Ad Law Access

Supreme Court Hears Oral Argument Over the TCPA’s Definition of an Autodialer

Alysa Z. Hutnik — Wed, 09 Dec 2020 17:39:43 -0500

For the second time this year, the TCPA came before the Supreme Court via teleconference oral argument in Facebook, Inc. v. Duguid, et al, Case No. 19-511 (2020). The Supreme Court’s disposition of Facebook’s petition is expected to resolve a widening Circuit split over what qualifies as an automatic telephone dialing system (“ATDS”) under the TCPA, 47 U.S.C. § 227, et seq., and thus determine much of the scope of the TCPA’s calling restrictions.

Question Presented

The Supreme Court granted review of the question: “Whether the definition of ATDS in the TCPA encompasses any device that can “store” and “automatically dial” telephone numbers, even if the device does not “us[e] a random or sequential generator”?”

Six Circuits have previously answered the question. The Second, Sixth and Ninth held that a predictive dialer or system that dials from a stored list can qualify as an ATDS under the TCPA. The Third, Seventh, and Eleventh require that technology must have the capacity to generate random or sequential telephone numbers to qualify as an ATDS. The Seventh Circuit decision, Gadelhak v. AT&T Services, Inc., was penned by then-Judge Barrett, who participated in today’s argument. In addition, the D.C. Circuit’s 2018 remand in ACA International v. FCC questioned whether a broad reading of ATDS was lawful.

This case arises out of the Ninth Circuit’s broad approach to the definition of an automatic telephone dialing system under the TCPA.

Procedural History

The controversy comes before the Supreme Court on the basis of text messages that plaintiff Duguid allegedly received from Facebook in 2005. Duguid alleged that Facebook had violated the TCPA by maintaining a database of numbers on its computer and transmitting text message alerts to selected numbers from its database using an automated protocol. Facebook filed a motion to dismiss, arguing that Duguid had failed to plead the use of an ATDS. The district court held that the ATDS allegations were insufficient because they “strongly suggested direct targeting rather than random or sequential dialing” and dismissed the case. Soon after, the Ninth Circuit issued its decision in Marks v. Crunch San Diego, holding that an ATDS definition includes devices with the capacity to store numbers and to dial numbers automatically. Duguid appealed the prior dismissal of his claims and, applying Marks, the Ninth Circuit reversed. Facebook asked the Supreme Court to review the Ninth Circuit’s decision.

Briefing

Duguid, Facebook, and the United States have fully briefed the issue. Duguid argues for a broad definition of ATDS based on the statutory text and two canons of construction, the distributive-phrasing canon and last-antecedent canon, that he alleges show the adverbial phrase “using a random or sequential number generator” modifies the verb “to produce” but not the verb “to store.” Facebook, on the other hand, posits that the statutory language “using a random or sequential number generator” is an adverbial phrase that modifies both the verbs “store” and “produce.” Under that approach, the statutory text limits the definition of an ATDS to technology that uses a random- or sequential-number-generator. The United States filed a brief agreeing with Facebook that the plain text of the TCPA limits the definition of an ATDS to random- or sequential-number-generators. The government’s grammatical analysis focuses on the comma that precedes the adverbial phrase, pointing to past Supreme Court decisions and canons of statutory interpretation that advise such a comma is evidence that the phrase is meant to modify all antecedents (in this case, both the verbs “store” and “produce”).

Oral Argument

Argument in the case went over the scheduled hour by about 20 minutes. Facebook and the United States split the first 30 minutes and Duguid took the remaining time, excluding Facebook’s brief rebuttal. While oral argument does not always foretell the Court’s decision, certain trends developed.

