Case 1:18-cv-10548 Document 2-1 Filed 03/22/18 Page 1 of 36 

UNITED STATES DISTRICT COURT 

DISTRICT OF MASSACHUSETTS 

FEDERAL TRADE COMMISSION, 

Plaintiff, 

v. 

ALLIANCE SECURITY INC., a Massachusetts 

corporation formerly known as Versatile 

Marketing Solutions, Inc., VMS Alarms, VMS, 

Alliance Security, Alliance Home Protection, and 

AH Protection, 

JASJIT GOTRA, a/k/a Jay Gotra, individually 

and as an officer or owner of Alliance Security 

Inc., formerly known as Versatile Marketing 

Solutions, Inc., VMS Alarms, VMS, Alliance 

Security, Alliance Home Protection, and AH 

Protection, 

DEFEND AMERICA LLC, a Florida Limited 

Liability Company, 

JESSICA MERRICK, a/k/a Jessica Bright, a/k/a 

Jessica Dudlicek, individually and as an officer of 

Defend America LLC, 

POWER MARKETING PROMOTIONS LLC, 

a North Carolina Limited Liability Company, also 

d/b/a J Tele Alarms, and 

KEVIN KLINK, individually and as an officer or 

owner of Power Marketing Promotions LLC, also 

d/b/a J Tele Alarms, 

Defendants. 

CASE NO. 1:18-cv-10548

STIPULATED FINAL ORDER FOR PERMANENT INJUNCTION 

AND CIVIL PENALTY JUDGMENT 

AS TO DEFENDANTS POWER MARKETING PROMOTIONS AND KEVIN KLINK 

Plaintiff, the Federal Trade Commission (“Commission” or “FTC”), filed its Complaint 

for Civil Penalties, Permanent Injunction, and Other Relief (“Complaint”) in this matter 

pursuant to Sections 5(a), 5(m)(1)(A), 13(b), and 16(a) of the Federal Trade Commission Act 

(“FTC Act”), 15 U.S.C. §§ 45(a), 45(m)(1)(A), 53(b), and 56(a), and Section 6 of the 
Case 1:18-cv-10548 Document 2-1 Filed 03/22/18 Page 2 of 36 

Telemarketing and Consumer Fraud and Abuse Prevention Act (the “Telemarketing Act”), 15 

U.S.C. § 6105. The Commission and Defendants Power Marketing Promotions LLC and Kevin 

Klink stipulate to the entry of this Stipulated Final Order for Permanent Injunction and Civil 

Penalty Judgment (“Order”) to resolve all matters in dispute in this action between them, but not 

as to any other person, such as an indemnitee. 

THEREFORE, IT IS ORDERED as follows: 

FINDINGS 

1. This Court has jurisdiction over this matter. 

2. The Complaint charges that Defendants Power Marketing Promotions LLC and 

Kevin Klink participated in deceptive acts or practices in violation of Section 5(a) of the FTC 

Act, 15 U.S.C. § 45(a), and have engaged in acts or practices that violate the FTC’s 

Telemarketing Sales Rule (the “TSR” or “Rule”), as amended, 16 C.F.R. Part 310, in the 

Telemarketing of their products and services or the Telemarketing of their clients’ products and 

services by, among other things: (a) initiating and causing the initiation of Telemarketing calls to 

consumers whose telephone numbers were on the National Do Not Call Registry; (b) failing to 

disclose to consumers the identity of the Seller truthfully, promptly, and in a clear and 

conspicuous manner; and (c) misrepresenting their affiliation with competitors in the home 

security system industry. 

3. Defendants Power Marketing Promotions LLC and Kevin Klink neither admit nor 

deny any of the allegations in the Complaint, except as specifically stated in this Order. Only for 

purposes of this action, Power Marketing Promotions LLC and Kevin Klink admit the facts 

necessary to establish jurisdiction. 

4. Defendants Power Marketing Promotions LLC and Kevin Klink waive any claim 

that they may have under the Equal Access to Justice Act, 28 U.S.C. § 2412, concerning the 

prosecution of this action through the date of this Order, and agree to bear their own costs and 

attorneys’ fees. Defendants Power Marketing Promotions LLC and Kevin Klink waive and 

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release any claims that they may have against the Commission and its agents that relate to this 

action. 

5. Defendants Power Marketing Promotions LLC and Kevin Klink and the 

Commission waive all rights to appeal or otherwise challenge or contest the validity of this 

Order. 

DEFINITIONS 

For the purpose of this Order, the following definitions apply: 

A. “Assisting Others” includes, among other conduct, receiving an inbound 

telephone call that was generated through an Outbound Telephone Call, or providing access to 

software, computers, or servers that assist with, manage, or automate the delivery of Outbound 

Telephone Calls. 

B. “Caller Identification Service” means a service that allows a telephone 

subscriber to have the telephone number, and, where available, name of the calling party 

transmitted contemporaneously with the telephone call, and displayed on a device in or 

connected to the subscriber’s telephone. 

C. “Defendant Power Marketing” means Power Marketing Promotions LLC, a 

North Carolina limited liability company, and its successors and assigns, individually, 

collectively, or in any combination. 

D. “Defendant Klink” means Kevin Klink. 

E. “Defendants” means Defendant Power Marketing and Defendant Klink. 

F. “Entity-Specific Do Not Call List” means a list of telephone numbers 

maintained by Defendant Klink of persons who have previously stated that they do not wish to 

receive Outbound Telephone calls made by or on behalf of Defendant Klink, including the date 

and time the telephone number was added to that list. 

G. “Established Business Relationship” means a relationship between Defendant 

Klink and a consumer based on: (1) the consumer’s purchase, rental, or lease of Defendant 

Klink’s goods or services or a financial transaction between the consumer and Defendant Klink, 

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within the eighteen (18) months immediately preceding the date of a Telemarketing call; or (2) 

the consumer’s inquiry or application directly to Defendant Klink regarding a product or service 

offered by Defendant Klink, within one (1) month immediately preceding the date of a 

Telemarketing call. 

H. “National Do Not Call Registry” means the “do-not-call” registry of telephone 

numbers maintained by the Federal Trade Commission pursuant to 16 C.F.R. 

§ 310.4(b)(1)(iii)(B). 

I. “Telemarketing” means a plan, program, or campaign which is conducted to 

induce the purchase of goods or services or a charitable contribution, by use of one or more 

telephones and which involves more than one interstate telephone call. 

J. “Telemarketer” means any person who, in connection with Telemarketing, 

initiates or receives telephone calls to or from a customer or donor. 

K. “Outbound Telephone Call” means a telephone call initiated by a Telemarketer 

to induce the purchase of goods or services or to solicit a charitable contribution. 

L. “Seller” means any person who, in connection with a Telemarketing transaction, 

provides, offers to provide, or arranges for others to provide goods or services to the customer in 

exchange for consideration. 

ORDER 

I. Permanent Ban on Telemarketing 

IT IS ORDERED that Defendant Power Marketing, whether acting directly or through an 

intermediary, is permanently restrained and enjoined from engaging in, or Assisting Others to 

engage in, Telemarketing. 

II. Permanent Ban on Home Security and Medical Alert Device Sales 

IT IS FURTHER ORDERED that Defendants, whether acting directly or through an 

intermediary, are permanently restrained and enjoined from: 

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A. Advertising, marketing, promoting, or offering for sale, or assisting in the 

advertising, marketing, promoting, or offering for sale of home security systems, home alarms, 

or medical alert systems or medical alert devices; and/or 

B. Owning or controlling, holding a managerial post, consulting for, serving as an 

officer in, having any revenue sharing agreement with, holding any ownership interest, share, or 

stock, other than a publicly traded company, in any company that engages in conduct prohibited 

by subsection II.A. 

III. Permanent Ban on Robocalls 

IT IS FURTHER ORDERED that Defendant Klink, whether acting directly or through an 

intermediary, is permanently restrained and enjoined from: 

A. Initiating, causing the initiation of, or Assisting Others in initiating any Outbound 

Telephone Call that delivers a prerecorded message; and/or 

B. Owning or controlling, holding a managerial post, consulting for, serving as an 

officer in, having any revenue sharing agreement with, holding any ownership interest, share, or 

stock, other than a publicly traded company, in any company that engages in conduct banned in 

subsection III.A. 

IV. Permanent Ban on Calls to Numbers Listed on the National Do Not Call Registry 

IT IS FURTHER ORDERED that Defendant Klink, whether acting directly or through an 

intermediary, is permanently restrained and enjoined from: 

A. Initiating, causing the initiation of, or Assisting Others in initiating any Outbound 

Telephone Call to any number listed for more than thirty-one (31) days on the National Do Not 

Call Registry, unless Defendant Klink proves that he has an Established Business Relationship 

with the consumer who owns that telephone number; and/or 

B. Owning or controlling, holding a managerial post, consulting for, serving as an 

officer in, having any revenue sharing agreement with, holding any ownership interest, share, or 

stock, other than a publicly traded company, in any company that engages in conduct banned in 

subsection IV.A. 

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V. Permanent Ban on Selling Lists of Data Containing Telephone Numbers Listed on the 

National Do Not Call Registry 

IT IS FURTHER ORDERED that Defendants Power Marketing and Klink, whether 

acting directly or through an intermediary, are permanently restrained and enjoined from selling 

or Assisting Others in selling any data lists or other lists or compilations of information that 

contain telephone numbers listed on the National Do Not Call Registry more than thirty-one (31) 

days after the date on which such numbers are added to the National Do Not Call Registry. 

VI. Prohibition Against Misrepresentations 

IT IS FURTHER ORDERED that Defendants, Defendants’ officers, agents, employees, 

and attorneys, and all other persons in active concert or participation with any of them, who 

receive actual notice of this Order, whether acting directly or indirectly, in connection with 

promoting or offering for sale any good or service, are permanently restrained and enjoined from 

misrepresenting, or Assisting Others in misrepresenting, expressly or by implication: 

A. The name of Defendants’ business, including through the use of fictitious 

business names and aliases. Provided, however, that this section does not prohibit the use of a 

“doing business as” name that is registered with a Secretary of State or other governmental 

authority; or 

B. That Defendants are representatives of, related to, associated with, vetted by, or in 

any way affiliated with any competitor. 

VII. Prohibition on Abusive Telemarketing Practices 

IT IS FURTHER ORDERED that Defendant Klink, and Defendant Klink’s officers, 

agents, employees, and attorneys, and all other persons in active concert or participation with any 

of them, who receive actual notice of this Order, whether acting directly or indirectly, in 

connection with the promoting or offering for sale any good or service on behalf of Defendant 

Klink are permanently restrained and enjoined from engaging in, causing others to engage in, or 

Assisting Others to engage in any of the following practices: 

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A. Initiating any Outbound Telephone Call to a person when that person has 

previously stated that he or she does not wish to receive an Outbound Telephone Call made by or 

on behalf of Defendant Klink, the Seller, or the Telemarketer. 

