New TCPA Rules Take Effect on October 16, 2013

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The Telephone Consumer Protection Act of 1991 (“TCPA”)[1] places certain restrictions on telemarketing calls, text messages, and faxes.  It has long been a favorite of the plaintiffs’ bar because it provides for statutory damages of $500 to $1500 per violation,[2] which in the aggregate can lead to substantial windfalls for plaintiffs.  TCPA violations (even innocent ones) can place companies at significant risk and TCPA litigation has skyrocketed as a result.[3]

Last year, the Federal Communications Commission (“FCC”) added fuel to the fire by amending its TCPA rules and further restricting telemarketing calls.[4]  The most significant of those amendments – which narrow and eliminate key statutory exemptions – will take effect tomorrow, on October 16, 2013.

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Federal Court Takes Narrow View of What Constitutes an ATDS

The TCPA prohibits the use of an automatic telephone dialing system (“ATDS”) to place calls to wireless phones without the called party’s prior express consent.  Because calls placed without the use of an ATDS are not subject to the TCPA’s prior express consent requirements, what constitutes an ATDS has been a hotly contested issue.  This issue can be expected to take on even greater importance under the new FCC rules that take effect on October 16, because the “prior express consent” requirement will now require written consent.  Telemarketers, it can be expected, may explore ways to abandon the use of equipment that would fall within the definition of ATDS and to modify or replace that equipment with something that would not be an ATDS.

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