Grammatical Construction: A majority of Justices seemed to agree that Facebook and the United States had a stronger grammatical reading of the statute, but struggled with both the awkwardness of the construction, and the surplusage problem that their interpretation creates.
- Justice Alito, for example, asked both Facebook and the United States whether it made sense to talk about random or sequential number generators as a device that can “store” numbers, wondering if their interpretation rendered the verb “store” superfluous. In response, the United States suggested that Congress was likely taking a “belt-and-suspenders” approach to drafting.
- The Chief Justice, noting that most speakers do not resort to statutory canons of interpretation to understand language, suggested that the “sense” of the provision was more important than its syntax.
- Justice Kavanaugh repeatedly asked about the different scope of the prohibition on artificial or prerecorded voice calls and “live” calls using an ATDS, as a way to understand the ATDS language.
- Justice Gorsuch asked Facebook and the United States to address an alternate interpretation, offered by then-Judge Barrett in her decision in Gadelhak, that the clause “using a random or sequential number generator” could modify the phrase “telephone numbers to be called” instead of the verbs “store” and/or “produce.” Both parties asserted this interpretation would lead to their preferred outcome.
Broader Questions on TCPA Scope: The Justices also pressed the parties on questions unrelated to the grammatical construction the statute.
- Justice Thomas asked why “text messages” were covered by the TCPA at all, given that the statute’s language only regulates calls and later called the statute an “ill fit” for current technology. Justice Thomas’s question is indicative of a broader concern, shared expressly by Justices Sotomayor, Alito and Kavanaugh, that the TCPA may be ill-suited to regulate technology that looks very different from the technology available in 1991 when the TCPA was passed.
- Justices Sotomayor, Barrett, Breyer, and Gorsuch each questioned whether the Ninth Circuit’s broad definition of an ATDS would expose all smartphone users to potential liability.
- Justice Barrett was concerned specifically with the call-forwarding function and seemingly “automated” functions that modern cellphones are equipped with.
- Duguid seemed unable to provide the Justices with a satisfactory answer on several of the non-grammatical issues and gave conflicting answers concerning the role for, and level of, human interaction necessary to remove technology from the definition of an ATDS.

In sharp contrast to the Supreme Court’s oral argument in Barr v. American Association of Political Consultants, none of the Justices mentioned the TCPA’s popularity among the American public in interpreting the statutory language. Justice Alito went so far as to suggest that the TCPA may in fact be obsolete, and although the Court has not claimed the power to declare a statute null on that basis, the TCPA might be a good candidate.

The Court is expected to issue its ruling by Spring 2021. To learn more about the background of the case, the Circuit Courts’ varying definitions of an ATDS, and the potential implications for the Court’s ruling, consider listening to Kelley Drye’s preview podcast of Duguid or Kelley Drye’s monthly TCPA Tracker.

FCC/FTC Stake out Aggressive Robocall Position, Tell Gateway VoIP Providers to Block COVID-19 Robocalls – or Be Blocked Themselves

Alysa Z. Hutnik — Thu, 16 Apr 2020 00:19:50 -0400

The FTC and FCC have taken a number of actions to stem unlawful robocalls generally and, during the COVID-19 pandemic, to stem harmful and deceptive calls that seek to exploit the COVID-19 crisis. Even amid the backdrop of their long-standing commitment, the agencies’ most recent action stands out as an aggressive new approach to unlawful calls. On April 3, 2020, the enforcement arms of each agency jointly sent warning letters to three Voice over Internet Protocol (“VoIP”) service providers allegedly facilitating the transmission of international scam telemarketing calls originating overseas. The letters make an unprecedented demand: block the traffic of specific allegedly unlawful actors or have all of your traffic blocked by other carriers. In this post, we’ll take a look at this new approach, and discuss its relationship to the broader provisions of the Telephone Robocall Abuse Criminal Enforcement Act (“TRACED Act”), which institutes a number of measures designed to combat illegal robocalls.

The Warning Letters

The agencies identified the three VoIP gateway providers as the sources of the illegal calls through the efforts of the USTelecom Industry Traceback Group, a consortium of phone companies that help officials identify potentially unlawful calls. The phone companies used a process known as “traceback,” in which they share information to trace unlawful spoofed robocalls to their origination.

