Bill Text: MI HB6350 | 2017-2018 | 99th Legislature | Introduced

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Bill Title: Consumer protection; home solicitation sales; penalties for violation of do-not-call list; modify, and authorize inclusion of mobile telephones on list. Amends secs. 1, 1a, 1b, 1c, 1d & 1e of 1971 PA 227 (MCL 445.111 et seq.).

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2018-09-26 - Bill Electronically Reproduced 09/25/2018 [HB6350 Detail]

Download: Michigan-2017-HB6350-Introduced.html

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HOUSE BILL No. 6350

 

 

September 25, 2018, Introduced by Rep. Phelps and referred to the Committee on Commerce and Trade.

 

     A bill to amend 1971 PA 227, entitled

 

"An act to prescribe the rights and duties of parties to home

solicitation sales; to regulate certain telephone solicitation; to

provide for the powers and duties of certain state officers and

entities; and to prescribe penalties and remedies,"

 

by amending sections 1, 1a, 1b, 1c, 1d, and 1e (MCL 445.111,

 

445.111a, 445.111b, 445.111c, 445.111d, and 445.111e), section 1 as

 

amended by 2009 PA 93, section 1a as amended and sections 1b, 1d,

 

and 1e as added by 2002 PA 612, and section 1c as amended by 2006

 

PA 133.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 1. As used in this act:

 

     (a) "Home solicitation sale" means a sale of goods or services

 

of more than $25.00 in which the seller or a person an individual

 

who is acting for the seller engages in a personal, telephonic, or

 

written solicitation of the sale, the solicitation is received by

 

the buyer at a residence of the buyer, and the buyer's agreement or

 

offer to purchase is there given to the seller or a person an

 

individual who is acting for the seller. Home solicitation sale

 

does not include any of the following:

 

     (i) A sale made pursuant to in which payment is made using a

 

preexisting revolving charge account.

 

     (ii) A sale made pursuant to that is the result of prior

 

negotiations between the parties at a business establishment at a

 

fixed location where goods or services are offered or exhibited for

 

sale.

 

     (iii) A sale or solicitation of insurance by an insurance

 

agent licensed by the commissioner of insurance.who is licensed

 

under the insurance code of 1956, 1956 PA 218, MCL 500.100 to

 

500.8302.

 

     (iv) A sale made at a fixed location of a business

 

establishment where goods or services are offered or exhibited for

 

sale.

 

     (v) A sale made pursuant to on the terms included in a printed

 

advertisement in a publication of general circulation.

 

     (vi) A sale of services by a real estate broker or salesperson

 

licensed by the department of consumer and industry services.under

 

article 25 of the occupational code, 1980 PA 299, MCL 339.2501 to

 

339.2518.

 

     (vii) A sale of agricultural or horticultural equipment and

 

machinery that is demonstrated to the consumer by the vendor at the

 

request of either or both of the parties.

     (b) "Fixed location" means a place of business where the

 

seller or an agent, servant, employee, or solicitor of that seller

 

primarily engages in the sale of goods or services of the same kind

 

as would be sold at the residence of a buyer.

 

     (c) "Business day" means Monday through Friday and does not

 

include Saturday, Sunday, or the following business holidays: New

 

Year's day, Day, Martin Luther King's birthday, Washington's

 

birthday, King Jr. Day, Presidents' Day, Memorial day, Day,

 

Independence day, Day, Labor day, Day, Columbus day, Day, Veterans'

 

day, Day, Thanksgiving day, Day, and Christmas day.Day.

 

     (d) "Federally insured depository institution" means a state

 

or national bank, state or federal savings bank, state or federal

 

savings and loan association, or state or federal credit union that

 

holds deposits insured by an agency of the United States.

 

     (e) As used in only the definition of home solicitation sales,

 

"goods or services" does not include any of the following:

 

     (i) A loan, deposit account, or trust account lawfully offered

 

or provided by a federally insured depository institution or a

 

subsidiary or affiliate of a federally insured depository

 

institution.

