Tag: Communications

FCC Subjects Robocallers and Caller Identification Fraudsters to Increased Penalties and Broader Enforcement

On May 1, 2020, the Federal Communications Commission (FCC) adopted rules to strengthen protections against robocalls and the manipulation of caller identification information to misrepresent the true identity of the caller (known as caller ID spoofing).1 The FCC’s amended rules, which implement portions of the recently-enacted Pallone-Thune Telephone Robocall Abuse Criminal Enforcement and Deterrence Act (TRACED Act), streamline the procedure for commencing enforcement actions against violators and expand the statute of limitations applicable to FCC proceedings against robocallers and caller ID spoofers2 (see GT Alert, TRACED Act Subjects Robocallers to Increased Penalties, Outlines Regulatory and Reporting Requirements to Deter Violations).

The FCC’s changes to its rules include the following:

  • Eliminating the requirement that the FCC issue a citation to a person or entity that violates prohibitions against robocalling before issuing a notice of apparent liability if the person or entity does not hold a license, permit, or other authorization issued by the FCC. As noted by FCC Chairman Ajit Pai in the news release accompanying the FCC’s Order: “Robocall scam operators don’t need a warning these days to know what they are doing is illegal, and this FCC has long disliked the statutory requirement to grant them mulligans.” Caller ID spoofers are already subject to FCC enforcement actions without receiving a citation as a warning.3
  • Increasing the penalty amount to up to $10,000 for each intentional unlawful robocall in addition to the monetary forfeiture permitted under 47 U.S.C. § 503 (for persons or entities that are not FCC licensees or common carriers, the forfeiture penalty shall not exceed $20,489 for each violation and $153,669 for any continuing violation).4 Importantly, each unlawful robocall is considered to be a separate violation, so the potential forfeiture amounts could be very high.
  • Extending the statute of limitations applicable to FCC enforcement actions for intentional robocall violations and for caller ID spoofing violations to four years. Under the amended rule, the FCC may not impose a forfeiture penalty against a person for violations that occurred more than four years prior to the date a notice of apparent liability is issued. The statute of limitations had been one year for all robocall violations and two years for call ID spoofing violations. This change will significantly increase the timeframe of conduct subject to FCC enforcement and that can be included in a proposed forfeiture amount.

Conclusion

The FCC’s amended rules, consistent with the TRACED Act, are intended to discourage unlawful robocalling and caller ID spoofing by abolishing the “one free pass” formerly applicable to entities that do not hold FCC authorizations, increasing the penalties for intentional violations, and expanding the statute of limitations period. This is the FCC’s most recent action to implement the TRACED Act by strengthening protections against unlawful robocalls and caller ID spoofing. Other steps recently taken by the FCC include initiating a rulemaking proceeding to prevent one-ring scams (when a caller initiates a call and allows the call to ring for a short duration with the aim of prompting the called party to return the call and be subject to charges). Given the FCC’s significant focus on combatting illegal robocalling, it is important that companies that rely on robocalls to contact consumers understand the federal laws governing such calls implement procedures to ensure that they comply with those laws and regulations.

1 The Telephone Consumer Protection Act (TCPA) (which was amended by the TRACED Act) and the FCC’s implementing regulations generally prohibit the use of autodialed, prerecorded or artificial voice calls (commonly known as robocalls) to wireless telephone numbers and the use of prerecorded or artificial voice calls to residential telephone numbers unless the caller has received the prior express consent of the called party (certain calls, such as telemarketing calls, require prior express written consent) or is subject to specified exemptions. See 47 U.S.C. § 227; 47 C.F.R. § 64.1200.

2 The FCC issued these rules pursuant to an order, rather than utilizing notice and comment procedures, because the content of the rules did not require the exercise of administrative discretion. The rules will become effective 30 days after the date of publication in the Federal Register.

3 The FCC may issue a forfeiture order if it finds that the recipient of a notice of apparent liability has not adequately responded to the FCC’s allegations. The FCC may also seek to resolve the matter through a consent order which generally requires the alleged violator to make a voluntary payment, develop a compliance plan, and file compliance reports.

4 See 47 U.S.C. § 503(b)(2)(D) as adjusted for inflation. The FCC has authority to make upward or downward adjustments to forfeiture amounts based on several factors. See 47 C.F.R. § 1.80.

©2020 Greenberg Traurig, LLP. All rights reserved.

Texas Appeals Court Rules Private Communications with Customers Not Protected Free Speech

In a case addressing the applicability of free speech as a defense to trade secret misappropriation, the Court of Appeals for the Fifth District of Texas retracted its previous ruling, holding that communications with customers and suppliers did not involve a matter of public concern and were therefore not an exercise of free speech. Goldberg, et al. v. EMR (USA Holdings) Inc., et al., Case No. 05-18-00261-CV (Tex. App. Jan. 23, 2020) (Myers, J).