In the letters, the agencies reminded the companies that the COVID-19 scam robocalls are in fact illegal and directed them to cease transmitting the traffic immediately, as the calls have “the potential to inflict severe harm on consumers.” The letters warned the companies that if they did not stop transmitting the identified traffic within 48 hours, the FCC would authorize other U.S. voice providers to block all calls from the companies and take any other steps necessary to prevent transmission of the calls. The agencies also sent a separate letter to USTelecom advising the trade association that, if the VoIP providers do not block the traffic, the FCC will authorize other U.S. service providers to block all calls coming from that gateway and will take other actions as necessary to authorize U.S. service providers to block traffic from the originating entities. In addition, the FCC encouraged other service providers to take immediate action to block unlawful calls pursuant to existing legal authority.

This action is a significant – and significantly aggressive – new approach by the agencies. While both agencies have taken actions to prevent and deter unlawful robocalls, the threat to block traffic from the originating carrier is a new tactic in the fight against unlawful calls. Notably, it is not clear under what authority the FCC can or would order the blocking of all traffic from the subject VoIP gateway providers if they failed to block the allegedly unlawful robocalls. The letter does not cite any provision of the Communications Act that would authorize such blocking. Moreover, existing FCC orders relating to call blocking have authorized only limited call blocking practices that were optional for the carriers. Were the FCC to order such blocking (and to make it mandatory), it appears that such action would be the first of its kind by the agency.

Briefly, we will review the agencies’ recent history with anti-robocall activities.

The Educare Services Enforcement Action and Prior FTC Warning Letters

In the three letters to the VoIP gateway providers, the FCC and FTC reference the FTC’s recent enforcement action against VoIP provider Globex Telecom. This action relied upon provisions of the FTC’s Telemarketing Sales Rule (“TSR”), which addresses calls made for a telemarketing purpose. In December 2019, the FTC obtained a preliminary injunction against Educare Services and Globex Telecom Inc. for robocalling consumers to promote allegedly fraudulent credit card interest rate reduction services. The FTC complaint alleges that Globex played a key role in “assisting and facilitating” the illegal credit card interest rate reduction services Educare promoted by providing Educare with the means to call consumers via interconnected VoIP communication services and facilities. For a VoIP company to be liable under a TSR “assisting and facilitating” theory, the FTC must prove that the company “knew or consciously avoided knowing” the robocall campaigns violated the TSR.

A week before the joint letters, the FTC sent letters to nine VoIP service providers and other companies warning them that “assisting and facilitating” in the transmission of illegal COVID-19-related telemarketing or robocalls is unlawful. The agency also sent letters to nineteen VoIP service providers in January with a similar warning about all illegal robocalls.

FCC TRACED Act Implementation and the STIR/SHAKEN Mandate

Like the FTC, the FCC recently shifted its focus in robocall enforcement towards the originating carriers. On February 4, 2020, the FCC’s Enforcement Bureau sent letters to seven VoIP gateway service providers, notifying them that unlawful robocalls had been traced to their networks and asking for their assistance in tracking down the originators of the calls. Although no enforcement action was threatened at the time, the FCC also asked each provider to detail their anti-robocall efforts to the Commission.

More recently, the FCC took several steps in implementing the TRACED Act, which requires the FCC to initiate several near-term rulemakings and other actions aimed at addressing unlawful spoofing and robocalling operations. On March 27, the agency adopted a Report and Order and Further Notice of Proposed Rulemaking establishing rules for the registration of a single consortium to conduct private-led “traceback” efforts, which is expected to formalize the relationship with the USTelecom Industry Traceback Group. Additionally, on March 31, the FCC adopted a separate Report and Order and Further Notice of Proposed Rulemaking mandating that originating and terminating voice service providers implement the STIR/SHAKEN framework in the IP portions of their networks by June 30, 2021. STIR/SHAKEN—the technology framework behind the “traceback” process—allows providers to verify that the caller ID information transmitted with a particular call matches the caller’s number as the calls are passed from carrier to carrier. FCC Chairman Pai previously urged major providers to adopt STIR/SHAKEN technology voluntarily and warned that the voluntary approach would become a mandate if the providers did not move fast enough. Still to come are comments on a “know your customer” obligation for service providers and rules to deny access to numbering resources to originators of unlawful calls.

