Senate Bill Report: ESHB 1051 (Robocalling and telephone scams)

Summary

A Washington Senate Bill Report on ESHB 1051, an act relating to robocalling and telephone scams, as of March 15, 2023, prepared by staff of the Senate Committee on Business, Financial Services, Gaming & Trade. The report records that the bill, sponsored by the House Committee on Consumer Protection & Business by request of the Attorney General, passed the House 96-0 on February 27, 2023. It describes current law under the Telephone Solicitation Act and the Commercial Telephone Solicitation Regulation Act, including list-removal duties, enforcement and penalties. The bill summary covers new definitions such as assist in the transmission and terminating provider, a ban on solicitations to numbers on the federal do not call registry, per se Consumer Protection Act violations, and recovery of actual damages or $1,000 per violation. It lists no appropriation.

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Full text

SENATE BILL REPORT
ESHB 1051

As of March 15, 2023
Title: An act relating to robocalling and telephone scams.
Brief Description: Concerning robocalling and telephone scams.

Sponsors: House Committee on Consumer Protection & Business (originally sponsored by
Representatives Leavitt, Walen, Simmons, Ryu, Goodman, Fitzgibbon, Pollet, Doglio,
Orwall, Macri, Timmons, Wylie, Bronoske, Ramos, Thai and Kloba; by request of Attorney
General).

Brief History: Passed House: 2/27/23, 96-0.
Committee Activity: Law & Justice: 3/09/23 [w/oRec-BFGT].
Business, Financial Services, Gaming & Trade: 3/16/23.

Brief Summary of Bill

¢ Expands existing provisions regulating robocalls and _ solicitations
targeting Washington residents.

¢ Makes certain persons that assist in the transmission of unwanted
commercial solicitation subject to the Consumer Protection Act.

¢ Prohibits a person from initiating, or causing the initiation of, a
telephone solicitation to a telephone number on the federal do not call
registry or that violates federal law which prohibits misleading or
inaccurate caller identification information.

¢ Makes a violation of the Telephone Solicitation Act and a violation of
the prohibition on using an automatic dialing and announcing device to
make a commercial solicitation per se violations of the Consumer
Protection Act.

¢ Adds that a person injured by a commercial solicitation by an automatic
dialing and announcing device may bring civil action to enjoin further
violations and recover actual damages or $1,000 per violation, whichever

This analysis was prepared by non-partisan legislative staff for the use of legislative
members in their deliberations. This analysis is not part of the legislation nor does it
constitute a statement of legislative intent.

Senate Bill Report -l- ESHB 1051
is greater.

SENATE COMMITTEE ON BUSINESS, FINANCIAL SERVICES, GAMING & TRADE

Staff: Clinton McCarthy (786-7319)

Background: Scope and Exceptions. Telephone Solicitation Act. The Telephone
Solicitation Act (TSA) defines "telephone solicitation" as the unsolicited initiation of a
telephone call by a commercial or nonprofit company or organization to a residential
telephone customer and conversation for the purpose of encouraging a person to purchase
property, goods, or services or soliciting donations of money, property, goods, or services.

Telephone solicitation does not include:
¢ calls made in response to a request or inquiry by the called party;
* calls made by a not-for-profit organization to its own list of bona fide or active
members of the organization;
* calls limited to polling or soliciting the expression of ideas, opinions, or votes; or
¢ business-to-business contacts.

The TSA does not cover calls from political parties.

Commercial Telephone Solicitation Regulation Act. The Commercial Telephone
Solicitation Regulation Act (CTSRA) defines commercial telephone solicitation as:

* an unsolicited telephone call to a person initiated by a salesperson, and conversation
for the purpose of inducing the person to purchase or invest in property, goods, or
services;

* other communication with a person where a free gift, award, or prize is offered to a
purchaser who has not previously purchased from the person initiating the
communication;

¢ a telephone call response is invited; and the salesperson intends to complete a sale or
enter into an agreement to purchase during the course of the telephone call; or

¢ other communication with a person which misrepresents the price, quality, or
availability of property, goods, or services and which invites a response by telephone
or which is followed by a call to the person by a salesperson.

Commercial telephone solicitor means any person who engages in commercial telephone
solicitation, including service bureaus.

The CTSRA exempts a number of specific industries and activities, for example, isolated

solicitations; calls by charities and collection agencies; the sale of certain securities, cable
television, fish, and so on.

Senate Bill Report -2- ESHB 1051
List Removal. Telephone Solicitation Act. At any point during the call, if the called party
states or indicates they do not want to be called again or want to have their contact
information removed from the solicitor's telephone lists, the solicitor must not:
¢ make any additional telephone solicitation of the called party at that telephone
number for at least one year; and
¢ sell or give the called party's name and telephone number to another company or
organization.

