DECEMBER 2015

FCC

The FCC has issued a waiver of the legal name identification requirement found in the TCPA for prerecorded calls by a utility company.  National Grid requested to use its d/b/a rather than full corporate name in its prerecorded messages, and the FCC granted this request.

The FCC has issued a citation to Lyft, Inc. alleging it placed unauthorized prerecorded marketing calls to consumers’ residential and wireless phones.  The FCC claimed that Lyft did not obtain “prior express consent” for these messages and its terms of service did not establish “prior express consent.”

The FCC has granted five waivers to companies which requested that they not be subject to the opt-out disclosure requirement for faxes already expressly consented to by recipients.  It ruled that these companies were aware of the TCPA disclosure requirement and attempted to comply.  It denied others requests for waivers from companies which admitted they were unaware of the TCPA’s disclosure requirements.

Comment: Many of these companies likely are concerned about TCPA liability from individuals who provided express consent to receive faxes, and then sued when faxes did not contain TCPA disclosures.  These TCPA plaintiffs will now likely challenge the FCC’s authority to grant waivers.

FTC

The FTC has settled a complaint against four individuals offering consumers mortgage modification services.  The FTC alleged that instead of delivering these services, the defendants kept payment.  The settlement bars the defendants (d/b/a HOPE Services and HAMP Services) from the industry and future telemarketing.

LifeLock will pay $100 million to settle contempt charges brought by the FTC that the company violated a 2010 settlement agreement.

The FTC alleged LifeLock falsely advertised that it could protect consumers’ personal data, that it failed to implement a security program to protect that data, and that it would promptly notified customers of identified theft.

Comment: Once a company enters a consent judgment, not only does it have an obligation to follow the law with whatever penalties exist for violation of the law, it also can be held in contempt by the Court for failure to comply with the injunction.  These penalties for contempt are often more serious, and this recent settlement is an example of how serious those penalties can become.

Wyndham Hotels and Resorts has settled FTC charges regarding its data security practices after hackers obtained its consumers’ payment card information on three separate occasions.  The settlement requires the company to obtain annual security audits of its information security program.

Comment: The FTC uses its general power to prohibit “unfair trade practices” to require companies to protect private consumer information and can prosecute companies after breaches of that information.  Please contact me if you would like to discuss more specific state privacy rules or how federal and state consumer privacy rules overlap and interact.

Consumer Data Breach

Target Corporation has reached a $39 million settlement with a group of banks which sued the store after hackers stole more than 40 million customers’ credit card information in 2013.  The settlement has been preliminarily approved in federal court.

California

A California court has certified a class of individuals who received a text message after entering their contact information on a night club’s website.  Mendez v. C-Two Group, Inc.  Information was collected from individuals who signed up to be on a guest list for the club and provided their mobile number.  The web form did not contain other disclosures required by the TCPA.

A California court has granted a motion to dismiss a TCPA claim against Microsoft Corporation.  Pietzak v. Microsoft Corporation.  The Judge ruled that it was undisputed the plaintiffs knowingly released their cell phone numbers to Microsoft when participating in a promotional activity.   

Florida

A Florida court has stayed a TCPA case pending the Supreme Court’s decision in SpokeoTel.Sci.Corp v Hilton Grand Vacations.  Plaintiff provides a free call-blocking service called “Nomorobo,” which detects and tracks robo-calls.  Plaintiff claims defendant has called Nomorobo’s numbers in violation of the TCPA.  Nomorobo appears to act as a plaintiff in multiple TCPA cases, claiming potentially millions of dollars in damages.

A Florida judge has refused to dismiss a purported class action against Pizza Hut and one of its franchisees alleging illegal text violations of the TCPA.  Defendants argued that plaintiff did not allege they used an automatic telephone dialing system (“ATDS”) but the judge disagreed noting that predictive dialers fall within the FCC’s definition of ATDS.

Illinois

An Illinois judge has approved a settlement in the Walgreen’s case where it obtained consumers’ numbers “for security purposes only” then called those numbers for prescription renewals and other purposes.  The settlement class involved 9.2 million calls to cell phones and the settlement requires Walgreens to establish a settlement fund of $11 million.  Plaintiff’s attorneys claimed $2.8 million in fees.

Comment:  The named plaintiff receives $5,000.  This case is extremely important with regard to what constitutes “prior express consent” for marketing and non-marketing calls, including calls subject to HIPAA.

New Jersey

New Jersey has enacted a law banning unsolicited text message advertising.  New Jersey Assembly Bill (AB 119).  The law goes into effect November 1, 2016, and allows text message advertising only with prior express consent, revocable at any time.

New York

A New York court has dismissed a TCPA claim brought against multiple defendants including Experian Marketing Solutions.  Melito v. American Eagle Operators, Inc., et al.  The Court concluded that Experian did not make the text allegedly sent to plaintiffs.  She concluded, further, that Experian would not be vicariously liable for the actions of American Eagle or other defendants.

A judge has dismissed a purported class action against Uber Technologies alleging violation of the TCPA based on prerecorded calls Uber sent to people in New York urging New York citizens to contact their councilmembers regarding an anti-Uber bill.  Bank v. Uber Technologies.  The Court ruled that political calls were not subject to the prior express written consent restriction in the TCPA.  Bank, however, argued that Uber was advertising its services in the calls as well as making a political request.

Comment: The Court disagreed holding that Bank’s broad reading of the term “advertisement” would “gut” the exemption the FCC carved out for political speech.

A federal judge has stayed a TCPA class action alleging illegal text messages to plaintiffs’ cell phones.  The judge concluded that two Supreme Court cases could make the TCPA claims moot, and that the challenges to the FCC’s recent order regarding “ATDS” could also affect the case.  Acton v. Intellectual Capital Management.

Another New York court has ruled that a credit card holder’s contract with the bank required her to resolve her TCPA claim in arbitration rather than bring a lawsuit.  Carr v. CitiBank.

North Carolina

A North Carolina judge has ruled that a consumer could revoke consent given to a business even if a call is regarding her account.  Galbreath v. Time Warner Cable.  Although she provided her number, she claims she revoked consent and that Time Warner’s later debt collection calls violated the TCPA.

Comment: Time Warner argued Galbreath’s consent was irrevocable.  That is not a good argument.  It also argued that its debt collection calls were not telemarketing calls and therefore were outside of the TCPA.  This argument is also not good, as the TCPA applies a different standard to non-telemarketing calls, but does not exempt debt collection calls from the entire statute.