As we have previously noted, the TRACED Act also requires the implementation of an alternative call authentication framework in non-IP networks, extends the FCC’s statute of limitations for bringing some illegal robocall enforcement actions, and eliminates the requirement to give warnings before issuing certain filings.

Takeaways

These letters, coupled with the recent activity by the FTC and FCC to combat illegal robocalls, signal the agencies’ desire to cause a meaningful reduction in unlawful calling, and in particular, demonstrate a desire to prevent scammers from taking advantage of the COVID-19 crisis to carry out their deceptions. Both agencies can seek civil penalties and take other actions necessary to prevent the proliferation of these calls.

Importantly, the targets of agency action are not necessarily limited to the entities that place the unlawful calls. These federal actions are a good reminder for VoIP and other service providers to assess whether their customers’ practices may indicate unlawful use of VoIP or other services. With the warning letters, and now these blocking letters, the FCC and FTC increasingly are showing an openness to pursuing penalties under vicarious liability theories. If there are facts that support knowledge of the unlawful activity or “red flag” type practices (such as a customer being the target of multiple third party government subpoenas, among other facts), that’s a good indication that further steps by the VoIP provider may be warranted to mitigate the risk of facing an enforcement action by the FTC or FCC. If you have questions about how these enforcement trends and related risk factors are relevant to your business, please contact your Kelley Drye counsel.

Ninth Circuit Decision in AT&T “Throttling” Case May Reset Boundaries Between FTC and FCC Jurisdiction

Alysa Z. Hutnik — Wed, 31 Aug 2016 09:35:03 -0400

On Monday, August 29, 2016, the Ninth Circuit Court of Appeals issued an opinion that may dramatically alter the boundaries between the Federal Trade Commission’s (FTC) and Federal Communications Commission’s (FCC) authority over phone companies, broadband providers, and other common carriers. The Ninth Circuit dismissed a case that the FTC brought against AT&T over its practices in connection with wireless data services provided to AT&T’s customers with unlimited data plans. The FTC had filed a complaint against AT&T for “throttling” the data usage of customers grandfathered into unlimited data plans. Once customers had used a certain level of data, AT&T would dramatically reduce their data speed, regardless of network congestion. The FTC asserted that AT&T’s imposition of the data speed restrictions was an “unfair act or practice,” and that AT&T’s failure to adequately disclose the policy was a “deceptive act or practice.”

The Ninth Circuit’s decision is the latest in a series of actions attempting to identify the jurisdiction over Internet access services and Internet-based services. As providers and regulators have struggled to identify the proper regulations applicable to such services, the Ninth Circuit’s decision could force significant shifts by both the FTC and FCC for at least a large segment of the industry.

Background

At issue before the Ninth Circuit was the scope of the FTC Act’s exemption of “common carriers” from the FTC’s authority. The FTC argued, and the trial court held, that the common carrier exemption only applied to the extent that the service in question is a common carrier service (i.e., an “activity-based” test that precluded FTC jurisdiction only where a common carrier is engaging in common carrier activities). Because the service that the FTC challenged (wireless broadband Internet access service (“BIAS”)) was not a common carrier service at the time that the FTC brought its action against AT&T, the trial court held AT&T was not engaging in common carrier activity and therefore the FTC had authority to bring its lawsuit.

AT&T appealed the decision, arguing that the FTC Act’s exemption of common carriers should be based on their status, and thus telecommunications service providers like itself are exempt from the FTC’s authority regardless of whether the activity at issue is a common carrier service.

The Ninth Circuit noted two things related to the dispute. First, the court noted that “it is undisputed that AT&T is and was a ‘common carrier[] subject to the Acts to regulate commerce’ for a substantial part of its activity.” Further, the court noted that, during the time period in question, AT&T’s mobile data service “was not identified and regulated by the FCC as a common carrier service” although, since the FCC’s 2015 Open Internet Order, the FCC has classified the service as a common carrier service.

