BILL NUMBER: AB 2721 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 22, 2000
AMENDED IN ASSEMBLY MAY 10, 2000
AMENDED IN ASSEMBLY APRIL 5, 2000
AMENDED IN ASSEMBLY MARCH 29, 2000
INTRODUCED BY Assembly Member Wesson
(Principal coauthor: Assembly Member Longville)
(Coauthor: Assembly Member Havice)
(Coauthor: Senator Murray)
FEBRUARY 25, 2000
An act to amend Section 1770 of the Civil Code, and to amend
Sections 2872 and 2874 of, and to add Section 2875.5 to, the Public
Utilities Code, relating to public utilities.
LEGISLATIVE COUNSEL'S DIGEST
AB 2721, as amended, Wesson. Automatic dialing-announcing
devices.
(1) Existing law authorizes the Public Utilities Commission to
control and regulate the use of automatic dialing-announcing devices
and specifies the hours during which the devices may not be operated.
Existing law also provides for exemptions from regulation and
time-of-use limitations in various situations, including the
contacting of an established business associate, customer or other
person having an established relationship with the person using the
automatic dialing-announcement device.
This bill would expand the exemptions, as prescribed. The bill
would also state that the requirement that an automatic dialing
announcement message be preceded by an unrecorded natural voice
message does not apply to specified situations.
The bill would prohibit a prerecorded message from being left on
an answering machine, voicemail, or other message recording device.
The bill would prohibit, on and after July 1, 2001, any person
operating specified automatic calling equipment from making a
telephone connection for which no person, acting as an agent or
telemarketer, or prerecorded message, is available for the person
called.
(2) The Consumers Legal Remedies Act prohibits any person in a
transaction intended to result, or which results, in the sale or
lease of goods or services to disseminate an unsolicited prerecorded
message by telephone without an unrecorded, natural voice first
informing the person answering the telephone of the name of the
caller or the organization being represented, and either the address
or the telephone number of the caller, and without obtaining the
consent of that person to listen to the prerecorded message. The act
exempts from that prohibition a message disseminated to a business
associate, customer, or other person having an established
relationship with the person or organization making the call.
This bill would restate that exemption, limit an established
relationship, as prescribed, and add an exemption for a call for the
purpose of fraud prevention.
(3) The bill would make related legislative findings and
declarations.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) The use of the telephone to market goods and services to the
home and other businesses is now pervasive due to the increased use
of cost-effective telemarketing techniques.
(b) Unrestricted telemarketing, however, can be an intrusive
invasion of privacy, and, when an emergency or medical assistance
telephone line is seized, a risk to public safety.
(c) Many consumers are outraged over the proliferation of
intrusive nuisance calls to their homes from telemarketers,
including, but not limited to, prerecorded messages and abandoned
calls.
(d) It is the intent of the Legislature in enacting this act to
balance individual privacy rights and public safety concerns with
commercial free speech rights.
SEC. 2. Section 1770 of the Civil Code is amended to read:
1770. (a) The following unfair methods of competition and unfair
or deceptive acts or practices undertaken by any person in a
transaction intended to result or which results in the sale or lease
of goods or services to any consumer are unlawful:
(1) Passing off goods or services as those of another.
(2) Misrepresenting the source, sponsorship, approval, or
certification of goods or services.
(3) Misrepresenting the affiliation, connection, or association
with, or certification by, another.
(4) Using deceptive representations or designations of geographic
origin in connection with goods or services.
(5) Representing that goods or services have sponsorship,
approval, characteristics, ingredients, uses, benefits, or quantities
which they do not have or that a person has a sponsorship, approval,
status, affiliation, or connection which he or she does not have.
(6) Representing that goods are original or new if they have
deteriorated unreasonably or are altered, reconditioned, reclaimed,
used, or secondhand.
(7) Representing that goods or services are of a particular
standard, quality, or grade, or that goods are of a particular style
or model, if they are of another.
(8) Disparaging the goods, services, or business of another by
false or misleading representation of fact.
(9) Advertising goods or services with intent not to sell them as
advertised.
(10) Advertising goods or services with intent not to supply
reasonably expectable demand, unless the advertisement discloses a
limitation of quantity.
(11) Advertising furniture without clearly indicating that it is
unassembled if that is the case.
(12) Advertising the price of unassembled furniture without
clearly indicating the assembled price of that furniture if the same
furniture is available assembled from the seller.
