Hearing of the Senate Commerce, Science, & Transportation Committee - Chairman's Opening Statement on "The Telephone Consumer Protection Act at 25:Effects on Consumers and Business"

Hearing

"Good morning. Welcome to today's hearing on the Telephone Consumer Protection Act (TCPA).

"When passing TCPA nearly 25 years ago, Congress expressly sought a balanced approach that "protects the privacy of individuals and permits legitimate telemarketing practices."

"As a result of TCPA, a number of abusive and disruptive telemarketing practices have been significantly reduced or eliminated. For example, companies have to maintain "do-not-call" lists and cannot make solicitation calls before 8:00 a.m. or after 9:00 p.m.

"But, TCPA is also showing its age, and there are opportunities to build on its consumer benefits while also ensuring consumers fully benefit from modern communications. "Consumers should be able to take advantage of new technologies that help them avoid falling victim to unscrupulous actors and those callers who ignore "do not call" requirements. I doubt there is a person in this room who has not received a recorded voice on their mobile phone telling them they have won a cruise.

"We should also ensure that the FCC continues to take action against abusive and harassing practices, and has the tools it needs to bring bad actors to justice, including those operating from overseas. We recently took a step in this direction by unanimously approving Ranking Member Nelson and Senator Fischer's anti-spoofing legislation as part of the FCC Reauthorization Act.

"But, our discussion today is not only about policing abusive and harassing practices and stopping bad actors. We must also acknowledge that most businesses are trying to do the right thing and play by the rules, and we need to understand whether TCPA is inadvertently hurting the good actors and consumers.

"When Congress passed TCPA, cell phones were uncommon and mobile telephone service was extremely expensive. It made sense to have particularly strict rules about contacting people on their mobile phones.

"Today, however, mobile phones are not only ubiquitous, they are actually smart devices that do much more than just send and receive phone calls.

"Consumer behavior is also far different today than in 1991. In fact, today's consumer expectations about communications connectivity and the benefits of better contact with their doctors, schools, favorite charities, and -- yes -- even their lenders would be unrecognizable to Congress 25 years ago.

"More than 90 percent of Americans now have a mobile phone, and nearly half of all households in the United States are mobile-only. These percentages are even higher for young adults. Simply put, if you can't reach these people on their mobile phones, you are going to have a hard time reaching them at all.

"The balance forged decades ago may now be missing the mark, and consumers may be missing the benefits of otherwise reasonable and legitimate business practices.

"The Federal Communications Commission (FCC) was tasked by Congress with assuring a balanced application of TCPA. The Commission, however, has struggled to apply TCPA to a changing communications marketplace, and the agency actually seems to be creating more imbalances and more uncertainty.

"The Commission's rules have created new questions rather than answers.

"For example, what is an auto-dialer? The Commission will not answer that clearly, and instead only says it is something other than a rotary-dialed telephone.

"The FCC declared last year that it would not "address the exact contours of the "auto-dialer' definition or seek to determine comprehensively each type of equipment that falls within that definition." Hospitals, charities, utilities, banks, and restaurants should not have to engage engineers and telecommunications attorneys in order to know if they can call their customers without being sued.

"Another example is what to do if a customer's number has been reassigned? While the FCC claims to have addressed this issue, companies say there is still no way to know with certainty. What is certain, however, is that if a phone number has been reassigned and you call it more than once, you could be liable for $500 per call, even if the new party never answers.

"TCPA litigation has also become a booming business. TCPA cases are the second most-filed type of case in federal courts, with 3,710 filed last year alone. That represents a 45 percent increase over 2014.

"And the companies affected by an unbalanced TCPA may surprise you. For example, Twitter stated the following in a filing at the FCC:

"As a result of this hyper-litigious environment, innovative companies increasingly must choose between denying consumers information that they have requested or being targeted by TCPA plaintiffs' attorneys filing shake-down suits. No company should be put to such a choice."

"The cost of getting the balance wrong isn't just burdensome litigation, it is also the cost to consumers--and to the economy--of the important consumer contact that is not being made for fear of running afoul of an ill-defined rule:

"Text messages to let parents know about weather-related cancellations; calls to let struggling low-income households know how to keep the heat from getting cut off; calls to alert borrowers that they are at risk of defaulting on their debts and ruining their credit ratings; and follow-up calls to patients to make sure they understand their post-discharge treatment plans.

"Another specific matter that will be discussed today is the Obama Administration's carve out to allow robocalls to mobile phones to collect debts owed to or guaranteed by the federal government.

"The Administration used last year's must-pass Bipartisan Budget Act as a vehicle to achieve its robocall carve out. The Committee reached out to the Office of Management and Budget, the Department of the Treasury, and the Department of Education to testify about why the Administration has prioritized this robocall carve-out for years. Unfortunately, the Obama Administration is not represented before us today, but we will continue to seek its input as its robocall carve-out is implemented by the FCC and as the Committee continues its oversight of TCPA.

"Ultimately, finding the right balance is essential to protecting the privacy of consumers while making sure they have reasonable access to the information they want and need, and making sure good faith business actors can reasonably assess the cost of doing business.

"We have a variety of perspectives with the panel before us and I look forward to hearing your testimony and appreciate your participation today."

Source