Satellite Television Provider Fined $280M in Do-Not-Call Lawsuit

On June 6, 2017, the U.S. District Court for the Central District of Illinois ordered a major satellite television provider to pay $280 million to the federal government and four states for federal and state do-not-call (DNC) law violations, and enjoined the company from violating DNC laws.

The lawsuit, United States of America, et al. v. Dish Network, L.L.C., was filed by the U.S. Department of Justice and the States of California, Illinois, North Carolina, and Ohio following a Federal Trade Commission investigation of the company’s telemarketing practices.  The lawsuit asserted that the company and its call center vendors made over 55 million calls to consumers: (1) whose numbers were on the National Do Not Call Registry; (2) who previously indicated they did not want to receive calls; and (3) using prerecorded messages.

The lawsuit alleged these activities violated federal and state DNC laws including: (1) the Telemarketing Consumer Fraud and Abuse Prevention Act; (2) the Telephone Consumer Protection Act; (3) the Telemarketing Sales Rule; and (4) state DNC provisions. The U.S. sought $900 million in fines, while the States sought more than $110 million.  The company blamed its call center vendors for over 90 percent of the calls in question, and asserted that the rest were inadvertent.

Following a five week bench trial, the court issued a 475-page Findings of Fact and Conclusions of Law and an Order for Permanent Injunction.  The court found, among other things, that the Company: (1) caused “millions and millions of violations of the [DNC] Laws”; (2) minimized the significance of its errors and denied responsibility for its venders’ actions; (3) knew, in many cases, that its vendors were violating DNC laws and “did nothing’’; and (4) “showed little concern for compliance.”  The court ordered the company to pay a $168,000,000 civil penalty to the U.S. and statutory damages of $36,456,000 to California, $17,388,000 to Illinois, $10,248,000 to North Carolina; and $19,908,000 to Ohio.

 The court also enjoined the company from making illegal telemarketing calls and imposed a compliance plan requiring that the company: (1) demonstrate compliance with the Telemarketing Sales Rule Safe Harbor provisions and that no prerecorded calls be made for five years; (2) hire a telemarketing-compliance expert to prepare a plan to ensure the company and its vendors continue to comply with the telemarketing laws and the court’s injunction; (3) allow Plaintiffs to make ex parte application to the court for unannounced company and vendor inspections; and (4) retain and transmit to Plaintiffs on a semi-annual basis telemarketing compliance materials, including all outbound telemarketing call records.

Copies of the Findings of Fact and Conclusions of Law and Order for Permanent Injunction can be viewed here:

https://www.justice.gov/opa/press-release/file/971706/download (Findings of Fact and Conclusions of Law);

https://www.justice.gov/opa/press-release/file/971701/download (Permanent Injunction).