Legal insights on the impending risks of the TCPA updates

[Matthew Marx]
Thanks, Justin. Hey y’all, I’m Matthew Marx. I’m the founder and CEO of Evocalize. I’ve done a number of these webinars now just trying to educate people around the coming changes in some of these key laws for those of us in the lead generation space. Just briefly about me, I’m an engineer, product person, and strategy consultant. We’ve been operating Evocalize, which is a venture-funded marketing automation platform in the lead generation space for almost 10 years now. 

Lots of big partners across many industries that intersect in this particular new lead generation use case as well as other objectives from a marketing perspective. One of the things that’s unique about what we do is legal can lock down and pre-approve the entire marketing pipeline from the context of the advertising all the way down through compliance forms, consent, and for an entire multi-location brand, franchise system, marketplace, or technology platform. I think it’s really important for you to think about that.

This is a topic that not enough people in the lead generation space know about, y’all. Thank you for joining. I’m glad you’re here.

I’m proud to introduce, I have a special guest today, the TCPA czar himself, Eric Troutman. Eric, thanks for joining. Can you give a quick intro before we dive in?

[Eric Troutman]
Look, everybody knows the czar, right? Hi, everybody. No, I’m Eric Troutman. I am known as the czar of the TCPA. I run tcpaworld.com. Also, I’m a partner at Troutman Amin.

That’s that little lion that you see everywhere. Also, the president of REACH. That’s the big trade organization for the lead generation industry.

In my role, obviously, I’ve been advocating on behalf of the industry, both to the Congress, to the FTC, and to the FCC to try to get maybe some modifications to this one-to-one rule that’s being rolled out. We’re going to talk about all of this here in a few minutes, but of course, this is all I’ve done for 12 years now is TCPA, TCPA-related issues. My law firm just does litigation and compliance and advocacy work around TCPA and the lead gen space.

Happy to help. Happy to be a resource. Let’s get some questions answered. We’ll have some fun.

[Matthew Marx]
Let’s do it. This is going to be fun, y’all. Just so you know, we’re going to have some fun in this webinar as well.

This is not going to be, hopefully, super stodgy, but to start us out, I’m a business guy on the call. As Justin pointed out, we do have a legal scholar on the call, and Eric. I’m going to do my best.

For those of you, I know we have a lot of internal company counsel, a lot of attorneys that are registered and dialing in today. I’m going to try not to bore you, but I want to give a 101 very quickly to catch people up on the basics of what the heck we’re talking about before we dive in to the specifics. If you’ll bear with me just for a couple of minutes, I’m going to start us off starting with what the heck are we talking about here?

What is the TCPA

What is the TCPA? The TCPA is the Telephone Consumer Protection Act passed way back in 1991, originally, based on a series of laws that had been on the books for a long time. The TCPA has been amended over the years, but as we’ll talk about, there’s some pretty big changes coming out of the results of a working group that had been working for a few years to try and reduce the text and phone call spam that was perceived in the US.

If you rewind time back to the end of last year in December, a working group passed some changes. These changes have a lot of aspects to them. What I think we’re going to try and focus on here is what we call the closing of the lead generator loophole.

What is the lead generator loophole?

What do they mean? What is a working group? What does the FCC mean when they talk about the lead generator loophole?

Well, if you look at what lead generator, lead aggregators are, many of the people on this call are what the FCC would call lead generators and lead aggregators. It’s the ability to collect a person’s consumer’s information on a particular subject and then sell that intent signal regarding that lead that’s been collected to parties that are related to the topic that the lead was captured on, and sometimes not as directly related to the topic. And then the buyers of those leads typically use manual methods of calling and texting, more frequently lately use technology to assist in the calling and texting of consumers in order to try and win their business.

So basics there of kind of what a lead generator, lead aggregator is, and Eric, keep me honest. As we look forward, what are we trying to do in closing the lead aggregator, lead generator loophole? The FCC is trying to narrow the scope and consent related to who can collect a lead, what that lead can be collected on, and then who can call the consumer based on the collection of that lead.

And so kind of in a nutshell, maybe that’s a super 101, maybe not even college level, we’re like high school sophomore at that level, but that’s what we’re talking about today. Eric, anything I missed that you think is super critical on the base case of what the TCPA is, what the changes are at a very high level you’d like to add in?

[Eric Troutman]
Well, it’s all super critical. And Matt, thanks for putting this together, by the way, you, Evocalize, this fantastic, you’re fantastic. No, look, you nailed it, right?

Why Pay Attention

The TCPA, we all know this, this is the federal crown jewel response to the robocall epidemic. It is the statute that governs your outreach via phone to consumers across the country. If you don’t know the TCPA and you’re doing outreach, you are in harm’s way because at $500 per violation, the statute is one of the heaviest hands when it comes to remedies that are afforded to private rights of action.

So your risk under the TCPA, which we’ve been talking about, is massive. Collective actions, class actions are enabled for your statutory period. So if you’re not complying with the statute and you’re doing outreach, $500 per call, however many calls you make times 500 for four years, that’s what you’re looking at for liability.

And as Matt just laid out, what the FCC has just done is taken the defense of express consent. That is the defense that you need to use regulated technology, to reach out to consumers for marketing purposes. And the commission has taken express consent.

And with its new one-to-one ruling, the commission is all-powerful. It has the power to decide what express consent is, and it has narrowed massively the extent of consent. And that’s what we’re going to talk about.

And if you’re not listening, if you’re not complying, if you’re buying leads, you’re making calls, you’re not listening and heeding the FCC, then those massive penalties we just talked about could be landing at your doorstep and there’s personal liability, not just for your employer, for you. So you really want to pay attention.

[Matthew Marx]
Who, Eric, to double down on that, I think some people have a, and we’ll get into what the changes to the law are here in a minute, but I think it’s really important to double click on what you’re talking about and where liability exists in potential liability and exposure exists in the chain here, right? So are we talking about Eric, exposure for a franchisor or a parent group that’s doing marketing or a marketplace? Are we talking about exposure for marketing companies that generate leads on behalf of companies or franchisors?

