Telephone Consumer Protection Act (TCPA) Exposure for NJ Businesses

A recent decision by the Third Circuit Court of Appeals could lead to increased exposure for New Jersey businesses under the federal Telephone Consumer Protection Act (TCPA).

A recent decision by the Third Circuit Court of Appeals could lead to increased exposure for New Jersey businesses under the federal Telephone Consumer Protection Act (TCPA). In Leyse v. Bank of America National Association, the federal appeals court held that recipients of telemarking calls may have standing under the statute even if they were not the callers’ intended targets.

The Legal Background

One of the goals of the TCPA was to address the proliferation of automated telemarketing calls to private residences. The federal statute prohibits any person from, among other things, “initiat[ing] any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a message without the prior express consent of the called party, unless the call is initiated for emergency purposes or is exempted by rule or order by the [Federal Communications] Commission.”

As we have previously discussed on the Scarinci Hollenbeck Business Law Blog, running afoul of the TCPA can be costly because the statute authorizes statutory damages of $500-$1,500 per violation, regardless of the actual damages suffered by the recipient. Plaintiffs’ lawyers also frequently rely on the federal statute as the basis for bringing class-action lawsuits.

In this case, plaintiff Mark Leyse filed suit under the TCPA after receiving a prerecorded telemarketing call on the landline he shared with his roommate. Leyse was not the intended recipient of the call—his roommate was. For this reason, the District Court dismissed the complaint for lack of statutory standing.

 The Court’s Decision

 The Third Circuit reversed, holding that the plaintiff’s “status as a regular user of the phone line and occupant of the residence that was called brings him within the language of the Act and the zone of interests it protects.”

 As further explained by the Third Circuit, “the Act’s zone of interests encompasses more than just the intended recipients of prerecorded telephone calls. It is the actual recipient, intended or not, who suffers the nuisance and invasion of privacy.”

Under the court’s holding, a houseguest or other temporary visitor would likely not have standing. However, a regular user of the telephone line who occupies the residence would. “The complaint alleges that Bank of America placed a call ‘to Leyse’s residential telephone line.’ At the motion to dismiss stage, we are required to treat this allegation as true, and it places Leyse squarely within the zone of interests[,]” the Third Circuit decision stated.

The Third Circuit’s decision is in line with similar rulings by the Seventh and Eleventh Circuit Courts of Appeal, which have also granted TCPA standing to members of the household of the intended recipient, as well as the determination of the Federal Communications Commission.