AMERICAN ASSOCIATION OF HEALTHCARE ADMINISTRATIVE MANAGEMENT RISING TCPA COMPLAINTS-LOWER RISK AAHAM GREATER FLORIDA BUCCANEER CHAPTER June 3, 2011 Ernest H. (Skip) Kohlmyer, III, Esquire, Partner South Milhausen, P.A. Gateway Center 1000 Legion Place, Suite 1200 Orlando, Florida 32801 407-539-1638 (office) 407-539-2679 (fax) 407-230-6408 (cell) (c) Ernest H. Kohlmyer, III TELEPHONE CONSUMER PROTECTION ACT (“TCPA”) • The Telephone Consumer Protection Act of 1991 (TCPA) prohibits the use of any auto-dialers and predictive dialers or an artificial or prerecorded voice to place calls to any wireless number except for emergency purposes or with the called party’s express consent. What is the TCPA? • The TCPA, specifically 47 U.S.C. § 227(b)(1)(A)(iii), prohibits a person from making “any call using any automatic telephone dialing system or an artificial or prerecorded voice” to any wireless telephone number. 47 U.S.C.A. § 227 • • • • • • • • • • • • It shall be unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States-(A) to make any call (other than a call made for emergency purposes or made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice-(i) to any emergency telephone line (including any “911” line and any emergency line of a hospital, medical physician or service office, health care facility, poison control center, or fire protection or law enforcement agency); (ii) to the telephone line of any guest room or patient room of a hospital, health care facility, elderly home, or similar establishment; or (iii) to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call; (B) to initiate any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a message without the prior express consent of the called party, unless the call is initiated for emergency purposes or is exempted by rule or order by the Commission under paragraph (2)(B); EXCEPTIONS • However, the statute explicitly permits making autodialed or prerecorded message calls to a wireless number under two circumstances: • (1) if the call is made for an emergency purpose; or • (2) if the call is made with the prior express consent of the called party. PRIOR EXPRESS CONSENT EXCEPTION • Thus, the prior express consent exception to making autodialed and prerecorded message calls to a wireless number has always been an exception to the TCPA prohibition on making autodialed or prerecorded message calls to a consumer’s wireless number. The FCC issued a declaratory ruling in response to ACA’s request on January 4, 2008. • In an effort to clarify how the TCPA applies to the credit and collection industry, ACA International submitted a petition to the FCC in 2005 requesting the FCC publish an order explaining the TCPA prohibition against autodialed or prerecorded message calls to wireless numbers does not apply to creditors and debt collectors when initiating such calls to wireless numbers for debt collection purposes. • Since the TCPA’s inception, the Federal Communications Commission (FCC), charged with rulemaking authority over the TCPA, implemented regulations and provided guidance over the application of the TCPA. FCC RULING IMPACTS DEBT COLLECTION INDUSTRY • In particular, the FCC ruled that autodialed and prerecorded message calls to wireless numbers provided by the called party in connection with an existing debt are permissible because such calls are made with the prior express consent of the called party. • It should be noted at the outset that the FCC’s ruling is by no means an absolute clarification on the TCPA and the application of the prior express consent provision toward creditors, debt collectors, and asset buyers, as courts could still weigh in on this issue in the future. The ruling does, however, provide significant clarity on a number of issues. As an overview, the FCC’s ruling clarifies the following: • 1. A creditor, debt collector, or asset buyer is not prohibited by the TCPA from manually placing a call to a consumer’s wireless number in connection with a debt. • • 2. A creditor, debt collector, or asset buyer is permitted to make autodialed and prerecorded message calls to a consumer’s wireless number in connection with an existing debt so long as the consumer provides prior express consent to that calling party. • • 3. A consumer provides prior express consent to be called at her wireless number via auto-dialer or prerecorded message if she knowingly releases her wireless telephone number to the calling party. Such consent does not have to be in writing. • • 4. A consumer who gives prior express consent to the creditor similarly gives such consent to the debt collector calling on behalf of the creditor. What constitutes “prior express consent”? • • A consumer gives prior express consent for a debt collector or creditor to contact the wireless number via auto-dialer or prerecorded message if: • (1) the consumer knowingly releases his/her wireless number; and • (2) the wireless number is provided during the transaction that resulted in the debt owed. • The first element requires the consumer to knowingly release his/her wireless number. • In its ruling, the FCC references its 1992 TCPA Order in which it defined prior express consent, stating, “[P]ersons who knowingly release their phone numbers have in effect given their invitation or permission to be called at the number which they have given, absent instructions to the contrary.” • As a result, the release of a wireless number, for purposes of prior express consent, does not require the consumer have knowledge that she will receive autodialed or prerecorded message calls to her wireless telephone, but simply that she will be contacted by the calling party if she releases her wireless number. The second element requires the wireless number be “provided during the transaction that resulted in the debt owed.” • The consumer must have knowingly released her wireless number to a creditor or debt collector between the time the transaction is initiated and the time the transaction is paid off. • In other