I hate to beat a dead horse, but despite all sorts of newly enforceable regulatory hurdles, those obnoxious telemarketing calls keep coming. The good news is that the FCC, as the lead agency enforcing the newly tightened telemarketing rules, is taking action, but the bad news is that the calls keep coming because they are effective. Not at my house, and not likely at yours, but someone’s buying what telemarketers are selling. Just like any hungry sales person knows when obstacles are placed in the path, you work around them. Telemarketers and those who rely on their services are no different than any other industry that is quasi-regulated. As new legal and regulatory hurdles are placed in front of them, telemarketers devise creative ways to re-interpret or completely ignore them altogether.
Hiring third-party telemarketers to make calls on an entity’s behalf is one such approach. This makes sense for a number of reasons—it frees up the company to do what it does best, but it also insulates (or USED TO insulate) the company from liability for behavior that is contrary to the Telecommunications Consumer Protection Act (TCPA). Where initially violations of the TCPA (47 U.S.C. § 227), with its newfangled financial fangs came with hefty penalties (between $500 and $1,500 per call/fax/text), the reach of the TCPA has been repeatedly tested, both in practice and in court. Those hiring telemarketers should be well aware that a recent FCC Declaratory Ruling, coupled with a more recent court decision, and should know that those who hire telemarketers, whether directly or indirectly, need to understand the risks and liabilities associated with sub-optimal behavior.
The TCPA has been around since 1991. Since then, the proliferation of those using telemarketing services has grown substantially. So too have the different technologies used to reach customers. The TCPA was designed to protect consumers, and when thwarted by regulators and court decisions, creative and inspired telemarketers have simply found other ways to reach out and touch potential customers. Truthfully, interpretations of the TCPA have taken more twists and turns than in an Olympic bobsled run. Although the initial concept was to enable consumers to curb calls that had become “an intrusive invasion of privacy,” according to the 2004 case of Mainstream Marketing Services, Inc. v. FTC, 358 F.3d 1228, 1235 (10th Cir. 2004), the hairsplitting of the rules is what legal careers are made of… Annoying as those calls are, at least one of the companies that has found telemarketing calls most effective has been the loudest in raising objections. Among the most vocal is Dish Network, LLC, whose petition prompted the 2013 ruling. Clearly they view telemarketing as a highly effective sales tool regardless of the cost.
In the February 2012, the FCC issued an order (http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-12-21A1.pdf), where the Commission made it known that it was fired up to curtail some telemarketing practices. One of the most important changes in this order was the requirement that telemarketers obtain prior written consent before a telemarketer marketer could initiate calls to consumers.
However, in the spring of 2013, the FCC issued a declaratory ruling following receipt of 3 petitions submitted to the FCC and two pending federal court cases brought by telemarketers (28 F.C.C.R. 6574, 28 FCC Rcd. 6574, 58 Communications Reg. (P&F) 355, 2013 WL 1934349). In this instance, the FCC took on the issue of vicarious liability and the use of common law of agency to find a defendant vicariously liable for the actions of a third party marketing company. The most significant takeaway from this ruling is that even though a company using a third party telemarketer may not directly initiate calls itself (the third party does that), it may, in fact, be held “vicariously liable under federal common law principles of agency for violations of either § 227(b) or § 227(c) that are committed by third part[ies].”
In In re Dish Network, LLC, 28 FCC Rcd. 6574, paragraph 46 (http://www.fcc.gov/document/dish-network-et-al-petition-declaratory-ruling-re-tcpa-rules), the FCC provided guidance with a five pronged test to determine whether the entity on behalf whose calls are being made has vicarious liability. The test requires a showing that 1) the seller allows the outside sales entity access to information and systems that normally would be within the seller’s exclusive control; 2) the outside sales entity had the ability to enter information into the seller’s systems 3) the seller gave the outside sales entity the authority to use the seller’s trade name, trademark and service mark; 4) the seller approved, wrote or reviewed the telemarketing scripts and 5) the seller knew (or reasonably should have known) that the telemarketer was violating the TCPA on the seller’s behalf, and the seller failed to take effective steps to stop the violations.
Currently, there remain 15 pending petitions before the FCC seeking clarification of TCPA rules. Among these include questions of what constitutes call initiation for purposes of TCPA? What constitutes “prior written consent?” Is an electronic signature from a customer acceptable? Does a one-time response to a consumer-initiated text message requesting future text offers trigger TCPA compliance?
What’s the solution when there’s liability to an entity that doesn’t actually make telemarketing calls but retains a third party to do so? If third party telemarketers must be used (and again, clearly as unpleasant as being on the receiving end of one of these calls is, they MUST be effective), the entity doing the retaining must understand the incumbent risks. With 15 pending petitions currently before the FCC, and numerous class actions working their way through the courts seeking some sort of clarification of the TCPA rules (not to mention guidelines), this is an area where it’s critical to stay current. Or make sure that the third party that’s doing the work knows what it’s doing.
