Category: Consumer Issues, Privacy & Data Security

1
New TCPA Order Holds Few Bright Spots For Businesses
2
Court Awards Individual Plaintiff $229,500 in Damages Under TCPA
3
Update: Sixth Circuit Limits Scope of “Unsolicited Advertisement” under the TCPA
4
Connecticut Mandates Identity Theft Services for SSN Data Breaches
5
Webinar Update: European Commission Strategy on the Digital Single Market
6
Proposed Arbitration Fairness Act Would Ban Pre-Dispute Arbitration Clauses in Consumer Contracts
7
Client of Blast Fax Solutions Provider Hit with $22 Million TCPA Judgment
8
Unmanned Aircraft–A Winged Threat to Privacy?
9
Cybersecurity: The Obama Administration Proposes Legislation; Proposals Would Standardize Breach Notification Requirements, Enhance Cybersecurity-Related Information Sharing, and Toughen Cybercrime Prosecution
10
E-LABEL Act Exempts Wireless Devices from Physical Label Requirements

New TCPA Order Holds Few Bright Spots For Businesses

As originally published in Law360

By Martin L. Stern, Andrew C. Glass, Gregory N. BlaseJoseph C. Wylie and Samuel Castic

On Friday, July 10, 2015, the Federal Communications Commission issued its much-anticipated Declaratory Ruling and Order clarifying numerous aspects of the Telephone Consumer Protection Act. The commission had adopted the order at a particularly contentious June 18, 2015 open meeting (see earlier post), which one commissioner called “a farce” and another described as “a new low … never seen in politics or policymaking.”

In an unusual move, the commission made the order effective on its July 10 release date, rather than following publication in the Federal Register as is typical, providing companies with no opportunity to digest the order and adjust business practices accordingly.

As expected, the order largely brushes aside legitimate business concerns and a sensible approach to TCPA regulation in favor of findings that potentially increase risk for businesses in a variety of circumstances, including the possibility of increased class action litigation. In addition, beyond clarifying that carriers may offer call-blocking technologies to consumers, the order offers little to actually protect consumers from scam telemarketing schemes, including offshore “tele-spammers” that use robocalling or phone-number spoofing technologies.
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Court Awards Individual Plaintiff $229,500 in Damages Under TCPA

By Marty Stern, Joseph C. Wylie II, Molly K. McGinley and Nicole C. Mueller

A recent decision by a New York federal court serves as a stark reminder of the need for companies to adopt and follow robust “do not call” procedures in order to minimize the risk of rapidly escalating statutory damages under the Telephone Consumer Protection Act.  The case appears to be the first to rely on the Federal Communications Commission’s recently-announced but at the time, unreleased TCPA declaratory rulings (previously discussed here).  (The order has just been released, but as of this writing, the link was down.)

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Update: Sixth Circuit Limits Scope of “Unsolicited Advertisement” under the TCPA

By Joseph C. Wylie II, Molly K. McGinley, and Nicole C. Mueller

The Sixth Circuit recently held that a facsimile which lacks commercial components on its face does not constitute an advertisement under the Telephone Consumer Protection Act and ruled that the possibility of remote economic benefit to a defendant is “legally irrelevant” to determining whether the fax violates the TCPA.  The Sixth Circuit’s narrow rule stands out among decisions from other courts that have adopted an expansive interpretation of “advertisement” under the TCPA, and demonstrates that the scope of the TCPA is indeed subject to limitations.

In Sandusky Wellness Center, LLC v. Medco Health Solutions, Inc., the defendant, a pharmacy benefits manager, sent two unsolicited faxes to the plaintiff, a chiropractor.  The faxes informed plaintiff that medications covered by defendant’s health plans could help lower costs for plaintiff’s patients, and directed plaintiff to a complete list of “plan-preferred medications” on defendant’s website.  The faxes, however, did not promote defendant’s services or solicit business from plaintiff.  Nor did the faxes contain pricing, ordering or sales information.  Notably, defendant did not offer for sale any of the identified medicines, either in the faxes themselves or on defendant’s website.

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Connecticut Mandates Identity Theft Services for SSN Data Breaches

By: Holly K. Towle

On June 30, 2015, Connecticut’s governor signed into law an amendment to the state’s data-security-breach-notice statute to mandate “appropriate” identity theft prevention services for breaches involving social security numbers. Identity theft mitigation services are also required “if applicable” (e.g., if identify theft actually occurs). The services must be provided at no cost and for at least 12 months. The statute does not explain which identity theft “prevention” or “mitigation” services are mandated or which are “appropriate.”

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Webinar Update: European Commission Strategy on the Digital Single Market

We recently held a webinar on the highly anticipated EU’s Digital Single Market Strategy, which was released on May 6th by the European Commission.

To listen to the webinar recording and view the presentation slides, please click here.