words, if a wireless number is obtained from another source, such as through skip-tracing efforts or consumer reports, then the consumer has not provided prior express consent. CONSENT AT THE COLLECTION PHASE • The same applies to debt collectors. If a consumer provides her wireless number to a debt collector as a way to be contacted in regards to one debt, the debt collector can make autodialed and prerecorded message calls to the consumer in regards to that particular debt. • The debt collector cannot utilize that wireless number to contact the consumer in regards to another debt without obtaining the consumer’s prior express consent to do so. • Again, note the debt collector could place manual calls to the consumer’s wireless number in regards to any debt. Preserving the “Prior Express Consent” Exception • Adding language in forms, applications and contracts substantially similar to the following: • • You agree, in order for us to service our account or to collect any amounts you may owe, we may contact you by telephone at any telephone number associated with your account, including wireless telephone numbers, which could result in charges to you. We may also contact you by sending text messages or e-mails, using any e-mail address you provide to use. Methods of contact may include using pre-recorded/artificial voice messages and/or use of an automatic dialing device, as applicable. • Hospital Consent or Intake Form Saves the Day • Pollock v. Bay Area Credit, United States District Court, Southern District of Florida, August 2009 • Plaintiff sought TCPA damages for 187 calls to her cell phone arising out of medical transportation services debt. • Jury to Consider (1) Did Plaintiff provide “prior express consent?”, if not, (2) Did Defendant willfully and knowingly violate the TCPA? Possible Outcomes • Defendant wins and pays $0.00 • Defendant loses and pays $93,500.00 • Defendant loses and pays $280,500.00 Jury Finding • Despite Plaintiff’s denial that she did not consent to calls to her cell number, jury held that since she provide the cell number on ambulance intake report prior to transportation and there was no evidence of revocation, Defendant is entitled to defense of prior express consent and received a defense verdict. • Burden of proof is on the Defendant to prove prior express consent and was not entitled to argue a “mitigation” of damages issue. • Plaintiff filed two other TCPA claims against other businesses for the same delinquent charge and never called the agency to request that they cease communication. • Agency had no knowledge that the telephone number was a cellular number and did not use “scrubbing” software to find out this information. Revocation of Prior Express Consent • Because a consumer may provide prior express consent to the creditor or debt collector for either party to make autodialed and prerecorded message calls to her wireless number in connection with the collection of a debt, it appears a consumer has the ability to provide prior express consent at any time during which a debt is created and is ultimately paid off. • As a result, a consumer that has provided prior express consent may similarly revoke such consent at any time. • Further, revocation prohibits both the creditor and debt collector from making autodialed and prerecorded calls to the consumer’s wireless number. • For example, if a consumer revokes consent when communicating with a debt collector, the debt collector must inform the creditor of such revocation as both parties are prohibited from placing autodialed and prerecorded message calls to the consumer. Liability under the TCPA • The creditor is responsible for proving the consumer provided prior express consent. • Nevertheless, the ruling states in a footnote that a third-party debt collector may also face liability for violating the FCC’s rules. • The ruling’s suggestion to include a written disclosure informing the consumer that she provides prior express consent to be contacted on her wireless number by autodialed or prerecorded message underscores the significance for creditors and debt collectors to develop and implement policies and procedures that identify whether a consumer has knowingly offered her wireless number and also identify if, and when, a consumer has revoked such consent. Liability under the TCPA • A person or entity may, if otherwise permitted by the laws or rules of court of a State, bring in an appropriate court of that State-• • (A) an action based on a violation of this subsection or the regulations prescribed under this subsection to enjoin such violation, • • (B) an action to recover for actual monetary loss from such a violation, or to receive $500 in damages for each such violation, whichever is greater, or • • (C) both such actions. • • If the court finds that the defendant willfully or knowingly violated this subsection or the regulations prescribed under this subsection, the court may, in its discretion, increase the amount of the award to an amount equal to not more than 3 times the amount available under subparagraph (B) of this paragraph. • GOOD NEWS: TCPA does not provide for entitlement to attorney’s fees Suggested Strategies to Reduce Exposure to TCPA Liability • Amend hospital admissions or intake forms to include consent language authorizing communications to telephone numbers provided in the forms. • Amend hospital admission or intake forms to specifically indicate whether the telephone number provide is a residential land line or a cellular number. • Utilize “call scrubbing” software programs and technology prior to the telephone number being loaded for an auto-dialer campaign. • Reduce or eliminate auto-dialer calls to the Fort Lauderdale (954) and Miami (305) area codes which have the highest number of TCPA cases. • Avoid call frequency to less than 50 calls to avoid federal court jurisdiction. • Manually dial all cellular telephone numbers when prior express consent can’t be established by written documentation signed by the patient.