In what has become a common theme of late another court in the Northern District of Illinois has held that a dialer must operate randomly or sequentially to qualify as an ATDS under the TCPA. This marks the seventh time a court within that district has so held.

The latest decision is in Smith v. Premier Dermatology, No. 17 C 3712, 2019 U.S. Dist. LEXIS 152887 (N.D. Ill. Sept. 9, 2019). The reasoning follows a familiar path.

First, the Court addresses the FCC’s 2003 and 2008 predictive dialer rulings and determines that they were set aside by ACA Int’l.

The Court then moves on to interpreting the statutory language. While recognizing a certain “allure” to Marks, the court nonetheless concludes that the Ninth Circuit’s analysis is inconsistent with the plain text of the statute.

In the Smith court’s view, the statute means what it says:

the plain text of the statutory definition provides that an ATDS is a device that (1) stores or produces telephone numbers that (2) were randomly or sequentially generated and (3) dials them automatically.

Notably, the Court concludes the statutory language is “not ambiguous” such that there is no reason to consider the context or the structure of the statutory scheme.

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The Court also rejects the Plaintiff’s argument that the system has the “capacity” to dial randomly because, in essence, it is a software-enabled dialing device capable of being reprogrammed. It is the present capacity of the system that matters according to the Smith court.

While this latest decision is helpful for Defendants—and indeed does away with a number of pesky arguments TCPA plaintiffs enjoy making regarding the meaning of ATDS—it is small potatoes compared to the coming ruling from the Seventh Circuit in Gadelhak. There the Seventh Circuit is set to definitively answer whether an ATDS must dial randomly or sequentially. And considering that a near majority of the entire nation’s “statutory approach” to TCPA cases arise out of N.D. Ill., losing Gadelhak would be a real problem for Defendants. More to come on that.

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Editor’s note: This article is provided through a partnership between insideARM and Squire Patton Boggs LLP, which provides a steady stream of timely, insightful and entertaining takes on TCPAWorld.com of the ever-evolving, never-a-dull-moment Telephone Consumer Protection Act. Squire Patton Boggs LLP—and all insideARM articles—are protected by copyright. All rights are reserved. 

Today, the Consumer Financial Protection Bureau (CFPB) announced that it launched the American Consumer Financial Innovation Network (ACFIN) to promote innovation within the financial sector while also ensuring such advances are safe for consumers. Joining the CFPB as initial members of ACFIN are Attorneys General from Alabama, Arizona, Georgia, Indiana, South Carolina, Tennessee, and Utah. The CFPB invited all state regulators to participate.

In the CFPB’s announcement, Director Kathleen Kraninger writes:

Federal and state coordination promotes consistency in the regulation of consumer financial products and services while facilitating consumer-beneficial innovation. ACFIN will provide a platform for Federal and State regulators to coordinate with each other as they develop new rules of the road and apply existing ones. This coordination can provide greater regulatory certainty across jurisdictions and allow regulators to keep pace with market developments. I will continue to work to encourage other state regulators to join this important new initiative that will foster collaboration among Federal and State regulators.

Separately, the CFPB also announced today that it issued three new policies to promote innovation and benefit consumers: a new No-Action Letter Policy, a Trial Disclosure Program Policy, and a Compliance Assistance Sandbox Policy.

Concurrently, the CFPB issued its first No-Action Letter (NAL) under its new NAL Policy. The purpose of NALs is to promote innovation in products and services that are beneficial to consumers by removing the fear of a supervisory or enforcement action by the CFPB. The Department of Housing and Urban Development (HUD) received the first NAL under the new policy to promote housing counseling agencies and lenders to enter into agreements that fund counseling services without the uncertainty of RESPA.

In this announcement, Kraninger states:

Innovation drives competition, which can lower prices and offer consumers more and better products and services.  New products and services can expand financial options, especially to unbanked and underbanked households, giving more consumers access to the benefits of the financial system. The three policies we are announcing today are common-sense policies that will foster innovation that ultimately benefits consumers.