The Ninth Circuit sided with AT&T, and remanded the case for an entry of an order for dismissal. The court held that under the plain language of the statute, the exemption is based on a company’s status and applies regardless of the activity at issue. The “literal reading of the words Congress selected,” the court wrote, “simply does not comport with an activity-based approach [to the common carrier exemption].” The court compared the common carrier exemption to the other exemptions in the statute (for banks, savings and loan institutions, federal credit unions, air carriers and foreign air carriers) that are admitted by the FTC to be status-based, and to the exemption for meatpackers “insofar as they are subject to the Packers and Stockyards Act,” which the court found to be activity-based. The court held that amendments enacted in 1958 to Section 5 – which added the “insofar as” language – indicated an activity-based exemption for that provision but affirmed status-based exemptions for the remainder “then and now.”

Notably, the Ninth Circuit chose to address the status question, rather than addressing a more narrow issue of whether the FCC’s 2015 reclassification of BIAS as a telecommunications service applied to AT&T’s service retroactively.

Implications

The FTC issued a statement that it is “disappointed” and “considering [its] options,” but it is unclear whether it will appeal the ruling to the Supreme Court. It is worth noting that, although the Ninth Circuit did not discuss the decisions, this is the third time that a court of appeals has faced status-based arguments relating to the common carrier exemption. The Seventh Circuit’s 1977 decision in U.S. v. Miller, and the Second Circuit’s 2006 decision in FTC v. Verity Int’l, Ltd., both involved entities claiming common carrier status, although neither decision brought finality to the question. If the FTC pursues the issue further, industry and practitioners could receive welcome guidance on the issue.

More broadly, the FTC has openly called for the end of the common carrier exemption in the past few years. This decision may add fuel to the agency’s efforts in that regard.

As is, the decision makes it more difficult for the FTC to bring an action against a company that can claim to be a common carrier. The Ninth Circuit’s decision noted that AT&T unquestionably was a common carrier “for a substantial part of its activity” and at one point distinguished a case, noting that AT&T’s status “is not based on its acquisition of some minor division unrelated to the company’s core activities.” Nevertheless, the court’s analysis leaves open the possibility that even providing only a small amount of common carrier service may be enough to qualify all of a company’s activities for the common carrier exemption.

On the FCC side, there are equally broad questions raised by the decision. The FCC recently has broadly construed its own authority under Section 201(b), to a fair degree of controversy, to address practices of common carriers “for or in connection with” their services, such as advertising and billing. Presumably, these efforts will continue after the Ninth Circuit’s ruling. The Ninth Circuit’s ruling, however, may encourage the FCC to fill any potential gap in coverage by taking a broader view of its own authority to regulate non-common carrier services that common carriers offer to consumers. This could have significant implications for a number of ongoing FCC proceedings, including a proceeding to overhaul the FCC’s privacy rules after the Open Internet Order and requests to classify SMS messaging and interconnected voice-over-Internet-Protocol (VoIP) service as telecommunications services subject to common carrier regulation. This also might color the FCC’s approach to regulation of over-the-top services provided by non-carrier entities using telecommunications or Internet services.

Time will tell how this plays out, but for now, the Ninth Circuit appears to have significantly reset the boundaries between the agencies’ jurisdictions. AT&T is not off the hook yet, however, as it faces a parallel action from the FCC, which has issued a Notice of Apparent Liability to AT&T, alleging that its disclosures in connection with its unlimited data plans violated the FCC’s “transparency” rules. The FCC proposed $100 million in forfeitures for the violation, which sparked vigorous dissent by the two Republican commissioners and was opposed by AT&T in a strongly-worded response. The FCC forfeiture proceeding remains pending.

Steve Augustino and Jameson Dempsey, of Kelley Drye’s Communication Group, co-authored this post.

Express Written Consent Requirement for Telemarketing Calls and Texts to Take Effect October 16, 2013

Wed, 09 Oct 2013 16:05:33 -0400

New rules issued by the Federal Communications Commission ("FCC") last year are about to take effect. These rules will make it more difficult for businesses to make telemarketing calls and texts to wireless customers and to certain residential customers by requiring express written consent (1) to make telemarketing calls using an autodialer or prerecorded message to wireless callers, and (2) to send prerecorded message calls to residential subscribers. Previously, any form of consent was permitted for these calls, and, in the case of prerecorded messages to residential subscribers, a business could rely upon an "established business relationship" to place such calls.