Are we talking about all the way down to loan officers, real estate agents, and franchisees? Like what group is impacted here?

Who is affected?

[Eric Troutman]
This is a great bump. And here comes the czar for the spike. All of them, everybody, everybody is at risk.

And I say this with love. So you have to think about the ecosystem here, right? And you have to think about who is first in line to be attacked. And really should think about this as an attack, right? By the plaintiff’s lawyers who are representing consumers. Many of them are litigators.

Many of them are setting up these lawsuits, not all, but many. Okay. So there’s a bunch of these sharks that are around swimming, right? So who’s the front line? Who are they going to see first? Well, whoever’s calling and whoever’s name is being dropped on the call, right?

And if you’re in a transfer situation, you have to understand that the original caller, right, might not be identifying themselves and they should be, might not be identifying themselves. It has to get transferred and transferred to you as the lead buyer, as the brand, right? As the seller, as it’s defined under the CFR, which we’re going to talk about here in a second.

Your name, right? Whether you’re Loan Depot, Mutual of Omaha, Wells Fargo, to pick on the mortgage vertical, is going to be who the consumer hears, right? And so you are an easy target to get sued, even if you didn’t make the call.

Of course, the person that did make the call is going to be revealed in the lawsuit because these brands are going to say, wait a second, I didn’t even call you, dude. It was so-and-so up the chain, right? They’re going to get named.

But guess what? Probably there’s a middleman, a broker somewhere that’s doing some kind of call purchase and resale. They’re going to get named.

And then all the way down from where the caller emanated from, of course, they probably bought that data lead from someplace. They’re going to get named, if not directly in the lawsuit, then through indemnity, right? So it’s this cascade.

Everybody from start to finish is going to face potential liability. The brand is facing probably the most liability. The entity that made the call is probably facing the second most liability.

But everybody in between, we just asked AccuQuilt, right? They’re stuck in a case where they bought a lead from DMS, they sold it to Mutual, and somehow they’re stuck in a case in a TCPA class action because they bought the lead and sold the lead, and somehow they’re stuck in the case. That’s how this goes.

And even the lead, again, the lead, the publisher, right? The folks that are generating that lead on a website, even though they didn’t even make the phone call, many times it depends on how the contracts are written, but these folks can be directly liable as well. So everybody in the ecosystem, even perhaps the platforms that are making the calls, even perhaps the data management software, right?

The middleware platforms where the auctions are taking place or where the leads are being stored. Anybody touching the lead generation industry, anything touching outbound calling are potentially at issue here, potentially going to be facing these lawsuits and even regulator fines, which are even higher. So everyone’s got to be paying attention.

[Matthew Marx]
It’s an all-in. So if you’re on the call, you’re probably impacted by this in a pretty big way. Let’s get into, Eric, if you’re ready to go there, let’s get into what the main changes are that are coming and when they’re coming.

So I talked about December and the rules being passed, there was a delayed enforcement. Maybe you can talk about the consent rules, one-to-one consent, and the logically and topically related rules and others related to what’s now changing.

[Eric Troutman]
Yeah, sure. So today, as we all know, right, you’ve got the ability to capture a conspicuous written disclosure. It’s got to have nine components that I call the Troutman nine, it’s got to be on the form.

But importantly, you can have any number of marketing partners that maybe are in a hyperlink. It could be literally thousands of these people. And as long as it’s clear to the consumer, you’re not tricking the consumer, there’s no dark pattern, you’re not a click farm or consent farm, that is by and large going to be an enforceable consent today.

And you can sell it to a network and the network can resell it and resell it and eventually ends up in the name or being purchased by a buyer, who hopefully whose name is on that original marketing partners list, right? Like this is very common. We know how this works.

This has been, you know, since the dawn of the lead generation world. All right. All of that is about to change.

All right. And so please understand, like there are some people out there that are like, oh, nothing’s gonna change. My God, get your head out of the sand.

What are the changes?

It is changing, totally different. This is the biggest change in the history of the lead generation world. It is happening, it is real, and you’re going to either get on board, or you’re going to be out of business.

It is as simple as that. Let me just make it stark. The change is this.

No longer can you have that marketing partners list. No longer can you just present, even in an isolated or even in a transparent way to the consumer, the 4,000, 5,000, 200, 10, 15 partners that you’re going to potentially sell that lead to. Those days are gone.

Now the consumer has to choose one at a time, one at a time. Individually, the seller, stay with me on that definition here. The seller that may eventually buy the lead.

Now that makes no sense, because you just said the seller. Wait a second, are you talking about the lead seller? No.

Are you talking about the product seller? Not necessarily. What I’m talking about is the ultimate good or service provider.

In the lending vertical we just talked about, it would be Loan Depot’s name has to be on the form. Mutual Omaha’s name has to be on the form. Wells Fargo’s name has to be on the form.

In the insurance vertical has to be Allstate, has to be Progressive. In the Medicare vertical has to be the carrier’s name, the ultimate carrier that’s going to be offering the Medicare benefits. These are the names that need to appear on the form.

The brand has to appear on the form. The consumer has to give consent specifically to each one of the brands that they want to hear from, period. That’s the change.

I know it doesn’t make sense, because I know the consumer comes onto the website the comparison shopping website to learn about options and to be informed and to be educated, and it makes no sense. At the beginning of the consumer’s journey, the consumer would have to pick the brand that they have to hear from. I get it.

That makes no sense, but that is what the FCC has ordered. Every single one of you out there that currently has a form that has a name other than the ultimate good or service provider, is going to have to modify that form, going to have to give the consumer those options, and going to have to be able to operationalize throughout the networks, only selling to ultimately that brand or to somebody that is permitted to call on behalf of that brand. We can unpackage and play with this, but those are the new rules.

