Can the government hold a business liable if a third-party marketer, hired to help the marketing of the business, violates the law? That was the question in a recent case. The case involved a business that contracted with a third-party to provide telemarketing calls on their behalf. As part of the agreement, the business had the third-party telemarketer agree to a contract that stated it would “comply with the [Telephone Consumer Protection Act (TCPA)] and all applicable laws.”
During the arrangement, a consumer contacted the government and filed a complaint. The consumer stated the business made contact in violation of the TCPA. The government reviewed the evidence and moved forward with a claim against the third-party marketer and the business. The business argued that the government should move forward with a claim against the third-party alone. It stated it was removed from liability because of the contract specifically stating the third-party marketer should abide by the TCPA and similar laws.
Unfortunately for the business, the court did not agree. In this case, the government provided evidence the business was aware the third-party marketer was using methods that were in violation of the TCPA to contact consumers. Because it knew of the violation and did not correct the third-party marketer, the court held the business was also liable for the violation.
Business leaders can learn an important lesson from this case. Having an agreement that states the marketer will comply with the law is not enough. If you are aware of a violation, you must address it. A failure to do so could result in shared liability.