Federal Communication Commission

The Federal Communication Commission (“FCC”) has announced a consent decree with Birch Communications to pay $6.1 million to settle allegations of cramming on consumer telephone bills.  The FCC’s enforcement bureau alleged that Birch’s telemarketers misrepresented their identity and the purpose of the telemarketing calls including claiming to be affiliated with the consumer’s current carrier.

Outgoing FCC Chairman Tom Wheeler expressed strong support for the Telephone Consumer Protection Act (“TCPA”) in December.  The FCC’s press announcement describes the TCPA’s exemptions as “common sense.”

Comment: For example, debt collector calls are regulated by the TCPA, but debt collector calls to collect a debt owed to or guaranteed by the federal government are exempt.  Calls regarding debts owed to state government are not exempt.  This does not seem like “common sense.”

Entities continue to seek waivers of the opt-out disclosure requirements promulgated by the FCC for fax advertisements.  The FCC has indicated it will continue to receive and consider requests for waiver even though its initial deadline for those requests has passed.  See In re: Docket 02278 “Consumer and Governmental Affairs Bureau Seeks Comment on Petitions Concerning the Commission’s Rule on Opt-Out Notices on Fax Advertisements, December 2, 2016”.

Federal Trade Commission

The Federal Trade Commission (“FTC”) has announced settlement of two cases against senders of prerecorded “robocalls” to persons on the national “do-not-call” registry.  FTC v. Justin Ramsey; FTC v. Aaron Michael Jones

FTC Chairwoman Edith Ramirez announced her resignation from the commission effective February 10, 2017.  President Donald J. Trump will choose the new leader of the FTC.

Comment: The FTC administers the Telemarketing Sales Rule (“TSR”), the national “do-not-call” registry, and other laws and rules governing domestic trade and consumer protection.


A California court has denied a motion to dismiss for a TCPA case against a pharmacy who continued to call the plaintiff with prescription reminder calls despite his request to stop.  St. Clair v. CVS Pharmacy.  CVS argued the calls were for emergency purposes, but the judge denied this argument.

Comment: “Emergency purposes” is defined as “calls made necessary in any situation affecting the health and safety of consumers.”  47 C.F.R. § 64.1200(f)(4).  Courts and the FCC have taken a very narrow view of the scope of this definition in the past.

A California court has dismissed a case brought against a health insurer alleging TCPA violations for prerecorded calls to a number provided by plaintiff on her insurance application.  Smith v. Shield D California.  On January 13, 2017, the Court ruled the calls were informational and subject only to requirement that the consumer give prior express oral or written consent, and not prior express written signed consent required for telemarketing calls.


A trial judge has affirmed the ruling dismissing a suit brought by Nomorobo under the TCPA alleging that Nomorobo intended to generate calls to its numbers and therefore was not within the “zone of interests” the TCPA was designed to protect.  As the creation of the “illegal” calls was inherent to Nomorobo’s business plan, the Court held the company therefore should not be able to sue under the TCPA for those calls.  Telephone Science Corp. v. Asset Recovery Solutions.

Comment: This case could be valuable in other “set-up” situations where individuals intentionally opt-in to calls or faxes, then sue alleging “violations” in those communications.

An Illinois court has approved the largest class action settlement to date under the TCPA amounting to between $56 and 76 million.  Birchmeier v. Caribbean Cruise Line, Inc. et al.  The calls purported to be a “political survey,” but the callers used information gathered for sales presentations for timeshares.

Comment: The (large) group of plaintiffs’ attorneys seek one third of the total award as their attorneys’ fee, or between $15 and 25 million.

An Illinois court has denied a motion to dismiss a TCPA class action brought against a tax preparation firm which allegedly send illegal texts.  Hollingsworth v. Jackson Hewitt (D. Ill.).  The plaintiff alleged he had texted “stop” but messages continued and he never provided the defendant with his cell phone number or gave prior express consent to receive text messages.  Jackson Hewitt argued that the plaintiff had not argued the texts were sent using an automatic telephone dialing system but the court disagreed because the texts were identical and sent at the same time each day.

Plaintiffs have dismissed their suit against Donald J. Trump for President, Inc. with prejudice.  This means that they cannot refile the claim.  The notice of dismissal was filed without explanation on January 11, 2017, and could mean a confidential settlement was reached or that the plaintiffs simply dismissed their claims.


The United States Seventh Circuit Court of Appeals rejected a claim that Indiana’s “robocall” statute was unconstitutional.  The plaintiffs had argued that three exceptions to the statute (school districts, subscribers with a current business relationship, and employers sending work schedules) caused the statute to be content-based and therefore subject to “strict scrutiny” under the First Amendment to the United States Constitution.  The trial court disagreed ruling the statute to be content neutral, and the appeals court upheld the trial court decision.  The Court ruled “the three exceptions … depend on the relation between the caller and the recipient, not on what the call proposes to say.” 


A Louisiana court held that a doctor whose time and fax paper were wasted by unsolicited faxes did have standing to bring a TCPA suit.  Sartin v. EKF Diagnostics, Inc.  The defendant argued that wasted time was not sufficient as an “actual injury” for the plaintiff to have constitutional standing to bring the suit.  The judge disagreed.


A bill has been proposed in the Mississippi House (HB 1063) which would include businesses in the definition of “consumer” for state telemarketing and no-call law purposes.


A Missouri court has certified a class action against the company which sent prerecorded marketing calls to consumers advertising a movie.  Golan v. Veritas Entertainment (E.D. Mo).  The calls purported to be surveys about traditional American values, but actually advertised the movie “Last Ounce of Courage”.  Plaintiffs alleged they received illegal prerecorded calls that advertised goods or services when they were on the national “do-not-call” list.

Comment: “Do-not-call” list cases are not certified often. 

New York

A bill has been introduced in the New York Senate (SB 977) which would require telemarketers to transmit correct caller ID information in telephone solicitation calls.  A similar bill (AB 10756) has been proposed in the New York General Assembly.

Comment: This bill duplicates existing federal restrictions.

A bill has been proposed in the New York Senate (SB 3152) which would raise the maximum fine for violations of state telemarketing law to $20,000 per violation.

A New York court has approved a settlement of a TCPA class action involving more than 600,000 persons who received text messages on their cell phones from American Eagle Outfitters.  Melito v. American Eagle Outfitters, Inc.  The New York settlement involves a payment of $14.5 million.  American Eagle has sought indemnification from Experian which contracted with the retailer to send text messages.

Comment: Plaintiff’s counsel has moved for up to $4.8 million in fees.


A bill has been proposed in the Vermont General Assembly (Vermont House Bill 47) which would require telemarketers to transmit accurate caller ID information. 


A bill has been proposed in the Virginia Senate (SB 1264) which would amend Virginia’s no-call law to include calls to cellular telephone numbers (in addition to residential lines already included in the statute).  The bill would also explicitly provide for a liability for sellers who hire third party telemarketers who act illegally while calling on behalf of the seller.