With the rise in class action cases for alleged TCPA violations, businesses engaging in telemarketing should review their practices for obtaining customer consent prior to implementation of the new rules on October 16, 2013.

For more information, click to read our client advisory.

FCC Opens the Door to Vicarious Liability for Third-Party Telemarketing Under Certain Conditions

Wed, 15 May 2013 16:28:24 -0400

On May 9, 2013, the Federal Communications Commission ruled that sellers may be held vicariously liable under the Telephone Consumer Protection Act (“TCPA”) for unlawful telemarketing by third parties under certain circumstances. The FCC’s Declaratory Ruling addresses third-party liability for violations of the Do Not Call and prerecorded message restrictions of the Communications Act. The Commission ruled that, under both provisions, a seller may be held vicariously liable for violative calls placed by third-party marketing agents under principles of the federal common law of agency.

The Declaratory Ruling thus resolves a central question that is raised in a number of TCPA lawsuits: sellers may only be held liable for actions of those third party telemarketers that are determined to be agents, applying the federal common law of agency. Moreover, a manufacturer that simply puts a product in the chain of commerce that is later resold by a seller is not likely to be affected by this Ruling, provided that it does not otherwise trigger the TCPA’s seller definition.

With respect to how and under what circumstances the federal common law of agency will be applied to find a seller vicariously liable for the acts of third parties, the future is unclear – particularly with respect to claims based on alleged apparent authority and whether the FCC’s “illustrative examples” of such apparent authority set forth in the Ruling will influence courts in interpreting how the federal common law of agency should apply to the specific facts of a particular case.

For more on this decision, please reference the Kelley Drye client advisory.

Watch Kelley Drye's "Smartphone Revolution" Webinar On Demand

Tue, 20 Nov 2012 17:34:40 -0500

Mobile marketing, sweepstakes and services, including location-based services, are governed by an alphabet soup of statutes and regulations: TCPA, COPPA, CAN-SPAM, CPNI, etc. To complicate compliance even further, numerous class action lawsuits in state and federal courts have addressed issues and nuances that the Federal Communications Commission, Federal Trade Commission, and state regulatory agencies or legislatures have not.

On November 16th, Kelley Drye held a webinar which discussed the new rules of the road for mobile communications, marketing, and sweepstakes, and offered suggestions for reaching consumers while mitigating the legal risks.

Click here to download the slides from the webinar and click here to watch the recording.

Insurance Coverage for Data Breach Claims

Wed, 14 Nov 2012 18:01:18 -0500

Data breaches caused by hackers or other forces outside the control of a business are a scary, and expensive, proposition for any organization that collects or retains personally identifiable information, or warehouses credit or financial information. According to a recent study by Symantec, an average data breach will cost an organization $5.5 million, including direct costs such as engaging forensic experts, outsourcing hotline support and providing free credit monitoring subscriptions, discounts for future products and services, and indirect costs such as in-house investigations and communication. These costs are in addition to the costs of potential litigation (often in the form of a class action) by customers alleging that the company failed to take adequate measures to protect their data, and investigations by government agencies, such as the Federal Trade Commission, that frequently become involved when breaches affect a large number of consumers.

Like any potentially catastrophic problem, insurance can be at least a partial solution. A new article in The Corporate Counselor examines insurance coverage for data breaches. In-house counsel may be surprised to learn that coverage for data breaches is not limited to specialty policies, and can often be found under standard CGL or property insurance policies. Any time a potential data breach occurs, it is essential for an insured to consider all forms of insurance that it carries and to provide prompt notice to its insurer(s) of any policy that even potentially could apply.

The article, "Insurance Coverage for Data Breach Claims," was co-written by Cameron R. Argetsinger.