The case concerns allegations of trade secret misappropriation brought by EMR (USA Holdings) (EMR), against Kenneth Goldberg, his company Geomet Recycling (Geomet), and several Geomet employees who, like Goldberg, formerly worked for EMR. EMR and Geomet are both involved in the business of scrap metal recycling. EMR alleged that Goldberg, Geomet and the former EMR employees (collectively, “Defendants”) violated the Texas Uniform Trade Secrets Act (TUTSA), breached fiduciary duties and tortuously interfered with contracts by, among other things, using EMR’s trade secrets and confidential and proprietary information to contact purchasers and suppliers.

Defendants moved to dismiss all claims under the Texas Citizen’s Participation Act (TCPA), claiming that their contacts with purchasers and suppliers were protected free speech involving a matter of public concern. The TCPA allows litigants to seek early dismissal of a lawsuit if they prove by a preponderance of the evidence that the legal action is based on, or is in response to, a party’s exercise of the right of free speech.

The TCPA defines “exercise of the right of free speech” as “a communication made in connection with a matter of public concern.” The statute states that a “‘[m]atter of public concern’ includes an issue related to: (A) health or safety; (B) environmental, economic, or community well-being; . . . or (E) a good, product, or service in the marketplace.” Id. § 27.001(7). Additionally, under the “commercial-speech exemption,” the TCPA does not apply to a legal action brought against a person engaged in the business of selling goods or services if the conduct arises out of a commercial transaction in which the intended audience is an actual or potential buyer or customer.

After the trial court denied Defendants’ motion to dismiss without providing any reasoning, Defendants appealed.

On August 22, 2019, the Court of Appeals for the Fifth District of Texas affirmed the trial court’s decision. The Court held that the commercial-speech exemption to the TCPA applied to the Defendants’ communications with purchaser and suppliers. However, the Court also found that these communications concerned “an issue related to . . . a good, product, or service in the marketplace” and therefore involved a matter of public concern under the TCPA.

Both sides asked for rehearing. In its new ruling, the Court of Appeals reversed course and found that Defendants’ communications with purchasers and suppliers did not involve matters of public concern. Defendants argued that the business of recycling scrap metal relates to environmental, economic and community well-being, which are considered matters of public concern under the TCPA. The Court rejected this argument, noting that while scrap metal recycling may indeed relate to matters of public concern, the communications at issue “were private communications regarding private commercial transactions for the purchase and sale of a commodity.” The Court held that, because the communications themselves did not implicate matters of public concern, they were not subject to the TCPA.

Practice Note:

The new ruling significantly restricts the application of the TCPA. The holding indicates that the TCPA cannot shield defendants from trade secret claims based on communications between the defendant and potential customers or suppliers that solely relate to the purchase or sale of a commodity—even if the commodity at issue might arguably relate to matters of public concern.

© 2020 McDermott Will & Emery

For more on TCPA rule application, see the National Law Review Communications, Media & Internet law section.

Clash of Consumer Protection Goals: Does the Text of the TCPA Frustrate the Purposes of the CPSA?

“Hello.  This is an automated call from Acme Manufacturing. Our records indicate that you purchased Product X between December 2019 and January 2020. We wanted to let you know that we are recalling Product X because of a potential fire risk. Please call us or visit our website for important information on how to participate in this recall.”

When companies recall products, they do so to protect consumers.  In fact, various federal laws, including the Consumer Product Safety Act (CPSA), the Federal Food, Drug, and Cosmetic Act (FDCA), and National Highway and Motor Vehicle Safety Act (MVSA), encourage (and may require) recalls. And the agencies that enforce these statutes would likely approve of the hypothetical automated call above because direct notification is the best way to motivate consumer responses to recalls.[1]

But automated calls to protect consumers can run into a problem: the Telephone Consumer Protection Act (TCPA).

Are Recall Calls a Nuisance or an Emergency?

The TCPA seeks to protect consumers from the “nuisance and privacy invasion” of unwanted automated marketing calls.[2] The TCPA prohibits any person from making marketing calls to landlines, or any non-emergency calls or text messages[3] to wireless lines, using automated dialers or recorded messages unless the recipient has given prior written consent. The Act includes a private right of action and statutory per-violation damages – $500, trebled to $1,500 if a court finds the violation willful and knowing.[4] These penalties can add up quickly: In one case, a jury found that a company violated the TCPA nearly two million times, exposing the company to minimum statutory damages totaling almost $1,000,000,000.[5]

There is an important exception to the TCPA’s prohibition on automated calls. The TCPA allows autodialed calls for emergency purposes,[6] but the Act does not define that phrase. While the FCC has interpreted emergency purposes to mean “calls made necessary in any situation affecting the health and safety of consumers,”[7] recalls are not explicitly identified within this definition. As a result, aggressive plaintiffs have demanded millions in damages from companies that use automatic dialers to disseminate recall messages.[8]

For example, a grocery chain – Kroger – made automated calls to some purchasers of ground beef as part of a recall stemming from salmonella concerns. A plaintiff responded with a purported class action that did not mention the recall [9] but was based on consumers alleging that they had received “annoying” “automated call[s] from Kroger.”

