In July 2013, the ACA International Board of Directors approved initiatives to protect the long term viability of the credit and collection industry. These efforts are funded by a three-year Industry Advancement Fund assessment.
On March 24, 2014, ACA International submitted additional comments during the public comment period for its petition filed in January with the Federal Communications Commission to reform the Telephone Consumer Protection Act.
In its new comments, ACA explicitly called out concern regarding the fast-growing number of TCPA related class action lawsuits, which have risen by a “staggering 592 percent in the last few years,” and that predictive dialer cases have increased by 800 percent. Individual TCPA lawsuits filed against creditors and debt collectors rose to 1,862 cases in 2013 and had already reached 208 cases in January 2014.
ACA argued that companies may often be targeted for frivolous lawsuits because barriers for filing these suits are very low, there are no limits on damages, and companies are forced to settle quickly or incur significant costs to defend themselves in court on cases with no merit.
ACA pointed out that the “cottage industry” of TCPA litigation, with class action plaintiff attorneys incentivized to file lawsuits that inure primarily to their own benefit and not to the benefit of consumers, runs counter to congressional intent of the TCPA. In 1991, the TCPA’s sponsor, Sen. Ernest “Fritz” Hollings, noted in the Congressional Record that consumers would be able to bring TCPA actions in small claims court with damages set at a fair level for both the consumer and the calling entity:
“[I]t is my hope that States will make it as easy as possible for consumers to bring such actions, preferably in small claims court… Small claims court or a similar court would allow the consumer to appear before the court without an attorney. The amount of damages in this legislation is set to be fair to both the consumer and the telemarketer.”
Further, ACA shared with the FCC that President Barack Obama’s FY2015 budget highlighted the important need for balance between consumer protection and the need for consumers to repay rightfully owed debts. The White House proposed that the U.S. Treasury efforts on student loans could be improved by “clarify[ing] that the use of automatic dialing system and prerecorded voice messages is allowed when contacting wireless phones in the collection of debt owed to or granted by the United States.”
In filing its petition asking the FCC to adopt updates and provide clarification to rules governing the TCPA, ACA’s intent is to allow covered communications to be governed by a clear, fair and consistent regulatory framework that does not impede the legitimate business operations of the association’s members. The petition asked the FCC to accomplish the following objectives:
Confirm that not all predictive dialers are categorically automatic telephone dialing systems.
Confirm that “capacity” under the TCPA means present ability.
Clarify that prior express consent attaches to the person incurring a debt, and not the specific phone number provided by the debtor at the time a debt was incurred.
Establish a safe harbor for autodialed “wrong number” non-telemarketing calls to wireless numbers.