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insideARM Perspective

Innovation in the consumer financial marketplace is important, especially in debt collection—where currently laws and regulations often prevent the use of modern technology. insideARM’s Innovation Council works towards this goal by seeking to advance the adoption of modern, efficient and consumer-friendly technologies within the collection landscape. The Bureau’s new policies are promising as they show its dedication toward ensuring that new, innovating financial products and services get to be explored and see the light of day.

Editor’s Note: This article is authored by Linda Straub Jones of NeuAnalytics and is published on insideARM with permission from the author.

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It may be 12-18 months before the CFPB finalizes their new debt collection rules, but it’s never too early for financial institutions who place accounts with debt collection agencies to start thinking about what those rules will mean for them, and what changes may need to happen when the rules go into effect.  

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Although the proposed rules are being written for debt collectors, financial institutions need to be aware of the rules’ requirements while auditing their agencies to ensure their agencies comply with the new standards. As we’ve seen many times before, financial institutions are held responsible for their vendor’s actions. With your reputation at stake, you want to validate that your agencies are fully in compliance. You don’t want to be the first to end up in the headlines for a lawsuit relating to the new CFPB rules.  

Below are five items you can start thinking about now so you don’t have to rush to get everything done once the new rules are in place: 

1. Obtain updated policies and procedures from vendors with any changes made due to the new rules (i.e., call frequency, copies of new letter wording and formats, texting, emailing, etc.)

2. Ensure your collection agencies update their internal policies and procedures relating to their communication methods.

3. Update your audit questions/procedures for your agencies to include additional communication methods and other requirements in the new rules, for example: 

• Are your agencies now texting?  If so, texts are considered a ‘call’ to a cell phone under the TCPA. Your agencies need to follow TCPA rules for express consent, including tracking consent and revocation. Also, the new rules outline ‘unsubscribe’ requirements, are those in place? 
• Are your agencies now emailing?  If so, what messaging are they sending via email? Is it secure? Have you reviewed the email templates to ensure compliance?  How are the email addresses being verified? Do they have a process in place to avoid emailing at the consumer’s place of employment (unless it is documented that the consumer wants emails there)?   Do they have the proper ‘unsubscribe’ procedures in place? 
• If disclosures are emailed, are proper consent procedures in place? 
• For both texting and emailing, your agencies may now be using a new external vendor to perform those tasks, do you have sub-vendor information updated for those new sub-vendors? 
• Do your agencies use social media messaging? If so, do they have policies and procedures in place to ensure messages are only sent via a private messaging function? 
• You may already have call frequency requirements for your agencies, but make sure they are in line with the CFPB’s new call frequency requirements.  
• Do your agencies credit report your debt? If so, do they have a procedure in place that covers the proposed rule on communication with a consumer prior to reporting the debt?
• Have you reviewed your agencies’ validation notices and ensured they are compliant with the new rules? 

4. Do you use a specialty vendor for collecting deceased debt? If so, do they have updated policies and procedures to follow the new guidelines on who they can contact about the deceased consumer’s debt, as well as the updated validation notice requirements? And have you included that checkpoint in your audit procedures?

5. As rules/regulations change, or as your internal requirements change or are updated, what process do you have in place to track updates and versioning of your audits and ensure your agencies are still in compliance? 

It is important to keep in mind that the final rules may be somewhat different from the proposed rules, so it’s important to be flexible. There are always a lot of moving parts when you outsource accounts to an agency, but taking a little time to think about the upcoming rules before they go into effect will go a long way to ensuring you can timely implement the new requirements without scrambling at the last minute.    

Linda Straub Jones is a Sr. Account Executive at NeuAnalytics, a technology company that provides vendor management, audit, and compliance management solutions to financial institutions.

Well, we are all still trying to cope with the fallout from Morgan and now we have something new to worry about—wait queue messages.

Framing the issue—when a predictive dialer places a call and there is no agent available to take the call a pre-recorded voice message is sometimes played to consumers while the system places them on hold to await the availability of an agent. As these systems are designed to accurately predict agent availability this should be a relatively rare event. Nonetheless, it has never been held that the mere playing of a “we’ll be right with you” message on an outbound call is per se subject to the TCPA—until now.