Moving to dismiss, Kroger observed that the plaintiff – who had not listened to the call beyond its initial greeting[10] and thus could not comment on the call’s text – had “cherry-picked”[11] portions of consumers’ online comments to support the case, omitting text that clearly demonstrated that the calls were made for health and safety purposes.[12] Kroger argued that the online comments did not support the plaintiff’s allegations that Kroger had made any marketing calls.

The court granted Kroger’s motion and dismissed the complaint without leave to amend. Even so, Kroger was compelled to spend time and money defending the claim.

In light of this type of lawsuit, one communications firm involved in automotive recalls has petitioned the FCC to “clarify . . . that motor vehicle safety recall-related calls and texts are ‘made for emergency purposes.’”[13] The Association of Global Automakers and the Alliance of Automobile Manufacturers commented in support of the petition, arguing that the “[l]ack of clarity regarding TCPA liability for vehicle safety recall messages has had a chilling effect on these important communications.”[14] The Settlement Special Administrator for the Takata airbag settlements also wrote in support, commenting that automated “recall-related calls and texts serve an easily recognizable public safety purpose.”[15]

The TCPA’s emergency exception offers protection in litigation. The FCC’s definition – “calls made necessary in any situation affecting the health and safety of consumers” – neatly encapsulates the entire function of a recall, namely acting to protect consumers’ health and safety. Moreover, in developing the emergency exception, Congress broadened initial language that excepted calls made by a “public school or other governmental entity” to the enacted “emergency purposes” phrasing precisely to ensure the exception encompassed automated emergency calls by private entities.[16] One of the seminal emergency purposes for which a private entity might seek to make automated calls is a product recall.

Even with such sound arguments that TCPA claims related to recall calls are without merit within the statute, however, aggressive plaintiffs have brought such claims. These efforts compel companies to spend finite resources defending claims that should not be brought in the first place. An express statutory or regulatory statement that recalls are squarely within the definition of emergency purposes would give companies greater confidence that not only would they be able to successfully defend against any effort to pit the TCPA against consumer-protection values, but that the claims are so unlikely to be brought that the companies need not even fear to have to defend.

Protecting Against Recall-Call Complaints

Until the FCC or Congress expressly instructs plaintiff’s counsel not to try to litigate against automated recall calls, there are steps companies that want to use automated dialers to drive recall responses can take to minimize any risk of a court misinterpreting their calls or finding TCPA liability where it should not attach.

For example, companies may (as some already do) ask for customers’ consent to be autodialed in connection with the products they have purchased – e.g., by including consent language on product warranty cards or registration forms. In fact, the Consumer Product Safety Improvement Act of 2008 (CPSIA)[17] already requires manufacturers of durable infant and toddler products to include registration cards for recall-communication purposes.[18] Companies in some other industries (like the on- and off-road motor vehicle industries) typically have robust registration systems that can incorporate auto dialing consent, and more companies in other spaces may want to consider using registration to facilitate recalls.

Further, automated recall calls should focus on the recall. If calls extend to marketing messaging, that could undermine both a future TCPA defense and the efficacy of that and future recall communications.

Optimally, companies would be less likely to need these defenses if the statute more clearly signaled to would-be litigants that they should not even bother. If the FCC grants the pending petition and plainly states that product recalls are emergencies for TCPA purposes, courts’ deference to agency interpretations might deter at least some complaints. A statutory amendment would be the surest guarantee, though, and manufacturers may wish to ask Congress to amend the TCPA to clarify that recall messages are emergency messages.

[1] See, e.g., Joseph F. Williams, U.S. Consumer Prod. Safety Comm’n, Recall Effectiveness Workshop Report, 5 (Feb. 22, 2018).

[2] Pub. L. No. 102-243, § 2(12), 105 Stat. 2394, 2395 (Dec. 20, 1991).

[3] Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, CG Docket No. 02-278, Report and Order, 18 FCC Rcd 14014, 14115, para. 165 (2003)

[4] TCPA at § 3(a), 105 Stat. at 2399 (codified at 47 U.S.C. § 227(c)(5)).

[5] Wakefield v. ViSalus, Inc., No. 3:15-cv-1857-SI (D. Or.).

[6] See, e.g., TCPA at § 3(a), 105 Stat. at 2395-96 (codified at 47 U.S.C. § 227(b)(1)(A)).

[7] 47 C.F.R. § 64.1200(f)(4).

