Tags: Cybersecurity | clyburn | fcc | markey | tcpa | thune

Outdated Telecom Law Lets Predatory Lawyers Shake Businesses Down

Outdated Telecom Law Lets Predatory Lawyers Shake Businesses Down

Friday, 24 August 2018 12:08 PM Current | Bio | Archive

An ongoing problem in Washington has been updating older laws for the modern era. A lot of regulation for telecommunications that may have made sense at a time when most human beings had never even sent an email, but don’t now that we all have smart phones in our pockets.

We see this with large dramatic laws — like those covering national security and privacy.

But smaller stuff needs attention too, such as the Telecommunications Consumer Protection Act (TCPA), which became law in 1991. The Act was intended to keep telemarketers from bugging people at home. Instead it's become a payday for predatory trial lawyers to put small businesses out of work.

As technology has swiftly moved along in this century, the law has not kept pace —although the for-profit legal industry has. In 2008, only 16 plaintiffs nationwide filed TCPA claims, but by 2012 there were 1,136, according to litigation analyst WebRecon LLC. By 2016, there were 4,860 claims.

Examples of TCPA abuse are egregious. One New Jersey man, Jan Konopca, has extorted approximately $800,000 from more than 30 lawsuits he’s led, according to Forbes.

Casey Blotzer created a minefield for businesses by allegedly encouraging family and friends use her phone number when entering financial transactions.

Jason Alan posted his many phone numbers online like bait, then sued anyone who called him.

Health clubs have been shaken down like mom-and-pop stores on a mafia protection racket, including Gold’s Gym, 24 Hour Fitness, Town Sports International, Work Out World, and Crunch Fitness.

One company, Life Time, had to settle for a whopping $15 million in "damages" for innocuous TCPA mistakes.

Former Federal Communications Commission (FCC) chief of staff and Mignon Clyburn said it best when he told the House Judiciary Committee that:

"The law has become the second most popular vehicle for class action lawyers to reap millions in the name of consumer protection. As an attorney, a consumer and a citizen, this really bothers me because it is a bastardization of the public interest and a travesty to our legal system. As a matter of equity, it just seems to be plain wrong."

Hoffman continued that TCPA was "unforgiving." Any violation entitles the receiver of an unsolicited call, text, or fax end to damages of up to $1,500 per unsolicited call. This includes misdials and even calls to reassigned numbers previously used by someone else.

To take advantage of this particular loophole, Melody Stoops "stockpiled more than 35 phones with different numbers with the hope that debt collectors would call her in an effort to reach the person who previously used the phone number."

Given that mobile carriers reassign about 100,000 telephone numbers every day, the law must become more accommodating to the realities of 2018.

Another innocent mistake is calls or texts to "one-day" numbers. ISPs need liability protection from phone number cloning and Digital Network Protection systems within their networks. And of course tort reform is necessary to prevent law firms from manufacturing class action suits by aggressively seeking out individuals who didn’t even know they’d been "harmed" then shaking down "offending" companies for "damages."

Several lawmakers have already outlined a plan going forward – including a letter from seven Republicans on the Senate Commerce Committee urging FCC Chairman Ajit Pai to reform the TCPA and a bipartisan letter from Sens. John Thune, R-S.D., and Edward Markey, D-Mass. One hopes these are the small pebbles that start the avalanche for much needed reform.

Not only would this help small business from legal extortion as discussed earlier, but it would obviate the need of companies to send call centers off-shore to side-step the TCPA. The call center industry could grow to almost 500,000 American jobs without the burden of the current TCPA, according to one estimate.

Certainly no one enjoys telemarketing calls, but the fact that they still exist means they do provide utility to our economy. Moreover, many non-marketing calls can be caught in the TCPA trap, including notifications about potential fraud, reminders about appointments, and customer service calls.

Illegal robocalls are certainly a problem, but the current law needs to make a clear distinction between legitimate business communication and actual bad actors.

The government needs to modernize the TCPA for the 21st century so they can serve clients and potential clients without fear of abusive litigation. Something designed to protect Americans shouldn’t be a cash cow for the legal-industrial complex.

Jared Whitley is a long-time politico who has worked in the U.S. Congress, White House, and defense industry. He is an award-winning writer, having won best blogger in the state from the Utah Society of Professional Journalists (2018) and best columnist from Best of the West (2016). He earned his MBA from Hult International Business School in Dubai. To read more of his reports — Click Here Now.

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Illegal robocalls are certainly a problem, but the current law needs to make a clear distinction between legitimate business communication and bad actors.Something designed to protect Americans shouldn’t be a cash cow for the legal-industrial complex.
clyburn, fcc, markey, tcpa, thune
Friday, 24 August 2018 12:08 PM
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