FCC Determines Radio Station Failed to Comply with Contest Rules

Mon, 27 Aug 2012 08:20:43 -0400

Last year, a CBS radio station in North Carolina ran a “Carolina Cuties” contest in which listeners were invited to submit pictures of their babies on the station’s website. The grand prize winner was be determined by public votes. Although broadcast announcements for the contest stated that voting would end on September 5, 2011, the station’s website and e-mails to the finalists stated that voting would end by September 4, 2011. One of the contestants complained to the FCC about the discrepancies.

The FCC requires broadcast licensees to disclose the material terms of their promotions -- including when and how winners will be selected -- and to conduct their promotions substantially as advertised. The agency wasn’t persuaded by the station’s argument that the discrepancies were due to inadvertent errors, holding that inadequate oversight of staff does not excuse a failure to run the promotion as advertised. The agency also rejected the station’s argument that the errors did not put any consumers at a disadvantage. Instead, the FCC noted that there was a potential for harm, and that a showing of actual harm is not necessary in determining whether a violation occurred. Accordingly, the FCC proposed a fine of $10,000.

This case demonstrates that companies can be held responsible for discrepancies between how they advertise a promotion and how the promotion is actually run. If you are running a promotion, make sure that your rules and marketing materials are in sync with how you actually run the promotion.

FCC Seeks Comment on Petition to Rule on Text Messages

Mon, 02 Apr 2012 11:56:38 -0400

The FCC has issued a notice seeking public comment on a petition filed in February by SoundBite Communications seeking a declaratory ruling on text messaging. SoundBite asked FCC to issue a ruling that sending a one-time text message to confirm a consumer’s request that no further messages be sent does not violate the Telephone Consumer Protection Act (“TCPA”) or the FCC’s implementing regulations.

Under the TCPA, a person is prohibited from making non-emergency calls, including sending text messages, with an automatic telephone dialing system or an artificial or pre-recorded voice to a cell phone without prior consent. Industry best practice includes confirming receipt of an opt-out request via text message. However, several companies, including SoundBite, are the subject of class action lawsuits for sending the confirmations. SoundBite has asked FCC to expedite a declaratory ruling on the matter on the grounds that the confirmation messages are sent within the grace period established by FCC and that SoundBite does not use an automatic dialing system, as that term is defined in the TCPA. All companies that follow the same practice of sending confirmation of an opt-out request via text message should review the FCC notice and decide whether to comment on the petition. Comments are due to FCC by May 15, 2012.

Join us Feb. 16 for "Privacy in 2012" Seminar and Teleconference

Wed, 25 Jan 2012 10:39:07 -0500

Changes to privacy regulations, such as proposed revisions to the Children's Online Privacy Protection Act (COPPA), and continuously evolving technologies, including mobile apps with location-based services, can make it difficult for businesses to ensure their privacy practices are up to par.

On February 16, Kelley Drye will gather government leaders from the FTC and FCC, and thought leaders in the industry, for a discussion about new regulations, enforcement trends, and best practices to avoid consumer privacy risks. Please join us for "Privacy in 2012: What to Watch Regarding COPPA, Mobile Apps, and Evolving Law Enforcement and Public Policy Trends."

Email [email protected] to register for the live seminar or teleconference.

KEYNOTE SPEAKER

Peter Swire, Professor of Law, Ohio State University; former Clinton Administration Chief Counselor for Privacy, U.S. Office of Management and Budget

PANEL 1: COPING WITH COPPA: CHILDREN'S PRIVACY AND PROPOSED REVISIONS TO THE COPPA RULE

Ellen Blackler, Vice President - Global Public Policy, The Walt Disney Company

Mamie Kresses, Senior Attorney, Division of Advertising Practices, Federal Trade Commission

Saira Nayak, Director of Policy, TRUSTe

Moderated by partners Dana Rosenfeld and Alysa Hutnik of Kelley Drye & Warren LLP

PANEL 2: MOBILE APPS: A PRIVACY AND CONSUMER PROTECTION HOT SPOT

Michael Altschul, Senior Vice President and General Counsel, CTIA

Jessica Rich, Associate Director, Division of Financial Practices, Federal Trade Commission

Jennifer Tatel, Associate General Counsel, Federal Communications Commission (invited)

Moderated by partners John Heitmann and Gonzalo Mon of Kelley Drye & Warren LLP

When:
February 16, 2012, 2:30 PM - 5:30 PM EST

Location:
Kelley Drye & Warren LLP
3050 K Street, NW, Suite 400
Washington, DC 20007-5108

And via audio webcast

RSVP:
Email [email protected] or contact Cassidy Russell at 202.342.8400.