B. Initiating any Outbound Telephone Call to a telephone number within a given 

area code unless Defendant Klink has paid the annual fee for access to the telephone numbers 

within that area code that are included in the National Do Not Call Registry, unless Defendant 

Klink proves that the telephone call is to a person with whom Defendant Klink has an 

Established Business Relationship. 

C. Initiating any Outbound Telephone Call through any other company, vendor, or 

automated dialing service that has not agreed to retain for a period of 18 months such records as 

are necessary to provide the following billing information about telephone toll calls: the name, 

address, and telephone number of the caller, telephone number called, date, time and length of 

the call. 

D. Abandoning, or causing others to abandon, any Outbound Telephone Call to a 

person by failing to connect the call to a live operator within two seconds of the person’s 

completed greeting, unless Defendant Klink retains sufficient records to prove that the following 

three conditions are met: 

1. The Outbound Telephone Call was initiated using technology that ensures 

abandonment of no more than three percent of all calls answered by a 

person, measured over the duration of a single calling campaign, if less 

than thirty days, or separately over each successive thirty day period or 

portion thereof that the campaign continues; 

2. The Outbound Telephone call allowed the telephone to ring for at least 

fifteen seconds or four rings before disconnecting an unanswered call; and 

3. Whenever a live operator is not available to speak with the person 

answering the Outbound Telephone Call within two seconds after the 

person’s completed greeting, promptly plays a recorded message that 

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states Defendant Klink’s, the Seller’s, or the Telemarketer’s name and 

telephone number; and 

E. Initiating any Outbound Telephone Call that fails to disclose truthfully, promptly, 

and in a clear and conspicuous manner the Defendant’s identity, that the purpose of the call is to 

sell goods or services, and the nature of the goods or services; 

F. Initiating any Outbound Telephone Call that fails to transmit or cause to be 

transmitted to any Caller Identification Service in use by a recipient of a Telemarketing call 

either: (i) the telephone number and, where available, name of the Telemarketer making the call; 

or (ii) Defendant’s customer service telephone number and, where available, Defendant’s name; 

G. Initiating any Outbound Telephone Call that displays a caller identification 

number other than a number licensed to or owned by Defendant Klink. 

H. Violating the Telemarketing Sales Rule, 16 C.F.R. Part 310, attached as Appendix 

A to this Stipulated Final Order. 

VIII. Telemarketing Compliance Assessments 

IT IS FURTHER ORDERED that Defendant Klink shall obtain initial and annual 

assessments and reports (“Assessments”) from a qualified, objective, independent third-party 

professional, who uses procedures and standards generally accepted in the profession. The 

Assessments will evaluate Defendant Klink’s compliance with this Order and the Telemarketing 

Sales Rule, 16 C.F.R. Part 310, to the extent that Defendant Klink, or any business that he owns 

or operates, engages in Telemarketing. The reporting period for the Assessments shall cover: (1) 

the first one hundred and eighty (180) days after service of the order for the initial Assessment; 

and (2) each one (1) year period thereafter for ten (10) years after entry of the order for the 

annual Assessments. Each Assessment shall be prepared and completed within ninety (90) days 

after the end of the reporting period to which the Assessment applies. Defendant Klink shall 

provide the initial Assessment to the Associate Director for Enforcement, Bureau of Consumer 

Protection, Federal Trade Commission, Washington, D.C. 20580, within ten (10) business days 

after the Assessment has been prepared. All subsequent annual Assessments shall be retained by 

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Defendant Klink throughout the ten-year period for the Assessments and provided to the 

Associate Director for Enforcement within ten (10) business days of request. Unless otherwise 

directed by a representative of the Commission, initial and annual Assessments shall be sent by 

overnight courier (not the U.S. Postal Service) to the Associate Director, Division of 

Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania 

Avenue, NW, Washington, D.C. 20580, with the subject line “FTC v. Power Marketing 

Promotions LLC, FTC File Number X140022.” Provided, however, that, in lieu of overnight 

courier, Assessments may be sent by first-class mail, but only if an electronic version of such 

Assessments is contemporaneously sent to the Commission at DEBrief@ftc.gov. 

IX. Monetary Judgment for Civil Penalty and Partial Suspension 

IT IS FURTHER ORDERED that: 

A. Judgment in the amount of three million two hundred ninety-three thousand five 

hundred and twelve dollars ($3,293,512) is entered in favor of the Commission against 

Defendants Power Marketing and Klink, jointly and severally, as a civil penalty. 

B. Defendants Power Marketing and Klink are ordered to pay to the Commission 

three hundred thousand dollars ($300,000) as follows: 

1. Within seven (7) days of entry of this Order, Defendants shall pay to the 

Commission, by electronic fund transfer in accordance with instructions 

previously provided by a representative of the Commission, the sum of 

two hundred twenty-five thousand dollars ($225,000). Defendants Power 

Marketing and Klink stipulate that their undersigned counsel holds this 

amount in escrow for no purpose other than payment to the Commission. 

2. Within ninety (90) days of entry of this Order, Defendants shall make a 

second payment to the Commission, by electronic fund transfer in 

accordance with instructions provided by a representative of the 

Commission, of seventy-five thousand dollars ($75,000). 

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3. Upon such payment, the remainder of the judgment is suspended, subject 

to the Subsections below. 

C. The Commission’s agreement to the suspension of part of the judgment is 

expressly premised upon the truthfulness, accuracy, and completeness of Defendants Power 

Marketing and Klink’s sworn financial statements and related documents (collectively, “financial 

representations”) at the time submitted to the Commission, namely: 

1. The Financial Statement of Defendant Power Marketing Promotions LLC 

signed on July 21, 2017, including the attachments and documents 

submitted with the Financial Statement; 

2. The Financial Statement of Defendant Klink signed on July 21, 2017, 

including the attachments and documents submitted with the Financial 

Statement; and 

3. The supplemental financial documents related to Defendant Klink’s other 

corporate holdings produced to the Commission on October 3, 2017. 

D. The suspension of the judgment will be lifted as to either Defendant if, upon 

motion by the Commission, the Court finds that Defendant failed to disclose any material asset, 

materially misstated the value of any asset, or made any other material misstatement or omission 

in the financial representations identified above. 

E. If the suspension of the judgment is lifted, the judgment becomes immediately 

due as to that Defendant in the amount specified in Subsection A above (which the parties 

stipulate only for purposes of this Section represents the amount of the civil penalty for the 

violations alleged in the Complaint), less any payment previously made pursuant to this Section, 

plus interest computed from the date of entry of this Order. 

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X. Additional Monetary Provisions 

IT IS FURTHER ORDERED that: 

A. Defendants Power Marketing and Klink relinquish dominion and all legal and 

equitable right, title, and interest in all assets transferred pursuant to this Order and may not seek 

the return of any assets. 

B. The facts alleged in the Complaint will be taken as true, without further proof, in 

any subsequent civil litigation by or on behalf of the Commission, including in a proceeding to 

enforce its rights to any payment or monetary judgment pursuant to this Order. 

C. Defendants Power Marketing and Klink agree that the judgment against them 

represents a civil penalty owed to the government of the United States, is not compensation for 

actual pecuniary loss, and, therefore, as to Defendant Klink, it is not subject to discharge under 

the Bankruptcy Code pursuant to 11 U.S.C. § 523(a)(7). 

D. Defendants acknowledge that the Taxpayer Identification Numbers (Social 

Security Numbers or Employer Identification Numbers), which Defendants previously submitted 

in connection with the Financial Statements referenced in Section IX.C., above, may be used for 

collecting and reporting on any delinquent amount arising out of this Order, in accordance with 

31 U.S.C. § 7701. 

XI. Customer Information 

IT IS FURTHER ORDERED that Defendants, Defendants’ officers, agents, employees, 

and attorneys, and all other persons in active concert or participation with any of them, who 

receive actual notice of this Order, are permanently restrained and enjoined from: 

A. Directly or indirectly disclosing, using, or benefitting from customer information, 

including the name, address, telephone number, email address, social security number, credit 

score, other identifying information, or any data that enables access to a customer’s account 

(including a credit card, bank account, or other financial account), that any Defendant obtained 

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prior to entry of this Order in connection with the offering for sale, advertising, Telemarketing, 

or installation of home security systems or alarms; and 

B. Failing to destroy such customer information in all forms in their possession, 

custody, or control within thirty (30) days after entry of this Order. 

XII. Cooperation 

IT IS FURTHER ORDERED that Defendant Klink must fully cooperate with 

representatives of the Commission in this case and in any investigation related to or associated 

with the transactions or the occurrences that are the subject of the Complaint. Defendant Klink 

must provide truthful and complete information, evidence, and testimony. Defendant Klink must 

appear for interviews, discovery, hearings, trials, and any other proceedings that a Commission 

representative may reasonably request upon five (5) days written notice, at such places and times 

that a Commission representative may designate, without requiring the service of a subpoena. 

Further, to assist the Commission with any investigation related to or associated with the 

transactions or the occurrences that are the subject of the Complaint, and with monitoring 

Defendant Klink’s compliance with this order, Defendant Klink consents, for purposes of the 

Electronic Communications Privacy Act, in relevant part at 18 U.S.C. §§ 2701-2712, to the 

disclosure, by electronic communications service providers and remote computing service 

providers of the contents and records of his auto-dialed, Telemarketing communications or other 

information pertaining to his auto-dialed, Telemarketing communications. Defendant Klink 

further agrees to execute, within fourteen (14) days of a request from the Commission, any forms 

or other documents evidencing his consent that may be required by such electronic 

communications service providers or remote computing service providers. 

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XIII. Order Acknowledgments 

IT IS FURTHER ORDERED that Defendants Power Marketing and Klink obtain 

acknowledgments of receipt of this Order: 

A. Each Defendant, within seven days of entry of this Order, must submit to the 

Commission an acknowledgment of receipt of this Order sworn under penalty of perjury. 

B. For five (5) years after entry of this Order, Defendant Klink for any business that 

he, individually or collectively with any other Defendant, is the majority owner or controls 

directly or indirectly, and Defendant Power Marketing, must deliver a copy of this Order, 

including Appendix A, to: (1) all principals, officers, directors, and LLC managers and members; 

(2) all employees, agents, and other representatives who participate in conduct related to the 

subject matter of the Order; and (3) any business entity resulting from any change in structure as 

set forth in the Section titled Compliance Reporting. Delivery must occur within seven (7) days 

of entry of this Order for current personnel. For all others, delivery must occur before they 

assume their responsibilities. 