[8] See, e.g., Compl., Ibrahim v. Am. Honda Motor Co., Inc., No. 1:16-cv-04294, Dkt. #1 (N.D. Ill. Apr. 14, 2016).

[9] Compl., Brooks v. Kroger Co., No. 3:19-cv-00106-AJB-MDD, Dkt. #1 (S.D. Cal. Jan. 15, 2019) (“Brooks”).

[10] Pl. Opp. to Mot. to Dismiss at 5, Brooks, Dkt. #9 (Apr. 4, 2019).

[11] Reply in Supp. of Mot. to Dismiss at 7, Brooks, Dkt. #10 (Apr. 11, 2019).

[12] The plaintiff quoted one complaint as “Automated call from Kroger.” Compl. at 3-4, Brooks. As the defense noted, that complaint continued, “requesting that you return ground beef . . . due to the threat of salmonella.” Mem. in Supp. of Mot. to Dismiss at 6, Brooks Dkt. #7 (Mar. 21, 2019).

[13] IHS Markit Ltd. Petition for Emergency Declaratory Ruling, CG Docket No. 02-278, Petition, ii (Sept. 21, 2018).

[14] IHS Markit Ltd. Petition for Emergency Declaratory Ruling, CG Docket No. 02-278, Comments of Association of Global Automakers, Inc. and Alliance of Automobile Manufacturers, 9 (Nov. 5, 2018).

[15] IHS Markit Ltd. Petition for Emergency Declaratory Ruling, CG Docket No. 02-278, Comments of Patrick A. Juneau, 3 (Nov. 5, 2018).

[16] S. Rep. No. 102-178, 5 (Oct. 8, 1991).

[17] Pub. L. No. 110-314, 122 Stat. 3016 (Aug. 14, 2008) (codified as amended at 15 U.S.C. § 2056a).

[18] 15 U.S.C. § 2056a(d).

© 2020 Schiff Hardin LLP

For more on CPSA, FDCA, MVSA & other recalls, see the National Law Review Consumer Protection law section.

Text Messages Inviting Independent Voters to Political Speeches by Former Presidential Hopeful Howard Schultz Were Not “Solicitations” For His Book Tour

The Western District of Washington recently held in Vallianos. v. Schultz, C19-0464-JCC, 2019 WL 4980649 (W.D. Wash. Oct. 8, 2019), that two text messages encouraging recipients to view a livestream of a political speech by the former chairman and CEO of Starbucks Howard Schultz did not amount to “solicitations” under the TCPA. While exploring a run for President, Schultz released a book, “From the Ground Up,” and went on a three-month long cross-country book tour. He also collected from voter records the phone numbers of individuals registered as having “No Party Affiliation” and sent them the text messages at issue. Named plaintiffs Cassandra Vallianos, Stacey Karney, and Mike Barker brought a putative TCPA class action against Schultz alleging that the text messages were sent to them without their consent after they had placed their cell phone numbers on the national Do Not Call Registry.

Specifically, plaintiffs made two claims: first, that Schultz sent the text messages using an auto-dialer and without the plaintiffs’ consent; second, that the calls were solicitations sent in violation of the TCPA’s Do Not Call restrictions. Plaintiffs’ claims were based on two separate text messages Schultz sent Plaintiffs. The first said “Howard Schultz will be speaking in Miami at 12:30! Watch live: https://hs.media.mi-a030[.]” The second said “Howard Schultz will be speaking about his vision for America in Miami at 12:30! Watch live: https://hs.media/mia030[.]” Plaintiffs argued that these text messages were “solicitations” under the TCPA because the text messages were sent with the goal of getting recipients to purchase Schultz’s book. Defendant Schultz moved to dismiss only the Do Not Call claim.

Acknowledging that messages that serve a “dual-purpose” by including both advertising and informational communications are solicitations for purposes of the TCPA, the court looked to the context of the messages to determine whether they constituted “solicitations” under the TCPA. The court reviewed the text messages, the webpage to which the text messages directed recipients, and the speech embedded in the website. The court found that the text messages did not facially discuss Schultz’s book. The court also found that the link in both text messages took Plaintiffs to the homepage of Schultz’s website, which included various video clips, including a livestream of Schultz’s speech and a link to a website where consumers could purchase his book. But the court held that the website was not transformed into a solicitation by the “mere inclusion of a link to a website on which a consumer can purchase a product.” The court found that the speech focused on Schultz’s political views and potential run for president, not his book. The court further found that the website was just a way to facilitate viewing of Schultz’s speech. Thus, the court ultimately determined that the messages did not constitute “telephone solicitations” under the TCPA.

With the seemingly never-ending national campaign season chugging along, we expect to see more such claims filter their way through the courts.

©2019 Drinker Biddle & Reath LLP. All Rights Reserved

For more on TCPA litigation, see the National Law Review Communications, Media & Internet Law page.

