Court opinion considers soundboard technology and the Robocall Rule

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Here’s the thing about robots. Whether it’s Astro Boy, C-3PO, Optimus Prime, or Major Motoko Kusanagi from Ghost in the Shell, variations on the technology are often out there. The same could be said for robots’ less popular cousins, robocalls. A recent opinion from a United States District Court discusses the FTC’s Robocall Rule and serves as a reminder for telemarketers to mark May 19, 2017, on their calendars.

That’s the day FTC staff will treat calls using soundboard technology as robocalls under the Telemarketing Sales Rule.

In 2008, the FTC responded to consumer concerns by amending the TSR to address prerecorded calls. The Robocall Rule prohibits telemarketers from “initiating any outbound telephone call that delivers a prerecorded message” without first getting a consumer’s “express agreement, in writing.” In 2009, FTC staff issued an informal staff opinion that the amendments didn’t prohibit telemarketing calls using soundboard technology. In its relative infancy at the time, soundboard technology allowed a live operator to communicate with a consumer by playing prerecorded audio clips, while also allowing for one-on-one conversation.

Then came complaints from consumers. People reported they weren’t getting appropriate responses to their questions or comments. Even when a consumer asked to speak with a real person, the operator didn’t respond. In other instances, when consumers asked questions, the call abruptly ended. What’s more, consumers often don’t know that there is a live operator on the line and think they’re on the receiving end of yet another robocall.

What was going on behind the scenes? The FTC had evidence that operators were juggling multiple calls at once, meaning that the practice was becoming much more like regular robocalls. So in 2016, FTC staff sent a letter to the Soundboard Association, observing that soundboard technology was now being used in ways that didn’t correlate to normal two-way conversation – a critical factor underlying the 2009 letter. The 2016 letter said that staff had re-evaluated its earlier analysis and would begin to view calls using soundboard technology like other robocalls, giving industry members six months to adjust.

The Soundboard Association went to court to challenge the November 2016 staff letter. On April 24, 2017, a United States District Judge ruled that the letter was properly issued and didn’t violate the Administrative Procedure Act’s notice-and-comment requirements. The Court also rejected the industry group’s First Amendment challenge to the TSR restrictions on the use of prerecorded messages to solicit new donors for charitable organizations. The Court held that the provision – no robocalls to new donors – was a valid time, place and manner restriction.

The message for marketers is that as of May 19, 2017, FTC staff will treat calls using soundboard technology as robocalls for TSR purposes. That means that standard robocall restrictions will apply, including the requirement that companies have consumers’ express written consent before calling.

(Edited on May 3, 2017, to reflect revised effective date of May 19, 2017)
 

Comments

SOMETHING NEEDS TO BE DONE. THOSE CALLS ARE A STEADY DAILY STREAM INTERFERING WITH THE CONDUCT OF BUSINESS. THANK YOU.

Finally, Relief is on it's way!

Why would ANY Telemarketer be ALLOWED to access the National DO NOT CALL Registry!!!!!! Isn't that an oxymoron??? I was under the impression the DO NOT CALL registry was just that, a way to shelter business' AND private Citizen's phone numbers which were placed on the list...
When I'm in the middle of work (I have Clients across the Country) i'm pretty sick and tired of the "RoboCalls"!

Don, I think you have it backwards. The purpose of the DO NOT CALL list is so that telemarketers can compare their call list to it and remove any contacts that match the DO NOT CALL list. Otherwise, how is the telemarketer supposed to know that a particular person (you, for example), does not want to be called? Get it? Having said that, it becomes a two-way street for the telemarketers that violate the DO NOT CALL list. They can get heavily fined or worse. It is true that there are many telemarketers that disregard it and there may even be some so bold as to use the DO NOT CALL list as a marketing call list. But they do so at their own peril.

Every day , multiple times a day we get robocalls saying our Google Listing or Google Maps have been flagged or some version of that. It's incredibly annoying. I file complaints on the Do Not Call website but it feels like nothing makes any difference. Hopefully after 5/19 it will ?

Thank you, FTC! Now for your next task, have carriers implement a *NN code so that when a Robocall is received a person can punch in the code after a call and have the caller phone number reported to the FTC in real time. This avoids the cumbersome complaint form.

The State of Hawaii unlawfully sells to Texas company telephone numbers of alleged traffic violators.Company uses robocalls to harass citizens!

Also the Democratic party of Hawaii uses robocalls to solicit the voters prior to election.

Actually political robocalls are exempt as it's protected political speech rather than commercial speech.

I think it should be the other way around... assume no one wants the calls and people have to opt-in to receive them.

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