C. From each individual or entity to which either Defendant delivered a copy of this 

Order, that Defendant must obtain, within thirty (30) days, a signed and dated acknowledgment 

of receipt of this Order. 

XIV. Compliance Reporting 

IT IS FURTHER ORDERED that Defendants Power Marketing and Klink make timely 

submissions to the Commission: 

A. One year after entry of this Order, Defendants Power Marketing and Klink must 

each submit a compliance report, sworn under penalty of perjury: 

1. Each Defendant must: (a) identify the primary physical, postal, and email 

address and telephone number, as designated points of contact, which 

representatives of the Commission may use to communicate with 

Defendant; (b) identify all of that Defendant’s businesses by all of their 

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names, telephone numbers, and physical, postal, email, and Internet 

addresses; (c) describe the activities of each business, including the goods 

and services offered, the means of advertising, marketing, and sales, and 

the involvement of any other Defendant (which Defendant Klink must 

describe if he knows or should know due to his own involvement); 

(d) describe in detail whether and how that Defendant is in compliance 

with each Section of this Order; and (e) provide a copy of each Order 

Acknowledgment obtained pursuant to this Order, unless previously 

submitted to the Commission. 

2. Additionally, Defendant Klink must: (a) identify all telephone numbers 

and all physical, postal, email and Internet addresses, including all 

residences; (b) identify all business activities, including any business for 

which he performs services whether as an employee or otherwise and any 

entity in which he has any ownership; and (c) describe in detail his 

involvement in each such business, including title, role, responsibilities, 

participation, authority, control, and any ownership. 

B. For twenty (20) years after entry of this Order, each Defendant must submit a 

compliance notice, sworn under penalty of perjury, within fourteen (14) days of any change in 

the following: 

1. Each Defendant must report any change in: (a) any designated point of 

contact; or (b) the structure of Defendant Power Marketing or any entity 

that either Defendant has any ownership interest in or controls directly or 

indirectly that may affect compliance obligations arising under this Order, 

including: creation, merger, sale, or dissolution of the entity or any 

subsidiary, parent, or affiliate that engages in any acts or practices subject 

to this Order. 

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2. Additionally, Defendant Klink must report any change in: (a) name, 

including aliases or fictitious name, or residence address; or (b) title or 

role in any business activity, including any business for which he performs 

services whether as an employee or otherwise and any entity in which he 

has any ownership interest, and identify the name, physical address, and 

any Internet address of the business or entity. 

C. Each Defendant must submit to the Commission notice of the filing of any 

bankruptcy petition, insolvency proceeding, or similar proceeding by or against such Defendant 

within fourteen (14) days of its filing. 

D. Any submission to the Commission required by this Order to be sworn under 

penalty of perjury must be true and accurate and comply with 28 U.S.C. § 1746, such as by 

concluding: “I declare under penalty of perjury under the laws of the United States of America 

that the foregoing is true and correct. Executed on: _____” and supplying the date, signatory’s 

full name, title (if applicable), and signature. 

E. Unless otherwise directed by a Commission representative in writing, all 

submissions to the Commission pursuant to this Order must be emailed to DEbrief@ftc.gov or 

sent by overnight courier (not the U.S. Postal Service) to: Associate Director for Enforcement, 

Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, 

Washington, DC 20580. The subject line must begin: FTC v. Power Marketing Promotions 

LLC, Matter Number X140022. 

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XV. Recordkeeping 

IT IS FURTHER ORDERED that Defendants Power Marketing and Klink must create 

certain records for twenty (20) years after entry of the Order, and retain each such record for five 

(5) years. Specifically, Defendants Power Marketing and Klink, for any business that he owns 

(directly or indirectly) at least a 50 percent ownership share or controls (directly or indirectly) 

must create and retain the following records: 

A. Accounting records showing the revenues from all goods or services sold; 

B. Personnel records showing, for each person providing services, whether as an 

employee or otherwise, that person’s: name; addresses; telephone numbers; job title or position; 

dates of service; and (if applicable) the reason for termination; 

C. Records of all consumer complaints, whether received directly or indirectly, such 

as through a third party, and any response; and 

D. All records necessary to demonstrate full compliance with each provision of this 

Order, including, among other documents and information: all submissions to the Commission; 

all evidence of an Established Business Relationship with the person who owns any telephone 

number listed for more than thirty-one (31) days on the National Do Not Call Registry to which 

Defendant Klink or his officers, agents, employees, and attorneys, and all other persons in active 

concert or participation with any of them, placed an Outbound Telephone Call; all records 

related to Defendant Klink’s Entity-Specific Do Not Call List; and all records related licensing or 

ownership of telephone numbers displayed as caller identification numbers in Outbound 

Telephone Calls. 

XVI. Compliance Monitoring 

IT IS FURTHER ORDERED that, for the purpose of monitoring Defendants Power 

Marketing and Klink’s compliance with this Order, including the financial representations upon 

which part of the judgment was suspended and any failure to transfer any assets as required by 

this Order: 

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A. Within fourteen (14) days of receipt of a written request from a representative of 

the Commission, each Defendant must: (1) submit additional compliance reports or other 

requested information, which must be sworn under penalty of perjury; (2) appear for depositions; 

and (3) produce documents for inspection and copying. The Commission is also authorized to 

obtain discovery, without further leave of court, using any of the procedures prescribed by 

Federal Rules of Civil Procedure 29, 30 (including telephonic depositions), 31, 33, 34, 36, 45, 

and 69. 

B. For matters concerning this Order, the Commission is authorized to communicate 

directly with each Defendant. Each Defendant must permit representatives of the Commission to 

interview any employee or other person affiliated with any Defendant who has agreed to such an 

interview. The person interviewed may have counsel present. 

C. The Commission may use all other lawful means, including posing through its 

representatives as consumers, suppliers, or other individuals or entities, to either Defendant or 

any individual or entity affiliated with either Defendant, without the necessity of identification or 

prior notice. Nothing in this Order limits the Commission’s lawful use of compulsory process, 

pursuant to Sections 9 and 20 of the FTC Act, 15 U.S.C. §§ 49, 57b-1. 

D. Upon written request from a representative of the Commission, any consumer 

reporting agency must furnish consumer reports concerning Defendant Klink, pursuant to 

Section 604(1) of the Fair Credit Reporting Act, 15 U.S.C. §1681b(a)(1). 

XVII. Retention of Jurisdiction 

IT IS FURTHER ORDERED that this Court retains jurisdiction of this matter for 

purposes of construction, modification, and enforcement of this Order. 

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SO ORDERED, this _____ day of __________, 2018. 

United States District Judge 

[Signatures of Parties and Counsel on Following Page] 

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Case 1:18-cv-10548 Document 2-1 Filed 03/22/18 Page 20 of 36 

Appendix A to Stipulated Final Order 

(Telemarketing Sales Rule) 
Case 1:18-cv-10548 Document 2-1 Filed 03/22/18 Page 21 of 36 

Appendix A 

Telemarketing Sales Rule
 

Case 1:18-cv-10548 Document 2-1 Filed 03/22/18 Page 22 of 36 

§ 310.2 

(b) Attorney General means the chief 

legal officer of a state. 

(c) Billing information means any data 

that enables any person to access a 

customer’s or donor’s account, such as 

a credit card, checking, savings, share 

or similar account, utility bill, mortgage loan account, or debit card. 

(d) Caller identification service means a 

service that allows a telephone subscriber to have the telephone number, 

and, where available, name of the calling party transmitted contemporaneously with the telephone call, and 

displayed on a device in or connected 

to the subscriber’s telephone. 

(e) Cardholder means a person to 

whom a credit card is issued or who is 

authorized to use a credit card on behalf of or in addition to the person to 

whom the credit card is issued. 

(f) Charitable contribution means any 

donation or gift of money or any other 

thing of value. 

(g) Commission means the Federal 

Trade Commission. 

(h) Credit means the right granted by 

a creditor to a debtor to defer payment 

of debt or to incur debt and defer its 

payment. 

(i) Credit card means any card, plate, 

coupon book, or other credit device existing for the purpose of obtaining 

money, property, labor, or services on 

credit. 

(j) Credit card sales draft means any 

record or evidence of a credit card 

transaction. 

(k) Credit card system means any 

method or procedure used to process 

credit card transactions involving credit cards issued or licensed by the operator of that system. 

(l) Customer means any person who is 

or may be required to pay for goods or 

services offered through telemarketing. 

(m) Debt relief service means any program or service represented, directly or 

by implication, to renegotiate, settle, 

or in any way alter the terms of payment or other terms of the debt between a person and one or more unsecured creditors or debt collectors, including, but not limited to, a reduction 

in the balance, interest rate, or fees 

owed by a person to an unsecured creditor or debt collector. 

16 CFR Ch. I (1–1–16 Edition) 

(n) Donor means any person solicited 

to make a charitable contribution. 

(o) Established business relationship 

means a relationship between a seller 

and a consumer based on: 

(1) the consumer’s purchase, rental, 

or lease of the seller’s goods or services 

or a financial transaction between the 

consumer and seller, within the eighteen (18) months immediately preceding 

the date of a telemarketing call; or 

(2) the consumer’s inquiry or application regarding a product or service offered by the seller, within the three (3) 

months immediately preceding the 

date of a telemarketing call. 

(p) Free-to-pay conversion means, in 

an offer or agreement to sell or provide 

any goods or services, a provision 

under which a customer receives a 

product or service for free for an initial 

period and will incur an obligation to 

pay for the product or service if he or 

she does not take affirmative action to 

cancel before the end of that period. 

(q) Investment opportunity means anything, tangible or intangible, that is offered, offered for sale, sold, or traded 

based wholly or in part on representations, either express or implied, about 

past, present, or future income, profit, 

or appreciation. 

(r) Material means likely to affect a 

person’s choice of, or conduct regarding, goods or services or a charitable 

contribution. 

(s) Merchant means a person who is 

authorized under a written contract 

with an acquirer to honor or accept 

credit cards, or to transmit or process 

for payment credit card payments, for 

the purchase of goods or services or a 

charitable contribution. 

(t) Merchant agreement means a written contract between a merchant and 

an acquirer to honor or accept credit 

cards, or to transmit or process for 

payment credit card payments, for the 

purchase of goods or services or a charitable contribution. 

(u) Negative option feature means, in 

an offer or agreement to sell or provide 

any goods or services, a provision 

under which the customer’s silence or 

failure to take an affirmative action to 

reject goods or services or to cancel the 

agreement is interpreted by the seller 

as acceptance of the offer. 