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But good news first.  The Court applied the statutory ATDS definition—requiring random or sequential number generation—in this TCPA suit against a user of *another* popular predictive dialer software in Brown v. Ocwen Loan Servicing Llc, Case No. 8:18-cv-136-T-60AEP, 2019 U.S. Dist. LEXIS 151236 (M.D. F. Sept. 5, 2019). The court concluded that the device used was not an ATDS because it did not have the required statutory functionalities.

Importantly, the Brown court accepted the Defendant’s evidence that the Defendant’s predictive dialer was not “capable of generating and dialing random or sequential numbers”—the precise opposite conclusion reached in Morgan regarding seemingly similar predictive dialing technology. On that basis, the court entered summary judgment in favor of the Defendant on the ATDS issue. Straightforward enough.

But then things get dicey. After recognizing that the use of a pre-recorded voice message is an independent basis to assert liability, the court appears to assume that messages played while the consumer was in the hold queue necessarily trigger TCPA liability. While there is little analysis on the subject the court accepts that the message was “artificial or pre-recorded” and appears satisfied that the mere use of this voice—during an otherwise live calls—triggers statutory coverage. Notably, summary judgment was denied—but only because of a dispute as to the number of calls at issue.

A couple of additional points:

First, the Court found a question of fact as to whether Defendant’s servicing calls exceeded the scope of consent provided by the consumer when she provided her phone number in connection with a loan modification application. I haven’t seen that argument in a while—not since Bayview really— and this seems to be the first district court giving credence to the argument. Keep it in mind.

Second, the phone changed hands during the course of the calls at issue with the regular user of the phone transferring from wife to husband. There is a one-liner in the opinion that is a little confusing and that also might make a big difference in the outcome. It reads: “When [Husband] became the primary user of the – 5620 number in March 2016, he became the – 5620 number’s subscriber.” It is unclear to me whether Husband, in fact, became the subscriber or whether the court is concluding—as a legal matter—that one who is the primary user of a phone is the “subscriber” for consent purposes. In any event, the Court concludes that after Husband became the user of the phone he had the power to revoke the consent as the “called party.” A disputed issue of fact thwarted summary judgment on the subject.

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Editor’s note: This article is provided through a partnership between insideARM and Squire Patton Boggs LLP, which provides a steady stream of timely, insightful and entertaining takes on TCPAWorld.com of the ever-evolving, never-a-dull-moment Telephone Consumer Protection Act. Squire Patton Boggs LLP—and all insideARM articles—are protected by copyright. All rights are reserved. 

SARASOTA, Fla. — TEC Services Group, Inc. announced today the recipient of the 2019 Scholarship Program. Applicants were required to meet academic, attendance, and citizenship standard requirements for their state. This year our applicants were required to submit an essay describing what their passion is and how they expect it to impact/influence society today. TEC would like to thank all who participated in the program, now in its fourth year. TEC had a great response to the program this year.  TEC would also like to thank Corporate Advisory Solutions (CAS) as a sponsor to this year’s scholarship program. The Scholarship Program is available to employees of the ARM industry and their dependents attending a four-year accredited college or university.  

Tom Sweat, President of TEC Services Group, Inc. says:

The youth of our country have the ability to change the world. At TEC we are extremely proud to help these young men and women reach their goals through education. The scholarship program has experienced more interest then ever before and we are excited what the next year brings.” 

After careful review and consideration, the TEC Scholarship Committee determined the 2019 Scholarship will be awarded to Nathan Brelage. Congratulations Nathan!

Nathan Brelage, now in his third year at the University of Dayton majoring in Mechanical Engineering. Nathan was the recipient of TEC’s scholarship awards in 2017 and 2018. Nathan continues to be an active member of many organizations including, the American Society of Mechanical Engineers, Biomedical Engineering Society, and Tau Beta Pi. He also volunteers in several community and civic service programs including, Christmas on Campus (ASME), Penny Wars (Tau Beta Pi) and Camp Blue. (Father Andrew Brelage of Ontario Systems)

With this year’s sponsorship from Corporate Advisory Solutions (CAS), TEC was once again able to award additional smaller scholarships to the following recipients: 

