TCPA Comes of Age

Automated dialing to cell phones result in a wave of large settlements

In case you haven’t been monitoring closely, a number of class action settlements have recently been announced due to alleged violations of the Telephone Consumer Protection Act (“TCPA”), with specific violations based upon automated dialing (“robocalls”) to cell phone numbers. These settlements are based upon dialing activities executed before the more stringent TCPA dialing consent provisions were amended on October 16, 2013.

The total of recent settlements exceed $200 million with over 300 cases still in litigation. Successful defenses by other companies, like Taco Bell and Citi Holdings, continue to increase industry costs to defend or settle TPCA-related allegations.

Recent settlement announcements

  • October 2, 2014 – Comenity Bank, $8.475MM.
  •  September 11, 2014 – Chase Bank, $34MM.
  •  September 30, 2014 – AT&T, $45MM.
  • August 19, 2014 – Capital One, $75MM.
  • June 24, 2014 – HSBC, $39.975MM.
  • June 20, 2014 – Best Buy, $4.5MM.

Example (Comenity Bank settlement post card received via USPS on November 5, 2014:

TCPA post card example

TCPA post card example


If your company or call center is making outbound calls, your company make be taking significant financial risk if you are:

  • Using automated contact software for “predictive” or “power” dialing (system dials each consumer and when successful, connects to agent).
  • Using automated contact software which generates random or sequential phone numbers.
  • Using automated contact software in “preview” dialing mode (agent takes action to connect with each consumer) but the software is capable of automated predictive/power dialing or generating phone numbers.
  • Calling consumer phone numbers, which may be cell phones, without specific written consent to call the cell phone.

Robocalls were developed as a highly-efficient way of contacting customers and prospects to maximize call center agent productivity. The 2013 amendment to TCPA regulations further restrict robocalls to cell phone numbers by requiring explicit consent to receive calls via an automated dialer. An existing business relationship is not sufficient consent and consent cannot be a condition of establishing a business relationship. Also, this regulatory amendment removed the established business relationship exemption for making pre-recorded telemarketing calls to residential land lines. Written consent is now required for these calls as well.

Although any individual consumer is likely to realize only a small portion of the damages mandated by TCPA, the liability to business is very substantial and very real. From a consumer perspective, there is no evident risk to participate in a class, especially with damages cited at $500 or $1500 per call incident.

A growing number of legal firms now specifically market to potential TCPA plaintiffs or offer retainer services to support corporate risk management & litigation defense for TCPA violations – both sides are covered. A simple search for “TCPA Class Action” on Google returns a page full of paid advertisements and SEO content provided by legal services which end with contact information for you to take action.

Your call center can help you avoid TCPA regulatory exposure. The software systems utilized by the call center can store and retrieve phone number information, but if there is even a remote chance that you  may dial a cell phone number or landline without appropriate consent, those systems cannot be capable of predictive dialing, random number generation or sequential number generation. If your captive or outsourced software systems are “too” capable, your regulatory exposure may exceed your company’s risk profile*.

* Legal counsel is advised for all TCPA-regulated activities.

At Balboa Digital, we provide only TCPA-compliant outbound dialing services as part of our portfolio of affordable inbound and outbound contact services. We specialize in supporting lead generators and lead buyers with high-quality and compliant services to meet their partial or fully outsourced contact needs.

Learn more: Please contact Balboa Digital at (888) 883-8160.


Tags: Call Center, Regulatory Issues

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