As our readers are aware, companies risk substantial penalties for failure to abide by federal Do-Not-Call ("DNC") regulations. Many DNC lawsuits, that eventually end in judgment or settlement, were preceded by DNC demand letters. The DNC registry was enacted by the Federal Trade Commission ("FTC"), with the help of the Federal Communications Commission ("FCC"), under the authority granted to it by the Telephone Consumer Protection Act ("TCPA"). The TCPA generally prohibits companies from placing telemarketing calls to consumers who have registered their telephone numbers on the National DNC list. In addition to the National DNC Registry, 11 individual states enforce their own DNC list protections, including Colorado, Florida, Indiana, Louisiana, Massachusetts, Missouri, Oklahoma, Pennsylvania, Tennessee, Texas, and Wyoming. Subject to certain exceptions, companies that contact consumer telephone numbers listed on either the National or state registries are at risk of receiving a DNC demand letter prior to litigation.
DNC Demand Letters Can Lead to Significant Monetary Penalties
If a DNC demand letter is not sufficiently addressed in a timely fashion, the result may be a world of pain. In addition to legal fees incurred in defense of a DNC lawsuit, both federal and state DNC provisions allow for monetary recovery if a DNC plaintiff prevails in a court of law. Under the TCPA, telemarketers are liable for statutory damages in the amount of $500 per call (excluding the first call) for DNC violations. If the court finds that a violation of the TCPA was willful, it may award the recipient of the unwanted call up to $1,500 per call. Penalties for violating a state's DNC registry provisions vary from state to state, but range from $100 to $25,000 per call. Note that telemarketers can also be fined up to $43,792 per violation of the DNC provisions of the Telemarketing Sales Rule ("TSR").
How Can a Business Reduce its Chances of Receiving a DNC Demand Letter?
DNC protections are generally afforded to all consumers that register their telephone numbers on federal and state DNC registries. However, it is important to mention that, in large part, the DNC penalty provisions do not apply to telemarketers who have an established business relationship with the consumer.
Pursuant to federal DNC provisions, a company has an established business relationship with a consumer if: (a) the consumer has entered into a transaction with the seller within the previous 18 months, or (b) the consumer inquired about the seller's goods/services within the previous three months. As with other alleged violations of the TCPA, acquiring prior express written consent from consumers is a complete defense to such claims.
Hire Experienced TCPA Attorneys to Address DNC Demands
Unfortunately, businesses often ignore DNC demand letters or discard them (assuming they are junk mail). Make no mistake, however, these demands carry very real financial implications if they are summarily disregarded. More often that not, claimants will carry through on their threats to file suit. Frequently, these lawsuits are filed as putative class actions. This means that even at the statutory federal minimum of $500 per violation, companies accused of violating DNC provisions face enormous potential judgments. To avoid this eventuality, companies that engage in telemarketing should maintain proper DNC compliance procedures. Unless an exemption applies, telemarketers should subscribe for access to the National DNC Registry, pay all necessary fees, and scrub potential called party numbers against the list (and state DNC lists).
The attorneys at Klein Moynihan Turco have decades of experience assisting clients with DNC compliance and defending TCPA class action matters. We maintain active oversight over the most recent TCPA lawsuits, big and small, in an effort to provide our clients with the best possible representation.
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