Kelsey Baich, is in her final year at the University of Mississippi, she will graduate in May 2020 with a degree in Secondary Education. After graduation, she plans to teach history at the high school level.  Kelsey has been a recipient of the TEC scholarship now for four years. In her fourth year at Ole Miss, Kelsey is a member of Pi Beta Phi Fraternity for Women, Student Housing and College Republicans. She continues to be an active volunteer in her community with her time in LeapFrog, Champions are Readers and Read > Lead > Achieve programs. (Father Kevin Baich of Day Knight & Associates) 

Jenna Cline as a 2019 graduate from Auburn High School in Auburn, IL.  Jenna will be attending the University of Missouri, where she will major in Nursing. During high school, Jenna was a member of the Student Council, Science Club, National Honor Society, Spanish Club, and Business Club. She has also been a volunteer in many community activities including Clean the Park, BLAST (Drug and Alcohol Prevention) and Earth Stewardship Day.  Jenna was a member of the high school volleyball team and football, basketball and competition cheer teams. (Mother Kimberlie Cline ProCom Services of Illinois, Inc.)

Chris Hunley, is in his second year at the University of Texas at Austin, majoring in Music Education. He has been a member of Texas Future Music Educators Associations. Chris has received several awards including North American Saxophone Alliance High School Solo competitions (first place) and Saxophone Academy Austin, All-State Masterclass (second place).  Chris continues to serve his community and school through his service with the Longhorn Band. (Mother Larise Lynch of EOSUSA/Collecto-INC)

Elizabeth Hartmann, a 2019 graduate of Waconia High School in Waconia, MN.  Elizabeth will be attending Gustavus Adolphus College and will major in English, minor in Communications with a focus on Pre Law.   During high school, Elizabeth was a member of the Students Against Destructive Decisions (SADD), National Honor Society, Pit Band, Marching Band and many clubs including Conservation, Book, Jazz.  She was also a leader of Family, Career, and Community Leaders of America (FCCLA) were she served as Treasurer, Vice President and President and won many awards during that time. She continues to serve her community as a member of the Girl Scouts of the USA,  Faith Lutheran Youth Group and as a Sunday school teacher at her church. (Mother Jessica Hartmann of ACA International.

Alexis Morgan is in her second year at Southern Oregon University.  She is majoring in Nursing, which will allow her to pursue her aspiration to become a Nurse Practitioner, specializing in Pediatrics/Neonatal.  This summer, Alexis participated in Job Shadowing of the Neonatal Intensive Care Unit at a local hospital. She continues to volunteer in numerous programs to help children improve their athletic skills, reading abilities and M.A.P.S., a program for children with physical and/or learning disabilities. Alexis also received the TEC scholarship in 2019.  (Father Robert Morgan of Action Financial Services) 

Dylan Morgan attends Pacific University and will graduate in May 2020 with a Bachelor Degree in Business, with concentrations in marketing and finance. Dylan is in his fourth year of college, and this will be his fourth degree. Upon graduation Dylan will continue his education as he works to earn his Masters of Business Administration at Southern Oregon University.  He plays for the Pacific University’s Baseball team, the Boxers. Dylan continues to serve in his community as a Camp Counselor for youth sports and an umpire for youth baseball in his local areas. Dylan was also a recipient of the 2018 TEC scholarship. (Father Robert Morgan of Action Financial Services)

TEC encourages employees of the ARM industry and their dependents to apply next year. Please look for an announcement on the 2020 Scholarship Program by the end of the year. For additional questions or comments, contact TEC Services Group at Scholarship@TECsg.com or call 941-375-0300 for more information.

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ROCKVILLE, Md. — The iA Institute announces the release of an illustrated brief titled, “The Consumer’s Credit-Collections Journey, Powered by Artificial Intelligence.” Designed for legislators, regulators, industry participants, and anyone seeking to get their arms around how the latest technology affects the consumer experience, the brief provides a plain-English overview of what the consumer sees, what’s going on behind the scenes, and examples of the companies that provide the technology.

The illustrated journey begins with a consumer’s application for credit and continues through purchases, payments, and dealing with possible life curves such as fraud alerts, identity breaches, late payments or collection notices.

