This hearing will get underway. My apologies for being tardy. Im running around a lot today but thank you all for your patience and welcome to todays hearing on the telephone Consumer Protection act. When passing tcpa 25 years ago congress sought a balanced approach that protects the privacy of individuals and permitted legitimate telemarketing practices. A as a result a number of telemarketing pract is have been significantly reduced or eliminates. For example companies have to maintain donotcall list and could not make solicitation calls before 8 00 a. M. Or after 9 00 p. M. But tcpa is showing its age and there are opportunities to build on the consumer benefits and ensuring consumers fully benefit from modern communications. Consumers should be able to take advantage of technology to help them fall victim to actors though those who ignore do not call requirements. I doubt there is a person in this room whos that not received a recorded mobile voice call telling them theyve won a cruise. And we continue to take practice against the tools to bring bad actors to justice including those operating from overseas. We recently took a step in this direction by unanimously approving Ranking Member nelson and senator fishers antispoofing legislation as part of the act but our discussion is not only about policing abusive practices and stopping bad actors. We must also acknowledge that most businesses are trying to do the right thing and play by the rules. And we need to understand whether tcpa is inadvertently hurting the good actors and consumers. When Congress Passed tcpa cell phones were uncommon and mobile Telephone Service was extremely expensive. It made sense to have particularly strict rules about contacting people on mobile phones. Today, however, mobile phones are not only ubiquitous, they are Smart Devices that do much more than send and receive phone calls. Consumer behavior is different than back in 1991. Todays Consumer Expectations about Communications Connectivity and the benefits of doctors schools and Favorite Charities and even their lernds would be unrecognizable to congress 25 years ago. More than 90 of americans now have a mobile phone. And nearly half of all households in the United States are mobile only. These are higher for young adults. Simply put, if you cant reach these people on their mobile phones, youre going to have a hard time reaching them at all. The balance forged decades ago may not be legitimate business practices. The federal Communications Commission was tasked by ensuring a balanced act of tcpa. But the commission has struggled to comply tcpa to a changing communication market place and the tcpa is creating more imbalances and more uncertainty. The Commission Rules have creates more questions rather than answers. For example, what is an auto dialer. The commission will not answer that clearly and instead only says it is something other than a rotary dial telephone. The fcc declared last year it would not address the exact contures of the auto dialer definition or seek to determine each type of equipment that falls within that definition. Hospitals and charities utilities and banks and restaurants should not have to engage engineers to know if they could call customers without being sued. Another example is what to do if a customers number has been reassigned. While the fcc claims to have addressed this issue, Companies Say there is still no way to know with certainty. What is certain, however, if you call a line more than once, could you be liable for 500 per call, even if the party never answers. Tcpa litigation is becoming a booming business. Tcpa cases are the second most failed type of case in court with 3710 filed last year alone. That represents a 45 increase over 2014. And the companies affected by an unbalanced tcpa may surprise you. For example, twitter stated the following in a filing at the fcc and i quote, as a result of this hyper letith us environment Innovative Companies must choose between denying consumers information they requested or targeting by tcpa plaintiff attorneys filing shakedown suits. No company should be put to such a choice. End quote. The cost of getting the balance wrong isnt just burdensome litigation. It is also the cost to consumers and to the economy of the important consumer contact that is not being made for fear of running afoul of an illdefined rule. Text messages to let parents know about weatherrelated cancellations, calls to struggling lowincome households know how to keep the heat from getting cut off, calls to alert borrowers they are at risk of defaulting on debts an ruin debt rating and follow up calls to patients to make sure they understand the postdischarge treatment plans. Another specific matter that will be discussed today is the Obama Administrations car avowal to allow robocalls to mobile phones to collect debts owed to the federal government. The administration used the mustpass bipartisan budget act as an achievement of the robo call carveout. The committee reached out to the office of management and budget and the department of treasury and department of education to testify about why they prioritized this robo call carve out for years. The Obama Administration has not represented before us today but we continue to seek the input as the robo call carve out is implemented by the fcc and the over site of tcpa. Finding the right balance is essential to protecting the privacy of consumers while making sure they have reasonable access to the information they want and need and making sure good faith business actors could reasonably assess the cost of doing business. We have a variety of perspectives represented on the panel before us today. I look forward to hearing your testimony and appreciate very much your participation with us, thank you. Ill recognize the senator from florida, Ranking Member senator nelson. Mr. Chairman, if you go anywhere in this country, and you ask a consumer do you want to receive robo calls, or you ask them would you like to receive robo calls