The Telephone Consumer Protection Act ("TCPA") restricts contacting consumers whose phone numbers are on the National Do Not Call Registry unless the telemarketer has obtained the consumer's prior express consent. As the recent decision in a case captioned Johansen v. EFinancial, LLC explained, the Do Not Call restriction is broad but contains one notable exception, a TCPA safe harbor. To qualify, a telemarketer must first show that the violation resulted from an error. After that, it must demonstrate that, as part of its routine business practices, it has implemented the following:
- Written procedures to comply with the Do Not Call rules;
- Adequate training of personnel involved in placing calls and/or sending text messages to consumers;
- Maintenance of an internal Do Not Call list;
- Procedures designed to prevent contacting phone numbers on an internal and the National Do Not Call Registry; and
- Procedures in place to ensure that the telemarketer only uses the National Do Not Call Registry for compliance purposes.
How does the Johnasen decision affect the TCPA safe harbor exception?
Kenneth Johansen applied for a life insurance quote through eFinancial. In doing so, he provided several pieces of personally identifying information, including his phone number. In submitting his information for a quote, Johansen consented to receiving calls even if his phone number was on the Do Not Call Registry. When it received Johansen's request, eFinancial placed two calls to Johansen. During one of those calls, Johansen provided further specific information relevant to receiving a life insurance quote. After being asked for a driver's license number, Johansen allegedly began seeking information from eFinancial that would be relevant to a TCPA lawsuit.
Johansen sued eFinancial for TCPA Do Not Call violations. EFinancial eventually moved for summary judgment on two grounds: prior express consent and the TCPA safe harbor exception. The Court entered judgment in eFinancial's favor. In so ruling, the Court found that Johansen consented to be contacted by providing his phone number for a life insurance quote and participating in the calls at issue by providing private medical information. It rejected Johansen's contention that a hacker had falsely provided this information.
In addition, the Court found that, even if Johansen did not provide his information, eFinancial "substantially complied" with the TCPA safe harbor requirements for two reasons. First, eFinancial had implemented sufficient telemarketing practices to demonstrate that it had strong internal safeguards against TCPA Do Not Call violations, including not calling consumers without consent. Second, those safeguards would have prevented any call to Johansen had he not submitted an Internet request for a life insurance quote. These outcomes are exactly the type that the safe harbor is meant to produce.
Evan accepting Johansen's "hacking" theory for argument's sake, the Court still held that, were Johansen's information submitted by a hacker, eFinancial had in good faith mistakenly believed that Johansen himself had submitted the information which entitled it to the safe harbor exception.
Why does the Johansen decision matter to your business?
Obtaining proper prior express written consent to contact consumers is the ultimate defense and protection against TCPA violation claims. Having gold-standard telemarketing policies and procedures is perhaps the second most important avenue of protection. As the Johansen decision proves, implementing robust telemarketing compliance practices can save your business from hundreds of thousands of dollars in damages.
Just as important as following proper procedures internally is making sure that any vendors involved in placing calls for you are subject to the same policies. You can usually accomplish this by including this requirement in your vendor agreement.
Hire experienced telemarketing attorneys.
The Johansen decision should prompt any telemarketer to ask certain important questions, such as:
- Is my business meeting all five TCPA safe harbor elements?
- Are my telemarketing procedures adequate to protect against TCPA Do Not Call claims?
- Are my telemarketing vendors following the same procedures, and do my vendor agreements require compliance with industry-best telemarketing practices?
With the TCPA in a constant state of flux, what qualifies as "adequate policies and procedures" can change from one week to the next. By hiring experienced telemarketing attorneys, you can focus on growing your business instead of complying with the patchwork of TCPA regulations and related caselaw. The attorneys at Klein Moynihan Turco have years of experience helping businesses in all things telemarketing, from updating practices and procedures, to defending your business against TCPA claims.
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.