 

     (ii) An extension of credit that is subject to any of the

 

following acts:financial licensing acts, as defined in section 2 of

 

the consumer financial services act, 1988 PA 161, MCL 487.2052.

 

     (A) The mortgage brokers, lenders, and servicers licensing

 

act, 1987 PA 173, MCL 445.1651 to 445.1684.

 

     (B) The secondary mortgage loan act, 1981 PA 125, MCL 493.51

 

to 493.81.

     (C) The regulatory loan act, 1939 PA 21, MCL 493.1 to 493.24.

 

     (D) The consumer financial services act, 1988 PA 161, MCL

 

487.2051 to 487.2072.

 

     (E) 1984 PA 379, MCL 493.101 to 493.114.

 

     (F) The motor vehicle sales finance act, 1950 (Ex Sess) PA 27,

 

MCL 492.101 to 492.141.

 

     (iii) A sale of a security or interest in a security that is

 

subject to the uniform securities act, 1964 PA 265, MCL 451.501 to

 

451.818, or the uniform securities act (2002), 2008 PA 551, MCL

 

451.2101 to 451.2703.

 

     (f) "Written solicitation" means a postcard or other written

 

notice delivered to a buyer's residence that requests that the

 

buyer contact the seller or seller's agent by telephone to inquire

 

about a good or service, unless the postcard or other written

 

notice concerns a previous purchase or order or specifies the price

 

of the good or service and accurately describes the good or

 

service.

 

     (g) "ADAD" or "automatic "Automatic dialing and announcing

 

device" means any device or system of devices that is used, whether

 

alone or in conjunction with other equipment, for the purpose of

 

automatically selecting or dialing telephone numbers.

 

     (h) "Commission" means the public service commission.

 

     (h) (i) "Do-not-call list" means a do-not-call list of

 

consumers and their residential telephone numbers maintained by the

 

commission, by a vendor designated by the commission, or by an

 

agency of the federal government, under section 1a.the National Do

 

Not Call Registry maintained by the Federal Trade Commission under

16 CFR 310.4.

 

     (i) (j) "Existing customer" means an individual who has

 

purchased goods or services from a person, who is the recipient of

 

a voice communication from that person, and who either paid for the

 

goods or services within the 12 months preceding the voice

 

communication or has not paid for the goods and services at the

 

time of the voice communication because of a prior agreement

 

between the person and the individual.

 

     (j) (k) "Person" means an individual, partnership,

 

corporation, limited liability company, association, governmental

 

entity, or other legal entity.

 

     (k) (l) "Residential telephone subscriber" or "subscriber"

 

means a person residing in this state who has residential telephone

 

service."Telephone consumer" means an individual who is a resident

 

of this state and has home or mobile telephone service.

 

     (l) (m) "Telephone solicitation" means any voice communication

 

over a telephone for the purpose of encouraging the recipient of

 

the call to purchase, rent, or invest in goods or services during

 

that telephone call. Telephone solicitation does not include any of

 

the following:

 

     (i) A voice communication to a residential telephone

 

subscriber telephone consumer with that subscriber's telephone

 

consumer's express invitation or permission prior to given before

 

the voice communication is made.

 

     (ii) A voice communication to an existing customer of the

 

person on whose behalf the voice communication is made, unless the

 

existing customer is a consumer who has requested that he or she

not receive calls from or on behalf of that person under section

 

1c(1)(g).

 

     (iii) A voice communication to a residential telephone

 

subscriber telephone consumer in which the caller requests a face-

 

to-face meeting with the residential telephone subscriber telephone

 

consumer to discuss a purchase, sale, or rental of, or investment

 

in, goods or services but does not urge the residential telephone

 

subscriber telephone consumer to make a decision to purchase, sell,

 

rent, invest, or make a deposit on that good or service during the

 

voice communication.

 

     (m) (n) "Telephone solicitor" means any person doing business

 

in this state who that makes or causes to be made a telephone

 

solicitation from within or outside of this state, including, but

 

not limited to, calls made by use of automated automatic dialing

 

and announcing devices or made by a live person.individual.

 

     (o) "Vendor" means a person designated by the commission to

 

maintain a do-not-call list under section 1a. The term may include

 

a governmental entity.