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(v) Outbound telephone call means a 

telephone call initiated by a telemarketer to induce the purchase of 

goods or services or to solicit a charitable contribution. 

(w) Person means any individual, 

group, unincorporated association, limited or general partnership, corporation, or other business entity. 

(x) Preacquired account information 

means any information that enables a 

seller or telemarketer to cause a

charge to be placed against a customer’s or donor’s account without obtaining the account number directly 

from the customer or donor during the 

telemarketing transaction pursuant to 

which the account will be charged. 

(y) Prize means anything offered, or 

purportedly offered, and given, or purportedly given, to a person by chance. 

For purposes of this definition, chance 

exists if a person is guaranteed to receive an item and, at the time of the 

offer or purported offer, the telemarketer does not identify the specific 

item that the person will receive. 

(z) Prize promotion means: 

(1) A sweepstakes or other game of 

chance; or 

(2) An oral or written express or implied representation that a person has 

won, has been selected to receive, or 

may be eligible to receive a prize or 

purported prize. 

(aa) Seller means any person who, in 

connection with a telemarketing transaction, provides, offers to provide, or 

arranges for others to provide goods or 

services to the customer in exchange 

for consideration. 

(bb) State means any state of the 

United States, the District of Columbia, Puerto Rico, the Northern Mariana 

Islands, and any territory or possession 

of the United States. 

(cc) Telemarketer means any person 

who, in connection with telemarketing, 

initiates or receives telephone calls to 

or from a customer or donor. 

(dd) Telemarketing means a plan, program, or campaign which is conducted 

to induce the purchase of goods or services or a charitable contribution, by 

use of one or more telephones and 

which involves more than one interstate telephone call. The term does not 

include the solicitation of sales

through the mailing of a catalog

§ 310.2 

which: contains a written description 

or illustration of the goods or services 

offered for sale; includes the business 

address of the seller; includes multiple 

pages of written material or illustrations; and has been issued not less frequently than once a year, when the 

person making the solicitation does 

not solicit customers by telephone but 

only receives calls initiated by customers in response to the catalog and 

during those calls takes orders only 

without further solicitation. For purposes of the previous sentence, the 

term ‘‘further solicitation’’ does not 

include providing the customer with 

information about, or attempting to 

sell, any other item included in the 

same catalog which prompted the customer’s call or in a substantially similar catalog. 

(ee) Upselling means soliciting the 

purchase of goods or services following 

an initial transaction during a single 

telephone call. The upsell is a separate 

telemarketing transaction, not a continuation of the initial transaction. An 

‘‘external upsell’’ is a solicitation 

made by or on behalf of a seller different from the seller in the initial 

transaction, regardless of whether the 

initial transaction and the subsequent 

solicitation are made by the same telemarketer. An ‘‘internal upsell’’ is a solicitation made by or on behalf of the 

same seller as in the initial transaction, regardless of whether the initial transaction and subsequent solicitation are made by the same telemarketer. 

EFFECTIVE DATE NOTE: At 80 FR 77558, Dec. 

14, 2015, § 310.2 was amended by redesignating 

paragraphs (aa) through (ee) as paragraphs 

(dd) through (hh), redesignating paragraphs 

(f) through (z) as paragraphs (h) through 

(bb), and adding new paragraphs (f), (g), and 

(cc), effective Feb. 12, 2016. For the convenience of the user, the added text is set forth 

as follows: 

§ 310.2 Definitions. 

* * * * * 

(f) Cash-to-cash money transfer means the 

electronic (as defined in section 106(2) of the 

Electronic Signatures in Global and National 

Commerce Act (15 U.S.C. 7006(2)) transfer of 

the value of cash received from one person to 

another person in a different location that is 

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§ 310.3 

sent by a money transfer provider and received in the form of cash. For purposes of 

this definition, money transfer provider means 

any person or financial institution that provides cash-to-cash money transfers for a person in the normal course of its business, 

whether or not the person holds an account 

with such person or financial institution. 

The term cash-to-cash money transfer includes 

a remittance transfer, as defined in section 

919(g)(2) of the Electronic Fund Transfer Act 

(‘‘EFTA’’), 15 U.S.C. 1693a, that is a cash-tocash transaction; however it does not include 

any transaction that is: 

(1) An electronic fund transfer as defined in 

section 903 of the EFTA; 

(2) Covered by Regulation E, 12 CFR 

1005.20, pertaining to gift cards; or 

(3) Subject to the Truth in Lending Act, 15 

U.S.C. 1601 et seq. 

(g) Cash reload mechanism is a device, authorization code, personal identification 

number, or other security measure that 

makes it possible for a person to convert 

cash into an electronic (as defined in section 

106(2) of the Electronic Signatures in Global 

and National Commerce Act (15 U.S.C. 

7006(2)) form that can be used to add funds to 

a general-use prepaid card, as defined in Regulation E, 12 CFR 1005.2, or an account with 

a payment intermediary. For purposes of 

this definition, a cash reload mechanism is 

not itself a general-use prepaid debit card or 

a swipe reload process or similar method in 

which funds are added directly onto a person’s own general-use prepaid card or account with a payment intermediary. 

* * * * * 

(cc) Remotely created payment order means 

any payment instruction or order drawn on a 

person’s account that is created by the payee 

or the payee’s agent and deposited into or 

cleared through the check clearing system. 

The term includes, without limitation, a 

‘‘remotely created check,’’ as defined in Regulation CC, Availability of Funds and Collection of Checks, 12 CFR 229.2(fff), but does not 

include a payment order cleared through an 

Automated Clearinghouse (ACH) Network or 

subject to the Truth in Lending Act, 15 

U.S.C. 1601 et seq., and Regulation Z, 12 CFR 

part 1026. 

* * * * * 

§ 310.3 Deceptive telemarketing acts or 

practices. 

(a) Prohibited deceptive telemarketing 

acts or practices. It is a deceptive telemarketing act or practice and a violation of this Rule for any seller or telemarketer to engage in the following 

conduct: 

16 CFR Ch. I (1–1–16 Edition) 

(1) Before a customer consents to 

pay 659 for goods or services offered, 

failing to disclose truthfully, in a clear 

and conspicuous manner, the following 

material information: 

(i) The total costs to purchase, receive, or use, and the quantity of, any 

goods or services that are the subject 

of the sales offer; 660 

(ii) All material restrictions, limitations, or conditions to purchase, receive, or use the goods or services that 

are the subject of the sales offer; 

(iii) If the seller has a policy of not 

making refunds, cancellations, exchanges, or repurchases, a statement 

informing the customer that this is the 

seller’s policy; or, if the seller or telemarketer makes a representation 

about a refund, cancellation, exchange, 

or repurchase policy, a statement of all 

material terms and conditions of such 

policy; 

(iv) In any prize promotion, the odds 

of being able to receive the prize, and, 

if the odds are not calculable in advance, the factors used in calculating 

the odds; that no purchase or payment 

is required to win a prize or to participate in a prize promotion and that any 

purchase or payment will not increase 

the person’s chances of winning; and 

the no-purchase/no-payment method of 

participating in the prize promotion 

with either instructions on how to participate or an address or local or tollfree telephone number to which customers may write or call for information on how to participate; 

659 When a seller or telemarketer uses, or 

directs a customer to use, a courier to transport payment, the seller or telemarketer 

must make the disclosures required by 

§ 310.3(a)(1) before sending a courier to pick 

up payment or authorization for payment, or 

directing a customer to have a courier pick 

up payment or authorization for payment. In 

the case of debt relief services, the seller or 

telemarketer must make the disclosures required by § 310.3(a)(1) before the consumer enrolls in an offered program. 660 For offers of consumer credit products 

subject to the Truth in Lending Act, 15 

U.S.C. 1601 et seq., and Regulation Z, 12 CFR 

226, compliance with the disclosure requirements under the Truth in Lending Act and 

Regulation Z shall constitute compliance 

with § 310.3(a)(1)(i) of this Rule. 

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(v) All material costs or conditions 

to receive or redeem a prize that is the 

subject of the prize promotion; 

(vi) In the sale of any goods or services represented to protect, insure, or 

otherwise limit a customer’s liability 

in the event of unauthorized use of the 

customer’s credit card, the limits on a 

cardholder’s liability for unauthorized 

use of a credit card pursuant to 15 

U.S.C. 1643; 

(vii) If the offer includes a negative 

option feature, all material terms and 

conditions of the negative option feature, including, but not limited to, the 

fact that the customer’s account will 

be charged unless the customer takes 

an affirmative action to avoid the 

charge(s), the date(s) the charge(s) will 

be submitted for payment, and the specific steps the customer must take to 

avoid the charge(s); and 

(viii) In the sale of any debt relief 

service: 

(A) the amount of time necessary to 

achieve the represented results, and to 

the extent that the service may include 

a settlement offer to any of the customer’s creditors or debt collectors, 

the time by which the debt relief service provider will make a bona fide settlement offer to each of them; 

(B) to the extent that the service 

may include a settlement offer to any 

of the customer’s creditors or debt collectors, the amount of money or the 

percentage of each outstanding debt 

that the customer must accumulate before the debt relief service provider 

will make a bona fide settlement offer 

to each of them; 

(C) to the extent that any aspect of 

the debt relief service relies upon or results in the customer’s failure to make 

timely payments to creditors or debt 

collectors, that the use of the debt relief service will likely adversely affect 

the customer’s creditworthiness, may 

result in the customer being subject to 

collections or sued by creditors or debt 

collectors, and may increase the 

amount of money the customer owes 

due to the accrual of fees and interest; 

and 

(D) to the extent that the debt relief 

service requests or requires the customer to place funds in an account at 

an insured financial institution, that 

the customer owns the funds held in 

§ 310.3 

the account, the customer may withdraw from the debt relief service at any 

time without penalty, and, if the customer withdraws, the customer must 

receive all funds in the account, other 

than funds earned by the debt relief 

service in compliance with 

§ 310.4(a)(5)(i)(A) through (C). 

