June 12, 2015
This Tuesday, Ms. Kathleen McGee, Internet Bureau Chief for the New York Attorney General’s Office, scrutinized the recently revised User Agreements of eBay, Inc. (“eBay”) and PayPal, Inc. (“PayPal”), respectively. Specifically, the NYAG has questioned certain robocall consent provisions contained in these agreements, which purportedly authorize the sending of autodialed and/or prerecorded telemarketing calls to the companies’ respective users.
Why is the NYAG taking issue with eBay and PayPal’s new telemarketing provisions?
eBay and PayPal’s Robocall Consent Provisions
Both eBay and its subsidiary PayPal recently updated the subject User Agreements, which are scheduled to go into effect on June 15 and July 1, 2015, respectively. The language in question, which is essentially identical in both agreements, purportedly allows eBay, PayPal and their respective affiliates and service providers to contact customers at telephone numbers that the companies might “have otherwise obtained” using “autodialed or prerecorded calls and text messages.”
NYAG Letters Question eBay and PayPal User Agreements
On June 9, 2015, Ms. McGee delivered separate letters to eBay and PayPal to express the NYAG’s concerns with the revised User Agreements. Noting the highly regulated nature of telemarketing under the TCPA and other applicable regulations, Ms. McGee questioned “whether the customer actually consented to such calls in light of [the robocall consent language’s] inconspicuous disclosure in a dense . . . user agreement.” Additionally, the letters point out the conspicuous lack of an opt-out mechanism, suggesting that “customers must accept automated marketing calls, emails and text messages or close their account[s].”
Ms. McGee’s letters pose a number of pointed questions to eBay and PayPal, including details of:
- How and why the companies plan to robocall customers;
- How customers may opt out of the unconventional robocall consent provision; and
- How customers can consent to autodialed/prerecorded telemarketing calls without even disclosing their telephone numbers.
Obtain Sufficient and Legally Compliant Telemarketing Consent
The NYAG’s Office has demanded answers in connection with Paypal and eBay’s robocall consent provisions by June 19, 2015 – one day after the FCC is scheduled to vote on additional regulatory requirements related to robocalling. Now more than ever, as regulatory reins continue to tighten, it is essential for telemarketers to ensure that their marketing practices are in compliance with applicable regulations.
If you need to review your telemarketing practices and procedures, or if you are facing an investigation from a state attorney general or other regulatory agency, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.
The material contained herein is provided for information purposes only and is not legal advice, nor is it a substitute for obtaining 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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