“Applications of artificial intelligence of all shapes and sizes are entering the market at a staggering rate,” said Stephanie Eidelman, CEO of the iA Institute. “Many of those tasked with implementing or regulating these new applications struggle to even get a full picture of where they come into play in the consumer experience. This brief is meant to provide that picture so that stakeholders can then take the next steps to address—or to simply start asking the right questions about—the risks, the opportunities, and where they should focus their efforts.”

The brief was developed by the iA Institute with input and guidance from members of the iA Innovation Council, a working group of leading industry firms that gathers three times each year for substantive dialogue and collaboration. The group takes a collaborative whiteboard approach to identifying points of friction across the collection lifecycle and developing solutions.

Download the brief here.

About the iA Institute

The iA Institute (iA) is a media company that produces handcrafted news, events and education for the consumer and commercial debt industry. The iA team believes that the value of your investment in our content should be undeniable, so we thoughtfully design everything we do with a focus on the details that make a difference. iA initiatives bring a range of stakeholders to the table in candid and intimate environments to inform, to collaborate, to innovate, and to make profitable connections.

The iA Institute, under the name insideARM LLC, is a certified woman-owned and woman-controlled business (WBE).

Learn more at theiainstitute.com.

Just what TCPAWorld needed—something else to debate.

We’re going to need a replay review on this one folks. And no, I’m not talking about football.

In Gary v. Trueblue, Inc., No.18-2281, 2019 U.S. App. LEXIS 26959 (6th Cir. Sept. 5, 2019), the Sixth Circuit Court of Appeal appears to have held the 2003 and 2008 predictive dialer rulings are now defunct and came tantalizingly close to holding that the TCPA’s ATDS definition requires random or sequential number generation. Whether or not you believe it actually did adopt the statutory definition likely turns on which side of the “V” you live on.

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First, you all remember the TrueBlue cases from last year, I presume. In the first decision, the Court denied the Plaintiff’s motion for summary judgment concluding that the text message platform at issue did not have the ability to dial randomly or sequentially. Gary v. TrueBlue, Inc., Case No. 17-cv-10544, 2018 WL 3647046 (E.D. Mich. Aug. 1, 2018). And then we were treated to a second case where the Court affirmed its earlier analysis and entered judgment in favor of the Defendant. Gary v. Gershwin A. Drain Trueblue, Case No. 17-cv-10544, 2018 U.S. Dist. LEXIS 175021 (E.D. Mich. Oct. 11, 2018).

The pro per Plaintiff appealed the judgment in favor of the Defendant, which set up the incredible prospect that the Sixth Circuit Court of Appeal would adopt the statutory read applied by the district court. Indeed, in football terminology this was the equivalent of a first and goal from the one. Yet the Sixth Circuit’s opinion, which is a brief summary-style ruling, appears to have taken a knee on the goal line. But did it break the plane?

Here’s what everyone will agree on. The opinion recites the district court’s ruling, in part,  as concluding that “the TCPA does not prohibit the use of devices with automated functions… [but rather] the statute requires a showing that the system has the  capacity to randomly or sequentially dial or text phone numbers.” But search as you may, you won’t find the words “we agree” or “we disagree” anywhere in the opinion.

Instead, the Sixth Circuit plays coy on the issue of ATDS functionality. Rather than affirmatively state that the district court got it right, the Court finds that the Plaintiff failed to demonstrate that the district court got it wrong—which may or may not be the same thing. Here’s what the court actually says: “First, [Plaintiff] asserts that the district court erred by not considering the FCC’s orders from before 2015 to have been binding. Under these orders, Gary believes that TrueBlue’s system qualifies as an ATDS. But Gary has not shown that this is true.”

Full stop. That’s it. That’s the analysis.

That appears to be a clear enough holding that the 2003 and 2008 rulings are overturned—take that Ammons— but it is not quite the affirmance of the statutory approach adopted by the district court that we were all hoping for.  Then again, the necessary implication of the ruling appears to be that the statutory definition now prevails, correct? The only other option would seem to be Marks, which the Court certainly does not appear to endorse.