Now, that’s step one. That’s level one to this new ruling. We’ve got some help on TCPA World. We’ve got the Troutman Amin 15 is a free template consent form that we put together, put out there in the public domain, take it, use it, help yourself, Troutman Amin 15. That’s step one. 

Step two is that there also has to be a logical and topical relationship between the transaction that led to the consent and the phone calls that are actually being made. We can unpackage that as well. That’s the rule, logical and topical relationship. 

The last piece of three big pieces here, last piece is a record keeping requirement that does not exist today, but will exist when this rule becomes effective, that requires the callers to actually take physical possession of the consent record before making the outbound call.

Today, of course, as we know, we’re just going to take a warm transfer. We’re probably not going to take a record of consent if we’re buying a lead. That’s a transfer lead.

Even if we’re buying a data lead, in most instances, what are we getting? An API put with one line of text, a little Excel row. That’s not going to be enough.

In the new world, you’re going to actually have to take not just a token, you’re probably going to have to pull down that drania, pull down that active prospect, have it in your possession before you make the call. Those are your three big changes. They’re very large.

They’re, again, transformative for the industry. This is a whole new world after the new rule becomes effective, January 27th, 2025. But as we’re going to talk about, it actually is going to become effective from a practical standpoint quite a few months before that day.

What if you generate your own leads?

[Matthew Marx]
That’s a great overview, Eric. Thanks for that background. How does this impact me, then, Eric, if I’m not buying leads from a centralized provider, but I’m going out and generating my own leads as a, say, contractor associated with a major real estate brokerage, just to not pick on mortgage credit as much.

We’ll shift industries just for fairness here. Poor real estate. Real estate’s been picked on a lot.

How does it impact me as an individual real estate agent if I’m going and doing my own advertising? Am I still required to comply with logically and topically related from the advertising I run all the way down? Am I still required to name the provider or the service as my real estate broker of record? How does that work?

[Eric Troutman]
Love it. Great question. Most of us are absorbing the new rules in the context of third-party lead generation.

It matters. Obviously, as we just talked about, it’s going to turn the whole third-party lead generation process on its head. But it also has massive impact in the first-party context across all verticals and for big companies and small companies.

We’ll start with the small company example. I’m Bob, real estate broker. I’m an franchisee for a big global or national real estate company.

The question is, who is providing the good or service to the customer? If you are an independent contractor, your broker of license is probably going to be the person that needs to be on there. What’s funny is if you’re a franchise, you might be the broker of record.

You might be the franchise owner who actually is providing the good or service. Depending on how your business is structured, it’s the ultimate entity. We all get to put our legal hats on and be lawyers.

Who is the entity that is providing the good or service to the consumer? That entity needs to be on the form. It matters not if it’s first-party or third-party.

I like to think of it, we just talked about in the small business, I like to think about in the big business context. I’m going to keep picking on Wells Fargo because they’re one of my favorite people. If you go to Wells Fargo right now, you go to any one of their websites for any one of their products, you fill out the form, they’re going to have this nice little disclosure.

It’s going to say, by filling out the form, you agree to hear from Wells Fargo Bank NA and all of its subsidiaries and affiliates. Depending on what loan product you are looking for, it might be provided by Wells Fargo Home Mortgage LLC or Wells Fargo Bank NA or Wells Fargo Financial LLC or whatever it is. Whatever one of the slew of LLCs and sub-entities that fall under the Wells Fargo umbrella, and they want to get consent for all of those entities to contact you depending on what financial product you actually deserve and want.

But in the new world, you can’t do that anymore. Not even Wells Fargo can just go out there and get blanket consent for all Wells Fargo entities to contact you. Even they will have to now identify on the form the specific entity that’s going to give you the specific financial product that you’re looking for.

This rule changes and upends everything we know about how to capture consumer engagement consent and consumer contact preferences, both in the first party and the third party context. It’s huge.

[Matthew Marx]
That’s an incredible context. I think one of the key things that you said that we’re trying to plan a little bit, people often sometimes think about the third party lead providers. You mentioned it, right?

That’s where your mind goes first. It’s where my mind goes first. We represent a lot of them from a lead generation perspective.

Who is responsible?

But this applies to distributed use cases too, like a business, a large franchise system. You can think about in every industry, we have large franchise systems. This has already happened, unfortunately.

You can maybe get into a few of the details, but the class action attorneys have already come in and already filed some pretty large cases related to individual lead purchase that has rippled. Not only have they had liability or presumed liability, but there’s been exposure up the chain all the way up to the parent company for the actions of the individual participant downstream who made the call. I just want to double click on that, y’all, because that’s a big, big, big deal here.

It’s not just the parent company that’s responsible here. Everyone has exposure up and down the chain. I want to just double click on that from Eric, because that’s something I think not everyone thinks about.

How is the use of technology defined?

Eric, if I pick up the phone, if I get a lead from any mechanism and I pick up the phone and I call, I’m a human and I call the lead myself from a human perspective, does that mean I didn’t use technology and I’m okay and I’m covered from this particular consent? How is the law shaking out around the use of technology and the definition of technology and the use case here that we’re talking about?

[Eric Troutman]
Let’s talk about the scope of the rule. I think this is valuable because there’s really two ways to comply with this new rule, and both have problems, to be perfectly frank with you. 

One way, as we’ve just been talking about, is to capture the right level of consent, make sure that you comply with the Troutman Amin 15, you have the one-to-one rule click, you’ve got the topically and logically related rule, and you’ve got the record-keeping rule.

You followed all three of the things I gave you earlier. Great, now you’ve got the right level of consent and you can utilize that regulated technology. 

But there’s another way to comply, and that’s what you’re driving at here, which is the new rule doesn’t actually apply to every call.

