FCC Enforcement Bureau chief praises PayPal after original TCPA terms drew criticism

FCC Enforcement Bureau chief praises PayPal after original TCPA terms drew criticism


By:  Kelley Drye and Warren LLP
Lexology


Two weeks ago, the Chief of the Enforcement Bureau of the Federal Communications Commission (“FCC”) sent a letter to PayPal, Inc. (“PayPal” or “Company”) stating that the Company’s recent amendments to its User Agreement did not comply with federal law.  Although the letter did not threaten enforcement action, the FCC has the power to impose fines for TCPA violations, after issuing citations to non-carriers such as PayPal.

According to the FCC, PayPal’s User Agreement would have violated the Telephone Consumer Protection Act of 1991 (“TCPA”) because the new policy would have allowed customers to receive autodialed, prerecorded or artificial voice calls and text messages.  The TCPA specifically restricts these kinds of calls unless a company obtains a customer’s “prior express written consent” 47 C.F.R. 64.1200(f)(8).  PayPal’s new User Agreement was set to become effective on July 1, 2015.

A few days after PayPal received that letter from the FCC, Senators Ed Markey (D-Mass.), Al Franken (D-Minn.), Ron Wyden (D-Ore.), and Robert Menendez (D-N.J.) also wrote to the Company urging it to reconsider its telemarketing policy and requesting a response by July 7, 2015.

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