2014,were class actions.

Source: Debt Collection Litigation & CFPB Complaint Statistics, September 2014, WebRecon LLC,Oct. 17, 2014, available at http://dev.webrecon.com/debt-collection-litigation-cfpb-complaint-statistics-september-2014/; and Debt Collection Litigation & CFPB Complaint Statistics, December2013 & Year in Review, WebRecon LLC, Jan. 22, 2014, available at http://dev.webrecon.com/debt-collection-litigation-cfpb-complaint-statistics-december-2013-year-in-review/.

2008 2009 2010 2011 2012 2013 2014

Number of

Cases14 31 345 825 1,101 1,862 1,908

TCPA Litigation Statistics


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TCPA Litigation Statistics


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Current Status of Advocacyfor TCPA Update


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TCPA Advocacy Update

As wireless devices and services become even moreprevalent in our society and TCPA litigation continuesto skyrocket, we have seen more and more petitions(currently over 50) filed at the FCC seeking clarificationby the agency of its TCPA rules.

Examples of common issues raised in the petitions:

- Definition of autodialer;

- Definition of capacity (hypothetical vs. current);

- Definition of called party; and

- Reassigned/wrongly dialed numbers.


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TCPA Advocacy Update

At the FCC and on Capitol Hill, the Chamber hasargued the FCC should issue clarifying rules and, ifnecessary, commence a rulemaking proceeding.

In the short term, the FCC needs to act to:

- Bring regulatory certainty to the business community; and

- Stem the tsunami of class action TCPA lawsuits driven not byaggrieved consumers, but by the opportunist plaintiffs’ firmstaking advantage of uncertainty in the law to rake in attorneyfees.

In the long term, statutory changes to the TCPA arenecessary.


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Additional Resources

U.S. Chamber TCPA Web page.https://www.uschamber.com/issue-brief/telephone-consumer-protection-act-tcpa.

U.S. Chamber Institute for Legal Reform paper onTCPA litigation:http://www.instituteforlegalreform.com/resource/the-juggernaut-of-tcpa-litigation--the-problems-with-uncapped-statutory-damages/


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Jason GoldmanSenior Telecommunications Policy Counsel and

Managing [email protected]

202.463.5949

Follow us on Twitter @Regulations

Visit our website at www.uschamber.com/etra

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