On January 9, 2015, the FCC released a Forfeiture Order against AmericanWest Advertising, LLC (“AmericanWest”) for alleged violations of the Telephone Consumer Protection Act’s (“TCPA”) prohibitions on unsolicited pre-recorded sales calls. In its Order, the Commission imposed a monetary penalty of $18,000 based on consumer complaints that AmericanWest delivered four unsolicited, pre-recorded advertising messages to consumers in March 2010 telling them that they had won vacation packages. The Forfeiture Order confirms a penalty proposed against the company in a 2011 Notice of Apparent Liability (“NAL”), to which, according to the Commission, AmericanWest never responded. Two aspects of this order are instructive.

“Free Offers” May be Advertising

The Forfeiture Order affirms a finding that AmericanWest’s messages constituted advertising, even though the pre-recorded messages did not offer anything for sale. In this instance, the recipients heard a message that they allegedly had won a free vacation package. The Commission noted in the NAL that according to the TCPA, “‘offers for free goods or services that are part of an overall marketing campaign to sell property, goods, or services’ also qualify as unsolicited advertisements and are ‘prohibited to residential telephone subscribers, if not otherwise exempted.’” Finding no exemption that would have allowed AmericanWest to make the calls in question, the FCC proposed a penalty of $4,500 per message, a rate that has been imposed in similar previous cases.

Statute of Limitations

The timing of the Forfeiture Order likely is motivated by the statute of limitations facing the FCC. Many communications carriers are aware of the FCC’s one-year statute of limitations for issuing a Notice of Apparent Liability. Once the FCC satisfies that limitations period, it faces a second one much later in the process: the time within which it must initiate an action to collect an unpaid forfeiture. That provision requires the FCC (technically, the Department of Justice) to commence an action to collect on a forfeiture within five years of when the violation occurred (not when the NAL was issued). Because the calls that violated the TCPA occurred in March 2010, the FCC must commence an action to collect a forfeiture by March 2015 – just two months from now.

Here at this blog, we have seen this pattern in enforcement cases at the FCC before. Typically, after the rush to satisfy the one-year statute of limitations for an NAL, an enforcement case can lie dormant for years. This is the case even when, as here, the respondent never even contests the proposed forfeiture. (But is also frequently happens when a respondent does contest the forfeiture, and then awaits an indication from the Commission that it is going to address the NAL.) Only as the FCC approaches its five-year limitations period on collections does the Commission address the “apparent” violations of the NAL. This also helps to explain the unusually short time period AmericanWest was given to pay the forfeiture – only 12 days. Once that time period passes, the Commission can proceed to commence a collection action against the company; the payment date is intended to provide the FCC time to do so before its March 2015 bar date.

FCC Imposes $18,000 Penalty for 4 TCPA Violations