Collector - September 2016 - (Page 10)
TCPA CLASS-ACTIONS BY INDUSTRY
attorneys' fees for
a TCPA class-action
for a TCPA
The Consequences of an Outdated Law
Research shows that the Telephone Consumer Protection Act is not living up to its name.
n the 25 years since the enactment of
the Telephone Consumer Protection
Act, plaintiff's attorneys and federal
regulators have manipulated the original
intent of the law, transforming it from a
statute that protects valuable consumer
communication with businesses into a tool
for frivolous lawsuits.
In its recent white paper, The Imperative to
Modernize the TCPA: Why an Outdated Law
Hurts Consumers and Encourages Abusive
Lawsuits, ACA International explained
why the TCPA must be modernized to help
consumers and allow legitimate businesses to
communicate with these consumers effectively.
"To function as an effective consumerprotection measure, the TCPA must be
reformed to more accurately reflect the
current state of communication technology
in addition to the ways both businesses and
consumers use those technologies," wrote
ACA's Director of Research Josh Adams,
Ph.D., in the white paper.
The number of TCPA-related lawsuits
skyrocketed 948 percent from 2010 to 2015.
Damages in a TCPA lawsuit are set at $500
per unintentional violation and $1,500 per
intentional violation. These damages add up
quickly in class-action lawsuits and are part of
the reason why TCPA litigation has increased
so dramatically in the last five years.
However, the outcome of these class-action
lawsuits generally benefits plaintiff 's attorneys
more than the consumers themselves. In
2014, the average attorneys' fees for a TCPA
class-action settlement were $2.4 million,
while the individual consumer received just
$4.12. This stark disparity undermines the
initial purpose of the TCPA, rendering it
more a tool for attorney enrichment than
Another reason for the proliferation of
unnecessary TCPA lawsuits is that the statute
has been increasingly applied across a diverse
range of industries beyond telemarketing,
including necessary informational calls
from legitimate debt collection companies
to consumers. Debt collection professionals,
as well as legitimate businesses across a wide
scope of industries, must be able to send vital,
nonsolicitous communications to consumers
in the way they want to be contacted.
"This problem has been exacerbated by
the Federal Communications Commission,
the agency responsible for implementing
the TCPA, whose broad interpretation of
the statute has failed to provide a pathway
to compliance for businesses using modern
communications," Adams wrote.
To solve these problems with the TCPA,
ACA advocates that the law must be
clarified to allow for the use of modern
communication technology to reach
consumers in the modern marketplace.
Specifically, the FCC must maintain the
balance Congress contemplated in enacting
the TCPA to protect consumer privacy
interests without impeding legitimate
"It is no wonder that there are so
many businesses that rely on effective
communication with their customers
coming to together to call for TCPA
reform," said ACA CEO Patrick J. Morris.
"This includes credit agencies, universities,
retailers, banks and utility companies.
They all want relief from abuses of an
Table of Contents for the Digital Edition of Collector - September 2016
5 Ways to Get Electronic Payments Right
Making the Connection
Curious About Amicus Curiae?
Know the Score
What Creditors Need to Know About the TCPA
ACA Industry Advancement Support Helps Secure Victory for Collection Industry in FDCPA Case
Collector - September 2016