ARTICLE
7 August 2019

Telemarketing List Management Agreements: Age of Consent

KM
Klein Moynihan Turco LLP
Contributor
Klein Moynihan Turco LLP (KMT) maintains an extensive practice, with an international client base, in the rapidly developing fields of Internet, telemarketing and mobile marketing law, sweepstakes and promotions law, gambling, fantasy sports and gaming law, data and consumer privacy law, intellectual property law and general corporate law.
Telemarketing List Management Options Through the course of interacting with consumers, and in connection with various ongoing commercial relationships with those consumers, business owners of all kinds are frequently able to amass a valuable database of consumer telephone numbers.
United States Telemarketing
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Telemarketing List Management Options

Through the course of interacting with consumers, and in connection with various ongoing commercial relationships with those consumers, business owners of all kinds are frequently able to amass a valuable database of consumer telephone numbers. Where permitted by the applicable privacy policy, as well as the specific telemarketing-related consent obtained from the subject consumers at the time of registration when their respective telephone numbers were collected, that database can be shared by the business in question (“list owner”) with third party entities (“list managers”) that specialize in telemarketing to client databases in order to create a mutually rewarding business opportunity.

Telemarketing list management arrangements enable third party list managers, with expertise in telemarketing to client databases, to select high performing and desirable offers, market those offers to client databases and manage the logistical aspects of such telemarketing campaigns. Telemarketing list managers thus provide a valuable service to list owners who may lack the knowledge or resources to undertake such campaigns.

Notwithstanding the potential benefits, it is crucial that businesses interested in pursuing these types of relationships, whether as list managers or list owners, ensure that the proper consumer consents have been obtained, in advance, prior to engaging in any telemarketing to those consumers. It is also vital that the parties negotiate and enter into a comprehensive list management agreement that establishes each party’s legal and operational obligations in order to maximize revenue potential, while allocating risk and potential liability.

Stand by Your Manager

From the list manager’s perspective, the primary goal in entering into a telemarketing list management agreement should be to ensure that the document reflects that the list owner is entirely liable for any and all matters related to the collection of the database(s), as well as the ability of the list owner to share the database with the list manager for the marketing purposes contemplated by the agreement.

In particular, the list manager should require that the list owner represent that it has obtained all required consents necessary for the list manager to contact consumers via telemarketing, including the “prior express written consent” of the subject consumers to be contacted on their respective mobile devices (where applicable) using automated means, as required under the Telephone Consumer Protection Act (“TCPA”) and other applicable state and federal telemarketing laws. Further, the list manager should make certain that the list owner scrubs its database against the National Do-Not-Call Registry, as well as any applicable state do-not-call lists, prior to providing the database to the list manager – with regular updates to be provided throughout the relationship.

Owner Beware

As a preliminary matter, when compiling a database for telemarketing purposes, list owners must ensure that they obtain all legally required consumer consents, including the “prior express written consent” required under the TCPA, and that they scrub their database against any applicable state and federal do-not-call lists or, in the alternative, rely on an exception contained in the Telemarketing Sales Rule (“TSR”).

In addition, list owners should be mindful to maintain internal data maps in connection with their respective databases so that they can comply with consumer information requests contemplated by the California Consumer Privacy Act (“CCPA”). In order to comply with CCPA information requests, list managers must be able to provide consumers with information pertaining to how their consumer information was collected and from what sources, how it is stored, with which parties it is shared and for what purposes.

Further, list owners must take steps to comply with Nevada’s privacy law, as amended by Senate Bill 220 (the “Nevada Privacy Law”). Specifically, list owners must give consumers the ability to opt-out of sharing their personal information for monetary gain with third party data brokers.

With the proper consents secured, as well as CCPA and Nevada Privacy Law concerns addressed, list owners should seek to ensure: 1) that the list manager represents that its telemarketing activities will comply with all applicable laws, including restrictions regarding which days and times are permissible for telemarketing activities; 2) strict adherence to the scripts provided or approved by list owner; 3) that the list manager agrees, in writing, that it will not use the database for any purpose other than the specific purpose of performing the telemarketing services specified in the list management agreement; and 4) that the list manager will remain solely responsible for any and all telemarketing activities associated with its use of the database.

Making a List, Checking it Twice

Without implementing strict contractual obligations that ensure each party’s respective state and federal regulatory compliance, there is an increased likelihood that you, as either a list owner or list manager, will suffer significant liability.

Under these circumstances, it is highly recommended that you retain qualified legal counsel to ensure that your database collection and maintenance practices are legally compliant and that any telemarketing list management agreement that you enter into, or currently use, is drafted and/or revised, as applicable, in order to ensure that you are adequately protected.

Please note that this is only a brief overview of some of the legal issues surrounding telemarketing and list management relationships.

ARTICLE
7 August 2019

Telemarketing List Management Agreements: Age of Consent

United States Telemarketing
Contributor
Klein Moynihan Turco LLP (KMT) maintains an extensive practice, with an international client base, in the rapidly developing fields of Internet, telemarketing and mobile marketing law, sweepstakes and promotions law, gambling, fantasy sports and gaming law, data and consumer privacy law, intellectual property law and general corporate law.

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