The opinion goes on, however, to confirm that even if the ATDS definition were broader than the statutory definition—why would it even suggest that?— “Gary has not explained how TrueBlue’s system functions in a way that would satisfy this [broader] definition.” (Again, what definition?) Later the Court noted that Plaintiff’s citation to “unhelpful, general internet articles [] did not create a genuine dispute about the matter.” But again the precise “matter” that is in dispute (or not in dispute as the case might be) is not identified. Eesh.

What is clear after Gary is that the Sixth Circuit definitely did (or did not) adopt the statutory TCPA definition and definitely rejected the 2003 and 2008 FCC Predictive Dialer rulings. Probably.

Let the debate begin.

Unrelated, the Pac 12 is definitely the best conference in college football this year, no?

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Editor’s note: This article is provided through a partnership between insideARM and Squire Patton Boggs LLP, which provides a steady stream of timely, insightful and entertaining takes on TCPAWorld.com of the ever-evolving, never-a-dull-moment Telephone Consumer Protection Act. Squire Patton Boggs LLP—and all insideARM articles—are protected by copyright. All rights are reserved. 

ROCHESTER, N.Y. — Continental Service Group, Inc., dba ConServe, is a devoted community partner.  Through the organization’s ongoing philanthropy program, Jeans For Charity, the ConServe team supports and funds the efforts of numerous agencies that strive to make a difference.  In August, they directed the donations to local fire fighters and their corresponding fire companies. ConServe employees feel a great sense of pride and accomplishment knowing that their contributions help make the community safe and secure.

The Bellevue, Egypt and Henrietta Fire Departments provide fire protection and first response emergency medical services to our communities. Additionally, these organizations provide important educational programs and preventative safety initiatives throughout their regions geared towards saving lives and making a difference.

“Our Jeans for Charity program provides ConServe employees with the opportunity to enjoy dressing down while making a difference in our community,” said George Huyler, Vice President of Human Resources.  “Supporting local fire companies and firefighters that give back selflessly to our communities exemplifies the moral and ethical fiber of our employees while capturing the essence of our mission statement – our people helping to improve the human condition. We take great pride in being a role model for fair and ethical business practices while being a good corporate citizen in all aspects of our operations.”

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About ConServe

ConServe is a top-performing award-winning provider of accounts receivable management services specializing in customized recovery solutions for our Clients. Anchored with ethics and compliance, and steadfast in our pursuit of excellence, we are a consumer-centric organization that operates as an extension of our Client’s valued brand.  For over 30 years, we have partnered with our Clients to give them peace of mind while simultaneously helping their consumers achieve financial freedom. At ConServe we call it Fostering Financial Freedom®.

Visit ConServe online at: www.conserve-arm.com

I’ve always been a fan of Capt. John Paul Jones. The notion of responding to a crew’s frantic requests to surrender with a baffled and indignant “I have not yet begun to fight” is both delicious and relatable—at least to me. It’s not easy guiding a ship through troubled waters—especially when the cannonballs start flying, and people want to find the exits. It is a scary (TCPA) world out there, after all, and danger indeed lurks at every turn.

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Well, we can now count VoApps, Inc. among TCPAWorld’s most intrepid ne’er-say-diers.

After sitting on the sidelines for three separate rulings finding that ringless voicemail technology constitutes a “call” for purposes of the TCPA, the developer of DirectDrop ringless voicemail has finally begun to fight. And it is very good to see.

As I have alluded to several times, both on TCPAWorld.com and while on the lecture circuit, defending ringless voicemail by arguing that the technology is not subject to Title II of the Telecommunications Act (i.e., that voicemail is an information service) is simply a dead end. The argument makes no sense given that text messages—also classified as information services—have long been subject to the TCPA. Plus just because a voicemail service is an information service, it does not follow that leaving an actual voicemail is not, yet, the “making” of a call.  Yet this argument has been presented, over and over again, by Defendants arguing that direct-to-voicemail messages are outside the coverage of the TCPA. An—as predictably as the coming change in autumn foliage—courts have continuously found that such messages are calls subject to the statute.