Whatever Happened to that Big Ringless Voicemail Decision We Were All Expecting? It Was a Nothing Burger—For Now

You’ll recall a few weeks back TCPAWorld.com featured analysis of efforts by VoApps—makers of the DirectDrop ringless voicemail platform—to stem the tide of negative TCPA rulings addressing ringless voicemail technologies. VoApps founder David King even joined the Unprecedented podcast to discuss his submission of a lengthy declaration to the court addressing how the technology works and why it is not covered by the TCPA.

Well, a few days ago the Court issued its ruling on the pending motion—a summary judgment effort by the Plaintiff—and I must say, it was rather anti-climactic. Indeed, the court punted entirely on the key issue.

In Saunders v. Dyck O’Neal, Case No. 1:17-CV-335, 2019 U.S. Dist. LEXIS 177606 (W.D. Mich. Oct. 4, 2019) the court issued its highly-anticipated ruling on the Plaintiff’s bid to earn judgment following the Court’s earlier ruling that a ringless voicemail is a call under the TCPA. It was in response to this motion that VoApps submitted a mountain of evidence that although a ringless voicemail may be a “call” it is not a call to a number assigned to a cellular service—and so such calls are not actionable under the TCPA’s infamous section 227(b).

Rather than answer the question directly the Court made mincemeat of the Federal Rules of Civil Procedure and treated the summary judgment motion as if it were some sort of motion to confirm the Court’s earlier ruling. This is weird because: i) no it wasn’t; and ii) there’s no such thing. As the Court put it: “Admittedly, Saunders moved for summary judgment, but her motion is in fact limited to a request for clarification of the impact of the Court’s prior ruling: Was the Court’s prior ruling that DONI’s messaging technology falls within the purview of the TCPA a ruling as a matter of law that binds the parties going forward? The answer is clearly yes.”

Great. So we now know what we already all knew—the Saunders court holds that a ringless voicemail is a call. Got it. As to the key issue of whether the calls were made to a landline to a cell phone, however, the Court finds: “These issues were unnecessary to Saunders’s motion, as she has not [actually] moved for summary judgment on her claim.”

So there you go. Plaintiff’s motion for summary judgment was not actually a motion for summary judgment after all. So all that work by VoApps was for nothing. But not really. Obviously this fight is not yet over. The Court declined to enter judgment in favor of the Plaintiff meaning that further work—and perhaps a trial—lies ahead for the good folks over at VoApps. We’ll keep you posted.

 

© Copyright 2019 Squire Patton Boggs (US) LLP

For more on voicemail & phone regulation, see the National Law Review Communications, Media & Internet law page.

Resist the Urge to Access: the Impact of the Stored Communications Act on Employer Self-Help Tactics

As an employer or manager, have you ever collected a resigning employee’s employer-owned laptop or cellphone and discovered that the employee left a personal email account automatically logged in? Did you have the urge to look at what the employee was doing and who the employee was talking to right before resigning? Perhaps to see if he or she was talking to your competitors or customers? If so, you should resist that urge.

The federal Stored Communications Act, 18 U.S.C. § 2701, et seq., is a criminal statute that makes it an offense to “intentionally access[ ]without authorization a facility through which an electronic communication service is provided[ ]and thereby obtain[ ] . . . access to a[n] . . . electronic communication while it is in electronic storage  . . . .” It also creates a civil cause of action for victims of such offenses, remedied by (i) actual damages of at least $1,000; (ii) attorneys’ fees and court costs; and, potentially, (iii) punitive damages if the access was willful or intentional.

So how does this criminal statute apply in a situation in which an employee uses a personal email account on an employer-owned electronic device—especially if an employment policy confirms there is no expectation of privacy on the employer’s computer systems and networks? The answer is in the technology itself.

Many courts find that the “facility” referenced in the statute is the server on which the email account resides—not the company’s computer or other electronic device. In one 2013 federal case, a former employee left her personal Gmail account automatically logged in when she returned her company-owned smartphone. Her former supervisor allegedly used that smartphone to access over 48,000 emails on the former employee’s personal Gmail account. The former employee later sued her former supervisor and her former employer under the Stored Communications Act. The defendants moved to dismiss the claim, arguing, among other things, that a smartphone was not a “facility” under the statute.

While agreeing with that argument in principle, the court concluded that it was, in fact, Gmail’s server that was the “facility” for purposes of Stored Communications Act claims. The court also rejected the defendants’ arguments (i) that because it was a company-owned smartphone, the employee had in fact authorized the review, and (ii) that the former employee was responsible for any alleged loss of privacy, because she left the door open to the employer reviewing the Gmail account.

