The Telephone Consumer Protection Act (TCPA) that was signed into law by President George H. W. Bush, restricts telemarketing and the use of automated telephone equipment.
Since technology has evolved rapidly over the past 25 years, many believe the law is an outdated consumer protection statute, and that plaintiffs’ lawyers have been exploiting the law’s outdated language to bring class- action lawsuits against businesses. Therefore, reform is necessary to clarify the interpretation of the law and to protect companies.
“This hearing is going be in front of the Senate Commerce Committee, which I think is a very appropriate place to get some awareness going about what the TCPA is doing to American businesses,” Becca Wahlquist, an attorney for Snell & Wilmer, recently told Palmetto Business Daily. “We are not going in with any specific recommendations or not to talk about a piece of legislation that has already been put together or anything.”
Instead, Wahlquist, who will be testifying at the hearing, said, the purpose is to raise awareness and to talk to some of the senators on the Commerce Committee about how the TCPA has been abused by targeting business that are trying in good faith to reach their own customers.
“The litigations are just sprawling all over the countryside and the really negative effect (is on consumers) because it is not helpful for businesses to feel they can’t contact them, sometimes about really important things,” she said.
Last July, the Federal Communications Commission (FCC) applied further restrictions, holding businesses responsible for calling a customer number reassigned to another person without the business’ knowledge.
Wahlquist said TCPA litigation abuse has become so rampant that “some people are making a living just bringing TCPA claims.”
“It is not just hurting American businesses, but consumers as well to have this kind of litigation going haywire at this point,” she said.
Wahlquist has been working closely with the U.S. Chamber Institute for Legal Reform and talking to businesses that she said have been hammered by TCPA litigation.
“What tends to happen with the TCPA is because the statutory damages can be in the hundreds of millions or billions of dollars, you generally just see a lot of settlements,” Wahlquist said.
AT&T settled a TCPA lawsuit for $44 million, and Capital One settled one for $75 million, Wahlquist said.
“I have a client that sent out one text message to everyone that was in the membership," she said. "There were allegations that some people in the membership shouldn’t have gotten the text message. And for one text message that didn’t lead to any complaints, there was one person who filed a class action saying give us $32 million -- for one text."
Wahlquist plans to highlight such examples and hopes to educate the Senate Commerce Committee about what has been taking place.
“It really is (large stakes) because there are so many businesses that still may not even be aware of the statute until they get sued under it,” she said.
In addition to Wahlquist, other witnesses scheduled to testify at the hearing include Monica Desai, a partner at Squire Patton Boggs who specializes in FCC regulations; Rich Lovich, a partner at the Law Offices of Stephenson, Acquisto & Coleman, testifying on behalf of the American Association of Healthcare Administrative Management; Margot Saunders, counsel for the National Consumer Law Center; and Indiana Attorney General Greg Zoeller.
The hearing will take place in Senate Russell Building 253.
The U.S. Senate Commerce Committee is chaired by U.S. Senator John Thune (R-SD). The ranking member of the committee is Sen. Bill Nelson (D-FL).