Fighting Back Against Debt-Collectors and Telemarketers

In 1991 Congress passed the Telephone Consumer Protection Act (TCPA), in an attempt to end unwanted prerecorded telemarketing messages and unwanted calls to cell phones. Although it was enacted more than 20 years ago, the Wall Street Journal recently reported that the number of claims for violations of the TCPA that are filed in, or transferred to, Federal court has increased exponentially in the past few years.  Also, many large companies have agreed to multi-million dollar settlements for alleged violations of the TCPA.  Recently, Heather Nelson, a plaintiff mentioned by the Wall Street Journal, was awarded $571,000 after a debt collection agency called her cellphone over 1,000 times and left more than 100 prerecorded messages in regards to her unpaid debts.  Ms. Nelson’s award was vacated after an undisclosed settlement.

The TCPA prohibits prerecorded calls to residential landlines without prior consent from the consumer, and it requires a consumer’s express consent for calls or text messages to cellphones, fax machines, or “any service for which the called party is charged.”  Considering the proliferation of cellphones in recent years and the increase in the use of auto-dialers by debt collection companies, it makes sense that claims for violations of the TCPA have increased.  TCPA claims have also increased as a result of decisions by regulators and courts.  In 2008, the Federal Communications Commission said that the provisions of the TCPA applied to debt collectors.  In 2012, the Supreme Court held that plaintiffs could bring TCPA cases in Federal court.

Plaintiffs have been successful in claims against debt-collectors because TCPA cases allow defendants fewer defenses than in claims brought under the Fair Debt Collection Practices Act, the law under which debt-collection cases were typically filed.  In a TCPA case, the defendant is often left without a defense if it cannot produce proof of the express consumer consent required by the TPCA for calls to cellphones.  Additionally, if the defendant cannot provide proof of one plaintiff’s consent, there are often many other potential plaintiffs for whom the debt-collector cannot prove consent.  This phenomenon has led to a number of class actions suits and settlements against debt-collectors.

According to the Wall Street Journal, consumer-rights advocates say that, despite the increased litigation, the TCPA has actually reduced unwanted calls to cell phones.  The law has also helped protect consumers’ privacy.  As would be expected, debt collectors feel stymied by the law, especially because auto-dialers are the most efficient way to reach a large number of people.  The Centers for Disease Control also reported in 2012 that about 38% of U.S. households only have cellphones, which further limits the debt-collectors’ ability to contact individuals in accordance with the provisions of the TCPA.