on your cell phone, you may get the cell phone thrown at you. And there are a few things that unite our country men and women like the distaste for robo calls. That are interrupting them at dinnertime, in the middle of driving, it goes on and on. Its a sentiment nearly all of us share. Thats why for the last 25 years the laws have sided with consumers. The number of Consumer Complaints about robo calls regardless of the laws continue to increase. The fcc receives tens of thousands of robo call complaints every month. And we all have stories to tell. One of our friends signed up for a line service one morning. And by the afternoon, before he had given his new number to his family and friends, his phone was being flooded by robo calls. So he gave up the land line. In fact, how many of us know friends at home that have given up the landline and just used the cell phone for that exact same reason. They dont want the robo calls. Most of us, our cell phone is our life line. If we allow those annoying robo calls to begin freely bombarding folks, where do consumers go to escape the harassment. So what would happen on mobile phones is that they would start to ignore the calls from unknown numbers so they dont have to hear another recording. Only to miss an important call. Or what about the Senior Citizens and how about low income americans, many of those consumers have calling plans that are restricted in the number of minutes that they can use every month. So opening the flood gates to robo calls to those individuals would have an immediate adverse effect. Or what about driving down the road. Just like i was this morning, dodging in and out of traffic. Coming across the 395 bridge. People cutting in front of me and me having to slam on the brakes. And suddenly you get a call and you want to answer it, but its not something important. Its a robo call. And, therefore, the distracted driving. Where would all of that end . So, you know, the frustration is there. Also because of fraudulent callers. Scammers are always going to be a problem. We have tried to address that directly on in a bipartisan way with the chairman. Thanks to his leadership. Senator fisher and i have teamed up on our bill to combat spoofing and thats why id also like us to see a revamped improved donotcall call. Now, obviously, there are legitimate businesses and other reasons to call consumers on their wireless phones. But theres already an answer to that. Just get the consumers consent. Thats been the law since 1991. In this bubble of washington, policymakers are often in danger of losing sight to what is actually out there in america. And theres no doubt, ask that question of any american consumer. I want to thank you, mr. Chairman, for calling this hearing to shed light on the distaste of American Consumers about these annoying calls. Thank you, senator nelson. All right. Well get underway. We have with us the honorable greg zoeller. And ms. Becca wahlquist. Margot saunders. With the National Consumer law center. Mr. Rich lovich, testifying on Administration HealthCare Management and miss monica dasai, a partner of squire patent bogs law firm. Well start with mr. Zoeller, please proceed and welcome to the committee. Thank you mr. Chairman and members of the committee, i appreciate the opportunity to come and be heard. Ill pick up with senator nelson left off. We do in the state of indiana receive remarkable number of complaints each year. I think last year it was somewhere around 14,000 calls, the largest number of complaints in our Consumer Protection area. Over half of those complaints were about robo calls specifically. Indiana has unique statute that was passed in 1988 that prohibits the use of the auto dialers to make calls to consumers. This is across the board. Weve successfully defended that statute to the federal courts, the seventh Circuit Court of appeals talking about how we do not allow these calls for any other than those like senator nelson mentioned, have opted in. So the schools and the pharmacies and people you refer to in terms of important calls have opted in and we do have those that are still being heard. But i think the points that i want to make, ive got written testimony that ive submitted but ill kind of summarize briefly. Really, the focus of our attention has been on maintaining the protection of our own statutes. So the recent budget bill you mentioned that had the exception for federal debt, now challenges the ability of our state to defend our own statute. Since we did not have any exceptions, we can claim theres no, lets say, unconstitutional acts on the part of the state, so now that we have this new exception for federal debt, i know the case thats recently filed by the American Association of Political Consultants challenges the constitutionality and according to our read of the seventh Circuit Court of appeals and our own defense weve got risks now whether that exception might raise the question about whether its unconstitutionally distinguishing between certain types of calls. We have a blanket exception. Its been very effective. We have been able to defend, but based on the fact we did not have those types of exceptions that now the federal government has allowed. I just briefly ill say that, you know, in the last month alone, according to you mail, which is a national robo call index, they estimate 2. 