911? 9911?
On December 1, 2013, Kari Rene Hunt was murdered by her estranged husband. The murder took place in a hotel room in Marshall, Texas. One of the many tragic elements of this brutal crime was the fact that the attack on Ms. Hunt was witnessed by her young children. Seeing their mother in grave danger, the kids tried to call 9-1-1. But they had no luck reaching first responders, because the way that the hotel’s phone system was set up, an extra “9” needed to be dialed before a caller could reach an outside line. This is something that Kari Hunt’s young kids would not have known.
Although the need to dial an extra digit before reaching first responders has surely cropped up before, this case has received considerable attention because of the brutality of the crime, and the fact that the kids in the room with the victim did precisely what they’d been trained to do. Unfortunately, their actions weren’t enough.
NENA (National Emergency Number Association), an organization that represents more than 7000 members dedicated to saving lives, has long promoted the simple concept of “One Number, Any Device, Anywhere.” The phrase is way more than a catchy tagline. With personal communications devices like cell phones and home landlines, an extra digit need not be dialed to reach fire, police or ambulance personnel. However, this is not the case for telephones serviced by multiline telephone systems (MLTS/PBX), such as those that exist in offices, hotels, hospitals and many other locations.
Multiline systems often require a special access code (in most cases a dialed “9”) that provides the caller with information necessary to reach an outside line. An individual who is situated “behind” an MLTS/PBX is likely required to dial 9 9-1-1 in the event of an emergency. As communications system technology has become increasingly sophisticated, the conflict of dialing 9-1-1 and dialing 9-9-1-1 has been recognized and addressed by many vendors in many ways that are internal to the MLTS/PBX, and often at no additional cost to the MLTS/PBX owner/operator.
On May 21, 2012, the Federal Communications Commission Public Safety and Homeland Security Bureau requested industry comments regarding multiline telephone systems pursuant to the Next Generation 9-1-1 Act of 2012. Comments on elements of the feasibility for precise 9-1-1 location information, as well as comments on the NENA model legislation, were included in this request.
The response by NENA, along with other industry players, has been clear. There was then--and is now--no technology gap. There is no financial barrier. Affordable and easily implementable solutions exist in most environments today, and it is merely the lack of education and awareness that remains as a barrier between MLTS/PBX users and Public Safety officials who every day make the difference between life and death.
Certainly the most desirable solution is what’s known as “on-site alert capability.” This internal system process allows for some form of immediate notification between the telephone system and the front—or security--desk once someone has dialed the emergency digits. That is, when a guest in Room 624 dials whatever digits he/she is supposed to dial to reach an outside first responder, the PBX or device that’s doing the switching recognizes the digits simultaneously and notifies someone at the front desk or in an administrative position. This capability saves time by both notifying house staff of an emergency and its location within the building.
Stickers on phones-were once the only way of ensuring that everyone in a building had some form of notice about what numbers to dial in an emergency. However, by themselves, stickers are not a good idea because while individuals may see them, they tend not to remember them or benefit from the information that’s contained on them. At best, emergency stickers—even if they’re printed in fluorescent colors—are an ugly step-sister when compared with the capability that on-site notification offers.
Often, when implementing new technology, customers inquire about the status of the law with respect to E9-1-1 notification and MLTS/PBXs. Unfortunately, that answer is often unclear, particularly when an enterprise has locations in multiple states where no statutes or rules exist on the issue of the kind of information that must be provided from a multi line telephone system. Lack of existing rules in a particular state does NOT relieve the enterprise from taking basic steps to ensure employee and guest (including contractor) safety, a federal obligation that OSHA is more than happy to enforce with significant penalties for non-compliance.
New York has no laws mandating specific information provided by MLTS/PBX (phone system). However, enterprises are not excused from providing a safe workplace under any circumstances. Basic good business practice dictates (and the maintenance of a safe workplace in an essential element of a safe workplace) that first responders identify the location of an individual who has called for emergency assistance.
As increasing numbers of enterprise users of telecommunications services move to IP (Internet Protocol)-based phone systems, the issue of location identification has become more critical because often, such systems will a) not work in a power failure situation absent a generator and b) extensions that may “look” like they’re in one location (a local number provided to an executive who is really sitting in Florida) are really in another. What happens when the remote worker dials 911? Are first responders dispatched from Buffalo because that’s the address in the database, when, in fact, the emergency is in Ft. Lauderdale? Absent affirmative steps taken by the employer/enterprise to make sure that location information databases are current and accurate, this unnecessary delay could, in fact, be the difference between life and death.