1. Hold The Phone – Everything You Thought You Knew, But Didn’t Know, About the TCPA And TSR Rachel Hirsch, Esq., Senior Associate © Ifrah PLLC (202) 524-4140 / ifrahlaw.com

2. Rachel Hirsch Senior Associate, Ifrah PLLC SPEAKER 2© Ifrah PLLC (202) 524-4140 / ifrahlaw.com

3. TCPA V. TSR 3© Ifrah PLLC (202) 524-4140 / ifrahlaw.com

4. WHAT IS THE TCPA? 4© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Enacted In 1991, Principally To Bolster Consumer Privacy By Addressing Issues Such As Unsolicited Facsimiles, Pre-recorded Telemarketing Calls To Residences, Autodialed And Pre-recorded Calls.Later Interpreted To Include Automated Short Message Service (SMS) Texts To Cellular Phones.Federal Communications Commission (“FCC”) Is Empowered To Issue Rules And Regulations Implementing The TCPA. As Of October 16, 2013, Marketers Must Receive Prior Express Written Consent From Consumers Before Placing Autodialed Calls/Texts Or Generating Pre-Recorded Messages To Cell Phones And Pre-recorded Calls Made To Residential Landlines For Telemarketing Purposes.

5. WHAT IS THE TCPA? – RESIDENTIAL LANDLINES 5© Ifrah PLLC (202) 524-4140 / ifrahlaw.com RESIDENTIAL LANDLINES - Purely Informational Calls Or Non-commercial Calls To Residential Landlines (With Or Without An Autodialer) Do Not Require Prior Consent - Live Telemarketing (With Or Without An Autodialer) To Residential Landlines Does Not Require Consent

6. WHAT IS THE TCPA? – MOBILE PHONES? 6© Ifrah PLLC (202) 524-4140 / ifrahlaw.com MOBILE PHONES - Live (Non-Autodialer) Telemarketing Calls To Wireless Numbers Do Not Require Consent. - Live (Non-Autodialer) Informational Calls To Wireless Numbers Do Not Require Consent.

7. WHAT IS THE TCPA? 7© Ifrah PLLC (202) 524-4140 / ifrahlaw.com REMEMBER! – Even Where Certain Exceptions Apply, Marketers Should Continue To Scrub Federal/State Do Not Call (DNC) Databases Unless There Is An Established Business Relationship Between The Seller And Customer Or Consent Is Obtained. 2013 Rule Changes Eliminates FCC’s Longstanding “Established Business Relationship” Exemption For Residential Prerecorded Telemarketing Calls

8. RECENT FCC CLARIFICATION OF TCPA 8© Ifrah PLLC (202) 524-4140 / ifrahlaw.com July 10, 2015 – FCC Issues Declaratory TCPA Omnibus Declaratory Ruling And Order Effective As Of That Date Number Of Appeals Filed Challenging FCC’s New Interpretations Autodialers – Declined To Establish Comprehensive List Of Equipment Types That Fall Within Definition, But Established Following Principles Under Expansive Definition: The Term “Capacity” Within The Autodialer Definition Includes Present And Potential Future Capability Of The Dialing Equipment; A Case-by-case Determination Is Necessary To Determine If Dialing Equipment That Requires Human Intervention Is Outside The Scope Of The TCPA; Speed Dialer Functionality Does Not Make Equipment An ATDS Under The TCPA, But Predictive Dialers (Or Similar Dialers That Meet This Standard Regardless Of The Marketing Descriptions Used) Satisfy The Definition Of An Autodialer If The Equipment Has The Requisite “Capacity” As Described In The Order; And An Autodialer Can Include Separately Owned And Operated Equipment That Is Integrated To Perform A Dialing Campaign.