The objective of the strategy is to tear down the regulatory obstacles to doing business online, and it will pose potential major challenges as well as opportunities for almost every company doing business in the EU. According to the European Commission the reforms could add €415bn per year to the European economy. The strategy is built on three pillars:

  1. better access for consumers and businesses to digital goods and services across Europe;
  2. creating the right conditions and a level playing field for digital networks and innovative services to flourish;
  3. maximising the growth potential of the digital economy.

In this webinar, Ignasi Guardans, Brussels Partner and former member of the European Parliament, presented the strategy as a whole, with a focus on some of its most challenging aspects in areas such as media law and copyright reform in the European Union.

Etienne Drouard, Paris Partner and former public officer at the CNIL (French Data Protection Authority), presented the announced changes in the legal framework of e-commerce, data management and privacy.

Annette Mutschler-Siebert, Berlin Partner, presented the measures related to e-government, e-procurement and how they will impact businesses.

Proposed Arbitration Fairness Act Would Ban Pre-Dispute Arbitration Clauses in Consumer Contracts

By Andrew C. Glass, Robert W. Sparkes, III, Roger L. Smerage, Eric W. Lee

Two members of Congress are seeking to expand the reach of a federal ban on pre-dispute arbitration agreements to cover nearly all consumer contracts.  The proposed legislation would have a widespread effect, barring the use of pre-dispute arbitration provisions in credit card agreements, auto loan agreements, wireless telephone service contracts, and many other types of consumer-facing agreements that often contain such provisions.

On April 29, 2015, Senator Al Franken (D-Minnesota) and Representative Hank Johnson (D-Georgia) introduced the Arbitration Fairness Act of 2015 (“AFA”) (S. 1133; H.R. 2087).  The proposed legislation would amend the Federal Arbitration Act, 9 U.S.C. §§ 1, et seq. (“FAA”), to prohibit parties from entering into agreements to arbitrate consumer disputes in advance of a dispute arising.  The bar on pre-dispute arbitration agreements would also apply in the context of employer, antitrust, and civil rights disputes.

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Client of Blast Fax Solutions Provider Hit with $22 Million TCPA Judgment

By Joseph C. Wylie II, Molly K. McGinley, and Nicole C. Mueller

A new decision once again highlights the dangers that companies face if their independent contractors engage in conduct that violates the Telephone Consumer Protection Act, and highlights the need to monitor contractor compliance with the TCPA.  In City Select Auto Sales, Inc. v. David/Randall Assocs., Inc., a federal court in New Jersey recently found a roofing company, David/Randall Associates, liable for $22.4 million under the TCPA for the actions of its blast fax solutions provider, Business to Business Solutions (B2B).  The plaintiff had alleged that the roofer and its president were liable for the transmission of fax advertisements 44,832 times to 29,113 different fax numbers by its independent contractor, B2B, without obtaining the prior express invitation or permission of the recipients and without including an FCC-required opt-out notice.

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Unmanned Aircraft–A Winged Threat to Privacy?

By Tom DeCesar, Ed Fishman, Jim Insco, and Marty Stern

It is has been a busy time in the field of unmanned aircraft systems (a.k.a., drones).  The Federal Aviation Administration recently released a Notice of Proposed Rulemaking that would allow the widespread use of small unmanned aircraft for a variety of low-altitude, line-of-site commercial operations–something currently prohibited by the agency.  However, the FAA does not typically deal with privacy issues.  So, while the FAA will regulate the use of these devices, President Obama issued a Presidential Memorandum calling for the National Telecommunications and Information Administration to begin a multi-stakeholder process to outline industry guidelines related to privacy, transparency, and accountability in the use of unmanned aircraft.  (See our recent client alert on the FAA small UAS NPRM and the Presidential Memorandum by clicking here.)  Although the NTIA’s typical focus is on telecommunications issues, it has convened a multi-stakeholder processes to address privacy issues involving such things as mobile app disclosures and facial recognition technologies. Read More

Cybersecurity: The Obama Administration Proposes Legislation; Proposals Would Standardize Breach Notification Requirements, Enhance Cybersecurity-Related Information Sharing, and Toughen Cybercrime Prosecution

By R. Paul Stimers, András P. Teleki, Bruce J. Heiman, Michael J. O’Neil

On January 13, 2015, in response to the continuing onslaught of cyber attacks, including the recent cybersecurity attack and data loss at Sony Pictures Entertainment, the Obama Administration sent to Congress three legislative proposals to improve cybersecurity. The proposals would:

  • Establish a single federal breach notification standard preempting a patchwork of state notification laws;
  • Encourage cyber threat information sharing within the private sector and between the private sector and the federal government; and
  • Enhance law enforcement’s ability to investigate and prosecute cyber crimes.

The President has been highlighting the cybersecurity proposals in a series of speeches leading up to the State of the Union Address today.

To read the full alert, click here.

 

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