(2) Misrepresenting, directly or by 

implication, in the sale of goods or 

services any of the following material 

information: 

(i) The total costs to purchase, receive, or use, and the quantity of, any 

goods or services that are the subject 

of a sales offer; 

(ii) Any material restriction, limitation, or condition to purchase, receive, 

or use goods or services that are the 

subject of a sales offer; 

(iii) Any material aspect of the performance, efficacy, nature, or central 

characteristics of goods or services 

that are the subject of a sales offer; 

(iv) Any material aspect of the nature or terms of the seller’s refund, 

cancellation, exchange, or repurchase 

policies; 

(v) Any material aspect of a prize 

promotion including, but not limited 

to, the odds of being able to receive a 

prize, the nature or value of a prize, or 

that a purchase or payment is required 

to win a prize or to participate in a 

prize promotion; 

(vi) Any material aspect of an investment opportunity including, but not 

limited to, risk, liquidity, earnings potential, or profitability; 

(vii) A seller’s or telemarketer’s affiliation with, or endorsement or sponsorship by, any person or government 

entity; 

(viii) That any customer needs offered goods or services to provide protections a customer already has pursuant to 15 U.S.C. 1643; 

(ix) Any material aspect of a negative option feature including, but not 

limited to, the fact that the customer’s 

account will be charged unless the customer takes an affirmative action to 

avoid the charge(s), the date(s) the 

charge(s) will be submitted for payment, and the specific steps the customer must take to avoid the 

charge(s); or 

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§ 310.3 

(x) Any material aspect of any debt 

relief service, including, but not limited to, the amount of money or the 

percentage of the debt amount that a 

customer may save by using such service; the amount of time necessary to 

achieve the represented results; the 

amount of money or the percentage of 

each outstanding debt that the customer must accumulate before the provider of the debt relief service will initiate attempts with the customer’s 

creditors or debt collectors or make a 

bona fide offer to negotiate, settle, or 

modify the terms of the customer’s 

debt; the effect of the service on a customer’s creditworthiness; the effect of 

the service on collection efforts of the 

customer’s creditors or debt collectors; 

the percentage or number of customers 

who attain the represented results; and 

whether a debt relief service is offered 

or provided by a non-profit entity. 

(3) Causing billing information to be 

submitted for payment, or collecting or 

attempting to collect payment for 

goods or services or a charitable contribution, directly or indirectly, without the customer’s or donor’s express 

verifiable authorization, except when 

the method of payment used is a credit 

card subject to protections of the 

Truth in Lending Act and Regulation 

Z,661 or a debit card subject to the protections of the Electronic Fund Transfer Act and Regulation E.662 Such authorization shall be deemed verifiable 

if any of the following means is employed: 

(i) Express written authorization by 

the customer or donor, which includes 

the customer’s or donor’s signature;663 

(ii) Express oral authorization which 

is audio-recorded and made available 

upon request to the customer or donor, 

and the customer’s or donor’s bank or 

other billing entity, and which evidences clearly both the customer’s or 

661 Truth in Lending Act, 15 U.S.C. 1601 et 

seq., and Regulation Z, 12 CFR part 226. 662 Electronic Fund Transfer Act, 15 U.S.C. 

1693 et seq., and Regulation E, 12 CFR part 

205. 663 For purposes of this Rule, the term 

‘‘signature’’ shall include an electronic or 

digital form of signature, to the extent that 

such form of signature is recognized as a 

valid signature under applicable federal law 

or state contract law. 

16 CFR Ch. I (1–1–16 Edition) 

donor’s authorization of payment for 

the goods or services or charitable contribution that are the subject of the 

telemarketing transaction and the customer’s or donor’s receipt of all of the 

following information: 

(A) The number of debits, charges, or 

payments (if more than one); 

(B) The date(s) the debit(s), 

charge(s), or payment(s) will be submitted for payment; 

(C) The amount(s) of the debit(s), 

charge(s), or payment(s); 

(D) The customer’s or donor’s name; 

(E) The customer’s or donor’s billing 

information, identified with sufficient 

specificity such that the customer or 

donor understands what account will 

be used to collect payment for the 

goods or services or charitable contribution that are the subject of the 

telemarketing transaction; 

(F) A telephone number for customer 

or donor inquiry that is answered during normal business hours; and 

(G) The date of the customer’s or donor’s oral authorization; or 

(iii) Written confirmation of the 

transaction, identified in a clear and 

conspicuous manner as such on the 

outside of the envelope, sent to the 

customer or donor via first class mail 

prior to the submission for payment of 

the customer’s or donor’s billing information, and that includes all of the information contained in 

§§ 310.3(a)(3)(ii)(A)-(G) and a clear and 

conspicuous statement of the procedures by which the customer or donor 

can obtain a refund from the seller or 

telemarketer or charitable organization in the event the confirmation is 

inaccurate; provided, however, that 

this means of authorization shall not 

be deemed verifiable in instances in 

which goods or services are offered in a 

transaction involving a free-to-pay 

conversion and preacquired account information. 

(4) Making a false or misleading 

statement to induce any person to pay 

for goods or services or to induce a 

charitable contribution. 

(b) Assisting and facilitating. It is a deceptive telemarketing act or practice 

and a violation of this Rule for a person to provide substantial assistance or 

support to any seller or telemarketer 

when that person knows or consciously 

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avoids knowing that the seller or telemarketer is engaged in any act or practice that violates §§ 310.3(a), (c) or (d), 

or § 310.4 of this Rule. 

(c) Credit card laundering. Except as 

expressly permitted by the applicable 

credit card system, it is a deceptive 

telemarketing act or practice and a 

violation of this Rule for: 

(1) A merchant to present to or deposit into, or cause another to present 

to or deposit into, the credit card system for payment, a credit card sales 

draft generated by a telemarketing 

transaction that is not the result of a 

telemarketing credit card transaction 

between the cardholder and the merchant; 

(2) Any person to employ, solicit, or 

otherwise cause a merchant, or an employee, representative, or agent of the 

merchant, to present to or deposit into 

the credit card system for payment, a 

credit card sales draft generated by a 

telemarketing transaction that is not 

the result of a telemarketing credit 

card transaction between the cardholder and the merchant; or 

(3) Any person to obtain access to the 

credit card system through the use of a 

business relationship or an affiliation 

with a merchant, when such access is 

not authorized by the merchant agreement or the applicable credit card system. 

(d) Prohibited deceptive acts or practices in the solicitation of charitable contributions. It is a fraudulent charitable 

solicitation, a deceptive telemarketing 

act or practice, and a violation of this 

Rule for any telemarketer soliciting 

charitable contributions to misrepresent, directly or by implication, any of 

the following material information: 

(1) The nature, purpose, or mission of 

any entity on behalf of which a charitable contribution is being requested; 

(2) That any charitable contribution 

is tax deductible in whole or in part; 

(3) The purpose for which any charitable contribution will be used; 

(4) The percentage or amount of any 

charitable contribution that will go to 

a charitable organization or to any 

particular charitable program; 

(5) Any material aspect of a prize 

promotion including, but not limited 

to: the odds of being able to receive a 

prize; the nature or value of a prize; or 

§ 310.4 

that a charitable contribution is required to win a prize or to participate 

in a prize promotion; or 

(6) A charitable organization’s or 

telemarketer’s affiliation with, or endorsement or sponsorship by, any person or government entity. 

EFFECTIVE DATE NOTE: At 80 FR 77558, Dec. 

14, 2015, § 310.3 was amended by redesignating 

paragraphs (a)(3)(ii)(A) through (G) as paragraphs (a)(3)(ii)(B) through (H) and adding 

new paragraph (a)(3)(ii)(A), eff. Feb. 12, 2016. 

For the convenience of the user, the added 

text is set forth as follows: 

§ 310.3 Deceptive telemarketing acts or 

practices. 

(a) * * * 

(3) * * * 

(ii) * * * 

(A) An accurate description, clearly and 

conspicuously stated, of the goods or services or charitable contribution for which 

payment authorization is sought; 

* * * * * 

§ 310.4 Abusive telemarketing acts or 

practices. 

(a) Abusive conduct generally. It is an 

abusive telemarketing act or practice 

and a violation of this Rule for any 

seller or telemarketer to engage in the 

following conduct: 

(1) Threats, intimidation, or the use 

of profane or obscene language; 

(2) Requesting or receiving payment 

of any fee or consideration for goods or 

services represented to remove derogatory information from, or improve, a 

person’s credit history, credit record, 

or credit rating until: 

(i) The time frame in which the seller 

has represented all of the goods or 

services will be provided to that person 

has expired; and 

(ii) The seller has provided the person 

with documentation in the form of a 

consumer report from a consumer reporting agency demonstrating that the 

promised results have been achieved, 

such report having been issued more 

than six months after the results were 

achieved. Nothing in this Rule should 

be construed to affect the requirement 

in the Fair Credit Reporting Act, 15 

U.S.C. 1681, that a consumer report 

may only be obtained for a specified 

permissible purpose; 

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§ 310.4 

(3) Requesting or receiving payment 

of any fee or consideration from a person for goods or services represented to 

recover or otherwise assist in the return of money or any other item of 

value paid for by, or promised to, that 

person in a previous telemarketing 

transaction, until seven (7) business 

days after such money or other item is 

delivered to that person. This provision 

shall not apply to goods or services 

provided to a person by a licensed attorney; 

(4) Requesting or receiving payment 

of any fee or consideration in advance 

of obtaining a loan or other extension 

of credit when the seller or telemarketer has guaranteed or represented a high likelihood of success in 

obtaining or arranging a loan or other 

extension of credit for a person; 

(5)(i) Requesting or receiving payment of any fee or consideration for 

any debt relief service until and unless: 

(A) The seller or telemarketer has renegotiated, settled, reduced, or otherwise altered the terms of at least one 

debt pursuant to a settlement agreement, debt management plan, or other 

such valid contractual agreement executed by the customer; 

(B) The customer has made at least 

one payment pursuant to that settlement agreement, debt management 

plan, or other valid contractual agreement between the customer and the 

creditor or debt collector; and 

(C) To the extent that debts enrolled 

in a service are renegotiated, settled, 

reduced, or otherwise altered individually, the fee or consideration either: 

(1) Bears the same proportional relationship to the total fee for renegotiating, settling, reducing, or altering 

the terms of the entire debt balance as 

the individual debt amount bears to 

the entire debt amount. The individual 

debt amount and the entire debt 

amount are those owed at the time the 

debt was enrolled in the service; or 

(2) Is a percentage of the amount 

saved as a result of the renegotiation, 

settlement, reduction, or alteration. 

The percentage charged cannot change 

from one individual debt to another. 

The amount saved is the difference between the amount owed at the time the 

debt was enrolled in the service and the 

16 CFR Ch. I (1–1–16 Edition) 

amount actually paid to satisfy the 

debt. 

