Advertising Law Blog

The Telephone Consumer Protection Act (TCPA) treats telemarketing calls, defined as calls seeking to encourage a purchase, differently than it treats informational calls. Prerecorded telemarketing calls require express written consent from the recipient, whereas prerecorded informational calls require no consent when made to land lines and only oral consent when made to cell phones. However, it is not always easy to distinguish between telemarketing and informational calls because the line between the two can often become blurred. Two recently decided cases show where courts are drawing the line between these two types of calls.

In Leyse v. Clear Channel Broadcasting, Inc., decided on September 6, 2012, the Sixth Circuit Court of Appeals was presented with prerecorded calls that promoted a radio station and a contest awarding a $1000 prize. The court found the call in question was a "hybrid call" that promoted the station generally even though it also announced a contest. Because the radio broadcasts were free to listen to (as opposed to say, a pay-per-view event), the court ruled that this hybrid call should be treated as an informational call, and since it was made to a land line, no prior consent was needed. The Sixth Circuit ruled that the call was legal.

On the other hand, Chesbro v. Best Buy Stores, L.P., decided on October 17, 2012 by the Ninth Circuit Court of Appeals, was a plaintiff's victory. In this case, Best Buy made automated calls to its prior customers that did not solicit a particular sale but promoted a Best Buy Reward Zone Program. This time, the court treated the call as a telemarketing solicitation, not an informational call. The court relied on the fact that the call "urged the listener to redeem his Reward Zone points, directed him to a website where he could further engage with the [program] and thanked him for shopping at Best Buy." According to the Ninth Circuit, "Redeeming Reward Zone points required going to a Best Buy store and making further purchases of Best Buy's goods. There was no other use for the Reward Zone points. Thus, the calls encouraged the listener to make future purchases at Best Buy."

Because the court viewed Best Buy's calls as telemarketing, the calls were only legal if they had the plaintiff's prior express written consent. The plaintiff claimed he had not consented, but because there no evidence concerning prior express consent on the court's record, the Ninth Circuit sent the case back to the Western District of Washington to determine if such consent existed.

In light of these two recent decisions, users of automated calling services should be very careful before relying on the distinction between informational and telemarketing calls as a basis to avoid obtaining prior express consent for prerecorded calls. The first question that should be asked is whether or not the message in question is encouraging a purchase.