It only applies to calls made using regulated technology. If you are very, very confident that you are not using pre-recorded calls, artificial voice, AI, outbound IVR, pre-recorded voicemails, RVM, or let’s say an auto dialer, that’s the big one you’ve got to watch out for, then you are actually free to ingest even the existing kind of lead, right, not change anything, and make these outbounds manually without using regulated technology. Now there’s a little bit of an asterisk there because there’s some confusion in terms of what the level of consent is.

If the I think in my opinion very bad arguments being advanced by the AGs and some plaintiff’s lawyers that you have to still comply with the one-to-one rules even in that context. I’m going to leave that aside for now. You can, in my view, in my reading of the statute and new rules, utilize manual or like a human selection, like a true human selection, like a safe select or something, a true human selection tool to make outreach without otherwise complying with the one-to-one rules.

So there is still going to be the availability for, for instance, like your independent broker to pick up their cell phone, right, buy a lead online just like they’re doing now, and just pick up the phone and make a little call and say, hey, this is so-and-so local broker, so-and-so local agent, so-and-so, you know, local guy. 

That is still going to be allowed even under the new rule. But anytime you’re trying to call it scale, right, you’re really going to have to kind of find one of these tailor-made solutions to get around the potential that you’re going to be using an auto dialer because it will be death following the new rules here.

Text, call, and email

[Matthew Marx]
Yeah, text too. I’ll just add to, we talk a lot about calls, but it applies to texts. And Eric, correct me if I’m wrong, it does not apply to emails, right?

So we’re not talking about emails, we’re talking about phone numbers for texting and calls using technology and auto dialers and other types of technology similar to auto dialers.

[Eric Troutman]
You are right. And it does not apply to emails. And for those who are interested, right, that the law around what is an auto dialer and isn’t an auto dialer continues to evolve.

You’ve got state concerns as well because different states have different definitions. And of course, the district courts all across the country have come up with different formulations. 

Be conservative

So again, I urge caution because understand, I mean, the right now, today, today, TCPA class actions are up 40% from last year already. 40%, guys. When this rule takes effect next January, it is going to be a feeding frenzy on a level that we have never seen before. You do not want to be low hanging fruit.

You do not want to be the guys that are out there taking chances. You want to be as conservative as you can in the beginning. Now, over time, opportunities might arise, right?

We’re going to be quick. We’re going to be nimble. Like this industry is very quick, very nimble.

And there’s going to be opportunities you’re going to take. But in the beginning, you should not be thinking, how can I be sneaky? Okay. It is the wrong time, man. Just a feeding frenzy. Be smart. Be conservative. Then look for opportunities, right? That’s how the smart guys are going to make their money.

[Matthew Marx]
We’re probably talking billions here, aren’t we, in fact, Eric?

[Eric Troutman]
Trillions. Trillions. And I say that without hesitance.

[Matthew Marx]
Scary.

[Eric Troutman]
The truth. Yeah.

[Matthew Marx]
Scary. Awesome. Where should we go next, Eric? What have we missed? What have we not covered that we should? Whenever we’re ready to get into questions and start riffing on those, we can do that too.

Timing of the new rules

[Eric Troutman]
Let’s just talk timing real quick. This is going to be important. The rule becomes effective January 27th, 2025.

But it’s important for everyone has to understand what that means. That means as of January 27th, 2025, every phone call that you make has to have a consent that complies with the rule. So that means if you are going to wait until January 27th, 2025 to start generating leads properly, every call you make has to be from leads that you generated that day.

And maybe in some verticals, that’s okay. Maybe some lead buyers are like, that’s fine. I only want leads from today anyway.

Cool. Good for you. Most people want a pipeline. Most folks want leads that they can call more than today. Now it’s all done. I can’t call them tomorrow.

And that’s increasingly the situation you find yourself in. If you are still abiding the old rules, understand every day that goes by brings you closer to the end of the value of that lead. So today your lead is only going to be valuable for the next six months.

Next month, your lead is only valuable for five months. Next month, you’re only valuable for three months. And so it goes until the day that that rule becomes effective.

Every lead buyer I’m talking to today is telling me the same thing, which is I want leads I can keep calling in January. Well, that means that those lead buyers are looking today, right now they’re hungry for leads that are complying with the one-to-one rule today. And that hunger, that appetite is going to get to a place where they’re not even going to be willing to buy leads.

My clients, major lead buyers, I’m telling them it gets to be September, October, November, you’re not buying leads anymore unless they comply with the one-to-one rule. You heard what I just said. My lead buyer clients are not buying leads come November at the latest, unless they comply with the new rule.

So if you’re a lead seller, if you’re a publisher, if you’re a network, and you’re thinking, yeah, we got till January, you don’t. You’ve got until September, for sure. October-ish, November, maybe.

All right. And then it’s lights out. And of course, the REACH guidelines, again, REACH is a big trade organization for the lead buyers in the space.

We’re coming out with standards 2.0. That’s going to be out August 5th. And those standards are going to set now the new standards for the entire industry. And I’m telling you right now, every lead buyer in the country is going to look at the standards and say, we expect them to be met. And we expect them to be met by October, by November. Right. 

So folks have got to be innovating. You’ve got to be thinking about this. You’ve got to be coming up with your go-to-market strategies right now, because this is not happening in January, folks. This is happening in the third quarter.

[Matthew Marx]
That’s a great point, Eric. And these leads don’t all matriculate on day one, either, to your point. We want to populate and nurture a lead pipeline over three, six months, sometimes longer. And so we really need to be thinking about this now. 

What happens to your existing lead database?

That begs the question, before we get to Q&A, a big question that I get asked a lot on this particular topic, maybe you can shed some light on, what happens to my existing contact database? My existing CRM database that I’ve honed over the years, no matter where I am in this, this stack of folks who have exposure to this problem. 

What do I do with that? Can I still automate a text and auto-call those folks or like, do I need to regain consent? And if I do, I’m just going to tee one more up for you. If I do, can I send them an automated text in order to get their consent?