 

     Sec. 1a. (1) A person shall not make a home solicitation sale

 

shall not be made by telephonic solicitation using in whole or in

 

part a recorded message.

 

     (2) A person shall not make a telephone solicitation that

 

consists in whole or in part of a recorded message.

 

     (2) Within 120 days after the effective date of the amendatory

 

act that added this subsection, the commission shall do 1 of the

 

following:

 

     (a) Establish a state do-not-call list. All of the following

apply if the commission establishes a do-not-call list under this

 

subdivision:

 

     (i) The commission shall publish the do-not-call list

 

quarterly for use by telephone solicitors.

 

     (ii) The do-not-call list fund is created in the state

 

treasury. Money received from fees under subparagraph (iii) shall

 

be credited to the fund. The state treasurer shall direct the

 

investment of the fund. The state treasurer shall credit to the

 

fund interest and earnings from fund investments. Money remaining

 

in the fund at the end of a fiscal year shall be carried over in

 

the fund to the next and succeeding fiscal years. Money in the fund

 

may be appropriated to the commission to cover the costs of

 

administering the do-not-call list, but may not be appropriated to

 

compensate or reimburse a vendor designated under subdivision (b)

 

to maintain a do-not-call list under that subdivision.

 

     (iii) The commission shall establish and collect 1 or both of

 

the following fees to cover the costs to the commission for

 

administering the do-not-call list:

 

     (A) Fees charged to telephone solicitors for access to the do-

 

not-call list.

 

     (B) Fees charged to residential telephone subscribers for

 

inclusion on the do-not-call list. The commission shall not charge

 

a residential telephone subscriber a fee of more than $5.00 for a

 

3-year period.

 

     (iv) The commission shall maintain the do-not-call list for at

 

least 1 year. After 1 year, the commission may at any time elect to

 

designate a vendor to maintain a do-not-call list under subdivision

(b), in which case subdivision (b) shall apply.

 

     (b) Designate a vendor to maintain a do-not-call list. All of

 

the following apply to a vendor designated to maintain a do-not-

 

call list under this subdivision:

 

     (i) The commission shall establish a procedure or follow

 

existing procedure for the submission of bids by vendors to

 

maintain a do-not-call list under this subdivision.

 

     (ii) The commission shall establish a procedure or follow

 

existing procedure for the selection of the vendor to maintain the

 

do-not-call list. In selecting the vendor, the commission shall

 

consider at least all of the following factors:

 

     (A) The cost of obtaining and the accessibility and frequency

 

of publication of the do-not-call list to telephone solicitors.

 

     (B) The cost and ease of registration on the do-not-call list

 

to consumers who are seeking inclusion on the do-not-call list.

 

     (iii) The commission may review its designation and make a

 

different designation under this subdivision if the commission

 

determines that another person would be better than the designated

 

vendor in meeting the selection factors established under

 

subparagraph (ii) or if the designated vendor engages in activities

 

the commission considers contrary to the public interest.

 

     (iv) If the commission does not establish a state do-not-call

 

list under subdivision (a), the commission shall comply with the

 

designation requirements of this subdivision for at least 1 year.

 

After 1 year, the commission may at any time elect to establish and

 

maintain a do-not-call list under subdivision (a), in which case

 

subdivision (a) shall apply.

     (v) Unless the vendor is a governmental entity, a vendor

 

designated by the commission under this subdivision is not a

 

governmental agency and is not an agent of the commission in

 

maintaining a do-not-call list.

 

     (vi) The commission and a vendor designated under this

 

subdivision shall execute a written contract. The contract shall

 

include the vendor's agreement to the requirements of this section

 

and any additional requirements established by the commission.

 

     (vii) The commission shall not use state funds to compensate

 

or reimburse a vendor designated under this subdivision. The vendor

 

may receive compensation or reimbursement for maintaining a

 

designated do-not-call list under this subdivision only from 1 or

 

both of the following:

 

     (A) Fees charged by the vendor to telephone solicitors for

 

access to the do-not-call list.

