The Telephone Consumer Protection Act (“TCPA”) governs the conduct of telemarketing services and other companies that use telephone solicitation during the course of their business. A number of lawsuits have raised the question of whether debt collectors should be treated similarly to telemarketers, insofar as they should be subject to the same restrictions.

In a recent case before the United States District Court for the Western District of New York, a plaintiff argued that a debt collection agency’s continuous phone calls regarding a financial obligation that the putative debtor did not owe were in violation of the TCPA. Franasiak v. Palisades Collection, 09-cv-835S. The plaintiff, John Franasiak, claimed that the defendant, Pallisades Collection (“Pallisades”), repeatedly contacted his residence regarding a debt owed by his daughter. He alleged that Palisades did this even though Franasiak continued to inform them that he was not the debtor and that his daughter did not live at his residence. He claimed the calls continued several times a week for seven months. After Pallisades ignored a cease-and-desist letter he issued, Franasiak filed an action under the TCPA.

In its motion for summary judgment, Pallisades argued that debt collection calls are exempt from the TCPA. A Federal Communication Commission (“FCC”) administrative decision indicates “that calls solely for the purpose of debt collection are not telephone solicitations and do not constitute telemarketing.” In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, 23 FCC Rcd. 559, 565, ¶¶ 11 [2008 WL 65485 (F.C.C.)]. Additionally, earlier in 2011, another Western District Court determined that “debt collection calls are exempt from the TCPA’s prohibitions against prerecorded message calls because they are commercial calls which do not convey an unsolicited advertisement and do not adversely affect residential subscriber rights.” Santino v. NCO Fin. Sys., 09-cv-982-JTC.

Franasiak argued that this exception did not necessarily include calls by debt collectors to individuals who are not the debtor. In other words, he argued that the TCPA should extend to situations where debt collectors are persistently calling those who are not actually in debt. However, the Court decided to defer to the FCC and its specific exemption of all debt collection activities from the TCPA. The Court held that it is for the FCC “to determine whether a resident’s privacy rights are adversely affected by seemingly intrusive phone calls by prerecorded messages.” The Court added that “[a]lthough it is this Court’s opinion that such calls, when they are made to non-debtors, do adversely affect the individual’s privacy interests, the FCC has found otherwise,” and noted that a holding in favor of Franasiak would overstep the bounds of the judiciary.

It is significant to note that the answer to this question could vary depending on the district. For example, the United States District Court for the Eastern District of Pennsylvania has held that non-debtors have their rights violated when they receive continuous collection calls. Watson v. NCO Group, 462 F. Supp 2d 641 (E.D. Pa. 2006). However, the majority of courts have followed the same path as the Franasiak court and decided to defer to the FCC and not interpret different rules for non-debtors. It will be interesting to see if the FCC decides to amend its regulations or take any steps to address this issue, and whether the majority of courts will continue to exercise judicial restraint.


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