9. FCC DECLARATORY RULING HIGHLIGHTS 9© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Establishing/Revoking Consent Consent Can Be Rescinded By The Caller/Consumer At Any Time, And Via Any Reasonable Means TCPA Does Not Prohibit A Calling From Obtaining A Consumer’s Prior Express Consent Through An Intermediary TCPA Requires Consent Not Of The Intended Recipient Of A Call, But Of The Current Subscriber

10. FCC DECLARATORY RULING HIGHLIGHTS - CONT’D. 10© Ifrah PLLC (202) 524-4140 / ifrahlaw.com FCC Now Holds That Callers May Incur TCPA Liability Where They Have Actual Or Constructive Knowledge Of Number Reassignment. FCC Provides Following Examples Of How Callers May Learn Of Reassignments Of Wireless Numbers: Include An Interactive Opt-out Mechanism In All Artificial Or Prerecorded-voice Calls So That Recipients May Easily Report A Reassigned Or Wrong Number; Implement Procedures For Recording Wrong Number Reports Received By Customer Service Representatives Placing Outbound Calls; Implement Processes For Allowing Customer Service Agents To Record New Phone Numbers When Receiving Calls From Customers; Periodically Send An Email Or Mail Request To The Consumer To Update His Or Her Contact Information; Utilize An Autodialer’s And/Or A Live Caller’s Ability To Recognize “Triple-tones” That Identify And Record Disconnected Numbers; Establish Policies For Determining Whether A Number Has Been Reassigned If There Has Been No Response To A “Two-way” Call, Such As Accessing A Paid Database That Reports A High Probability Of Number Reassignment; And Enable Customers To Update Contact Information By Responding To Any Text Message They Receive, Which May Increase A Customer’s Likelihood Of Reporting Phone Number Changes And Reduce The Likelihood Of A Caller Dialing A Reassigned Number.

11. WHAT IS THE TSR? 11© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Gives Effect To The Telemarketing And Consumer Fraud And Abuse Prevention Act (The “Telemarketing Act”) Signed Into Law In 1994.Gives The FTC And State Attorney Generals Law Enforcement Tools To Combat Telemarketing Fraud.Gives Consumers Added Privacy Protections And Defenses Against Unscrupulous Telemarketers.Helps Consumers Tell The Difference Between Fraudulent And Legitimate Marketing. The Telemarketing Sales Rule (“TSR”):

12. WHAT IS THE TSR? – CONT’D. 12© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Original TSR Dates Back To 1995 Additional Amendments In 2003, 2008, And 2010 2008 Amendment – FTC Adopted Additional Amendments To TSR That Directly Address Use Of Pre-recorded Messages 2010 Amendment – FTC Further Amended TSR To Address Deceptive And Abusive Practices Associated With Debt Relief 2014 – FTC Request For Public Comment On TSR

13. WHAT IS THE TSR? – CONT’D. 13© Ifrah PLLC (202) 524-4140 / ifrahlaw.com TSR Covers Wide Variety Of Telemarketing Transactions, Including: Inbound Calls in Response to Advertising Sale Of Credit Repair Services Advance Fee Loans Prize Promotions Products With A Negative Option Fee

14. WHAT IS THE TSR? – CONT’D. 14© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Key Provisions:Prohibits Calling Consumers Who Have Put Their Phone On The National Do Not Call RegistryCoverage Of Solicitation Of Charitable Contributions By For-profit TelemarketersDisclosures Of Specific InformationProhibits MisrepresentationsLimits When Telemarketers May Call ConsumersRequires Transmission Of Caller ID InformationProhibits Unauthorized BillingAddresses Use Of Pre-recorded Messages In TelemarketingSets Payment Restrictions And Other Requirements For Credit Repair Services, Recovery Services, Advance-fee Loans, And Debt Relief ServicesRequires Specific Business Records To Be Kept For Two Years Like TCPA, Includes FTC’s Version Of Do Not Call (“DNC”) Rules And Restrictions On Use Of Prerecorded Message Calls Unlike TCPA, TSR Imposes Various Requirements For Inbound And Outbound Calls, Including Disclosure And Upsell Requirements.

