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PAG LIN
1 1 Section 1. NEW SECTION. 476B.1 DEFINITIONS.
1 2 As used in this chapter, unless the context otherwise
1 3 requires:
1 4 1. "Board" means the utilities board created in section
1 5 474.1.
1 6 2. "Consumer" means an actual or prospective purchaser,
1 7 lessee, or recipient of a consumer good or service.
1 8 3. "Consumer good or service" means any real property or
1 9 any tangible or intangible personal property which is normally
1 10 used for personal, family, or household purposes, including,
1 11 without limitation, any such property intended to be attached
1 12 to or installed in any real property without regard to whether
1 13 it is so attached or installed, as well as cemetery lots and
1 14 timeshare estates, and any service related to such property.
1 15 4. "Department" means the department of commerce.
1 16 5. "Doing business in this state" means a business which
1 17 conducts telephone solicitations from a location in this state
1 18 or from other states or nations to consumers located in this
1 19 state.
1 20 6. "Merchant" means a person who, directly or indirectly,
1 21 offers or makes available to a consumer any consumer good or
1 22 service.
1 23 7. "Telephone solicitation" means any voice communication
1 24 over a telephone for the purpose of encouraging the purchase
1 25 or rental of, or investment in, property, goods, services,
1 26 wherever originated, and includes any of the following
1 27 purposes:
1 28 a. To solicit a sale of a consumer good or service.
1 29 b. To offer an extension of credit for a consumer good or
1 30 service.
1 31 c. To obtain information that will or may be used for the
1 32 direct solicitation of a sale of a consumer good or service or
1 33 an offer of extension of credit for such purpose.
1 34 8. "Telephone solicitor" means a person doing business in
1 35 this state, who makes or causes to be made a telephone
2 1 solicitation, including, but not limited to, calls made by use
2 2 of automatic dialing-announcing device equipment.
2 3 9. "Unsolicited telephone solicitation" means a telephone
2 4 solicitation other than a call made as follows:
2 5 a. In response to an express request of the person called.
2 6 b. Primarily in connection with an existing debt or
2 7 contract, payment, or performance of which has not been
2 8 completed at the time of such call.
2 9 c. To a person with whom the telephone solicitor has a
2 10 prior or existing business relationship.
2 11 d. To a residential subscriber if the telephone
2 12 solicitation is made on behalf of a not-for-profit
2 13 organization exempt from paying taxes under section 501(c) of
2 14 the Internal Revenue Code, and if a bona fide member of the
2 15 exempt organization makes such communication.
2 16 Sec. 2. NEW SECTION. 476B.2 TELEPHONE SOLICITATION
2 17 DISCLOSURE REQUIREMENTS.
2 18 1. A telephone solicitor who makes an unsolicited
2 19 telephone solicitation to a residential, mobile, or telephonic
2 20 paging device telephone number shall identify the telephone
2 21 solicitor's self by the telephone solicitor's first and last
2 22 name, and the business on whose behalf the telephone solicitor
2 23 is making the unsolicited telephone solicitation, immediately
2 24 upon making contact by telephone with the person who is the
2 25 object of the unsolicited telephone solicitation.
2 26 2. Upon request of the consumer, or at least by the end of
2 27 the telephone solicitation if such solicitation results in the
2 28 sale of goods or services to the consumer, the telephone
2 29 solicitor shall provide the name of the telephone solicitation
2 30 business and a telephone number for the telephone solicitation
2 31 business.
2 32 3. If the solicitation results in the sale of goods or
2 33 services to the consumer, the telephone solicitor shall also
2 34 inform the consumer that the consumer may cancel the
2 35 transaction at any time prior to midnight of the third
3 1 business day after the date of the transaction by calling the
3 2 telephone number required to be disclosed in subsection 2.
3 3 This right of cancellation is separate from the consumer's
3 4 rights under sections 476B.5 and 476B.6.
3 5 Sec. 3. NEW SECTION. 476B.3 REGISTRATION OF TELEPHONE
3 6 SOLICITORS.
3 7 1. A telephone solicitor who makes a telephone
3 8 solicitation to a consumer in this state shall register with
3 9 the department, obtain a registration number from the
3 10 department, and pay a registration fee to the department. The
3 11 fee that an individual telephone solicitor is required to pay
3 12 shall be based on the number of telephone lines used by the
3 13 telephone solicitor to make telephone solicitations. A
3 14 telephone solicitor who registers with the department shall
3 15 pay an annual registration renewal fee to the department.
3 16 2. All telephone solicitors shall be licensed and bonded
3 17 as a condition of registration pursuant to rules adopted by
3 18 the board.
3 19 Sec. 4. NEW SECTION. 476B.4 TELEPHONE SOLICITOR
3 20 REQUIREMENTS.
3 21 A telephone solicitor shall not do any of the following:
3 22 1. Make a telephone solicitation to a person in this state
3 23 unless the telephone solicitor is registered with the
3 24 department.
