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)