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12 February 2024

Maryland's New Telemarketing Law Now In Effect

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As of January 1, 2024, the State of Maryland's new telemarketing law, the ​"Stop the Spam Calls Act of 2023," officially became law.
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As of January 1, 2024, the State of Maryland's new telemarketing law, the "Stop the Spam Calls Act of 2023," officially became law.

One key provision of the new law creates a prohibition, absent prior express written consent, against "telephone solicitation[s]" that involve "an automated system for the selection or dialing of telephone numbers." A "telephone solicitation" is defined as "an organized activity, program, or campaign to communicate by telephone with residents of Maryland in order to: (i) sell, lease, or rent goods or services; (ii) attempt to sell, lease, or rent goods or services; (iii) offer or attempt to offer a gift or prize; (iv) conduct or attempt to conduct a poll; or (v) request or attempt to request survey information, if the results of the survey will be used directly to solicit persons to purchase, lease, or rent goods or services." The term "communicate by telephone" suggests an intent to include both phone calls and text messages within the scope of this definition.

The reference to an "automated system" is not defined by the Maryland law and thus is broader than the Telephone Consumer Protection Act's ("TCPA's") definition of "automatic telephone dialing system," ("ATDS"), which the Supreme Court ruled in 2021 only encompasses devices that use a random or sequential number generator to either store or produce a telephone number. It's possible, therefore, for a dialer to be subject to the Maryland law while not technically constituting an ATDS under the TCPA. It is also worth noting that after a similar law was implemented in Florida, the spike in litigation pertaining to autodialers caused the legislature to eventually reverse course and adopt a narrower definition of the term. Whether Maryland follows suit and amends its definition may depend on whether a similar uptick in litigation occurs in the coming months. The Maryland law also prohibits prerecorded message calls without prior express written consent.

The law defines the term "prior express written consent" similar to federal TCPA regulations, including requiring a signature by the called party (electronic signatures are acceptable) and informing consumers that consent is not required to purchase goods or services. The Maryland statute was passed and signed by the governor before the Federal Communications Commission (FCC) adopted its rule change mandating seller-specific (or one-to-one) consent, and as such, it does not reflect a similar requirement. The FCC rule, once effective in January 2025, will be the stricter standard and apply nationally, at least as to those calls made by an ATDS, as defined under the TCPA.

Other noteworthy provisions of the new law with respect to telephone solicitations include:

  • A permissible calling window limited to between 8 AM–8 PM;
  • A limit of three calls in a 24-hour period "on the same subject matter or issue" (this is similar to restrictions in Florida and Oklahoma);
  • Prohibitions on the use of technology or voice altering to deliberately conceal the identity of the caller;
  • A rebuttable presumption that any call made to a Maryland area code is a call made to a Maryland resident;
  • Exceptions for "isolated transaction[s]"; solicitations by or on behalf of a tax-exempt nonprofit entity for religious, charitable, political, or educational purposes; business-to-business sales; soliciting contracts for the maintenance or repair of goods previously purchased from the solicitor; a single solicitation in response to an inquiry or request from a customer; and certain communications pursuant to an existing business relationship with the called party (provided the communication "is initially intended for informational purposes only; and based on further inquiry from the customer [it] becomes a telephone solicitation").

The new law is enforceable under the Maryland Consumer Protection Act, which allows both the state and individual consumers to bring an action for alleged violations, does not require evidence of actual deception or damages to prove a violation, and establishes civil penalties of up to $10,000 per violation (or $25,000 for repeat violations), and criminal penalties of a fine of up to $1,000, one year in prison, or both, among other remedies. The private right of action in the new statute is in addition to an existing law in Maryland that allows consumers to recover $500 or actual damages, plus reasonable attorney's fees, for violations of the federal TCPA or Telemarketing Sales Rule.

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.

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