Ignore the FCC’s warnings at your financial peril.

Telemarketing is a fact of modern life, mainly because it can be a very efficient and effective way to communicate a message (commercial, political, etc.) to a huge audience. But that doesn’t mean that the audience necessarily likes to receive telemarketed messages: many, perhaps most, consumers don’t. That’s probably even truer when it comes to “robocalls” (i.e., calls that are dialed automatically or play prerecorded messages), a type of unsolicited marketing that involves no actual human interaction, at least on the robocaller’s end. And it’s probably truer still when the robocall is directed to a cell phone or mobile device where the recipient can end up paying for the minutes.

Responding to public sentiment more than two decades ago, Congress (in the Telephone Consumer Protection Act (TCPA)) banned the use of automatic calling (both live and prerecorded) to mobile devices except in emergency situations or when the company has the express written consent of the recipient of the call. In contrast to landline numbers, mobile phone subscribers don’t have to put their numbers on the Government’s Do-Not-Call list to get this protection. (See our earlier post and this FCC Advisory that provide details on some of the TCPA’s requirements.)

Charged with enforcing the TCPA’s proscriptions, the FCC has dogged TCPA violators aggressively and expensively. Just ask Dialing Services, LLC, a robocaller that, according to the FCC, made almost 200 unsolicited robocalls to cell phones. (Actually, it made more than 4,700,000 such calls – but is being penalized for only about 200 of the most recent. Read on for more about that.) And for those 200 calls, it’s being fined nearly $3 million.

Dialing Services apparently attracted the FCC’s attention in 2012, when the Enforcement Bureau investigated its operations. The Bureau reviewed Dialing Services’s records and concluded that it had made more than 4.7 million non-emergency robocalls to cell phones in just three months, each presumably a violation of the Telephone Consumer Protection Act (TCPA).

Because Dialing Services doesn’t hold any FCC licenses or permits and hasn’t applied for any, the FCC couldn’t just issue it a Notice of Apparent Liability (NAL) for those calls. In such cases, the Communications Act requires that the FCC issue a warning (proper technical name: a “Citation”) as a first step, along with a chance to have a personal interview with the FCC. So the Commission dutifully issued a Citation to Dialing Services, alerting it to the fact that it had been engaging in unlawful conduct, inviting it to come in for a chat, and advising it that further such misconduct could be subject to penalties. (The theory underlying this shot-across-the-bow procedure is that entities that aren’t technically regulated – i.e., entities that aren’t licensees, permittees, etc. – may not be expected to be aware of all the ins and outs of communications law. Hence, the initial Citation to clue the target in.)

The Bureau must have gotten some bad vibes about Dialing Services because, a bare two months after the issuance of the Citation, the Bureau followed up with a further inquiry. The Bureau asked for records of Dialing Services’s calls and, wouldn’t you know it, found 184 unauthorized robocalls to cell phones. As part of its investigation, the Bureau even contacted 52 individuals who had received some of those calls; the Bureau wanted to see whether any of them had in fact consented to the calls. Most confirmed that they had not. Some did so emphatically (e.g., “Oh my God, NEVER” and “I hate those damn calls”).

And, as a result, down has come the Commission’s $3 million hammer, right on Dialing Services.

The principal take-home lesson here is reasonably obvious: the government has outlawed certain types of telemarketing and is prepared without question to enforce that prohibition. If you doubt that, check out the lengths to which the Enforcement Bureau went in this case: in its pre-Citation investigation it analyzed enough Dialing Services records to determine than nearly four million unlawful calls had been made. That alone presumably took considerable effort. And in the post-Citation investigation, the Bureau sifted carefully enough to identify the 184 unsolicited calls, and it then went further by contacting the consumers themselves just to make sure.

Another possible measure of FCC antipathy toward Dialing Services’s robocalls: according to the Notice of Apparent Liability, in three months in 2012 (i.e., before the Citation) Dialing Services made more than 4.7 million unlawful calls – i.e., a monthly average of about 1.6 million. But during the two months after the Citation, the monthly average plummeted to fewer than 100, a dramatic reduction and, at least arguably, an indication that Dialing Services may have been trying to comply after receipt of the Citation. But if that were the case (and we really don’t know for sure), it had no apparent effect on the Commission.

Of course, there might be a different explanation for why Dialing Services appears to have stomped on the brakes in 2013. While the NAL doesn’t spell things out in detail, 2012 was an election year and the NAL refers, purely in passing, to the fact that Dialing Services purchased “voter lists” for its clients. The plot thickens with the FCC’s press release announcing the NAL: it says that the calls were made during the “2012 election cycle”, describes the calls as having been made “on behalf of political campaigns and candidates”, and notes that there is no exemption from the TCPA for “political calls.” Oh yeah, the headline for the press release says that the fine was issued “for making political robocalls to cell phones”. Perhaps, but you’d be hard-pressed to reach that conclusion from the NAL itself.

The FCC would likely be courting big-time push-back – from First Amendment scholars and members of Congress, among others – if it were to single out political advertising for stricter enforcement (whether or not that advertising takes the form of robocalling). So even if the press release does indeed reveal what was really going on in the back rooms at the FCC when the NAL was being drafted, the NAL itself – which is the official record of the FCC’s action – stops well short of piling on penalties because the calls may have been primarily political.

The bottom line: the lot of the telemarketer is not an easy one. Telemarketing clearly provides a valuable service – witness the fact that, despite the strictures imposed on it by the government, it continues to thrive. Those strictures, and the multi-million dollar penalties that their violation can fetch, can be avoided by careful telemarketers. To do so, though, it’s important to understand and abide by the limitations imposed by the TCPA, limitations which can turn on the proper interpretation of occasionally subtle and nuanced statutory or regulatory language.

The FCC is plainly loaded for bear here, and (also as we have previously observed) there is an active universe of TCPA plaintiffs and their counsel ready to haul violators – and occasionally even innocent parties wrongly suspected of being violators – into court. Anyone considering engaging in any telemarketing activities, especially robocalls, would be well-advised to seek knowledgeable counsel before doing so. We would be happy to assist in that effort.