[Eric Troutman]
No, let’s start with the last one. No, don’t ever do that. But once a year, I’ll get a client asking me that.

Can I send out some regulated technology messages to get the consent, to send out the regulated technology? No, but what if they say yes? No, it’s just not allowed, you can’t do that.

So the question, the lingering question of, well, wait a second, what about all the contacts in my CRM? Are those now gone? 

They’re not gone, right? Those are still valid contacts. And if you have an ongoing business relationship with them, those are still valid, you know, essentially EBRs over the “Do Not Call” (DNC), but they are not consent for regulated technology anymore. 

So any, again, it’s the same rule as your leads, right? Your same rule as any ingested contacts that you had before, you can no longer call them come January 27th. It’s the same rule for your contacts in your CRM. You can no longer contact them using regulated technology.

So again, you know, if I could buy stock in SafeSelect or in Drips Initiate right now, I would probably do that because like these guys have cornered the market in human selection, which is exactly the sort of framework that I counsel my clients to be looking for when they’re thinking about a manual solution. 

Again, unless you wanna pick up your phone, like that is still allowed, right? If you’re a small guy, you just wanna pick up your phone, call your contacts in a CRM, you can do that, right?

That has not, those rules have not changed. Same DNC rules, right? If they’re an inquiry, you’ve got 90 days. If they’re a business transaction, you’ve got 18 months, you can pick up your phone and call. That is still allowed, that did not change. 

But if you’re, again, you’re calling at scale, everybody in your contact list, right? If you’re a major enterprise, every one of your customer contacts that you wanna remarket to, you cannot use automated technology, you cannot use regulated technology, you cannot use AI, you cannot use RBM, you cannot use voicemails. Those are all toast, you gotta call manually now.

[Matthew Marx]
That’s crazy, so my own contact database that I’ve worked so hard to build, I have to go through another mechanism than automated technology, get consent to be able to even put them in a normal drip campaign. I mean, that’s something it feels like, Eric, people are gonna miss in large, large, large quantities across the industry.

[Eric Troutman]
So this will be another wave of class action settlements. There’s no question about it. How exactly it’s gonna materialize remains to be seen because there’s so many low hanging fruit attack points now for the sharks, and make no mistake, guys, this was brought to you, brought and paid for by the plaintiff’s bar, right?

The entity that brought this proposal forward to the commission was the NCLC, the National Consumer Law Center, who receives millions of dollars a year from the plaintiff’s bars. They siphon money from TCPA settlements into the NCLC who go to the FCC and make proposals to expand the statute, and when the industry doesn’t come forward and oppose it, which frankly just didn’t happen this time, not sufficiently, these rules come out, which are not consumer friendly, they’re not helping anybody except for the plaintiff’s bar. So there are many, many little latch holds here for the plaintiff’s bar to come and attack, right?

Exactly which theory they’re gonna latch onto first and cash in on, I don’t know, because they’ve got four or five really good ones that just got handed out to them. So again, as I told you earlier, the folks that come out in the beginning and are just not paying attention, they’re gonna get slaughtered. I mean, there’s like an army of these sharks out there just waiting to go, right?

Wanna be conservative at first, don’t give them any latch holds for you, see how the courts develop, see how the rulings develop, give it a little time, be nimble, be ready to go, and then you’ll be a lot safer than the other guys.

[Matthew Marx]
Good, good background, good debrief. Should we get to questions? We’re, I don’t know, we have 10, 15 minutes left.

Feels like we probably have some good stuff. Justin, can you help us pick the low-hanging fruit or maybe the hard one since we got Eric on the line?

[Justin Ulrich]
That’s right, that’s right. We’ll save the low-hanging fruit for future webinars without Eric. 

For existing contacts, do you need documentation?

So one question is if I’m reaching out to existing contacts to get consent and they give it, but I don’t have context around where I got the lead originally, will I be okay?

[Eric Troutman]
Depends how you’re making the outreach, right? So if you’ve got a contact in your CRM, you’re like, man, I don’t know where this came from. Okay, if they’re on the DNC (do not call list), you can’t call them for marketing purposes, period, full stop. You can’t call, okay?

If they’re not on the DNC, you can call them, pick up your phone, non-regulated technology, give them a call, chat with them. And if you can ingest and bring them into your ecosystem, get them to go to a form, give you that prior express written consent, then you can now convert that into a lead that you can call using automated technology. 

If they won’t give you any form of consent, that’s fine. You can still contact them until they tell you not to call you anymore. But so that is still available to you. Again, if you’re using SafeSelect or a cell phone or Dripps Initiate, something that’s very safe.

Could you get consent from leads today?

[Matthew Marx]
Eric, doubling on that, could I run, in order to get consent, this doesn’t apply to any kind of advertising channel. So I could potentially run like a remarketing re-engagement program against my current contacts in order to get them to fill out a form and give me consent, right? And then log the context of that consent. Theoretically, I could do things like that. I could email, since email is not covered by this.

[Eric Troutman]
You mean today? Yeah, so today, that’s smart, right? Man, I don’t know.

Why didn’t I think of that, Matt? That’s smart, right? So before the new rule becomes effective, you wanna go out there and capture the level of consent that you need, because today you’re relying on consents that are valid today, but they’re not gonna be valid January 27th, 2025.

Now would be the time, right? Let’s get out there. Let’s roll out a text campaign.

And you can use regulated technology today, right? You don’t have to use any form of manual technology, assuming that your consents are valid. Let’s just assume for this purpose that they’re valid today, not valid January 27th, 2025.

Yeah, man, get out there. Get a campaign going. Get the consumers into your ecosystem, have them re-accept either in an app environment or in a web flow environment, a proper consent that you can document.

Remember, you’ve gotta be able to trace this. You gotta be able to document this. But it is definitely worth doing that.