(13) Making false or misleading statements of fact concerning
reasons for, existence of, or amounts of price reductions.
(14) Representing that a transaction confers or involves rights,
remedies, or obligations which it does not have or involve, or which
are prohibited by law.
(15) Representing that a part, replacement, or repair service is
needed when it is not.
(16) Representing that the subject of a transaction has been
supplied in accordance with a previous representation when it has
not.
(17) Representing that the consumer will receive a rebate,
discount, or other economic benefit, if the earning of the benefit is
contingent on an event to occur subsequent to the consummation of
the transaction.
(18) Misrepresenting the authority of a salesperson,
representative, or agent to negotiate the final terms of a
transaction with a consumer.
(19) Inserting an unconscionable provision in the contract.
(20) Advertising that a product is being offered at a specific
price plus a specific percentage of that price unless (1) the total
price is set forth in the advertisement, which may include, but is
not limited to, shelf tags, displays, and media advertising, in a
size larger than any other price in that advertisement, and (2) the
specific price plus a specific percentage of that price represents a
markup from the seller's costs or from the wholesale price of the
product. This subdivision shall not apply to in-store advertising by
businesses which are open only to members or cooperative
organizations organized pursuant to Division 3 (commencing with
Section 12000) of Title 1 of the Corporations Code where more than 50
percent of purchases are made at the specific price set forth in the
advertisement.
(21) Selling or leasing goods in violation of Chapter 4
(commencing with Section 1797.8) of Title 1.7.
(22) (A) Disseminating an unsolicited prerecorded message by
telephone without an unrecorded, natural voice first informing the
person answering the telephone of the name of the caller or the
organization being represented, and either the address or the
telephone number of the caller, and without obtaining the consent of
that person to listen to the prerecorded message.
(B) This subdivision does not apply to any of the following:
(i) A call for the purpose of collecting an existing obligation.
(ii) A call for the purpose of fraud prevention.
(iii) Any call generated at the request of the recipient.
(iv) Any call generated by an automatic dialing-announcing device
that is not used to randomly or sequentially dial telephone numbers,
but that is used to transmit a message in furtherance of an
established relationship to a business associate, customer, or other
person having a direct, established relationship with the person
using the automatic dialing-announcing device to transmit the
message. A message in furtherance of an established relationship
does not include a message pertaining to a new commercial transaction
that is unrelated to any product or service currently within the
scope of the established relationship.
(23) The home solicitation, as defined in subdivision (h) of
Section 1761, of a consumer who is a senior citizen where a loan is
made encumbering the primary residence of that consumer for the
purposes of paying for home improvements and where the transaction is
part of a pattern or practice in violation of either subsection (h)
or (i) of Section 1639 of Title 15 of the United States Code or
subsection (e) of Section 226.32 of Title 12 of the Code of Federal
Regulations.
A third party shall not be liable under this subdivision unless
(1) there was an agency relationship between the party who engaged in
home solicitation and the third party or (2) the third party had
actual knowledge of, or participated in, the unfair or deceptive
transaction. A third party who is a holder in due course under a
home solicitation transaction shall not be liable under this
subdivision.
(b) (1) It is an unfair or deceptive act or practice for a
mortgage broker or lender, directly or indirectly, to use a home
improvement contractor to negotiate the terms of any loan that is
secured, whether in whole or in part, by the residence of the
borrower and which is used to finance a home improvement contract or
any portion thereof. For purposes of this subdivision, "mortgage
broker or lender" includes a finance lender licensed pursuant to the
California Finance Lenders Law (Division 9 (commencing with Section
22000) of the Financial Code), a residential mortgage lender licensed
pursuant to the California Residential Mortgage Lending Act
(Division 20 (commencing with Section 50000) of the Financial Code),
or a real estate broker licensed under the Real Estate Law (Division
4 (commencing with Section 10000) of the Business and Professions
Code).
(2) This section shall not be construed to either authorize or
prohibit a home improvement contractor from referring a consumer to a
mortgage broker or lender by this subdivision. However, a home
improvement contractor may refer a consumer to a mortgage lender or
broker if that referral does not violate Section 7157 of the Business
and Professions Code or any other provision of law. A mortgage
lender or broker may purchase an executed home improvement contract
if that purchase does not violate Section 7157 of the Business and
Professions Code or any other provision of law. Nothing in this
paragraph shall have any effect on the application of Chapter 1
(commencing with Section 1801) of Title 2 to a home improvement
transaction or the financing thereof.
