Can You Hear Me Now? Class-Action and Other Lawsuits May Follow Calls or Texts to Customer Cell Phones

By Cocheo, Steve | ABA Banking Journal, June 2014 | Go to article overview

Can You Hear Me Now? Class-Action and Other Lawsuits May Follow Calls or Texts to Customer Cell Phones


Cocheo, Steve, ABA Banking Journal


[ILLUSTRATION OMITTED]

What handy gadgets our mobiles can be. In fact, we take phone numbers for granted, not much caring what the person on the other end is using so long as "Can you hear me now?" gets a "Yes."

But consider the following statistics from a federal survey released in December 2013:

* Nearly 40% of American homes had only wireless phone service--no landlines at all. In 2009, that figure was only 23%.

* Sixteen percent of all homes received all or nearly all calls on cell phones, in spite of having landline phones, too.

* Two-thirds of adults ages 25-29 lived in households with cell service only.

Add to these statistics another figure: Telephone companies are said to "recycle" as many as 37 million telephone numbers annually, and there is no mechanism for an organization, like a bank, to determine if a cell number in its customer records has been reassigned.

While these statistics may be very interesting to the bank's marketing department, these are critical facts for the compliance function.

Banks face exposure to a variety of parties who see them as deep pockets. One growing exposure lies in the world of cell phones under the strictures of the Telephone Consumer Protection Act (TCPA) of 1991, its implementing rules, and ongoing governance of those rules by the Federal Communications Commission. A law originally enacted to prevent intentional abusive contact patterns has been worked around to be a plaintiff moneymaker. While the TCPA covers all types of calls, the vast increase in cell phone usage has increased the potential liability.

Scoping out the risk

Any company, including banks, that needs to contact customers for many necessary reasons--warnings about potential fraud, alerts about low balances in accounts, payment reminders, and collections for unmade payments--can potentially be the target of a lawsuit under the TCPA if a plaintiff claims that he has been contacted on his cell phone using an "automatic telephone dialing system" (or autodialer) or a pre-recorded voice without his consent. (Overall in TCPA, the penalty can be $500 per call, text, or fax, or even more if willful disregard is proven. There is no cap on damages.)

In a white paper issued last fall, the U.S. Chamber's Institute for Legal Reform stated that:

"The TCPA has become a juggernaut: a destructive force that threatens companies with annihilation for technical violations that cause no actual injury or harm to any consumer. TCPA litigation will continue to expand and threaten well-meaning businesses with astronomical statutory damages unless something is done to limit those damages."

The numbers multiply because calls--which count even if no one picked up or no message was left--are repeated in attempts to reach the customer.

Further complicating matters are calls made to numbers that were originally held by customers who have then changed their phone service and whose numbers have been recycled to unrelated parties.

In the Chamber's white paper, The Juggernaut of TCPA Litigation: The Problems with Uncapped Statutory Damages, it is pointed out that the technology and business practices were very different in 1991, resulting in special protections for cell phones, for example. Receiving calls on the old-style cell phones could be very expensive, for instance.

The paper also notes that typically these matters don't go to trial, but are settled, generally in fear of the potential monetary totals that could be reached. Consumers have been known to "stockpile" such calls, not reaching out to object or point out that they are not the proper party. Besides law firms that look for such cases, in which many class-action plaintiffs themselves receive minimal payments, there are numerous places online where consumers can find out how to work the law to actually trigger such contacts.

Attempts to pass legislation that would provide some middle way or broad protections for essential and necessary contacts--potentially including a cap on legal damages--have not succeeded thus far. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Can You Hear Me Now? Class-Action and Other Lawsuits May Follow Calls or Texts to Customer Cell Phones
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.