In our world of sensationalism and polarizing news stories, we have all
learned a valuable lesson: a catchy headline gets you the most clicks. If you
are reading this, my choice was likely effective in capturing your prized
click. Hopefully it went further and made you read it twice, second guess
the accuracy, or maybe just click it to see if I was still ok. Bonus points if
you pictured the famous Spiderman meme of three Spidies pointing at each
other. Enough about headlines, though – I am sure you are curious what is
going on here.
New York Telemarketing Law Explained
New York’s often dreaded Section 399-z of their General Business Law has
been an interesting piece of legislation for quite some time. This section,
which focuses on overall telemarketing law in the state, has had minimal
but consequential changes over the last few years. This really heated up in
December of 2019 where a small change was inserted that many readers,
myself included, paid little concern – all unsolicited telemarketing in the
state was illegal during a state of an emergency. Those of us who were in
this industry on 9/11 probably immediately remembered that dark moment
in our nation’s history, and, as a telemarketer representing Fortune 100
companies at the time, remember an immediate order to halt ALL national
marketing for a few days in light of that tragedy. This was an internal
decision, and while our clients echoed that sentiment within hours of
everything unfolding, responsible minds didn’t need a client directive to be
respectful. Even as we began calling into the rest of the country a week or
two later, NO ONE was pushing calls to New York – especially Manhattan –
for quite some time. That said, when I saw this provision, I, like many
others, thought of something tragic like that shutting down the state;
otherwise, I expected something more akin to localized states of
emergencies due to flooding or other extreme weather events.
This new provision went into effect March 1, 2020, but I know there were
other, more prominent stories bubbling up around that same time. While
you probably don’t think of this provision relating to that timeframe, I am
sure you remember a highly contagious respiratory virus that was stealing
all the headlines at the time. To that end, then Governor Andrew Cuomo
declared a state of emergency for all of New York just 7 days after the ban
was in effect. Since that time and as I have written about many times, the
state has been under a CONSTANT state of emergency. While the reasons
since have ranged from gun violence to immigration, the status has
remained the same. New York, as a state, is under a state of emergency,
and therefore all unsolicited telemarketing calls have been banned since.
The penalty? What was, at the time, an astonishing $11,000 per violation
has since risen to $20,000, and there is a proposed bill looking to raise it to
$25,000!
The only potential silver lining here is that these fines are only brought
through government enforcement, meaning, unlike the TCPA, there is a
lower chance of opportunistic plaintiffs attempting to cash in on what would
be the mother of all jackpots. There are some in the media who see New
York as being fairly weak from an enforcement side, and much of the news
around enforcement in that state does seem to revolve around political
players on both sides of the political aisle (I’ll leave it at that). Perhaps this
is why they don’t believe the laws are working, as the newly proposed A 9029 bill states the increase in unsolicited commercial marketing
communications has heightened the risk of making residents of this state
susceptible to deceptive practices, scams, and fraudulent schemes.
Moreover, the receipt of such communications is also a nuisance to
residents as such communications clutter their inboxes, fill their devices
with unwanted messages, and consume their time and attention, thereby
disrupting their daily lives and diminishing the privacy and peace they
should be able to expect in their personal spaces.
What’s in the Bill?
To solve for this, the bill looks to create a “Do Not Disturb” registry. This is
similar to the traditional Do Not Call registry with which we are all familiar,
but there is a twist – it’s not just for calls, texts, or faxes. If passed, any
resident of the state may register to shutdown communication via email or
traditional mail as well. There is even an allowance for the registry to
support industry specific opt outs, presumably to bring this in line with
other attempts to modify this state law to allow vertical specific (i.e. Solar)
“no solicitation” lists.
This law would apply to any business who meets any of the following
threshold amounts...in one of the previous five calendar years prior to the
communication being made:
(a) five thousand unsolicited marketing communications made through
physical mail;
(b) ten thousand unsolicited marketing communications made through
electronic mail;
(c) one thousand unsolicited marketing communications made through
facsimile; or
(d) one unsolicited marketing communication made through telemarketing
call or text message.
The way it is written, there may be an argument to interpret this to mean
that the thresholds apply to the channel of communication, but arguably,
meeting any one threshold can subject a business to all.
Is there a silver lining?
While this bill is clear that this would not remove a resident’s right to file a
lawsuit under the TCPA, this is enforced by the state and carries a maximum
penalty of $1,500. This does not appear to be per violation, but rather per
“determined” finding. Also, if action is brought under this provision, there
is a clear statement that the same entity could NOT be held liable under
399-z for the same violation.
This is a curious bill for certain. With the state taking no significant action
under 399-z that I am aware of, I am uncertain that introducing another law
with lower fines is going to dissuade anyone currently ignoring the law. I
suppose this adds snail mail and email to prohibited communications, but, if
enforcement thinks it’s hard to find telemarketers and lead generators in
their jurisdiction, just wait until they try to go after email spammers!
Maybe this will finally get that Nigerian Prince to leave New Yorkers alone,
but I am uncertain as to whether or not it would protect consumers from
being tricked into buying oxygen for astronauts under attack in their
spaceship. It also makes me wonder just how often they get complaints
about unwanted grocery store coupons, but I will be watching to see if this
suddenly becomes a new income driver for the state!
What Should Businesses Do Now?
For now, make sure you are being careful with New York in general. As
previously stated, no cold calling is allowed in the state under the current
law, so, short of the emergency ending or more practical emergency restrictions being adopted restrictions being adopted, this is of no immediate effect to callers. Our DNC Scrub engine will automatically flag those records for you, helping you stay one step ahead. This also heightens the urgency to check for disconnected phone numbers; with an average of 30 MILLION phone numbers being exchanged each month in North America, any consent, EBR, inquiry, etc. exemption is only as good as your last scrub. Reach out to one of our compliance experts to learn more about how we can help improve
your compliance while minimizing your risk in calling!