SEC. 3. Section 2872 of the Public Utilities Code is amended to
read:
2872. (a) The connection of automatic dialing-announcing devices
to a telephone line is subject to this article and to the
jurisdiction, control, and regulation of the commission.
(b) No person shall operate an automatic dialing-announcing device
except in accordance with this article. The use of such a device by
any person, either individually or acting as an officer, agent, or
employee of a person or corporation operating automatic
dialing-announcing devices, is subject to this article.
(c) No person shall operate an automatic dialing-announcing device
in this state to place a call that is received by a telephone in
this state during the hours between 9 p.m. and 9 a.m. California
time.
(d) This article does not prohibit the use of an automatic
dialing-announcing device for any of the following purposes:
(1) A school for purposes of contacting parents or guardians of
pupils regarding attendance.
(2) An exempt organization under the Bank and Corporation Tax Law
(Part 11 (commencing with Section 23001) of Division 2 of the Revenue
and Taxation Code) for purposes of contacting its members.
(3) A privately owned or publicly owned cable television system
for purposes of contacting customers or subscribers regarding the
previously arranged installation of facilities on the premises of the
customer or subscriber.
(4) A privately owned or publicly owned public utility or its
affiliate for purposes of contacting customers or subscribers
regarding the previously arranged installation or ongoing operation
of facilities or services on the premises of the customer or
subscriber or for purposes of contacting employees for emergency
actions or repairs required for public safety or to restore services.
(5) A petroleum refinery, chemical processing plant, or nuclear
powerplant for purposes of advising residents, public service
agencies, and the news media in its vicinity of an actual or
potential life-threatening emergency.
(6) A law enforcement agency, fire protection agency, public
health agency, public environmental health agency, city or county
emergency services planning agency, or any private for-profit agency
operating under contract with, and at the direction of, one or more
of these agencies, placing calls through automatic dialing-announcing
devices, if those devices are used for any of the following
purposes:
(A) Providing public service information relating to public
safety.
(B) Providing information concerning police or fire emergencies.
(C) Providing warnings of impending or threatened emergencies.
(7) A call generated at the request of the recipient.
(8) A call for the purpose of collecting an existing obligation.
(9) A call for the purpose of fraud prevention.
(10) A call that is not made for a commercial purpose.
(11) Any
(e) This article does not apply to any automatic
dialing-announcing device that is not used to randomly or
sequentially dial telephone numbers, but that is used to transmit a
message in furtherance of an established relationship to a business
associate, customer, or other person having a direct, established
relationship with the person using the automatic dialing-announcing
device to transmit the message. A message in furtherance of an
established relationship does not include a message pertaining to a
new commercial transaction that is unrelated to any product or
service currently within the scope of the established relationship.
(e)
(f) The commission may determine any question of fact
arising under this section.
SEC. 4. Section 2874 of the Public Utilities Code is amended to
read:
2874. (a) Except as provided in subdivision (d) or (e)
of Section 2872, if telephone calls are placed through the use of an
automatic dialing-announcing device, the device may be operated only
after an unrecorded, natural voice announcement has been made to the
person called by the person calling. The announcement shall do all
of the following:
(1) State the nature of the call and the name, address, and
telephone number of the business or organization being represented,
if any.
(2) Inquire as to whether the person called consents to hear the
prerecorded message of the person calling.
(b) The calling person described in subdivision (a) shall
disconnect the automatic dialing-announcing device from the telephone
line upon the termination of the call by either the person calling
or the person called.
(c) It does not constitute consent of the person called to hear
the prerecorded message of the calling person if the calling person
connects to an answering machine, voicemail, or other message
recording device, and the prerecorded message may not be left on the
answering machine, voicemail, or other message recording device.
SEC. 5. Section 2875.5 is added to the Public Utilities Code, to
read:
2875.5. On and after July 1, 2001, no person operating any
automatic equipment that incorporates a storage capability of
telephone numbers to be called or a random or sequential number
generator capable of producing numbers to be called may make a
telephone connection for which no person, acting as an agent or
telemarketer, or prerecorded message, as set forth in subdivision (d)
of Section 2872, is available for the person called.