But as many times as I have decried the arguments proffered to defend ringless voicemails, I have also forcefully advocated that this technology is, indeed, outside the scope of the TCPA—just for a different reason. Simply put: direct drop voicemails are not calls sent to telephone numbers assigned to wireless carriers. Instead, the voicemails are sent—sometimes using VPNs and sometimes using regular phone telephony—to business-grade landline numbers. Hence these “calls” are not made to a number assigned to a wireless service for purposes of the TCPA’s restriction on automated technologies. Translation: direct to voicemail technology is not subject to the TCPA. (At least in most cases.)

And now, at long last, that rationale has been presented to a Court and supported by a brilliantly-crafted declaration by none other than the inventor of DirectDrop ringless voicemail—David King. Just today, a declaration by King was filed in opposition to summary judgment in the original Saunders case that started it all. (How do we find out about these things so quickly? 😉)

In his 32 paragraph declaration, King describes exactly how the technology works and why it is not subject to the TCPA. In broad strokes, voicemail messages are always delivered to a separate server rather than to a telephone device or handset. That server is accessed using a Forward-To-Number assigned to an individual cell phone user’s phone as he/she moves from cell tower to cell tower. The Forward-to-Number is a “business class, landline telephone number assigned to the voicemail platform of the voicemail service provider that the cellular user has chosen.” And the DirectDrop product communicates only with the Forward-to-Number, not with any specific cellular number.

Cannonballs away.

As the brief (again just filed today) submitted by VoApps customer Dyck O’Neal perfectly argues in seeking to avoid summary judgment in Saunders:

[DirectDrop] technology does not interact with any components of the Radio Access Network,” commonly referred to as the cellular network.  Specifically, the [DirectDrop] technology does not interact with any of cellular towers, radio transmission equipment, or actual cellular devices or telephones in any way.   Nor does the [DirectDrop] technology place a call to the consumer’s cellular phone number.  Instead, the only call is placed to a voicemail service provider’s business class, landline number.

Now that’s how you defend ringless voicemail folks.

Importantly, DirectDrop CEO Paul Geiss appeared on my old podcast to promise users of his product that the company would stand behind them in litigation. And that is exactly what DirectDrop has done in Saunders. By making expert testimony from the inventor of the ringless voicemail product available to the Defendant in that case, DirectDrop breathed new life into an entire communications medium.

So guess what? We’ve invited David King himself to join Squire Patton Boggs’ Unprecedented podcast this week to discuss the technology in further detail–and he has agreed. The interview will record this Thursday and you can expect an epic breakdown of this technology and golden defense tips at your fingertips when the Ninth Edition of the Unprecedented podcast is delivered next week.

For now, however, enjoy the briefs and declarations newly-submitted in Saunders. Available here: King Declaration and Response to Summary Judgment

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Editor’s note: This article is provided through a partnership between insideARM and Squire Patton Boggs LLP, which provides a steady stream of timely, insightful and entertaining takes on TCPAWorld.com of the ever-evolving, never-a-dull-moment Telephone Consumer Protection Act. Squire Patton Boggs LLP—and all insideARM articles—are protected by copyright. All rights are reserved.

Many organizations practice the motto “the customer is always right” — but is the customer always right?

This is a topic that we could all stand to talk about more often. The customer isn’t always right and allowing them to hold the payment(s) will create a bigger issue. Yes, it’s important the customer is heard and their dispute is researched. However, the phrase “I don’t agree with the charges,” is the number one delay tactic that prevents the collector from doing their job.

Questions to ask yourself: Did the customer wait for you to call them? Or did they proactively notify you? Did the customer contact you prior to the bill being due? Did they make mention to their sales representative in text, e-mail, and/or phone that they didn’t agree with the charges or invoice? or did they wait for the invoice to come past due and receive your call to notify you that a problem existed?

It’s important that the customer is coached, to contact you right away if they have a dispute. This is something I always teach: “It’s imperative Mr. Customer that you notify us right away if you see something incorrect on your bill; this will allow us adequate time prior to the bill being due to research and get a credit issued to your account.” Did the customer receive damaged goods? Did they receive something from the supplier or the manufacturer directly? Did they sign for the product that it was received in good order but discovered it was damaged after signing? Better yet, did the customer sign that they received everything, but then file a dispute for shortage in the product when you came to collect the invoice?