(ii) Nothing in § 310.4(a)(5)(i) prohibits 

requesting or requiring the customer 

to place funds in an account to be used 

for the debt relief provider’s fees and 

for payments to creditors or debt collectors in connection with the renegotiation, settlement, reduction, or other 

alteration of the terms of payment or 

other terms of a debt, provided that: 

(A) The funds are held in an account 

at an insured financial institution; 

(B) The customer owns the funds held 

in the account and is paid accrued interest on the account, if any; 

(C) The entity administering the account is not owned or controlled by, or 

in any way affiliated with, the debt relief service; 

(D) The entity administering the account does not give or accept any 

money or other compensation in exchange for referrals of business involving the debt relief service; and 

(E) The customer may withdraw from 

the debt relief service at any time 

without penalty, and must receive all 

funds in the account, other than funds 

earned by the debt relief service in 

compliance with § 310.4(a)(5)(i)(A) 

through (C), within seven (7) business 

days of the customer’s request. 

(6) Disclosing or receiving, for consideration, unencrypted consumer account numbers for use in telemarketing; provided, however, that 

this paragraph shall not apply to the 

disclosure or receipt of a customer’s or 

donor’s billing information to process a 

payment for goods or services or a 

charitable contribution pursuant to a 

transaction; 

(7) Causing billing information to be 

submitted for payment, directly or indirectly, without the express informed 

consent of the customer or donor. In 

any telemarketing transaction, the 

seller or telemarketer must obtain the 

express informed consent of the customer or donor to be charged for the 

goods or services or charitable contribution and to be charged using the 

identified account. In any telemarketing transaction involving 

preacquired account information, the 

requirements in paragraphs (a)(7)(i) 

through (ii) of this section must be met 

to evidence express informed consent. 

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(i) In any telemarketing transaction 

involving preacquired account information and a free-to-pay conversion feature, the seller or telemarketer must: 

(A) Obtain from the customer, at a 

minimum, the last four (4) digits of the 

account number to be charged; 

(B) Obtain from the customer his or 

her express agreement to be charged 

for the goods or services and to be 

charged using the account number pursuant to paragraph (a)(7)(i)(A) of this 

section; and, 

(C) Make and maintain an audio recording of the entire telemarketing 

transaction. 

(ii) In any other telemarketing transaction involving preacquired account 

information not described in paragraph 

(a)(7)(i) of this section, the seller or 

telemarketer must: 

(A) At a minimum, identify the account to be charged with sufficient 

specificity for the customer or donor to 

understand what account will be 

charged; and 

(B) Obtain from the customer or 

donor his or her express agreement to 

be charged for the goods or services 

and to be charged using the account 

number identified pursuant to paragraph (a)(7)(ii)(A) of this section; or 

(8) Failing to transmit or cause to be 

transmitted the telephone number, 

and, when made available by the telemarketer’s carrier, the name of the 

telemarketer, to any caller identification service in use by a recipient of a 

telemarketing call; provided that it 

shall not be a violation to substitute 

(for the name and phone number used 

in, or billed for, making the call) the 

name of the seller or charitable organization on behalf of which a telemarketing call is placed, and the seller’s or charitable organization’s customer or donor service telephone number, which is answered during regular 

business hours. 

(b) Pattern of calls. (1) It is an abusive 

telemarketing act or practice and a 

violation of this Rule for a telemarketer to engage in, or for a seller 

to cause a telemarketer to engage in, 

the following conduct: 

(i) Causing any telephone to ring, or 

engaging any person in telephone conversation, repeatedly or continuously 

§ 310.4 

with intent to annoy, abuse, or harass 

any person at the called number; 

(ii) Denying or interfering in any 

way, directly or indirectly, with a person’s right to be placed on any registry 

of names and/or telephone numbers of 

persons who do not wish to receive outbound telephone calls established to 

comply with § 310.4(b)(1)(iii); 

(iii) Initiating any outbound telephone call to a person when: 

(A) That person previously has stated 

that he or she does not wish to receive 

an outbound telephone call made by or 

on behalf of the seller whose goods or 

services are being offered or made on 

behalf of the charitable organization 

for which a charitable contribution is 

being solicited; or 

(B) That person’s telephone number 

is on the ‘‘do-not-call’’ registry, maintained by the Commission, of persons 

who do not wish to receive outbound 

telephone calls to induce the purchase 

of goods or services unless the seller: 

(i) Has obtained the express agreement, in writing, of such person to 

place calls to that person. Such written 

agreement shall clearly evidence such 

person’s authorization that calls made 

by or on behalf of a specific party may 

be placed to that person, and shall include the telephone number to which 

the calls may be placed and the signature664 of that person; or 

(ii) Has an established business relationship with such person, and that 

person has not stated that he or she 

does not wish to receive outbound telephone calls under paragraph 

(b)(1)(iii)(A) of this section; or 

(iv) Abandoning any outbound telephone call. An outbound telephone call 

is ‘‘abandoned’’ under this section if a 

person answers it and the telemarketer 

does not connect the call to a sales representative within two (2) seconds of 

the person’s completed greeting. 

(v) Initiating any outbound telephone 

call that delivers a prerecorded message, other than a prerecorded message 

permitted for compliance with the call 

664 For purposes of this Rule, the term 

‘‘signature’’ shall include an electronic or 

digital form of signature, to the extent that 

such form of signature is recognized as a 

valid signature under applicable federal law 

or state contract law. 

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§ 310.4 

abandonment safe harbor in

§ 310.4(b)(4)(iii), unless: 

(A) In any such call to induce the 

purchase of any good or service, the 

seller has obtained from the recipient 

of the call an express agreement, in 

writing, that: 

(i) The seller obtained only after a 

clear and conspicuous disclosure that 

the purpose of the agreement is to authorize the seller to place prerecorded 

calls to such person; 

(ii) The seller obtained without requiring, directly or indirectly, that the 

agreement be executed as a condition 

of purchasing any good or service; 

(iii) Evidences the willingness of the 

recipient of the call to receive calls 

that deliver prerecorded messages by 

or on behalf of a specific seller; and 

(iv) Includes such person’s telephone 

number and signature;665 and 

(B) In any such call to induce the 

purchase of any good or service, or to 

induce a charitable contribution from a 

member of, or previous donor to, a nonprofit charitable organization on whose 

behalf the call is made, the seller or 

telemarketer: 

(i) Allows the telephone to ring for at 

least fifteen (15) seconds or four (4) 

rings before disconnecting an unanswered call; and 

(ii) Within two (2) seconds after the 

completed greeting of the person 

called, plays a prerecorded message 

that promptly provides the disclosures 

required by § 310.4(d) or (e), followed 

immediately by a disclosure of one or 

both of the following: 

(A) In the case of a call that could be 

answered in person by a consumer, that 

the person called can use an automated 

interactive voice and/or keypress-activated opt-out mechanism to assert a 

Do Not Call request pursuant to 

§ 310.4(b)(1)(iii)(A) at any time during 

the message. The mechanism must: 

(1) Automatically add the number 

called to the seller’s entity-specific Do 

Not Call list; 

(2) Once invoked, immediately disconnect the call; and 

665 For purposes of this Rule, the term 

‘‘signature’’ shall include an electronic or 

digital form of signature, to the extent that 

such form of signature is recognized as a 

valid signature under applicable federal law 

or state contract law. 

16 CFR Ch. I (1–1–16 Edition) 

(3) Be available for use at any time 

during the message; and 

(B) In the case of a call that could be 

answered by an answering machine or 

voicemail service, that the person 

called can use a toll-free telephone 

number to assert a Do Not Call request 

pursuant to § 310.4(b)(1)(iii)(A). The 

number provided must connect directly 

to an automated interactive voice or 

keypress-activated opt-out mechanism 

that: 

(1) Automatically adds the number 

called to the seller’s entity-specific Do 

Not Call list; 

(2) Immediately thereafter disconnects the call; and 

(3) Is accessible at any time throughout the duration of the telemarketing 

campaign; and 

(iii) Complies with all other requirements of this part and other applicable 

federal and state laws. 

(C) Any call that complies with all 

applicable requirements of this paragraph (v) shall not be deemed to violate 

§ 310.4(b)(1)(iv) of this part. 

(D) This paragraph (v) shall not apply 

to any outbound telephone call that delivers a prerecorded healthcare message made by, or on behalf of, a covered 

entity or its business associate, as 

those terms are defined in the HIPAA 

Privacy Rule, 45 CFR 160.103. 

(2) It is an abusive telemarketing act 

or practice and a violation of this Rule 

for any person to sell, rent, lease, purchase, or use any list established to 

comply with § 310.4(b)(1)(iii)(A), or 

maintained by the Commission pursuant to § 310.4(b)(1)(iii)(B), for any purpose except compliance with the provisions of this Rule or otherwise to prevent telephone calls to telephone numbers on such lists. 

(3) A seller or telemarketer will not 

be liable for violating § 310.4(b)(1)(ii) 

and (iii) if it can demonstrate that, as 

part of the seller’s or telemarketer’s 

routine business practice: 

(i) It has established and implemented written procedures to comply 

with § 310.4(b)(1)(ii) and (iii); 

(ii) It has trained its personnel, and 

any entity assisting in its compliance, 

in the procedures established pursuant 

to § 310.4(b)(3)(i); 

(iii) The seller, or a telemarketer or 

another person acting on behalf of the 

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seller or charitable organization, has 

maintained and recorded a list of telephone numbers the seller or charitable 

organization may not contact, in compliance with § 310.4(b)(1)(iii)(A); 

(iv) The seller or a telemarketer uses 

a process to prevent telemarketing to 

any telephone number on any list established pursuant to § 310.4(b)(3)(iii) or 

310.4(b)(1)(iii)(B), employing a version 

of the ‘‘do-not-call’’ registry obtained 

from the Commission no more than 

thirty-one (31) days prior to the date 

any call is made, and maintains 

records documenting this process; 

(v) The seller or a telemarketer or 

another person acting on behalf of the 

seller or charitable organization, monitors and enforces compliance with the 

procedures established pursuant to 

§ 310.4(b)(3)(i); and 

(vi) Any subsequent call otherwise 

violating § 310.4(b)(1)(ii) or (iii) is the 

result of error. 

(4) A seller or telemarketer will not 

be liable for violating § 310.4(b)(1)(iv) if: 

(i) The seller or telemarketer employs technology that ensures abandonment of no more than three (3) percent of all calls answered by a person, 

measured over the duration of a single 

calling campaign, if less than 30 days, 

or separately over each successive 30-

day period or portion thereof that the 

campaign continues. 

(ii) The seller or telemarketer, for 

each telemarketing call placed, allows 

the telephone to ring for at least fifteen (15) seconds or four (4) rings before 

disconnecting an unanswered call; 

(iii) Whenever a sales representative 

is not available to speak with the person answering the call within two (2) 

seconds after the person’s completed 

greeting, the seller or telemarketer 

promptly plays a recorded message 

that states the name and telephone 

number of the seller on whose behalf 

the call was placed666; and 

(iv) The seller or telemarketer, in accordance with § 310.5(b)-(d), retains 

records establishing compliance with 

§ 310.4(b)(4)(i)-(iii). 

