Based on recent statutory amendments to New York State's telemarketing laws, the State is further restricting telemarketing activities in its jurisdiction. Back in March 2022, legislation was signed into law by Governor Kathy Hochul that amended the State's General Business Law, Section 399-z, the law that established The "No Telemarketing Sales Calls Statewide Registry." As readers of our blog know, marketing companies' practices must adhere to Section 399-z, also known as the "Nuisance Law." And now, as of September 13, 2023, New York has further amended the State's General Business Law, Section 399-z, to change the penalty from a fine of up to $11,000 per violation, to up to $20,000 per violation. It should now be clear that New York State is serious about restricting intrastate telemarketing practices.
Changes to New York's Telemarketing Law
In 2022, Governor Hochul's press release stated that New York's telemarketing law was designed to, among other things," help safeguard New Yorkers from continuous unwanted calls." Specifically, the revised law requires telemarketers to give customers the option to be added to a telemarketing company's internal do-not-call list at the outset of all sales calls. In fact, the right to be added to the company's internal do-not-call list must be disclosed immediately after the telemarketing company (or seller), and the individual who is calling on its behalf, is identified and before the call otherwise proceeds. This was an important change from the existing law which did not mandate when notice must be given. The reason for this change was that many telemarketers have historically waited until the end of sales calls to mention the State-mandated option to be added to the callers' internal do-not-call lists often after consumers had already hung up. Waiting to the end of a telemarketing script to provide the do-not-call option often resulted in repeated calls to the same consumer phone numbers. New York revised its law to address this issue.
In her September 13, 2023 press release, Governor Hochul stated: "Today, we're raising the penalty for violators of the Do Not Call Registry to deter telemarketers, protect New Yorkers, and send a clear message that New York won't tolerate these frustrating, unsolicited calls."
New York Telemarketing Law Penalties
While the 2022 amendment went into effect on March 6, 2023, the new amendment increasing the maximum penalty from $11,000 per violation, to up to $20,000 per violation is effective immediately. As we have explained in an earlier blog, the New York Secretary of State is charged with enforcing the Do Not Call Law and the Nuisance Call Act. Bear in mind, however, that the law does provide that "[n]othing in this subdivision shall be construed to restrict any right which any person may have under any other statute or at common law." As such, the plaintiffs' bar may use this provision to attempt to bring private rights of action against telemarketers.
How can Businesses Avoid Liability Under New York's Telemarketing Law?
Traditional telemarketing campaigns often involve a high volume of calls/text messages and, if done incorrectly, expose companies to considerable liability. Lawsuits filed by the Federal Trade Commission ("FTC"), state Attorneys General and private litigants usually seek significant monetary relief from companies and their owners. To minimize potential risks, telemarketers should retain experienced counsel to ensure compliance with applicable laws. Counsel should be well-versed in the ins and outs of New York's telemarketing law, as well as other state and federal telemarketing laws.
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