This seminar is free of charge, but space is limited. Reserve your place today.

CLE and CPE credit may be available in certain jurisdictions.

Avoiding Trouble When Adding an App to the Business Model

Wed, 27 Jul 2011 16:38:44 -0400

The rise of smartphones, wifi hotspots, and high-speed data networks has spurred new technology-based business models and the exponential growth of consumer information online. Chief among new technologies, the use of mobile applications—“apps”—has exploded in the past few years. From near-constant posts on Facebook to attacking the green pigs on Angry Birds, consumers have opened their hearts and wallets to mobile apps. While the upside is great, companies and developers considering a mobile app should also be mindful of the legal and business pitfalls of mobile apps and implement a process to sidestep common challenges.

A new article from E-Commerce Law & Policy, “Avoiding Trouble When Adding an App to the Business Model,” outlines several of these potential pitfalls and the best practices to avoid them.

For more information about this uncharted legal territory and emerging "rules for the road" for developing and marketing mobile apps, click here to view and listen to a recording of the Kelley Drye webinar, “Mobile Applications: Privacy and Data Security Considerations.”

'Big Three' Weigh in on Online Privacy: FTC, FCC and NTIA Testify at Privacy Hearing

Tue, 19 Jul 2011 13:34:46 -0400

On July 14, 2011, a joint House Energy and Commerce Subcommittee hearing focused on online privacy policy and perspectives of the ‘big three’ federal agencies with potential jurisdiction over online privacy – the Federal Trade Commission (FTC), the Federal Communications Commission (FCC), and the National Telecommunications and Information Administration (NTIA). The hearing, Internet Privacy: The Views of the FTC, the FCC, and NTIA, offered a comprehensive review of the state of online consumer privacy and the appropriate industry and government response to developments in online behavioral advertising and tracking. The hearing comes on the heels of a flurry of online privacy and data security legislation introduced in recent weeks and months. Witnesses included FCC Chairman Julius Genachowski, FTC Commissioner Edith Ramirez and NTIA Administrator Lawrence E. Strickling.

The hearing touched on issues including the economic impact of privacy regulation, defining the harms caused by data collection, agency jurisdiction and authority, protecting children, data security, and social networking. Click here for more detail regarding the major themes discussed at the hearing, which expanded the growing legislative record on online privacy and security.

Join Us on May 16 for the Webinar, "Mobile Applications: Privacy and Data Security Considerations"

Wed, 04 May 2011 11:51:55 -0400

Do you know what kind of data your smartphone apps are collecting?

Understanding the flow of data, how it is shared, and whether your apps collect sensitive information such as mobile payments or location-based data is critical to avoiding regulatory scrutiny and litigation risks.

Join Kelley Drye on May 16 from 12 noon – 1:00pm EST for a webinar exploring this uncharted legal territory, “Mobile Applications: Privacy and Data Security Considerations.” Topics of discussion will include:

The mobile ecosystem, including data flows and parties involved.
Privacy and security considerations, including unintended data uses.
Current issues in the legal landscape, including media coverage; inquiries and actions from Congress, the FTC, and FCC; litigation risks; and industry activity.
Emerging “rules for the road” for developing and marketing mobile apps.

This webinar will address the privacy and information security questions that are top of mind for anyone involved in developing, marketing, selling, or serving mobile apps.

Kelley Drye Speakers:

Dana B. Rosenfeld
Chair, Privacy & Information Security Practice and Partner, Advertising & Marketing Practice

Alysa Z. Hutnik
Partner, Privacy & Information Security and Advertising & Marketing Practices

John J. Heitmann
Partner, Telecommunications and Privacy & Information Security Practices

Email [email protected] to register.