It’s a really good thought. I see, I’ll just take a second to shamelessly plug. I see in the context or in the comments, everyone’s talking about Law Conference of Champions.

Yes, that’s coming up. We’re gonna be breaking down the one-to-one ruling and all the other rules around the FCC and the TCPA and all the little mini TCPAs and data privacy stuff that everyone wants. Law Conference of Champions, look it up, July 15th, really excited.

I’ll be on stage for like an hour and a half talking about this stuff. All right, that was my plug. I told you I was gonna get one in there. I got one in there.

[Matthew Marx]
It was a good one. It was a good one.

[Eric Troutman]
Because I had to mention it 12 times. I’m not mentioning it 12 times, I mentioned it once. All right, what else do we got? 

What about leads you have right now?

[Justin Ulrich]
So how does this affect me if I have a franchisee, agent, broker, etc., who has purchased a lead from a lead source and then calls, emails, SMS, texts the prospect?

[Eric Troutman]
It just depends, right? If they’re buying a valid one-to-one consented lead from a lead source, then you got nothing to worry about, right? So this is the challenge.

If you’re a large enterprise, and a lot of our companies are large enterprises that got distributed, you know, flashes or business lines or franchises or independent agents, some are captive, some aren’t, right? It can be really hard to kind of have visibility in terms of what your LOs are doing. Like what are people doing on the retail side? What are they doing out there? 

And I hate to tell you, but you’re gonna have to take more control than you have historically, because you can’t just trust that these guys who are great sellers, right? And they’re good at what they do, which is closing loans or closing sales, whatever it is they’re doing, but they’re not good at vetting the law and making sure that they’re buying leads that are valid.

And these lead rules are nuanced and they’ve changed. I just told you, right? If you’re in an agency model versus a franchise model versus an independent versus a captive, right?

There’s different rules that apply to all of you. So you can’t just trust that these folks are gonna go on a YouTube video and get the right answer because they probably aren’t. So where does that leave you, right?

You’re thinking, oh, but you know, I’ve got my ICA, I don’t wanna have too much control. I’m sorry, right? As Allstate found out recently, as some other big brokers who I won’t name found out recently, the courts don’t care about these independent contractor, franchise, franchisee relationships in the TCPA context.

They don’t care about this fiction. They will pierce through that like it’s butter. So you’re kidding yourself if you think that’s gonna provide you TCPA protection.

You are much better off in one lawyer’s opinion, going out there and actually getting these folks in line so they’re not violating the statute to begin with. And I know that’s gonna create tension with other kinds of business strategies and other kinds of issues around employee, agent. I get it, I’m not blind to this, but I’m telling you in the TCPA context, none of that matters, right?

These things are like, you know, bunker busting torpedoes that come in and just, I don’t care what you got in your contracts, I don’t care what it says from a franchise perspective, man, they’ll hold people individually liable who are corporate, you know, officers. Like nobody cares about your corporate fiction in TCPA world. The judges just blow this stuff out of the water all the time.

So from my perspective, when you’re talking about, you know, billions of dollars in liability, you gotta be active, right? Not reactive, you gotta be proactive with your disparate agents, with your franchisees, with all the folks that are flying your flag, bearing your brand, bearing your label, right? You have to understand that courts are gonna hold you responsible for what they’re doing.

And so you ought to be putting out enterprise licenses for safe select, right? Enterprise licenses with reach, let’s say lead suppliers who are complying with the highest potential standards that are gonna be complying with one-to-one. You can’t just let your guys be out there and just trusting them to do the right thing and assuming that, hey, if they screw it up, it’s their liability, not ours. Folks, those days are gone, they’re gone.

How is documentation being recorded?

[Matthew Marx]
I think that’s a great point. And shameless plug, you have to be able to prove logically on top of the contextuality in the process as well, right? And so you have to be able to prove the ad that you served related to the content of the lead form, related to the landing page, related to the entire flow all the way top to bottom.

And so whether you’re buying leads or generating themselves, you have to be able to prove that entire flow and that the service provider, to Eric’s point earlier, was named in the consent form in the lead flow process. So that’s all required. 

One of the things we’re seeing a lot, and again, this is a little bit of a shameless plug, folks are locking down marketing programs that their entire enterprise can run.

So no, they’re not letting individual agents or other folks go to a Facebook or go to a Google or go online and run their own marketing programs anymore because that’s easy to screw up. Any part of that flow when an individual loan officer, individual real estate agent, anyone that’s trying to generate their own leads can screw that up, right? And so we have folks that are handing them a self-service user interface that legal has locked down.

So the context of the ad matches to the context of the lead form, the consent, service provider, and then all of that is discoverable, trackable and logged into perpetuity, right? So we’re seeing that a lot happen in the space. I think that will, personally, I think that will continue where folks are just gonna lock down what their affiliated entities can do so that they’re not exposed.

And maybe they’ll pre-vet third-party lead sources that they buy from. To Eric’s point about the reach list and self-generation. I think self-generation personally is a big hole.

I mean, it’s easy today. You can go out to a Google and a Meta and a TikTok and try and generate your own leads. If you don’t gain consent, you’re at risk. You have exposure for this thing as the parent organization.

[Eric Troutman]
Well, it’s funny, because I mentioned SafeSelect and DRIPS earlier saying I could buy stock in them. Actually, Evocalize has a massive value prop here as well in the distributed situation where you’ve got all these agents and independent contractors.

[Matthew Marx]
Thank you for the plug, Eric.

[Eric Troutman]
I’ll get a little stock in you guys too, if you wouldn’t mind.

[Matthew Marx]
We’ll get you in on this thing.

[Justin Ulrich]
What else do we got?

[Eric Troutman]
No, this is good stuff, guys. This is real good.

What if you are a broker or an agency and have multiple carriers?

[Justin Ulrich]
Yeah, what does this mean for agencies/brokerages that sell multiple carriers? Does it mean that they can only present or discuss the specific carriers that are included in the lists and opted into by the customer?

