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How to Stay off the Hook for TCPA Claims

BY Benjamin J. Stone
November 28, 2010

Many companies use equipment that can dial hundreds, if not thousands, of telephone numbers instantly and automatically. This equipment can also leave pre-recorded messages or, if the call is answered, connect the call with a live operator. Commonly used in the telemarketing, banking and debt-collection industries, this equipment is the only efficient way for companies to communicate with potential and actual customers. Historically, these calls had been made to landlines but, due to the recession and other factors, people have been disconnecting their landlines in record numbers, using only cell phones and sharing their cellular numbers with companies that sell them goods and services. Consequently, more and more calls made by dialer are reaching cell phones.

In response, there has been an outbreak of putative class actions nationwide against companies in different industries alleging that they used this equipment to call cell phones in violation of Telephone Consumer Protection Act (TCPA). Given the sheer number of calls that can be made by these dialers and high penalties under the TCPA, the stakes are high in these cases. For example, Simon & Schuster recently agreed to pay up to $10 million to settle a putative class action by consumers who allegedly received text messages promoting a new Stephen King novel.

Thus, if your company uses hardware or software that dials telephone numbers automatically, provides pre-recorded or automated messages, or hires vendors who use this equipment, you should be aware of the provisions of the TCPA and strategies to prevent litigation.

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