15. 2014 PUBLIC COMMENT ON TSR 15© Ifrah PLLC (202) 524-4140 / ifrahlaw.com “Pre-Acquired Account Information” – Consumer Provides His Financial Account Information To A Seller To Complete A Purchase And Is Subsequently Charged By A Different Seller For Additional Purchases Arising From The Same Call Or Later Call “Negative Option Offers” – Treats Consumer’s Failure To Take An Affirmative Act To Reject The Goods Or Services As An Acceptance Of The Offer (I.E. Continuity And Recurring Billing Programs) Key: Impact Of Passage Of ROSCA On TSR Inquiry Whether TSR Should Include Requirement That Sellers And Telemarketers Retain Records Of Telemarketing Calls

16. HOW DOES THE TSR COMPARE TO THE TCPA? 16© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Types Of CallsJurisdiction Govt. Enforcement Private Right Of ActionRobocallsConsent TCPA All Calls + SMSFCCAdministrative Proceeding For Civil Forfeiture $500 In Damages Per Violation; Up To $1500 For Willful Conduct; No Damage Threshold; Strict Liability Statute Prohibits Telemarketing Robocalls To Residential Or Wireless Numbers Unless Caller/Seller Has Express Written Consent *Prohibits Calls/Messages Placed To Wireless Numbers Using An Autodialer Without Express Written Consent Written; Signed (E-sign Ok); Clear And Conspicuous; Willingness Of Consumer To Receive Robocalls; No Condition Of Purchase TSR Telemarketing Calls Only FTC (With Jurisdictional Limitations Federal Court Action For Injunctive Relief Brought By FTC Directly; Civil Penalties Brought In Conjunction With DOJ Only If Amount In Controversy Exceeds $50,000 In Actual Damages Per Person; No Statutory Damages Prohibits Telemarketing Robocalls To Residential Or Wireless Numbers Unless The Caller/Seller Has Express Written Consent *Does Not Address Calls Or Text Messages Placed Using An Autodialer Written; Signed (E-sign Ok); Clear And Conspicuous; Willingness Of Consumer To Receive Robocalls; No Condition Of Purchase Together, The TCPA And TSR Cover Nearly All Telemarketing With Similar Rules Note: Many States Have Laws Regulating Telemarketing; No Unified System Between State And Federal DNC List – No “One-stop” Service For Consumers

17. KEY PROVISIONS OF TSR 17© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Prohibits Calling Consumers Who Have Put Their Phone Numbers On National DNC Registry Prohibitions Include: Calling A Person Whose Number Is On National DNC Registry Or Person Who Asked Not To Receive Telemarketing Calls From A Particular Company Misusing A DNC List Denying Or Interfering With A Person’s DNC Rights Calling Outside Permissible Hours – I.E. Outside Hours Of 8 A.M. – 9 P.M. Abandoning An Outbound Telephone Call (With Exception) Placing An Outbound Telephone Call Delivering A Prerecorded Message To A Person Without That Person’s Express Written Consent To Receive Such Calls And Without Providing An Automated Interactive Opt-out Mechanism Failing To Transmit Caller ID Information Using Intimidating Or Obscene Language Causing Any Telephone To Ring Or Engaging Any Person In Telephone Conversation Repeatedly Or Continuously With Intent To Harass REMEMBER! – Established Business Relationship OR Written Permission To Call Exemptions REMEMBER! – Sellers Responsible For Maintaining Individual DNC List – Potential Civil Penalty Of $16,000 Per Violation

18. KEY PROVISIONS OF TSR – CONT’D. 18© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Requires Disclosure Of Specific Information And Prohibits Misrepresentations Applies To Both Outbound And Inbound Calls Must Disclose Identity Of Seller, Purpose Of Call, And Nature Of Goods Or Services Being Offered Promptly, Up Front Must Provide To Consumers, Without Limitation, Non-misleading Information Regarding Cost And Quantity, Negative Option And Continuity Offer Features, Material Restrictions And Conditions, And Refund And Cancellation Policy Prohibits Misrepresentations Regarding Any Material Aspect Of Performance, Efficacy, Nature, Or Central Characteristics Of Goods Or Services Offered To Consumer Prohibits Sellers And Telemarketers From Misrepresenting Affiliations With – Or Endorsements Or Sponsorships By – Any Person, Organization, Or Government Entity. Note: Failure To Provide Required Information In “Clear And Conspicuous” Manner Before Consumer Pays For Goods Or Services = Deceptive Telemarketing Act Or Practice, Subject To Civil Penalty Of $16,000 Per Violation

