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The Federal Communications Commission (FCC) is poised to vote on a rule that legal experts anticipate could significantly elevate the potential for lawsuits targeting lenders, insurers, and law firms regarding unsolicited texts and calls. This anticipated rule, aimed at curbing the influx of sales calls bombarding consumers, is expected to pass, paving the way for more lawsuits under the federal law against robocalls. Lawyers representing both consumers and companies predict a substantial impact.
New Restrictions Target Lead Generators
The proposed rule explicitly targets entities known as “lead generators.” These businesses gather consumer contact information and sell it to companies seeking new customers. The envisaged restrictions aim to rein in the activities of lead generators’ activities and establish a broader avenue for claims under the Telephone Consumer Protection Act (TCPA). The TCPA enables individuals to sue over unwanted calls and texts, encompassing robocalls.
FCC’s Effort to Combat Robocalls
A spokesperson for the FCC emphasized the agency’s long-standing commitment to reducing robocalls as the driving force behind their interest in clamping down on lead generators. Aaron Weiss, a partner at Carlton Fields specializing in TCPA litigation defense, noted that the proposed changes could create a “target-rich environment” for lawsuits against companies relying on leads for TCPA violations.
Anticipated Impact on Lawsuits
With over 1,300 TCPA lawsuits filed this year, mirroring the previous year’s figures, legal experts foresee a potential surge if the rule is enacted. Eric Troutman, a defense attorney representing companies in TCPA litigation, anticipates a doubling or tripling of filings.
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Lead Generation Practices Under Scrutiny
Lead generation, a common practice connecting consumers with various services, faces increased scrutiny. From mortgage quotes to insurance brokers and home improvement services, lead generation has expanded into personal injury law and mass litigation fields. The prevalent scenario involves consumers consenting to be contacted when seeking information, only to have their data sold to numerous businesses, resulting in unexpected and unwanted calls.
Potential Changes for Lead Generators
If the FCC rule is adopted in its current form, lead generators would be restricted to offering customer information to a single business unless explicit consent to additional firms is obtained. Troutman, president of a lead generator industry group, expects resistance from some lead generators accustomed to selling the same consumer data to multiple businesses.
Ensuring Compliance for Businesses
Businesses utilizing lead-generated contacts are urged to exercise caution and ensure compliance with the proposed law. Andrew Perrong, who has been involved in dozens of lawsuits as a plaintiff and an attorney representing clients suing over unwanted calls, stresses the need for businesses to be vigilant. He has encountered companies purchasing fraudulently generated leads, which later proved detrimental.
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