666 This provision does not affect any seller’s or telemarketer’s obligation to comply 

with relevant state and federal laws, including but not limited to the TCPA, 47 U.S.C. 

227, and 47 CFR part 64.1200. 

§ 310.4 

(c) Calling time restrictions. Without 

the prior consent of a person, it is an 

abusive telemarketing act or practice 

and a violation of this Rule for a telemarketer to engage in outbound telephone calls to a person’s residence at 

any time other than between 8:00 a.m. 

and 9:00 p.m. local time at the called 

person’s location. 

(d) Required oral disclosures in the sale 

of goods or services. It is an abusive telemarketing act or practice and a violation of this Rule for a telemarketer in 

an outbound telephone call or internal 

or external upsell to induce the purchase of goods or services to fail to disclose truthfully, promptly, and in a 

clear and conspicuous manner to the 

person receiving the call, the following 

information: 

(1) The identity of the seller; 

(2) That the purpose of the call is to 

sell goods or services; 

(3) The nature of the goods or services; and 

(4) That no purchase or payment is 

necessary to be able to win a prize or 

participate in a prize promotion if a 

prize promotion is offered and that any 

purchase or payment will not increase 

the person’s chances of winning. This 

disclosure must be made before or in 

conjunction with the description of the 

prize to the person called. If requested 

by that person, the telemarketer must 

disclose the no-purchase/no-payment 

entry method for the prize promotion; 

provided, however, that, in any internal upsell for the sale of goods or services, the seller or telemarketer must 

provide the disclosures listed in this 

section only to the extent that the information in the upsell differs from the 

disclosures provided in the initial telemarketing transaction. 

(e) Required oral disclosures in charitable solicitations. It is an abusive telemarketing act or practice and a violation of this Rule for a telemarketer, in 

an outbound telephone call to induce a 

charitable contribution, to fail to disclose truthfully, promptly, and in a 

clear and conspicuous manner to the 

person receiving the call, the following 

information: 

(1) The identity of the charitable organization on behalf of which the request is being made; and 

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§ 310.5 

(2) That the purpose of the call is to 

solicit a charitable contribution. 

[75 FR 48516, Aug. 10, 2010, as amended at 76 

FR 58716, Sept. 22, 2011] 

EFFECTIVE DATE NOTE: At 80 FR 77558, Dec. 

14, 2015, § 310.4 was amended by revising paragraphs (a)(3), (b)(1)(ii), (iii)(B), and (3)(vi), effective February 12, 2016, and in paragraph 

(a)(7)(ii)(B) by removing ‘‘or’’ from the end of 

the paragraph, in paragraph (a)(8) by removing the final period and adding a semicolon 

in its place, and by adding paragraphs (a)(9) 

and (10), effective June 13, 2016. For the convenience of the user, the added and revised 

text is set forth as follows: 

§ 310.4 Abusive telemarketing acts or practices. 

(a) * * * 

(3) Requesting or receiving payment of any 

fee or consideration from a person for goods 

or services represented to recover or otherwise assist in the return of money or any 

other item of value paid for by, or promised 

to, that person in a previous transaction, 

until seven (7) business days after such 

money or other item is delivered to that person. This provision shall not apply to goods 

or services provided to a person by a licensed 

attorney; 

* * * * * 

(9) Creating or causing to be created, directly or indirectly, a remotely created payment order as payment for goods or services 

offered or sold through telemarketing or as a 

charitable contribution solicited or sought 

through telemarketing; or 

(10) Accepting from a customer or donor, 

directly or indirectly, a cash-to-cash money 

transfer or cash reload mechanism as payment for goods or services offered or sold 

through telemarketing or as a charitable 

contribution solicited or sought through 

telemarketing. 

(b) * * * 

(1) * * * 

(ii) Denying or interfering in any way, directly or indirectly, with a person’s right to 

be placed on any registry of names and/or 

telephone numbers of persons who do not 

wish to receive outbound telephone calls established to comply with paragraph

(b)(1)(iii)(A) of this section, including, but 

not limited to, harassing any person who 

makes such a request; hanging up on that 

person; failing to honor the request; requiring the person to listen to a sales pitch before accepting the request; assessing a 

charge or fee for honoring the request; requiring a person to call a different number to 

submit the request; and requiring the person 

to identify the seller making the call or on 

whose behalf the call is made; 

(iii) * * * 

16 CFR Ch. I (1–1–16 Edition) 

(B) That person’s telephone number is on 

the ‘‘do-not-call’’ registry, maintained by 

the Commission, of persons who do not wish 

to receive outbound telephone calls to induce the purchase of goods or services unless 

the seller or telemarketer: 

(1) Can demonstrate that the seller has obtained the express agreement, in writing, of 

such person to place calls to that person. 

Such written agreement shall clearly evidence such person’s authorization that calls 

made by or on behalf of a specific party may 

be placed to that person, and shall include 

the telephone number to which the calls may 

be placed and the signature 664 of that person; 

or 

(2) Can demonstrate that the seller has an 

established business relationship with such 

person, and that person has not stated that 

he or she does not wish to receive outbound 

telephone calls under paragraph (b)(1)(iii)(A) 

of this section; or 

* * * * * 

(3) * * * 

(vi) Any subsequent call otherwise violating paragraph (b)(1)(ii) or (iii) of this section is the result of error and not of failure 

to obtain any information necessary to comply with a request pursuant to paragraph 

(b)(1)(iii)(A) of this section not to receive 

further calls by or on behalf of a seller or 

charitable organization. 

* * * * * 

§ 310.5 Recordkeeping requirements. 

(a) Any seller or telemarketer shall 

keep, for a period of 24 months from 

the date the record is produced, the following records relating to its telemarketing activities: 

(1) All substantially different advertising, brochures, telemarketing 

scripts, and promotional materials; 

(2) The name and last known address 

of each prize recipient and the prize 

awarded for prizes that are represented, directly or by implication, to 

have a value of $25.00 or more; 

(3) The name and last known address 

of each customer, the goods or services 

purchased, the date such goods or services were shipped or provided, and the 

664 For purposes of this Rule, the term 

‘‘signature’’ shall include an electronic or 

digital form of signature, to the extent that 

such form of signature is recognized as a 

valid signature under applicable federal law 

or state contract law. 

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amount paid by the customer for the 

goods or services;667 

(4) The name, any fictitious name 

used, the last known home address and 

telephone number, and the job title(s) 

for all current and former employees 

directly involved in telephone sales or 

solicitations; provided, however, that if 

the seller or telemarketer permits fictitious names to be used by employees, 

each fictitious name must be traceable 

to only one specific employee; and 

(5) All verifiable authorizations or 

records of express informed consent or 

express agreement required to be provided or received under this Rule. 

(b) A seller or telemarketer may 

keep the records required by § 310.5(a) 

in any form, and in the same manner, 

format, or place as they keep such 

records in the ordinary course of business. Failure to keep all records required by § 310.5(a) shall be a violation 

of this Rule. 

(c) The seller and the telemarketer 

calling on behalf of the seller may, by 

written agreement, allocate responsibility between themselves for the recordkeeping required by this Section. 

When a seller and telemarketer have 

entered into such an agreement, the 

terms of that agreement shall govern, 

and the seller or telemarketer, as the 

case may be, need not keep records 

that duplicate those of the other. If the 

agreement is unclear as to who must 

maintain any required record(s), or if 

no such agreement exists, the seller 

shall be responsible for complying with 

§§ 310.5(a)(1)-(3) and (5); the telemarketer shall be responsible for complying with § 310.5(a)(4). 

(d) In the event of any dissolution or 

termination of the seller’s or telemarketer’s business, the principal of 

that seller or telemarketer shall maintain all records as required under this 

section. In the event of any sale, assignment, or other change in ownership 

of the seller’s or telemarketer’s business, the successor business shall main667 For offers of consumer credit products 

subject to the Truth in Lending Act, 15 

U.S.C. 1601 et seq., and Regulation Z, 12 CFR 

226, compliance with the recordkeeping requirements under the Truth in Lending Act, 

and Regulation Z, shall constitute compliance with § 310.5(a)(3) of this Rule. 

§ 310.6 

tain all records required under this section. 

§ 310.6 Exemptions. 

(a) Solicitations to induce charitable 

contributions via outbound telephone 

calls are not covered by 

§ 310.4(b)(1)(iii)(B) of this Rule. 

(b) The following acts or practices 

are exempt from this Rule: 

(1) The sale of pay-per-call services 

subject to the Commission’s Rule entitled ‘‘Trade Regulation Rule Pursuant 

to the Telephone Disclosure and Dispute Resolution Act of 1992,’’ 16 CFR 

part 308, provided, however, that this 

exemption does not apply to the requirements of §§ 310.4(a)(1), (a)(7), (b), 

and (c); 

(2) The sale of franchises subject to 

the Commission’s Rule entitled ‘‘Disclosure Requirements and Prohibitions 

Concerning Franchising,’’ (‘‘Franchise 

Rule’’) 16 CFR part 436, and the sale of 

business opportunities subject to the 

Commission’s Rule entitled ‘‘Disclosure Requirements and Prohibitions 

Concerning Business Opportunities,’’ 

(‘‘Business Opportunity Rule’’) 16 CFR 

part 437, provided, however, that this 

exemption does not apply to the requirements of §§ 310.4(a)(1), (a)(7), (b), 

and (c); 

(3) Telephone calls in which the sale 

of goods or services or charitable solicitation is not completed, and payment 

or authorization of payment is not required, until after a face-to-face sales 

or donation presentation by the seller 

or charitable organization, provided, 

however, that this exemption does not 

apply to the requirements of 

§§ 310.4(a)(1), (a)(7), (b), and (c); 

(4) Telephone calls initiated by a customer or donor that are not the result 

of any solicitation by a seller, charitable organization, or telemarketer, 

provided, however, that this exemption 

does not apply to any instances of 

upselling included in such telephone 

calls; 

(5) Telephone calls initiated by a customer or donor in response to an advertisement through any medium, other 

than direct mail solicitation, provided, 

however, that this exemption does not 

apply to calls initiated by a customer 

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§ 310.7 

or donor in response to an advertisement relating to investment opportunities, debt relief services, business opportunities other than business arrangements covered by the Franchise 

Rule or Business Opportunity Rule, or 

advertisements involving goods or 

services described in §§ 310.3(a)(1)(vi) or 

310.4(a)(2)-(4); or to any instances of 

upselling included in such telephone 

calls; 

(6) Telephone calls initiated by a customer or donor in response to a direct 

mail solicitation, including solicitations via the U.S. Postal Service, facsimile transmission, electronic mail, 

and other similar methods of delivery 

in which a solicitation is directed to 

specific address(es) or person(s), that 

clearly, conspicuously, and truthfully 

discloses all material information listed in § 310.3(a)(1) of this Rule, for any 

goods or services offered in the direct 

mail solicitation, and that contains no 

material misrepresentation regarding 

any item contained in § 310.3(d) of this 

Rule for any requested charitable contribution; provided, however, that this 

exemption does not apply to calls initiated by a customer in response to a direct mail solicitation relating to prize 

promotions, investment opportunities, 

debt relief services, business opportunities other than business arrangements 

covered by the Franchise Rule or Business Opportunity Rule, or goods or 

services described in §§ 310.3(a)(1)(vi) or 

310.4(a)(2)-(4); or to any instances of 

upselling included in such telephone 

calls; and 

(7) Telephone calls between a telemarketer and any business, except 

calls to induce the retail sale of nondurable office or cleaning supplies; provided, however, that § 310.4(b)(1)(iii)(B) 

and § 310.5 of this Rule shall not apply 

to sellers or telemarketers of nondurable office or cleaning supplies. 

