First Ever Jury Verdict Finds Companies Violated Telemarketing Laws

For the first time, a jury issued a verdict finding that three companies violated the Telemarketing Sales Rule (TSR) and the requirements of the National Do Not Call Registry by making more than 117 million telemarketing calls to pitch movies and solicit donations. Of those calls, the jury found 99 million were made to individuals who had registered on the Do Not Call Registry operated by the Federal Trade Commission (FTC). The verdict affirms allegations raised by the Justice Department in its suit on behalf of the FTC against Forrest S. Baker III and his three companies, Feature Films for Families, Inc., Corporations for Character, L.C., and Family Films of Utah, Inc. A federal district court in Utah will now decide what relief to impose, which could include civil penalties of up to $16,000 for each violation given that the jury also found the defendants’ violations were made with “actual or implied knowledge.”

TIP: This case is another reminder that appropriate and adequate consent is required to make certain telemarketing calls, and restrictions apply where a number appears on the National Do Not Call Registry. A failure to meet appropriate requirements can lead to significant penalties, especially when it is felt that the company has actual or implied knowledge that the activity is in violation of telemarketing laws.