3 25 2. Divulge any consumer data, except as necessary to
3 26 complete a transaction for a particular consumer.
3 27 Sec. 5. NEW SECTION. 476B.5 REQUIREMENTS FOR CONTRACTS
3 28 MADE PURSUANT TO TELEPHONE SOLICITATION.
3 29 1. A contract made pursuant to a telephone solicitation is
3 30 not valid and enforceable against a consumer unless made in
3 31 compliance with this section.
3 32 2. A contract made pursuant to a telephone solicitation
3 33 must satisfy all of the following:
3 34 a. The contract must be reduced to writing and signed by
3 35 the consumer.
4 1 b. The contract must comply with all other applicable laws
4 2 and rules.
4 3 c. The contract must match the description of goods or
4 4 services as principally used in the telephone solicitation.
4 5 d. The contract must contain the name, address, and
4 6 telephone number of the telephone solicitor and of the
4 7 merchant of the goods or services, if different from the
4 8 telephone solicitor, the total price of the contract, and a
4 9 detailed description of the goods or services being sold.
4 10 e. The contract must contain, in bold, conspicuous type,
4 11 immediately preceding the signature, the following statement:
4 12 "You are not obligated to pay any money unless you sign
4 13 this contract and return it to the seller."
4 14 f. The contract must not exclude from its terms any oral
4 15 or written representations made by the telephone solicitor to
4 16 the consumer in connection with the transaction.
4 17 3. This section does not apply to contractual sales
4 18 specifically regulated by other law, or to the sale of
4 19 financial services, security sales, or sales transacted by
4 20 insurance companies or their wholly owned subsidiaries or
4 21 agents, or to the sale of cable television services to a
4 22 franchised cable television operator's existing subscribers
4 23 within that cable television operator's franchise area, or to
4 24 any sales where no prior payment is made to the merchant and
4 25 an invoice accompanies the goods or services allowing the
4 26 consumer no less than seven days to cancel or return the goods
4 27 or services without obligation for any payment.
4 28 Sec. 6. NEW SECTION. 476B.6 RESTRICTIONS ON CHARGES TO
4 29 CREDIT CARD ACCOUNTS AND ELECTRONIC TRANSFERS OF FUNDS.
4 30 1. A merchant who engages a telephone solicitor to make or
4 31 cause to be made a telephone solicitation shall not make or
4 32 submit any charge to a consumer's credit card account or make
4 33 or cause to be made any electronic transfer of funds until
4 34 after the merchant receives from the consumer a copy of the
4 35 contract, signed by the consumer, which complies with section
5 1 476B.5.
5 2 2. This section does not apply to any of the following:
5 3 a. A transaction made pursuant to prior negotiations in
5 4 the course of a visit by the consumer to a merchant operating
5 5 a retail business establishment which has a fixed permanent
5 6 location and where consumer goods are displayed or offered for
5 7 sale on a continuing basis.
5 8 b. A transaction in which the consumer may obtain a full
5 9 refund for the return of undamaged and unused goods or a
5 10 cancellation of services notice to the seller within seven
5 11 days after receipt by the consumer, and the seller will
5 12 process the refund within thirty days after receipt of the
5 13 returned merchandise by the consumer.
5 14 c. A transaction in which the consumer purchases goods or
5 15 services pursuant to an examination of a television, radio, or
5 16 print advertisement or a sample, brochure, or catalog of the
5 17 merchant that contains all of the following:
5 18 (1) The name, address, and telephone number of the
5 19 merchant.
5 20 (2) A description of the goods or services being sold.
5 21 (3) Any limitations or restrictions that apply to the
5 22 offer.
5 23 d. A transaction in which the merchant is a bona fide
5 24 charitable organization or a newspaper.
5 25 Sec. 7. NEW SECTION. 476B.8 INVESTIGATIONS – CIVIL
5 26 ACTIONS – CIVIL PENALTY – OTHER REMEDIES.
5 27 1. The attorney general may bring a civil action to impose
5 28 a civil penalty of five hundred dollars per violation and to
5 29 seek other relief, including injunctive relief, as the court
5 30 deems appropriate against the telephone solicitor.
5 31 2. A civil penalty imposed under this section may be
5 32 recovered in an action brought by the attorney general, or the
5 33 attorney general may compromise such civil penalty, and upon
5 34 agreement of the violator to pay the compromised amount,
5 35 terminate an action to recover such civil penalty. The
6 1 attorney general may waive a civil penalty if the violator has
6 2 previously made full restitution or reimbursement or has paid
6 3 actual damages to a consumer who was injured as a result of
6 4 the violation.
6 5 3. A civil penalty paid for a violation of this section
6 6 shall be deposited in the general fund of the state.
6 7 Sec. 8. NEW SECTION. 476B.9 PRIVATE CAUSE OF ACTION –
6 8 DAMAGES AND INJUNCTIVE RELIEF.