EFFECTIVE DATE NOTE: At 80 FR 77559, Dec. 

14, 2015, § 310.6 was amended by revising paragraphs (b)(5), (6) and (7), effective Feb. 12, 

2016, and by adding paragraphs (b)(5)(ii) and 

(6)(ii), effective June 13, 2016. For the convenience of the user, the added and revised text 

is set forth as follows: 

§ 310.6 Exemptions. 

* * * * * 

16 CFR Ch. I (1–1–16 Edition) 

(b) * * * 

(5) Telephone calls initiated by a customer 

or donor in response to an advertisement 

through any medium, other than direct mail 

solicitation, provided, however, that this exemption does not apply to: 

(i) Calls initiated by a customer or donor 

in response to an advertisement relating to 

investment opportunities, debt relief services, business opportunities other than business arrangements covered by the Franchise 

Rule or Business Opportunity Rule, or advertisements involving offers for goods or services described in § 310.3(a)(1)(vi) or § 310.4(a)(2) 

through (4); 

(ii) The requirements of § 310.4(a)(9) or (10); 

or 

(iii) Any instances of upselling included in 

such telephone calls; 

(6) Telephone calls initiated by a customer 

or donor in response to a direct mail solicitation, including solicitations via the U.S. 

Postal Service, facsimile transmission, electronic mail, and other similar methods of delivery in which a solicitation is directed to 

specific address(es) or person(s), that clearly, 

conspicuously, and truthfully discloses all 

material information listed in § 310.3(a)(1), 

for any goods or services offered in the direct 

mail solicitation, and that contains no material misrepresentation regarding any item 

contained in § 310.3(d) for any requested charitable contribution; provided, however, that 

this exemption does not apply to: 

(i) Calls initiated by a customer in response to a direct mail solicitation relating 

to prize promotions, investment opportunities, debt relief services, business opportunities other than business arrangements covered by the Franchise Rule or Business Opportunity Rule, or goods or services described in § 310.3(a)(1)(vi) or § 310.4(a)(2) 

through (4); 

(ii) The requirements of § 310.4(a)(9) or (10); 

or 

(iii) Any instances of upselling included in 

such telephone calls; and 

(7) Telephone calls between a telemarketer 

and any business to induce the purchase of 

goods or services or a charitable contribution by the business, except calls to induce 

the retail sale of nondurable office or cleaning supplies; provided, however, that 

§§ 310.4(b)(1)(iii)(B) and 310.5 shall not apply 

to sellers or telemarketers of nondurable office or cleaning supplies. 

§ 310.7 Actions by states and private 

persons. 

(a) Any attorney general or other officer of a state authorized by the state 

to bring an action under the Telemarketing and Consumer Fraud and 

Abuse Prevention Act, and any private 

person who brings an action under that 

Act, shall serve written notice of its 

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action on the Commission, if feasible, 

prior to its initiating an action under 

this Rule. The notice shall be sent to 

the Office of the Director, Bureau of 

Consumer Protection, Federal Trade 

Commission, Washington, DC 20580, and 

shall include a copy of the state’s or 

private person’s complaint and any 

other pleadings to be filed with the 

court. If prior notice is not feasible, 

the state or private person shall serve 

the Commission with the required notice immediately upon instituting its 

action. 

(b) Nothing contained in this Section 

shall prohibit any attorney general or 

other authorized state official from 

proceeding in state court on the basis 

of an alleged violation of any civil or 

criminal statute of such state. 

§ 310.8 Fee for access to the National 

Do Not Call Registry. 

(a) It is a violation of this Rule for 

any seller to initiate, or cause any 

telemarketer to initiate, an outbound 

telephone call to any person whose 

telephone number is within a given 

area code unless such seller, either directly or through another person, first 

has paid the annual fee, required by 

§ 310.8(c), for access to telephone numbers within that area code that are included in the National Do Not Call 

Registry maintained by the Commission under § 310.4(b)(1)(iii)(B); provided, 

however, that such payment is not necessary if the seller initiates, or causes 

a telemarketer to initiate, calls solely 

to persons pursuant to

§§ 310.4(b)(1)(iii)(B)(i) or (ii), and the 

seller does not access the National Do 

Not Call Registry for any other purpose. 

(b) It is a violation of this Rule for 

any telemarketer, on behalf of any seller, to initiate an outbound telephone 

call to any person whose telephone 

number is within a given area code unless that seller, either directly or 

through another person, first has paid 

the annual fee, required by § 310.8(c), 

for access to the telephone numbers 

within that area code that are included 

in the National Do Not Call Registry; 

provided, however, that such payment 

is not necessary if the seller initiates, 

or causes a telemarketer to initiate, 

calls solely to persons pursuant to 

§ 310.8 

§§ 310.4(b)(1)(iii)(B)(i) or (ii), and the 

seller does not access the National Do 

Not Call Registry for any other purpose. 

(c) The annual fee, which must be 

paid by any person prior to obtaining 

access to the National Do Not Call 

Registry, is $60 for each area code of 

data accessed, up to a maximum of 

$16,482; provided, however, that there 

shall be no charge to any person for accessing the first five area codes of data, 

and provided further, that there shall be 

no charge to any person engaging in or 

causing others to engage in outbound 

telephone calls to consumers and who 

is accessing area codes of data in the 

National Do Not Call Registry if the 

person is permitted to access, but is 

not required to access, the National Do 

Not Call Registry under this Rule, 47 

CFR 64.1200, or any other Federal regulation or law. Any person accessing the 

National Do Not Call Registry may not 

participate in any arrangement to 

share the cost of accessing the registry, including any arrangement with 

any telemarketer or service provider to 

divide the costs to access the registry 

among various clients of that telemarketer or service provider. 

(d) Each person who pays, either directly or through another person, the 

annual fee set forth in § 310.8(c), each 

person excepted under § 310.8(c) from 

paying the annual fee, and each person 

excepted from paying an annual fee 

under § 310.4(b)(1)(iii)(B), will be provided a unique account number that 

will allow that person to access the 

registry data for the selected area 

codes at any time for the twelve month 

period beginning on the first day of the 

month in which the person paid the fee 

(‘‘the annual period’’). To obtain access 

to additional area codes of data during 

the first six months of the annual period, each person required to pay the 

fee under § 310.8(c) must first pay $60 

for each additional area code of data 

not initially selected. To obtain access 

to additional area codes of data during 

the second six months of the annual period, each person required to pay the 

fee under § 310.8(c) must first pay $30 

for each additional area code of data 

not initially selected. The payment of 

the additional fee will permit the person to access the additional area codes 

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Case 1:18-cv-10548 Document 2-1 Filed 03/22/18 Page 36 of 36 

§ 310.9 

of data for the remainder of the annual 

period. 

(e) Access to the National Do Not 

Call Registry is limited to telemarketers, sellers, others engaged in or 

causing others to engage in telephone 

calls to consumers, service providers 

acting on behalf of such persons, and 

any government agency that has law 

enforcement authority. Prior to accessing the National Do Not Call Registry, 

a person must provide the identifying 

information required by the operator of 

the registry to collect the fee, and 

must certify, under penalty of law, 

that the person is accessing the registry solely to comply with the provisions of this Rule or to otherwise prevent telephone calls to telephone numbers on the registry. If the person is accessing the registry on behalf of sellers, that person also must identify 

each of the sellers on whose behalf it is 

accessing the registry, must provide 

each seller’s unique account number 

for access to the national registry, and 

must certify, under penalty of law, 

that the sellers will be using the information gathered from the registry 

solely to comply with the provisions of 

this Rule or otherwise to prevent telephone calls to telephone numbers on 

the registry. 

[75 FR 48516, Aug. 10, 2010; 75 FR 51934, Aug. 

24, 2010, as amended at 77 FR 51697, Aug. 27, 

2012; 78 FR 53643, Aug. 30, 2013; 79 FR 51478, 

Aug. 29, 2014] 

EFFECTIVE DATE NOTE: At 80 FR 77560, Dec. 

14, 2015, § 310.8 was amended by revising paragraph (c), effective Feb. 16, 2016. For the convenience of the user, the revised text is set 

forth as follows: 

§ 310.8 Fee for access to the National Do Not 

Call Registry. 

* * * * * 

(c) The annual fee, which must be paid by 

any person prior to obtaining access to the 

National Do Not Call Registry, is $60 for each 

area code of data accessed, up to a maximum 

of $16,482; provided, however, that there shall 

be no charge to any person for accessing the 

first five area codes of data, and provided 

further, that there shall be no charge to any 

person engaging in or causing others to engage in outbound telephone calls to consumers and who is accessing area codes of 

data in the National Do Not Call Registry if 

the person is permitted to access, but is not 

required to access, the National Do Not Call 

16 CFR Ch. I (1–1–16 Edition) 

Registry under this Rule, 47 CFR 64.1200, or 

any other Federal regulation or law. No person may participate in any arrangement to 

share the cost of accessing the National Do 

Not Call Registry, including any arrangement with any telemarketer or service provider to divide the costs to access the registry among various clients of that telemarketer or service provider. 

* * * * * 

§ 310.9 Severability. 

The provisions of this Rule are separate and severable from one another. If 

any provision is stayed or determined 

to be invalid, it is the Commission’s intention that the remaining provisions 

shall continue in effect. 

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