Similarly, in a 2017 federal case, a former employee sued her ex-employer for allegedly using her returned cell phone to access her Gmail account on at least 40 occasions. To assist in the prosecution of a restrictive covenant claim against the former employee, the former employer allegedly arranged to forward several of those emails to the employer’s counsel, including certain allegedly privileged emails between the former employee and her lawyer. The court denied the former employer’s motion to dismiss the claim based on those allegations.

Interestingly, some courts, including both in the above-referenced cases, draw a line on liability under the Stored Communication Act based on whether the emails that were accessed were already opened at the time of access. This line of reasoning is premised on a finding that opened-but-undeleted emails are not in “storage for backup purposes” under the Stored Communications Act. But this distinction is not universal.

In another 2013 federal case, for example, an individual sued his business partner under the Stored Communications Act after the defendant logged on to the other’s Yahoo account using his password. A jury trial resulted in a verdict for the plaintiff on that claim, and the defendant filed a motion for judgment as a matter of law. The defendant argued that she only read emails that had already been opened and that they were therefore not in “electronic storage” for “purposes of backup protection.” The court disagreed, stating that “regardless of the number of times plaintiff or defendant viewed plaintiff’s email (including by downloading it onto a web browser), the Yahoo server continued to store copies of those same emails that previously had been transmitted to plaintiff’s web browser and again to defendant’s web browser.” So again, the court read the Stored Communications Act broadly, stating that “the clear intent of the SCA was to protect a form of communication in which the citizenry clearly has a strong reasonable expectation of privacy.”

Based on the broad reading of the Stored Communications Act in which many courts across the country engage, employers and managers are well advised to exercise caution before reviewing an employee’s personal communications that may be accessible on a company electronic device. Even policies informing employees not to expect privacy on company computer systems and networks may not save the employer or manager from liability under the statute. So seek legal counsel if this opportunity presents itself upon an employee’s separation from the company. And resist the urge to access before doing so.

© 2019 Foley & Lardner LLP
For more on the Stored Communications Act, see the National Law Review Communications, Media & Internet law page.

How Are You Investing in Business-Building Relationships?

“Discipline is the bridge between goals and accomplishment” – Jim Rohn, international business management expert

Some things appear to be so simple that we assume (dangerously) that everyone “gets it.” Bear with me a moment.

For lawyers, it is imperative to consistently and persistently cultivate and nurture their relationships within their network; with clients, to receive more work and strengthen the loyalty bond; with referral sources, to receive more referrals; with prospects, to develop new work; and so on.

Why, then, is it that a significant number of lawyers either have no system — formal or otherwise — for getting and staying in touch with these people or do a dismal job of staying connected?

‘Getting and Staying in Touch’?

Again, a seemingly obvious question, but in my legal marketing practice of more than 25 years, I have worked with very few lawyers who realistically understand, as a practical matter, the fundamental principle of this phrase.

It is a widely known statistic that it takes 7-10 “touches” to achieve “top-of-mind awareness” status. Lawyers are implored to develop – often with the support of their legal assistant/marketing or IT team, a consolidated contact list including clients; industry and professional contacts; referral sources; prospects; friends and family; school classmates — law school, college, high school, etc.; co-workers and former co-workers; contacts from former clerkships; association contacts; community contacts; holiday card recipients; and so on.

Though it may be an arduous task to assemble all the business cards, old Rolodexes (yes, I’m showing my age), database printouts, etc., it is important to have all your contacts in one system. Can we say “CRM” (contact relationship management) system?

As I often relay to my clients, no list equals no connections, no communications with friends, peers, industry contacts and prospects, and, ultimately, no clients. Remember, we’re in the “relationship-building” business, and it becomes much more daunting to foster relationships if we don’t proactively get and stay in touch.

What does this mean to me?

For purposes of communicating regularly with your various constituents (clients, referral sources, prospects, etc.), no one communication message will be of interest to everyone on your contact list. That is to say, if you develop an e-newsletter or legal update on the importance of developing social media policies for the workplace and send it to your human resource clients, that topic may be of little interest to your charitable organization contacts unless they are involved in employment law issues. There is great efficiency and merit to tailor your message to an intended audience and there is no better way than to develop “categories” of contacts.

When it comes to knowing how, when and how often to reach out, paramount on most attorneys’ minds is that they do not want to be perceived as “too pushy” “aggressive” or otherwise annoying. Understandable. One principle I often convey to my clients is that most people are so involved in their own world, business, family, etc.; you are not capturing 100 percent of their attention most of the time. In other words, to adequately “register” on your targets’ radar, there must be regular, consistent and persistent “touch points”, be they via e-mail, phone call, face-to-face contact and social media outlets. You get the point.

Check Motivations

To build and grow a healthy practice, it is imperative to develop a system of getting and staying in touch but doing so with the appropriate mindset. In short, “It’s not about you.”

Lawyers often query, “What is it that I’m saying to all these people?” Lawyers sometimes say, “I don’t want to bother these folks”? Understandable.