[Eric Troutman]
So yes and no, all right? So as the rule is currently written, if you are buying leads from a third party, you really only have two choices. And the commission has not thought this through.

Okay, let me be very, very clear, right? The FCC has not thought about the impact of the one-to-one rule on brokers. Because as it is written, right, the intention of what the commission has done is that if there’s Allstate, Progressive, Geico on a form and they select only Allstate, it gets sold to a broker, guess what?

The broker can only sell Allstate. That’s crazy, right? If you’re the broker, you’re like, dude, Progressive’s got a better policy for less money.

How can I not talk about Progressive and I only have to talk about Allstate? That is what is written, right? That is something that I believe the commission missed, didn’t understand.

Reach has submitted comments to the commission asking the commission to think about that and say, hey, come on guys, you didn’t intend to do this. This is not good for the consumer. I am hopeful that the commission will change some of the rule to allow brokers to continue to operate in that setting.

But until they do as written, that is the rule. Now, now, if you can imagine a scenario where rather than going to a website to get insurance, what the consumer is doing is going to a website to get help with insurance, or that is to say to find an insurance brokerage, then yes, you can have the name of the brokerage on the form because all of a sudden the consumer is not there to get insurance, the consumer is there to get help getting insurance. And now the broker suddenly becomes the seller. They become the good or service provider, the service being assisting the consumer to get insurance assistance.

Then if it’s structured right, the call to action is right, then Bob’s Brokerage could be on the form and once the consumer consents to hear from Bob’s Brokerage, Bob’s Brokerage can make the outbound call and sell any of these insurance products because now the brokerage is providing the service that the consumer wanted. But there’s a nuance there, right? 

In the current environment, right, most of these lead gen forms, what are they selling? They’re promising quotes, right? They’re promising great coverage. They’re promising insurance. And so Bob’s Brokerage can’t have his name because Bob’s Brokerage is only selling insurance. They are not providing the actual insurance coverage.

These are the nuances folks that are out there and it’s really tricky. And again, you miss it, that’s class action central.

[Matthew Marx]
That’s Jedi level stuff, Eric. I mean, this is nuanced to the nth degree, right? Gosh, it’s scary for the industry.

Justin, do we have more questions?

[Justin Ulrich]
There are a bunch more. There’s like dozens, there’s dozens over here.

[Matthew Marx]
Are they? Awesome. I struggle with my comment section.

Can you pre-select a list of brands for the consumer?

[Justin Ulrich]
Oh yeah, can we pre-select a list of brands on the lead form and allow the customer to deselect or opt out of those before they submit?

[Eric Troutman]
So that’s a fantastic question. To me, like all the good companies, there’s kind of like three categories of companies out there right now. I think there’s the big boys who are coming to market right now, developing their strategies.

There’s kind of the folks that are waiting, I think, to see the reach standards, which I respect. And then there’s a bunch of companies that are like, oh, we’re not gonna change anything. All right, whatever, you guys are jokes.

But the guys who are really trying hard, I think there’s a good faith and reasonable minds could differ on this specific issue, right? Can you pre-select the boxes for the consumer? Now, you’ll notice on the Troutman Amin 15, if you take a look at that, we have taken the position, Troutman Amin has taken the rather bold position, I would say, that yes, we believe you can pre-select the brands for the consumer, as long as there’s a deselect button, and there’s language in the button that makes it very clear that the consumer is choosing to hear from the selected brands.

So that if there’s no question, no hiding, that the consumer can unselect using basic operations of a radio box, the brands they don’t wanna hear from. Now, I say this with caution, because there’s nuance there, right? And it’s gonna be a bit of a sliding scale.

And I tell people this all the time, right? If you want like a really slick form, you kinda wanna like bring people in and remove some of the friction in the funnel, you wanna be even like a little bit tricky with your form, okay, don’t pre-select, do not pre-select, right? You can get away with a lot more if the consumer is still selecting.

If you wanna pre-select, then you’ve gotta be super buttoned down everywhere else on the form, right? It has to be pristine. The point is, pre-selection alone in isolation is not going to be dispositive of whether or not the form is enforceable in my view.

It is a factor the courts will consider along with every other factor. But if you’re gonna take a shot on pre-selection, you’ve gotta walk the straight and narrow everywhere else on that form. You wanna be a little tricky?

Okay, look, people are gonna do it. I’m gonna tell you not to, but people are gonna do it. Don’t pre-select, because then you’re gonna be low-hanging fruit, you’re gonna get killed.

Will credit bureaus be allowed to sell trigger leads?

[Justin Ulrich]
Awesome. With these massive changes for the sake of the consumer, will credit bureaus still be allowed to sell trigger leads?

[Eric Troutman]
They never were. They never were. It’s illegal now. It always has been. You know, the CRAs are out there pitching these trigger leads. They’ll never give you an opinion letter that they’re legal under the FICRA, because they’re not.

You don’t have a permissible purpose, okay? That’s just, this is totally different than the one-to-one rules. The one-to-one rules don’t alter that, right?

The trigger was never consent. No one will tell you it’s consent. The trigger was never consent.

It was just a trigger to you to say, hey, if you have consent, you might wanna call them right now, right? So it’s the same rule. Either you’ve got the valid consent or you don’t.

In my opinion, though, you should not be using those things. They’re not legal, never were.

[Matthew Marx]
This might bring a little more focus onto that, though, Eric, I might imagine, right? Like, with all of the hubbub, everything going on, the frenzy, the shark-feeding frenzy, as we like to say, right? Like, I have to imagine that there maybe is gonna be even more attention put to that than there was before.

[Eric Troutman]
Yeah, I mean, so there’s a bunch of folks out there that are filing FICRA cases now. So FICRA, that’s the Fair Credit Reporting Act, right? That’s the federal response to the, call it an epidemic of errors in people’s credit reports.