6 9 A consumer who receives more than one telephone
6 10 solicitation within any twelve-month period by or on behalf of
6 11 the same person in violation of this chapter may do one or
6 12 both of the following:
6 13 1. Bring an action to enjoin further violations.
6 14 2. Bring an action to recover the greater of the
6 15 following:
6 16 a. Actual monetary damages incurred by the consumer as a
6 17 result of a violation of this chapter.
6 18 b. Five hundred dollars for each knowing violation of this
6 19 chapter.
6 20 Sec. 9. NEW SECTION. 476B.10 ATTORNEY FEES.
6 21 1. In a civil action initiated by the attorney general,
6 22 the court may award to the prevailing party reasonable
6 23 attorney fees and costs if the court finds that there was no
6 24 justiciable issue of either law or fact raised by the losing
6 25 party or if the court finds that the losing party acted in bad
6 26 faith.
6 27 2. In a civil action resulting from a transaction
6 28 involving a violation of this chapter, the prevailing party,
6 29 after judgment in the trial court and exhaustion of all
6 30 appeals, if any, is entitled to costs and reasonable attorney
6 31 fees.
6 32 Sec. 10. NEW SECTION. 476B.11 NOTIFICATION OF RIGHTS.
6 33 The board shall by rule ensure that telecommunications
6 34 providers inform their customers of the customers' rights
6 35 under this chapter. The notification shall be made by at
7 1 least both of the following:
7 2 1. Annual inserts in the billing statements mailed to
7 3 customers.
7 4 2. Conspicuous publication of the notice in the consumer
7 5 information pages of the local telephone directories.
7 6 EXPLANATION
7 7 This bill creates new Code chapter 476B establishing
7 8 restrictions on telephone solicitations.
7 9 New Code section 476B.1 provides definitions for the new
7 10 chapter.
7 11 The bill provides in new Code section 476B.2 that a
7 12 telephone solicitor who makes an unsolicited telephone
7 13 solicitation to a residential, mobile, or telephonic paging
7 14 device telephone number shall identify the solicitor's self by
7 15 the solicitor's first and last name, and the business on whose
7 16 behalf the solicitor is making the telephone call, immediately
7 17 upon making contact by telephone with the person who is the
7 18 object of the telephone solicitation. The telephone solicitor
7 19 also must disclose the name and telephone number of the
7 20 telephone solicitation business, and inform the consumer of
7 21 the right to cancel the transaction within three business
7 22 days.
7 23 The bill requires in new Code section 476B.3 that telephone
7 24 solicitors register with the state, pay registration fees, and
7 25 be licensed and bonded according to rules adopted by the
7 26 board.
7 27 New Code section 476B.4 requires a telephone solicitor to
7 28 be registered before making a telephone solicitation, and not
7 29 to divulge any consumer data, except as necessary to complete
7 30 a transaction.
7 31 The bill provides in new Code section 476B.5 that a
7 32 contract made pursuant to a telephone solicitation call must
7 33 be reduced to writing and signed by the consumer; must comply
7 34 with all other applicable laws and rules; must match the
7 35 description of goods or services as principally used in the
8 1 telephone solicitation; must contain the name, address, and
8 2 telephone number of the seller, the total price of the
8 3 contract, and a detailed description of the goods or services
8 4 being sold; must contain, in bold, conspicuous type,
8 5 immediately preceding the signature, the statement "You are
8 6 not obligated to pay any money unless you sign this contract
8 7 and return it to the seller."; and the contract shall not
8 8 exclude from its terms any oral or written representations
8 9 made by the telephone solicitor to the consumer in connection
8 10 with the transaction.
8 11 New Code section 476B.6 restricts charges to credit card
8 12 accounts or electronic funds transfers until the merchant
8 13 receives a signed contract from the consumer.
8 14 The bill provides in new Code section 476B.8 that the
8 15 attorney general may bring an action to impose a civil penalty
8 16 and to seek other relief, including injunctive relief, as the
8 17 court deems appropriate against the telephone solicitor. A
8 18 civil penalty is $500 per violation and shall be deposited in
8 19 the general fund of the state.
8 20 The bill provides in new Code section 476B.9 that a
8 21 consumer who receives more than one telephone solicitation in
8 22 violation of the new Code section within any 12-month period
8 23 by or on behalf of the same person may bring an action to
8 24 enjoin further violations; and may also bring an action to
8 25 recover the greater of actual monetary damages incurred by the
8 26 consumer as a result of a violation or an amount of $500 for
8 27 each knowing violation.
8 28 New Code section 476B.10 provides for recovery of attorney
8 29 fees by the prevailing party in an action.
8 30 New Code section 476B.11 requires adoption of rules by the
8 31 utilities board related to customer notification of rights
8 32 under the bill.
8 33 LSB 6286HH 79
8 34 jj/cls/14
Text: HF02592 Text: HF02594 Text: HF02500 - HF02599 Text: HF Index Bills and Amendments: General Index Bill History: General Index
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