19. KEY PROVISIONS OF TSR – CONT’D. 19© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Prohibits Unauthorized Billing Requires “Express Verifiable Authorization” When Payment Made By: Credit Card (Subject To Truth In Lending Act And Regulation Z) Debit Card (Subject To Electronic Fund Transfer Act And Regulation E) Customer Must Be Told And Acknowledge: Number Of Charges, Date Charges Will Be Submitted For Payment, Amount Of The Charges, Customer’s Name And Billing Information; Customer Service Telephone Number, And Date Of Authorization Additional Rules Apply For Pre-acquired Account Information And Offer Includes Free-to- pay Conversion Feature Lawful Recordings Of Verbal Authorizations Must Be Made Available Upon Request

20. KEY PROVISIONS OF TSR – CONT’D. 20© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Prohibits Misrepresenting Any Material Aspect Of A Negative Option Feature Of An Offer Prohibits Sellers And Telemarketers From Misrepresenting Any Material Aspect, Including: Fact That Consumer’s Account Will Be Charged Unless The Consumer Takes An Affirmative Action To Avoid Charges Dates The Charges Will Be Submitted For Payment Specific Steps Customer Must Take To Avoid Charges

21. TO WHOM DOES THE TSR APPLY? 21© Ifrah PLLC (202) 524-4140 / ifrahlaw.com TSR Provisions Apply To: Product/Service Providers Lead Generators Telemarketers ALSO: Everyone In Stream Of Telemarketing Commerce

22. “ACCOMPLICE LIABILITY” 22© Ifrah PLLC (202) 524-4140 / ifrahlaw.com

23. “SUBSTANTIAL ASSISTANCE” 23© Ifrah PLLC (202) 524-4140 / ifrahlaw.com SUBSTANTIAL ASSISTANCE = ACTUAL KNOWLEDGE OR CONSCIOUSLY AVOIDING SUCH KNOWLEDGE Example: MARS Rule - Mortgage Assistance Relief Services Rule: A Compliance Guide for Business IMPORTANT MESSAGES FOR BUSINESSES Scope Of Liability Under TSR Is Broad – “But We Aren’t The Ones Actually Selling Stuff Through Telemarketer” NOT A Defense Knowing – Or Consciously Avoiding Knowing – That Business Partner Is Violating TSR Could Land You In Legal Hot Water – Be Cautious About The Company You Keep

24. “SUBSTANTIAL ASSISTANCE” – CASE STUDY #1 24© Ifrah PLLC (202) 524-4140 / ifrahlaw.com FTC, State of Kansas, State of Minnesota, State of North Carolina, and State of Illinois v. Affiliate Strategies, Inc., 9-CV-4104- JAR, 5:09-CV-04104-JAR-KGS, 11-3319 (District of Kansas U.S. Circuit Court of Appeals for the Tenth Circuit)

25. “SUBSTANTIAL ASSISTANCE” – CASE STUDY #2 25© Ifrah PLLC (202) 524-4140 / ifrahlaw.com United States of America, Plaintiffs v. Skyy Consulting, Inc., also d/b/a CallFire, Defendant 13-CV-2136 (N.D.C.A. May 14, 2013)

26. “SUBSTANTIAL ASSISTANCE” – CASE STUDY #3 26© Ifrah PLLC (202) 524-4140 / ifrahlaw.com Consumer Financial Protection Bureau v. Universal Debt & Payment Solutions LLC, et al., 1:15-cv-0859 (N.D.G.A. March 25, 2015)

27. “ACCOMPLICE LIABILITY” UNDER THE TCPA – AGENCY PRINCIPLES 27© Ifrah PLLC (202) 524-4140 / ifrahlaw.com REMEMBER! Seller Liable Even If Does Not Initiate The Call May 9, 2013 - FCC Declaratory Ruling Dish Network Seller May Be Vicariously Liable For Violations Of TCPA Made By 3 rd Party Marketer

28. BEST PRACTICES 28© Ifrah PLLC (202) 524-4140 / ifrahlaw.com  Listen To Your Customer  Maintain Internal Records  Conduct Your Due Diligence  Secure Solid Contracts  Review Insurance Coverage  Respect The Law!

29. THANK YOU! QUESTIONS? © Ifrah PLLC (202) 524-4140 / ifrahlaw.com website: ifrahlaw.com email: rhirsch@ifrahlaw.com twitter: @TheRealMsHirsch blogs: www.FTCbeat.com & www.CrimeInTheSuites.com