• If the product came straight from the manufacturer, there may be limited time to file a damage claim.
• It’s very difficult to dispute something after they signed for it in good order.
• Does the customer have pictures of the shortage and/or damaged goods?
• It’s important that the proper paperwork is included in order to dispute an invoice. Does the customer have all the necessary paperwork?
• Were they billed for a service that wasn’t performed or ordered?
• If the charges didn’t match what they were quoted for the product/service, do they have documentation for the quoted amount?
• Quotes are only as good as the information provided to obtain a quote.

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Recommendation. The collector needs to set the proper expectation during this call. “We would be happy to research the dispute for you. It’s our company policy that disputes are filed prior to the invoice due date. We can go ahead and process the payment over the phone for the full amount due. Once the dispute is researched and approved, the credit will be applied against your account.” “I can be sure that we will update you once that is approved, but generally speaking, that can take upwards of one to two billing cycles. That being said, in the future if you notice an incorrect charge please notify us right away. This way we can ensure it’s corrected on your account before the invoice is due.”

This recommendation is putting the onus on the customer to communicate. Unfortunately, we can’t assume that we will get this amount credited. We don’t want to set the expectation that regardless they don’t owe the charges. We want to educate the customer that if they would have notified us prior to the amount falling past due, they wouldn’t have to pay for the charges. Lastly, we are now setting proper expectations for if they have something come up in the future.

Alternative Options. I’m sure you are thinking, that’s great Katie but the customers don’t care. Or regardless, the customer is going to refuse to pay the charges. If this is a good customer, one that generally isn’t late, and doesn’t typically dispute the charges than I get it. Also, the customer should be current outside of this dispute. However, maybe to you it makes sense to let the customer short pay the disputed amount.

Conditions for this option:

• The customer should be paying all the other charges on the invoice and account in full.
• They must have provided all the paperwork and filed their dispute.
• They must understand that if the dispute is denied, they are responsible for payment in full.
• Set proper expectations for how long until they hear back on if the dispute is approved or denied.

Maybe there is a scenario or customer that it’s worth letting them hold payment on the entire invoice. It could be because their process doesn’t allow them to short pay an invoice. Maybe it’s because this was a large incorrect billing. The charges are really other customers and someone incorrectly entered an account number, etc. Let’s use this opportunity to educate the customer on the process regardless if we are going to give them a pass. This is an excellent time for the collector to build additional loyalty and rapport with the customer. However, if this happens again that our expectation is that they will notify us proactively.

Helpful Tip: Depending on the size of the amount they are disputing, I would run a credit check. Make sure that something bigger isn’t going on behind the scenes and the chances that they using this as a stall tactic. Also, is this something they can get a credit on? In other words, if you know it’s going to be denied and it’s a large dispute, I wouldn’t let the customer keep invoicing. Let’s have the direct conversations and rip the bandaid now versus later.

Recommended exercise, look at your customers that haven’t paid their invoices in full. How many of them have notified you of a problem with the charges? How many of them have filed their disputes properly? Make it a top priority that the customer must file the dispute at minimum or the collector should be collecting all monies owed in full. I would do this exercise a minimum of twice a year.

Don’t be afraid to teach the customer isn’t always right. You want to teach your customers that you have expectations. You expect them to proactively communicate if something was incorrectly charged or partially charged to them. They can’t short pay the invoice without filing their dispute and supplying any/all required documentation. If we set these clear guidelines and expectations, the customer won’t react poorly when they are enforced. Yes, we can give a customer a pass but that shouldn’t be what happens every time.

How often are you reviewing your short paid invoices/accounts today? Does your collector know how a call of a customer with a short paid invoice should sound? Are the collectors proactively communicating the process to the customer and requiring them to file the disputes? Are you inspecting what you expect from your customers?

I hope you see purposeful decision-making throughout the steps mentioned above. If not, feel free to reach out to me via email at keich@theiainstitute.com. I would love to hear your thoughts. Even better, #ChimeIn on my personal LinkedIn page where this article will be shared and published for open comments.