My response is usually a variation on the theme of reaching out with a service mindset and with authentic intentions of checking in on your contacts’ business, seeing how they are making out with a recent transition or starting a new position, or a company move, etc. The universal sowing of seeds of goodwill will ultimately reap only good things. Or, relating another way, employing Newton’s Laws of Motion, “For every action, there is an equal and opposite reaction.” The more “goodwill” you put out, the more it will come back to you … usually multifold.

Time Considerations

Lawyers are very busy. Where do they “find” the time to get and stay in touch with everyone and have the oft-needed downtime?

Just today, I explained to a junior partner client that, if addressed productively, his contacts will soon become his friends. Consider this: we all have certain people with whom we enjoy sharing time. What if those special individuals could be the same ones in your categorized contact lists? How cool would that be? Kill two birds with, well, you know.

Many successful senior attorneys have worked most of their professional careers to create this very scenario though it didn’t happen overnight. It took years, in some cases, one contact at a time. This brings me to my next point.

Leverage Technology

In our digital age, it has never been easier to “get and stay connected” via a host of technological tools (e.g., LinkedIn, Facebook, Twitter, Instagram, blogging). Not a technophile? No sweat; there are “people” who make a career of helping clients “connect”. One such job title is “certified social media specialist”.

Net-Net

In the fiercely competitive legal services arena, cultivating strong relationships is more important than ever before. As a successful lawyer and business owner, you must find a way to get and stay in touch with your desired audiences, targeted constituents and those folks who ultimately can help you grow a healthy practice. It is most easily done by:

• Commit to making it happen.

• Seek buy-in from your support resources (internal and/or external) so everyone is on the same page.

• Develop a viable and workable system for gathering, categorizing and maintaining contacts on an ongoing basis.

• Schedule dates/calendar regular communication with your contacts in addition to the other regular “touches”.

  • For example, on Mondays, review last week’s business development actions. Schedule in two blocks of 15-minute increments to follow up with each contact, offering something of value to them…a copy of a new relevant report, a link to an interesting article, a professional announcement of a common acquaintance.
  • On Tuesdays, place three phone calls to inactive clients to check in on their status/business. Ask if there is anything with which you can help them.
  • On Wednesdays, invite three referral sources to schedule a coffee in the next month. Mark your calendar and make it happen.
  • On Thursdays, research upcoming targeted networking events in an industry you serve, a Bar association event and/or other relevant organization.
  • On Friday, consider what concrete steps you’ve taken during the week and consider next steps to nurture the relationships you’ve cultivated. Take the afternoon off to recover from a busy week.
  • Repeat.

 

© 2019 KLA Marketing Associates.

For more on legal marketing, see the National Law Review Law Office Management page.

Case Closed?: Not Quite Yet, But Serial TCPA Litigator Testing Court’s Patience

Well, no one can say that he did not get his day in Court.

Plaintiff Ewing, a serial TCPA litigator who filed yet another case assigned to Judge Battaglia, narrowly escaped dismissal of all his claims, and was permitted leave to amend for a second time.  See Stark v. Stall, Case No. 19-CV-00366-AJB-NLS, 2019 U.S. Dist. LEXIS 132814 (S.D. Cal. Aug. 7, 2019).  But in the process, the Judge called attention to the Plaintiff’s unprofessional conduct in an earlier case, ruled that he failed to name a necessary party, and found that he inadequately plead the existence of an agency relationship between the defendant and the necessary party that he had failed to join in the lawsuit.

At the outset, the court dismissed the claim brought by co-plaintiff Stark, as the Complaint contained no allegations that any wrongful telephone calls were placed to that particular individual.

In 2015, Ewing had already been put on notice of the local rules of professionalism and their applicability to him, despite his status as a pro se litigator.  Thus, the Court easily granted defendant’s motion to strike Plaintiff’s allegations to the effect that defendant had made a “derogatory remark” simply by pointing out that he was designated as a vexatious litigator.

The two most important pieces of the case for TCPAWorld are the Court’s rulings about Plaintiff’s failure to join a necessary defendant and his insufficient allegations to establish vicarious liability.

Plaintiff had failed to name as a defendant the entity (US Global) that allegedly made the calls to him.  The court determined that this company is a necessary party that must be added in order for the court to afford complete relief among the parties.  We often see situations where only a caller but not a seller, creditor, employer, franchisor, etc. are named, or vice versa, so it is encouraging to see courts strictly enforce Federal Rule 15 in the TCPA context.

The court further held that the relationship between Defendant and US Global was not such that Defendant could be held liable for violations of the TCPA that were committed by US Global.  While Plaintiff made unsubstantiated allegations that an agency relationship existed, the Court treated these as merely legal conclusions and granted dismissal based on insufficient allegations of facts to establish a plausible claim that there is a common-law agency relationship between Defendant and US Global.  Simply stated, the bare allegation that Defendant had the ability to control some aspects of the caller’s activity was insufficient to establish control for purposes of TCPA vicarious liability principles.

