The Bipartisan Budget Act of 2015 (the Act), signed into law by President Obama and effective as of November 2, 2015, amends the Telephone Consumer Protection Act (TCPA) and creates important exemptions for calls made to cellular and residential telephone numbers pursuant to the collection of debts owed to or guaranteed by the United States.

Prior to the amendment, these calls would have been prohibited absent the recipient’s prior express consent if placed to a cellular telephone and if they were made by an automatic telephone dialing system or included an artificial or prerecorded voice message. Now, such calls, if “made solely pursuant to the collection of a debt owed to or guaranteed by the United States,” no longer require the prior express consent of the recipient.

In addition to the exemption applicable to calls made to cellular telephone numbers, the Act also exempts certain calls to residential telephone lines. The statutory requirement that a caller obtain the called party’s prior express consent before making any call to a residential line if an artificial or prerecorded voice delivers a message is no longer applicable to calls made “solely pursuant to the collection of a debt owed to or guaranteed by the United States.” Likewise, these calls no longer require the called party’s prior express consent. While these residential calls were likely exempt from the TCPA’s prior express consent requirements prior to the enactment of the Act pursuant to regulations issued by the Federal Communications Commission (FCC), it is now clear that no specific consent is required in order to make such residential telephone calls.

The Act also mandates that the FCC prescribe regulations implementing the amendments to the TCPA, in consultation with the Department of Treasury, within nine months from the date of its enactment. The FCC has authority to restrict or limit the number and duration of these calls when made to cellular numbers; however, no such authority is granted for residential numbers.

In addition to possible FCC fines, the TCPA poses significant risk from plaintiffs’ counsel, as it provides for a private right of action, statutory damages of $500 per violation, and treble damages for willful violations. With the TCPA’s potential for significant liability, these amendments are welcome news for servicers and collectors of debts owed to or guaranteed by the United States.

Ballard Spahr’s TCPA Task Force assists clients in navigating the complex and challenging issues that arise under the TCPA. The Task Force, which comprises regulatory attorneys and litigators, provides counsel on TCPA compliance and avoiding TCPA liability, including reviewing policies and practices and helping to design mobile text message and prerecorded and autodialed call campaigns. It also assists clients in handling scrutiny from regulators, including preparing for examinations, responding to investigations, and defending against enforcement actions. Task Force members also defend clients against TCPA class or individual actions.

Ballard Spahr’s Consumer Financial Services Group is nationally recognized for its guidance in structuring and documenting new consumer financial services products, its experience with the full range of federal and state consumer credit laws, and its skill in litigation defense and avoidance (including pioneering work in pre-dispute arbitration programs).

For more information, please contact Consumer Financial Services Group Practice Leader Alan S. Kaplinsky, TCPA Task Force Chair Mark J. Furletti, John L. Culhane, Jr., Daniel JT McKenna.

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