Noncommercial Calls may Still Result in TCPA liability

Ringing PhoneA new addition to the tidal wave of Telephone Consumer Protection Act (TCPA) litigation that has swamped commerce over the course of the past few years will likely have a further chilling effect on those who attempt to comply with the law.  A  recent decision by the U.S. Court of Appeals reversed the ruling of an Indiana federal court in favor of a company making non-commercial autodialed calls that complied with the TCPA, but not with the stricter state law equivalent.

As those familiar with the statute are doubtless aware, the TCPA regulates unsolicited telemarketing calls, texts and faxes sent through use of autodialers and/or pre-recorded messages, but does not apply to calls made for non-commercial purposes, such as nonprofit fundraising and political calls. The TCPA also includes a “savings clause,” which expressly states that it does not preempt state laws that impose stricter intrastate requirements on the use of autodialers and/or pre-recorded messages.

The case at issue taught a bitter lesson to a non-profit company that used autodialed calls to deliver non-commercial political messages to Indiana landlines. Indiana law flatly prohibits the use of autodialed calls regardless of their purpose, unless the called party has consented to them.  The company sued the Indiana Attorney General and the State of Indiana, seeking a declaratory ruling that the TCPA preempts Indiana’s statute as it applies to interstate calls made with the use of an autodialer.  Basically, the company (which made calls across state lines from Illinois to Indiana, argued that the TCPA should govern the dispute and non-commercial calls are therefore not prohibited.  By any logical perspective, this was a strong argument.  After all, the U.S. Constitution gives Congress has the exclusive right to regulate interstate commerce, and the TCPA’s savings clause appears to expressly address the states’ right to regulate activity within their own borders.

But Court of Appeals disagreed,  holding that because the TCPA is silent as to preempting laws that regulate the interstate use of autodialers, Indiana’s statute would not be preempted.  In reaching its decision, the court looked at the express language of the TCPA and its interpretation of Congress’s intent when the statute was enacted, along with decisions in other jurisdictions, including New York and Utah.

Hopefully, the Plaintiff will appeal to the U.S. Supreme Court, but in the meantime, any company that delivers autodialed calls to Indiana, regardless of their purpose, should ensure that they have the proper express consent to do so.   Don’t assume you’re bulletproof just because you’re not selling anything, and research the laws of the state you’re targeting before the start of your campaign. 

Author: Seth Heyman
Seth D. Heyman is a California attorney with extensive experience in advertising and marketing law, corporate law, contracts, governmental regulations, international business, and Internet law. He has counseled numerous successful companies, both public and private, and was responsible for regulatory compliance, contract management, corporate governance, and HR best practices for multiple organizations in many diverse industries, including marketing, telecommunications, energy, and technology development. He offers insight and guidance on federal and state direct mail, TV, radio, telemarketing, and Internet marketing laws, as well as online promotions, Internet privacy, data protection regulations, and similar matters.
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