Decision bolsters FTC position on soundboard tech

On April 27, 2018, the United States Court of Appeals for the D.C. Circuit dismissed a challenge to a November 2016 FTC staff letter addressing certain prerecorded calls or “robocalls” using soundboard technology.

Soundboard robocalls use live agents to play recorded messages instead of talking to the person who picks up the phone. Over the years, the FTC has received numerous complaints about these calls from consumers reporting that they weren’t getting appropriate responses to their questions or comments – even when they asked to speak to a live agent. The FTC also learned that operators were often juggling multiple calls at once. As a result, the November 2016 letter announced that FTC staff would begin treating calls using soundboard technology as robocalls under the Telemarketing Sales Rule.

The Soundboard Association went to court to challenge the November 2016 staff letter. Last year, the United States District Court for the District of Columbia ruled that the letter was properly issued and didn’t violate the Administrative Procedure Act’s notice-and-comment requirements. The Association appealed. In the recent ruling, the D.C. Circuit Court dismissed the Soundboard Association’s challenge to the letter outright, holding that the November 2016 FTC staff letter was not a “final agency action” that would justify review under the Administrative Procedure Act.

The message for marketers has not changed: FTC staff regard calls using soundboard technology as robocalls for TSR purposes. This means that companies must have each consumer’s express written consent before calling and that fundraisers can only use soundboard technology to solicit charitable contributions from previous donors: no robocalls to new donors.