There is a lot of litigation under the FICRA. FICRA is a consumer statute. It does live alongside the TCPA.

Of course, we do TCPA and telecom. We do less FICRA. These are two different areas of law.

They are both actually very sophisticated areas of law. And just like we, on the defense side, don’t generally handle both kinds of law, on the plaintiff’s side, they don’t handle both kinds of law.

So the sharks and the TCPA, they might look over at FICRA and they’re like, eh, kind of looks kind of funny. I’m not gonna play in that space. But there are FICRA sharks who are doing just FICRA.

Now, whether or not there’ll be some crossover sharks here in the next few years, I don’t know, maybe. Wouldn’t shock me. But today, they’re kind of different environments, saltwater and freshwater, if you will.

What if you’re texting or calling businesses? Does TCPA still apply?

[Justin Ulrich]
That’s amazing. All right, this is a good one. What if you’re texting or calling businesses? Does TCPA still apply?

[Eric Troutman]
Yes. Now, people get very confused about this because the DNC rules do not apply to business numbers, business landlines, right? So that one little exception, which is business landlines don’t trigger DNC calls, somehow get people to think that the TCPA doesn’t apply to business calls at all. It does.

If you are calling a cell phone, a business cell phone, the same exact rules apply, right? I know it’s the Telephone Consumer Protection Act, right? So you think, oh, it only applies to consumers.

A business is a consumer of telephone services and the courts have so held, okay? So a business still has rights under the TCPA. And if I’m the user, let’s say my firm pays for my phone, I use this phone for personal purposes.

I, Eric Troutman, have standing to sue for your violation of the TCPA. The only exception, again, is if you’re calling manually for a B2B purpose to a phone that you can prove is used only for business purposes, then the TCPA does not apply, okay? So you just heard three layers you have to get through in order to take advantage of that exception. So do not rely on it.

[Justin Ulrich]
I have a feeling you’re gonna get a ton of business after this webinar, Eric. 

[Eric Troutman]
I’ve got tons of business already. I love all of you all, thank you. I love all of you all. 

If you’re using a third party to make calls by humans, is there still a compliance risk to that?

[Justin Ulrich]
One more question and then we’ll wrap things up. If you’re using a third party to make calls by humans, is there still compliance risk to that?

[Eric Troutman]
So again, by humans is not the standard, okay? It has to comply with a very tricky thicket of rules. But if you’re asking me to assume that the third party that you’re utilizing complies with the rules and these are true manual calls, then, okay, you can continue to use the prior express written consent that is available today.

It’s not like you have to have no consent because you still have those DNC issues. Remember, the DNC is always out there. I guess just as a reminder to everybody, there’s two different provisions in the TCPA.

There’s regulated technology, right? Autodialers, pre-recorded, artificial voice, AI, RVM, IVR, right? 

And then there’s the DNC rules. The DNC rules say, thou shalt not call, period, unless you have an established business relationship, prior express consent, or a personal relationship of some kind. Otherwise, you cannot call those numbers for marketing purposes, period, all right? So if you’re handing off leads to a third party who’s calling true manual, you’ve gotten rid of one provision, good job.

Regulated technology has withered on the vine. You’ve defeated that. It’s dead, like a boss in a video game.

It died, ooh, dead, okay? But you still have to worry about the DNC provisions, right? And so you have to have one of the exceptions there.

Assuming that you have exceptions there, yeah, you defeated it, you still have state law issues that are out there. And again, this is another little plug. Law Conference of Champions, we’re gonna break down all the state law issues too, for you, okay?

Definitely something you should think about attending. But assuming that you’ve killed both arms of the hydra of the TCPA, and no state law applies to you, then yes, you can make these calls. 

I know I’m making it sound really complicated. I promise, this is navigable, guys. It is difficult, but you can processize. You can do it. It can be done at scale. I’ve got massive clients that are doing this at scale. It can be done.

You just have to understand that it’s not intuitive. The things that you want to do, you’re not gonna get to do. But you can, generally speaking, get where you wanna get from an objective standpoint, even if you can’t do it the way that you want to do it. So just have faith. It can be done.

[Justin Ulrich]
Yeah, it makes total sense. All right, so we’ll wrap things up right there. You know, if we have other questions we haven’t gotten to, we’ll go ahead and try to answer those in the comments.

For the listeners, we’ve also pulled together, like I mentioned earlier, a really slick ChatGBT bot that’s been educated on all things regarding TCPA FCC updates. I’m gonna put a link in the chat there, or in the comments there for you both.

[Matthew Marx]
It is not your attorney either, just from a caveat perspective.

[Eric Troutman]
You guys gotta be careful with that.

[Matthew Marx]|
Get information and research. That’s right. It will tell you it’s not your attorney, but it’s not your attorney.

[Justin Ulrich]
That’s right, that’s right. And then also, we mentioned tcpaworld.com a couple times in this session. Great resources there.

It’s a site that Eric and his team has put together. All sorts of resources, so highly recommend you go check that out. And then one more time, I’ll give you a chance to plug the Law Conference of Champions.

[Eric Troutman]
This thing. If you found this webinar, if you found this to be useful, I am telling you, this will be, with due respect to this webinar, which was fantastic, but a single, that was only one topic we covered. We’re gonna cover everything that you wanna know about outreach at this conference.

Trust me, guys, this is fantastic. You should be there.

[Justin Ulrich]
Awesome. Well, thanks again for everybody joining us today. Thank you, Matt and Eric, for taking us through this update. I know it’s a highly complex issue that everyone could use some help in breaking it down, so we thank you.

[Eric Troutman]
Absolutely, Matt.

[Justin Ulrich]
Thanks, guys. Thanks, Eric.

[Eric Troutman]
Good work, you guys are fantastic. We’ll talk soon. 

[Matthew Marx]
Hey, likewise, fam.