Jun 10, 2013 Philip Burgess
Since a 2008 ruling by the Federal Communications Commission (FCC), creditors and debt collectors working with creditors have been able to contact debtors who have provided a phone number to the original creditor. Whether via a credit application or other source, insideARM notes that the ruling maintained that a consumer supplying a cellphone number to a creditor makes it permissible for the enterprise to contact them under the FCC's interpretation of the Telephone Consumer Protection Act (TCPA).
However, a Florida Federal District Court recently disagreed with that ruling and stated that calls placed by a third party debt collection agency were not in compliance with TCPA regulations. As the source states, this shows that the interpretation of the TCPA across the country is in limbo. Although insideARM stresses that the recent judgment by the Florida District Court does not set a legal precedent, it could lead to legally binding rulings in the future.
National law firm Dykema reports that the recent court case heard by the Florida court was Mais v. Gulf Coast Collection Bureau, in which the plaintiff - Mark Mais - was contacted via auto dialed calls regarding an outstanding medical debt. He sued the collection agency under the TCPA, claiming that the firm did not have express prior consent to contact the party. The court sided with Mais, despite the prior FCC ruling.
Express vs. implied consent
The discrepancy between the two interpretations manifests itself in what type of consent is provided by consumers that include cellphone numbers on credit forms. Although the FCC ruled that a consumer including contact information is considered express consent, the federal court in Florida ruled that it can only be considered implied consent, which goes against the TCPA's language, according to Dykema.
Complying with state and federal regulations can be difficult for debt collection agencies. Laws and acts passed in recent years have forced these firms to navigate a changing legal landscape. Even when laws are implemented, compliance can still be a major question, as it can take courts years to settle on a uniform interpretation.
This will most likely not be the last court case regarding the TCPA, which may mean more headaches for America's debt collectors. However, companies in the industry can prevent lawsuits similar to that filed against Gulf Coast Collection Bureau by exploring other avenues to gain consent from consumers.
As Dykema notes, there's a need for clarification regarding TCPA interpretation and it may only be provided by the United States Supreme Court.