Plaintiff’s amended pleading is due on August 31—anticipating another round of motion practice, we will track any further developments in this case.

© Copyright 2019 Squire Patton Boggs (US) LLP

For more TCPA cases, see the Communications, Media & Internet law page on the National Law Review.

Forget About Fake News, How About Fake People? California Starts Regulating Bots as of July 1, 2019

California SB 1001, Cal. Bus. & Prof. Code § 17940, et seq., takes effect July 1, 2019. The law regulates the online use of “bots” – computer programs that interact with a human being and give the appearance of being an actual person – by requiring disclosure when bots are being used.

The law applies in limited cases of online communications to (a) sell commercial goods or services, or (b) influence a vote in an election. Specifically, the law prohibits using a bot in those circumstances, “with the intent to mislead the other person about its artificial identity for the purpose of knowingly deceiving the person about the content of the communication in order to incentivize a purchase or sale of goods or services in a commercial transaction or to influence a vote in an election.” Disclosure of the existence of the bot avoids liability.

As more and more companies use bots, artificial intelligence, and voice recognition technology to provide customer service in online transactions, businesses will need to consider carefully how and when to disclose that their helpful (and often anthropomorphized) digital “assistants” are not really human beings.  In a true customer-service situation where the bot is fielding questions about warranty service, product returns, etc., there may be no duty. But a line could be crossed if any upsell is included, such as “Are you interested to learn about our latest line of products?”

Fortunately, the law doesn’t expressly create a private cause of action against violators. However, it remains to be seen if lawsuits nevertheless get brought under general laws prohibiting unfair or deceptive trade practices alleging failure to disclose the existence of a bot.

Also, an exemption applies for online “platforms,” defined as: “any public-facing Internet Web site, Web application, or digital application, including a social network or publication, that has 10,000,000 or more unique monthly United States visitors or users for a majority of months during the preceding 12 months.”  Accordingly, operators of very large online sites or services are exempt.

For marketers who use bots in customer communications – and who are not large enough to take advantage of the “platform” exemption – the time is now to review those practices and decide whether disclosures may be appropriate.

©2019 Greenberg Traurig, LLP. All rights reserved.
Article by Ed Chansky and Ian C. Ballon of Greenberg Traurig, LLP
For more on Internet & Communications see the National Law Review page on Communications, Media & Internet

Maryland Proposes New Telehealth Psychology and Therapy Rules

Two Maryland licensing boards – the Board of Examiners of Psychologist and the Board of Professional Counselors and Therapists – issued a pair of proposed rules setting forth practice standards for mental health services delivered via telehealth technologies. The Boards previously did not have specific practice standards or rules unique to telehealth. Once finalized, psychologists, counselors, and therapists using telehealth in their services should read and apply these new requirements to their operations and service models.

The proposed rules closely mirror each other. Both apply to professionals delivering care to patients located in Maryland. Both allow a wide range of modalities, defining telehealth as the “use of interactive audio, video or other telecommunications or electronic media,” but excluding an audio only telephone conversations, email, fax or text.  Both rules prohibit treatment based solely upon an online questionnaire.

The Board of Professional Counselors and Therapists rule allows therapists to conduct the initial patient evaluation via telehealth. The Board of Psychology rule requires an in-person initial evaluation unless the psychologist or psychologist associate documents in the record the reason for not meeting in person. (The rule doesn’t enumerate a list of acceptable or unacceptable reasons; it simply requires the reason to be documented.)

Professionals must confirm the identity of the client/patient, as well as the client’s location and contact information. The professional must also identify contact information for emergency services at the client’s location. Curiously, the rule issued by the Board of Professional Counselors and Therapists refers to the client’s location as the “practice setting.” While this could raise a suggestion that the client must be physically located in a clinical practice setting, it is more likely a drafting error because there is no mention of any originating site requirements in the rule.

Professionals must also identify everyone at the client’s location and confirm those individuals are permitted to hear the client’s health information. The use of the term “permitted” as opposed to “authorized or “legally authorized” and the absence of reference to any state or federal privacy law, suggests another person’s presence is subject to the client’s permission and not legal authority.

With regard to client consent to telehealth services, the Board of Psychology rule requires “written informed consent,” whereas the Board of Professional Counselors and Therapists rule requires the client’s “written and oral acknowledgement.” Both rules state that the standard for services delivered via telehealth is the same as services delivered in-person.

The Boards are considering comments and Maryland providers are awaiting the final regulations.  We will continue to monitor further developments including the passage of these final rules and any changes.

 

© 2019 Foley & Lardner LLP
This post was written by Emily H. Wein and Nathaniel M. Lacktman of Foley & Lardner LLP.