Already one of the more robust mini-Telephone Consumer Protection Act (“TCPA”) laws, the Michigan State Senate recently passed new legislation aimed at unsolicited telemarketing to Michigan consumers. Below, we discuss in detail Michigan Senate Bill 351 (S-4) (“SB 351”) and what it may mean for companies that telemarket in Michigan.
SB 351 and Proposed Changes to Michigan’s Telemarketing Law
Michigan’s telemarketing law, colloquially referred to as the Telephone Solicitation Act (“Telemarketing Act”), may undergo sweeping changes if SB 351 ultimately is enacted. SB 351 defines “telephone solicitation” as a telephone communication to encourage the recipient of the subject telephone solicitation to:
- Purchase, rent, receive, or invest in goods or services, or contribute to a charitable organization;
- Provide personal information, including identity, financial, or preferences information;
- Accept or participate in any employment, whether temporary or permanent, contracting, investment, or other income opportunity;
- Accept a prize promotion;
- Avoid liability, legal or otherwise (includes members of the recipient’s family); or
- Obtain or attempt to obtain anything of value from the recipient with the intent to defraud, violate the Act, or commit another unlawful act.
Please note that not all calls or text messages are considered telemarketing under Michigan’s SB 351, including: (1) calls or text messages to consumers who have given written “express verifiable authorization,” as defined in SB 351; (2) calls or text messages to existing customers (unless said customers have requested not to receive telemarketing calls/messages); and (3) business to business calls/text messages (unless the subject businesses requested not to receive telemarketing calls/messages). Telemarketing to consumers with a Michigan State area code are presumed to be Michigan residents, but this presumption may be rebutted. Depending on the method of telemarketing, Michigan’s SB 351 imposes certain disclosure requirements. Specifically:
- If marketing by telephone call, the individual telemarketer’s first and last name and the full name, address, and telephone number of the organization/person on whose behalf the call is made;
- If marketing by text message, the organization/person on whose behalf the text message is initiated;
SB 351 empowers Michigan’s Attorney General (“AG”) to investigate and prosecute telemarketers that it believes are violating Michigan’s Telemarketing Act. If the AG has probable cause to believe that telemarketers are violating Michigan’s Telemarketing Act, the AG must
- Notify the telemarketer before commencing an action; and
- Give the telemarketer an opportunity to cease and desist from engaging in the alleged misconduct; or
- Confer with the AG in person as to proposed remedial action.
The AG may accept an assurance of discontinuance from the alleged violator, which may include:
- Voluntary payment for the costs of investigation and reasonable attorneys’ fees;
- An amount to be held in escrow pending the outcome of an action; and
- An amount for restitution to any aggrieved individuals.
The AG may bring civil actions to prosecute alleged violations of Michigan’s Telemarketing Act to prevent the subject party from continuing to engage in the purported misconduct. The court may award civil fines up to $25,000 per violation of the Act. The Act also provides a private right of action that allows for the recovery of: (1) actual damages, plus reasonable attorneys’ fees; or (2) $1,000, plus reasonable attorneys’ fees, whichever is greater.
What Does SB 351 Mean For Your Company?
If SB 351 is enacted, Michigan’s Telemarketing Act would allow for the imposition of civil fines ranging from $50,000 to $100,000 for conduct directed at vulnerable individuals (persons who are 75 years of age or older or individuals who have one or more disabilities) or vulnerable telephone numbers, as defined in SB 351. While it remains to be seen whether SB 351 will be enacted, Michigan is one of numerous jurisdictions focused on strengthening its state’s telemarketing law to address consumer complaints.
The attorneys at Klein Moynihan Turco (“KMT”) have extensive experience assisting companies with regulatory and marketing law compliance. If your company engages in telemarketing and needs help with understanding Michigan’s telemarketing regulations, or has been sued for violating federal or state telemarketing laws, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.
The material contained herein is provided for informational purposes only and is not legal advice nor is it a substitute for seeking legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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