On the eve of a pivotal vote, the Federal Communications Commission (FCC) is poised to overhaul the landscape of lead generation, triggering expectations of an imminent surge in legal battles targeting lenders, insurers, and law firms accused of inundating consumers with unwarranted texts and calls.
The proposed rule, meticulously crafted to curtail the deluge of sales calls bombarding consumers, is widely anticipated to secure approval. Legal experts, representing both consumers and corporations, predict that the rule’s adoption will pave the way for a substantial increase in lawsuits under the federal law governing robocalls.
The regulatory shift is specifically directed at lead generators, entities responsible for accumulating consumer contact information and vending it to companies in search of new clientele. The stringent restrictions imposed by the new rule will also forge an expansive avenue for claims under the Telephone Consumer Protection Act (TCPA), empowering individuals to litigate against unwanted calls and texts, including the notorious robocalls.
According to an FCC spokesperson, the agency’s motivation to crack down on lead generators stems from a longstanding commitment to mitigate the menace of robocalls.
Aaron Weiss, a partner at Carlton Fields, known for his defense against TCPA litigation, foresees the changes ushering in a “target-rich environment” for suing companies relying on leads for TCPA violations.
Court records reveal that over 1,300 TCPA lawsuits have been filed this year, mirroring the figures from 2022.
Defense attorney Eric Troutman, representing companies entangled in TCPA litigation, anticipates a potential surge in filings if the rule is enacted, potentially doubling or tripling the current numbers.
Lead generation, a time-honored practice connecting consumers with mortgage quotes, insurance brokers, and home improvement services, has evolved to encompass personal injury attorneys and lawyers engaged in mass litigation pursuits.
Typically, consumers express interest in purchasing products or services through online platforms or contact numbers provided in advertisements. Unbeknownst to them, their consent leads to the sale of their contact information to a multitude of businesses, resulting in unforeseen and undesired calls.
Should the FCC rule be enacted in its present form, lead generators would be restricted to offering customer information to a single business unless explicit consent is given for additional businesses.
Troutman, who presides over a lead generator industry group, anticipates resistance from some generators accustomed to selling the same set of consumer data to multiple businesses.
Businesses utilizing leads are urged to exercise heightened caution to ensure compliance with the impending law, cautions Andrew Perrong, a litigator with experience filing numerous lawsuits as both a plaintiff and an attorney representing clients aggrieved by unwanted calls.
Perrong highlights the potential repercussions for businesses purchasing fraudulently generated leads, noting that such actions may come back to haunt them in the legal arena.
As the FCC stands on the precipice of this transformative decision, industries affected by lead generation brace themselves for a legal landscape poised for change.
