Private Actions & The Telemarketing Sales Rule

July 13, 2022
Andrew Cove

The Telemarketing Sales Rule went into effect on December 31, 1995, but was revised in 2003. It was created to protect consumers from receiving unwanted calls, but it also protects them against fraud, theft, and deception. It outlines how telemarketers can conduct their business and gives the FCC (which oversees the exchange of information) and the FTC (which deals with financial and economic actions) the ability to take action. Key provisions include:

  • Specific disclosure requirements
  • Restrictions for calling (e.g., when a telemarketing company can or cannot call people)
  • Record-keeping requirements
  • The establishment of the Do Not Call Registry

Telemarketing companies who don’t adhere to the TSR can be fined up to $11,000 for each violation. Due to the volume of calls these companies make, these fines can threaten the business’s existence. That is one reason why telemarketers must fully comprehend and comply with it. 

Today however, we are shifting our focus from actions by a government agency such as the FCC or FTC to actions by private citizens. 

Are Private Actions Permitted?

Although government authorities may enforce the Telemarketing Sales Rule, is it also possible for individuals to take legal action against marketers? Yes. Private actions are permitted for violations of the Telemarketing Sales Rule. However, there are prerequisites. They are allowed only if one can show $50,000 or more in actual damages. 

For instance, telemarketing companies cannot:

  • Contact people on the National Do Not Call Registry
  • Make calls before 8:00 am and after 9:00 pm

The TSR also prevents them from misrepresenting what they are selling and outlines how the transaction may or may not occur. (E.g., They cannot take money from you without having your permission to do so.) 

As a private citizen, you are entitled to take legal action against these violations – but you have to meet the $50,000 threshold. 

Individuals are also allowed to sue a telemarketing company for injunctive relief. Injunctive relief refers to a court order that stops the actions being taken by the telemarketers that led you to file a lawsuit against them. 

Cove Law

Cove Law has served clients within the telemarketing industry for more than 25 years. We understand the challenges that telemarketing companies face and assist them with compliance and regulatory defense. For more information about how Cove Law can help you, contact us to schedule your complimentary consultation.

Andrew Cove
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