Commercial Telephone Solicitation Regulation Act. At any point during the call, if the
purchaser states or indicates they do not want to be called again or want to have their
contact information removed from the solicitor's telephone lists, the solicitor must not:
¢ make any additional commercial telephone solicitation of the called party at that
telephone number for at least one year; and
¢ sell or give the called party's name and telephone number to another commercial
telephone solicitor.

Enforcement by the Attorney General. The attorney general may bring an action to enforce
compliance in both the TSA and the CTSRA.

Fines and Civil Penalties. Telephone Solicitation Act. Violation of the identification and
list removal requirements is punishable by a fine up to $1,000 per violation.

Commercial Telephone Solicitation Regulation Act. A civil penalty of $500 to $2,000 must
be imposed by the court for each violation.

Changes to the Commercial Telephone Solicitation Regulation Act in 2022. The definition
of "telephone solicitation" was expanded from having to be a call to a residential telephone

customer to a person. The term "telephone solicitor" was defined to mean a commercial or
non-profit company or organization engaged in telephone solicitation. Telephone solicitors
must hang up within ten seconds if the called party states or indicates that they don't want
the call.

Summary of Bill: Definitions. The definition of "automatic dialing and announcing
device" is expanded to mean a system which automatically dials telephone numbers and
transmits a recorded or artificial voice message once a connection is made. A recorded or
artificial message is transmitted even if the recorded or artificial message goes directly to a
recipient's voicemail.

The definition of commercial solicitation is also modified to include wrongfully obtaining
anything of value.

In addition, the following definitions are added:

¢ "assist in the transmission" means actions taken to provide substantial assistance or
support, which enables any person to formulate, originate, initiate, or transmit a

Senate Bill Report -3- ESHB 1051
commercial solicitation when the person providing the assistance knows or
consciously avoids knowing that the initiator of the commercial solicitation is
engaged, or intends to engage, in any practice that violates the Consumer Protection
Act (CPA). This does not include activities of:

1. any entity related to the design, manufacture, or distribution of any technology,
product, or component that has a commercially significant use other than to
violate or circumvent regulations;

2.a telecommunications provider or other entity that is limited to providing
access to the Internet for purposes excluding initiation of a telephone
communication; or

3.a terminating provider relating to the transmission of a_ telephone
communication.

* "terminating provider" means a telecommunications provider that provides voice
services to an end user customer.

Prohibition. No person may assist in the transmission of a commercial solicitation using an
automatic dialing and announcing device. In any action arising from a violation, there is an
affirmative defense that a telecommunications provider both acted in compliance with
federal law and implemented a reasonably effective plan to mitigate origination, initiation,
or transmission of a commercial solicitation using an automatic dialing and announcing
device.

Private Civil Actions and Penalties. A commercial solicitation violation is considered a per
se violation of the CPA, and a person injured by such violations may receive remedies
under the CPA. In addition, the person may bring civil action to enjoin further violations
and recover actual damages or $1,000 per violation, whichever is greater.

Telephone Solicitation Act. Definitions. "Telephone solicitation" is modified to include
wrongfully obtaining anything of value.

A definition of "telephone call" is added.

Prohibition. No person may initiate, or cause to be initiated, a telephone solicitation to any
telephone number on the federal do not call registry. It is also unlawful for a person to
initiate, or cause to be initiated, a telephone solicitation that violates federal law prohibiting
misleading or inaccurate caller identification information. The prohibitions apply to all
telephone solicitation intended to be received by telephone customers within Washington.

Exemptions. Calls made by a membership or labor organization to its own list of bona fide
or active members of the organization are also exempted from telephone solicitation

regulations.

Private Civil Actions. A violation of the TSA is made a per se violation of the CPA. The
court must award damages of at least $1,000 per violation for persons aggrieved by repeated

Senate Bill Report -4- ESHB 1051
violations.

Commercial Telephone Solicitation Regulation Act. Definitions. "Commercial telephone
solicitation" is modified to include wrongfully obtaining anything of value and references to
salesperson are removed. In addition, the exemption that a person who had less than 60
percent of their prior year's sales made as a result of commercial telephone solicitation is
removed, and such person is now considered a commercial telephone solicitor.

The following definitions are added:
¢ "telephone call" includes any communication made through a telephone that uses a
live person, artificial voice, or recorded message; and
¢ "unsolicited" means to initiate contact for the purpose of attempting to sell a person
property, goods, or services where such person provided no previous express interest
in purchasing, investing in, or obtaining information regarding the property, goods, or
services attempted to be sold.

Appropriation: None.
Fiscal Note: Available.
Creates Committee/Commission/Task Force that includes Legislative members: No.

Effective Date: Ninety days after adjournment of session in which bill is passed.

Senate Bill Report -5- ESHB 1051

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