Telephone Consumer Protection Act Of 1991 - Telephone Consumer Protection Act

The Telephone Consumer Protection Act of 1991 (TCPA) was passed by the United States Congress in 1991 and signed into law by President George H. W. Bush as Public Law 102-243. It amended the Communications Act of 1934. The TCPA is codified as 47 U.S.C. 227. The TCPA restricts telephone solicitations (i.e., telemarketing) and the use of automated telephone equipment. The TCPA limits the use of automatic dialing systems, artificial or prerecorded voice messages, SMS text messages, and fax machines. It also specifies several technical requirements for fax machines, autodialers, and voice messaging systemsâ€"principally with provisions requiring identificati on and contact information of the entity using the device to be contained in the message.

General provisions

Unless the recipient has given prior express consent, the TCPA and Federal Communications Commission (FCC) rules under the TCPA generally:

• Prohibits solicitors from calling residences before 8 a.m. or after 9 p.m., local time.
• Requires solicitors maintain a company-specific "do-not-call" (DNC) list of consumers who asked not to be called; the DNC request must be honored for 5 years.
• Requires solicitors honor the National Do Not Call Registry.
• Requires solicitors provide their name, the name of the person or entity on whose behalf the call is being made, and a telephone number or address at which that person or entity may be contacted.
• Prohibits solicitations to residences that use an artificial voice or a recording.
• Prohibits any call made using automated telephone equipment or an artificial or prerecorded voice to an emergency line (e.g., "911"), a hospital emergency number, a physician's office, a hospital/health care facility/elderly room, a cellular telephone, or any service for which the recipient is charged for the call.
• Prohibits autodialed calls that engage two or more lines of a multi-line business.
• Prohibits unsolicited advertising faxes.
• In the event of a violation of the TCPA, a subscriber may (1) sue for up to $500 for each violation or recover actual monetary loss, whichever is greater, (2) seek an injunction, or (3) both.
• In the event of a willful violation of the TCPA, a subscriber may sue for up to three time the damages, i.e. $1,500, for each violation.

When Congress passed the TCPA in 1991, it delegated the do-not-call rules to the FCC. Congress suggested that the FCC's do-not-call regulations "may require the establishment and operation of a single national database". The FCC did not adopt a single national database but rather required each company to maintain its own do-not-call database. The FCC's initial do-not-call list regulations were ineffective at proactively stopping unsolicited calls because the consumer had to make a do-not-call request for each telemarketer. In 2003, the Federal Trade Commission â€" not the FCC and not the agency entrusted with the TCPA â€" established the National Do Not Call Registry and implemented regulations prohibiting commercial telemarketers from making unsolicited sales calls to persons who did not wish to receive them. After being challenged in court by the telemarketing industry, the National Do Not Call Registry received Congressional ratification in the speedy enact ment of Do-Not-Call Implementation Act.

The CAN-SPAM Act made a minor amendment to the TCPA to explicitly apply the TCPA to calls and faxes originating from outside the U.S.

The portions of the TCPA related to unsolicited advertising faxes were amended by the Junk Fax Prevention Act of 2005.

Unusual statutory provision

Though the TCPA is a federal statute, suits brought by consumers against violators are frequently filed in state courts. The TCPA is unusual in that the language creating a private right of action led to conflicting views on whether the federal courts had federal question subject matter jurisdiction. The TCPA provides in relevant part: "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. …" Prior to January 2012, there was a circuit split among the federal appeals courts on the issue of whether federal courts have federal question, diversity jurisdiction (individually or under the Class Action Fairness Act of 2005), or whether the state courts have exclusive jurisdiction. In 2012, the Supreme Court decided Mims v. Arrow Fin. Servs., LLC, which resolved the circuit split by concluding that “The TCPA's permissive grant of jurisdiction to state courts does not deprive the U.S. district courts of federal-question jurisdiction over private TCPA suits.”

Major court cases

The TCPA's constitutionality was challenged by telemarketers soon after it was enacted. Two cases, Moser v. FCC, 46 F.3d 970 (9th Cir. 1995) cert. denied, 515 U.S. 1161 (1995) and Destination Ventures Ltd. v. FCC, 46 F.3d 54 (9th Cir. 1995) effectively settled this issue finding the restrictions in the TCPA were constitutional.

The United States Supreme Court resolved a significant circuit split to decide that federal courts have federal question subject matter jurisdiction in Mims v. Arrow Financial Services, LLC, __ US __, 132 S. Ct. 740, 181 L. Ed. 2d 881 (Jan. 18, 2012), resolving a circuit split.

The Ninth Circuit held that the TCPA applies to unsolicited cellular telephone text messages advertising the commercial availability of goods or services as "calls" made in violation of the act.

In August 2014, Capital One Financial Corp., AllianceOne Receivables Management Inc., Leading Edge Recovery Solutions, LLC and Capital Management Services, L.P. entered into an agreement to pay $75.5 million to end a consolidated class action lawsuit pending in the United States District Court for the Northern District of Illinois alleging that the companies used an automated dialer to call customers’ cellphones without consent. This is the largest proposed cash settlement under the TCPA to date. It is notable that this legal action involved informational telephone calls, which are not subject to the "prior express written consent" requirements which have been in place for telemarketing calls since October of 2013.