5 billion robo calls were made in the month of march. So again, the barrage of this. I had to ask my staff whether that was a legitimate number because i couldnt believe it. But unless someone wants to argue the other side, ill just leave it that thats the only number weve got in terms of the volume of these. We do have a very specific sense of what a robo call, the auto dialer is when it can blast out 10,000 calls a minute its a robo caller. When you say you get a call on a new line, its not that they actually called you. They called everybody in the area code. So within an hour and a half you can literally call everybody in washington, d. C. Weve heard from a number of companies that really need the opportunity to call cell phones. But, again i will side with senator nelsons view that thats the last link in terms of the ability to communicate, since most of us have long since pulled out our land line due to the robo calling abuse. And again, most of it is from overseas, again, not something that either state attorneys general or the federal government can address. Frankly, the problems that we have with robo calls, ive warned all the citizens of our state if its a robo call you should assume its a scam artist. Its the best tool for scam artists. So anytime you see these calls, weve trained the people of indiana, hang up as quickly as you can because, frankly, anything you say or do, even just staying on the line, will actually be sold to others. The information that youre going to be home on a wednesday at 10 30 is now known by the people who have done the robo calling and they sell that to others that may want to use other techniques to call you at that same time and place. Knowing youll be home, the likelihood, again, the risk to seniors is where we see this. The use of this technology to collect data when we talk about scam artists youre really talking about the old version of a confidence man. The more they understand about you, the more they can win over your confidence. And knowing when youre going to be home, time, place, and the ability to target people with the amount of information, the risk to consumers are not just the harassment. This is the number one tool to gain the information that the scam artists are using to bilk particularly the seniors in our state. Ill finally just say we were very disappointed with the exception that was carved out. Without this type of hearing were having a hearing after the fact of the budget bill which, again, the chairman noticed that it was put in without this kind of attention. Im representing it now 25 attorneys general who have asked you take up the hang up act. Which would take that back out. So why weve made an exception which, again, risks the constitutionality defense, plus youre targeting particularly the younger students who are using their cell phone and now that weve managed to run up a 1. 3 trillion of Student Loan Debt that will be the number one target. Were worried about where this ends. Were against creating a safe harbor. Number of reasons we can go through. But, finally, i would just say that the point that for years, 25 years now of having the tcpa, theres always been the opportunity for legitimate businesses to ask people to opt in. We have new programs that you may want to know about. Please sign up and we wont harass you. Well use it very specifically. You can always opt out. But weve never seen anyone really go through this process of asking consumers whether they would like to get a robo call. So, again, without the trial of going through the process of trying to get peoples opt in consent, the assumption should be made that people dont want this and businesses know that they will never get people to sign up for a robo call unless they can argue the case to their own customers. This shouldnt be something that the federal government allows, that the people that you represent have made it clear that they dont want. Thank you. Thank you very much. Miss wahlquist. Good morning. That was my good mornings. My name is becca wahlquist. Im honored to represent the u. S. Chamber of commerce and the chamber of institute for legal reform testifying before you today. The context for my knowledge about the tcpa is that for over a decade ive defended various companies sued under the tcpa for variety of communications. So ive been a first hand witness to the growing Cottage Industry of plaintiffs lawyers who have been targeting american businesses. I can confirm in the past few years the problem with tcpa litigation abuse have only worsened. We need your help. Overincentified plaintiffs and an antibusiness 2015 order from the fcc have led to an explosion of litigation in our country. Litigation that is less about protecting consumers and more about driving a multimillion dollar commercial enterprise of tcpa lawsuits. The suits are not about marketing calls and not about the kinds of robo calls we were hearing out. Robo calls are the indiscriminate calls trying to get someone to pick up the phones. Robo calls are not what my my clients have sent. So for example, a customers credit card payment is rejected. The customer has provided a telephone number as their point of contact to the company. The company then contacts the customer, to let them know your credit card has been rejected. Because if they dont know that and their service gets turned off, there is fees to get your service turned back on again. This is trying to provide information to a customer. The biggest drive of litigation now is if that number has been reassigned and the company has no knowledge about the reassignment. Who they then send the message to ends up being a new owner. Thats what driving a big chunk of tcpa litigation now. You now have someone that says i didnt consent to get the call. Especially if they dont inform the company the calls can roll in for other reasons. Then you now have 40 calls, i want my 20,000. And you get the demand. This is what companies are facing over and over again. The tcpa does not provide for attorney fees. Its clear lawsuits are a lawyer driven business at this point. Attorneys fees awards are are getting pulled from common class funds, dwarfing what consumers receive. In 2014, the average attorneys fees awarded was 2. 4 million. The average class members award would be 4. 12. Its not just Large Companies who are finding themselves targeted. Small businesses throughout the country are finding themselves brought into court when they had no intention of violating a law. They had no knowledge of the tcpa. I have a client who has six employees. And found me on the internet because i talk about tcpa and took on their case. And if they cant theyre not sure what to