 

     (B) Fees charged by the vendor to residential telephone

 

subscribers for inclusion on the do-not-call list. A designated

 

vendor shall not charge a residential telephone subscriber a fee of

 

more than $5.00 for a 3-year period.

 

     (viii) The designee do-not-call list fund is created in the

 

state treasury. If the vendor is a department or agency of this

 

state, money received from fees under subparagraph (vii) by that

 

vendor shall be credited to the fund. The state treasurer shall

 

direct the investment of the fund. The state treasurer shall credit

 

to the fund interest and earnings from fund investments. Money

 

remaining in the fund at the end of a fiscal year shall be carried

 

over in the fund to the next and succeeding fiscal years. Money in

the fund may be appropriated to that vendor to cover the costs of

 

administering the do-not-call list.

 

     (3) In determining whether to establish a state do-not-call

 

list under subsection (2)(a) or designate a vendor under subsection

 

(2)(b), and in designating a vendor under subsection (2)(b), the

 

commission shall consider comments submitted to the commission from

 

consumers, telephone solicitors, or any other person.

 

     (3) (4) Beginning 90 days after the commission establishes a

 

do-not-call list under subsection (2)(a) or designates a vendor to

 

maintain a do-not-call list under subsection (2)(b), a A telephone

 

solicitor shall not make a telephone solicitation to a residential

 

telephone subscriber telephone consumer whose name and residential

 

telephone number is home or mobile telephone number or numbers are

 

on the then-current version of that the do-not-call list.

 

     (5) Notwithstanding any other provision of this section, if an

 

agency of the federal government establishes a federal do-not-call

 

list, within 120 days after the establishment of the federal do-

 

not-call list, the commission shall designate the federal list as

 

the state do-not-call list. The federal list shall remain the state

 

do-not-call list as long as the federal list is maintained. A

 

telephone solicitor shall not make a telephone solicitation to a

 

residential telephone subscriber whose name and residential

 

telephone number is on the then-current version of the federal

 

list.

 

     (4) (6) A telephone solicitor shall not use a the do-not-call

 

list for any purpose other than meeting the requirements of

 

subsection (4) or (5).(3).

     (7) The commission or a vendor shall not sell or transfer the

 

do-not-call list to any person for any purpose unrelated to this

 

section.

 

     Sec. 1b. (1) At the beginning of a telephone solicitation, a

 

person the organization or other person on whose behalf the call

 

was initiated shall ensure that the individual who is making a the

 

telephone solicitation to a residential telephone subscriber

 

telephone consumer shall state his or her name and the full name of

 

the organization or other person on whose behalf the call was

 

initiated and provide a telephone number of the organization or

 

other person on request. A natural person must be The organization

 

or other person shall ensure that an individual is available to

 

answer the telephone number at any time when the organization or

 

other person is making telephone solicitations. are being made.

 

     (2) The person An organization or other person described in

 

subsection (1) shall ensure that the individual answering the

 

telephone number required under subsection (1) shall provide

 

provides a residential telephone subscriber telephone consumer

 

calling the telephone number with information describing the

 

organization or other person on whose behalf the telephone

 

solicitation was made to the residential telephone subscriber

 

telephone consumer and describing the telephone solicitation.

 

     (3) A telephone solicitor shall not intentionally block or

 

otherwise interfere with the caller ID function on the telephone of

 

a residential telephone subscriber telephone consumer to whom a

 

telephone solicitation is made so that the telephone number of the

 

caller is not displayed on the telephone of the residential

telephone subscriber.telephone consumer.

 

     Sec. 1c. (1) It is an unfair or deceptive act or practice and

 

a violation of this act for a telephone solicitor to do any of the

 

following:

 

     (a) Misrepresent or fail to disclose, in a clear, conspicuous,

 

and intelligible manner and before payment is received from the

 

consumer, all of the following information:

 

     (i) Total purchase price to the consumer of the goods or

 

services to be received.sold to him or her.

 

     (ii) Any restrictions, limitations, or conditions to purchase

 

or to use the goods or services that are the subject of an offer to

 

sell goods or services.

 

     (iii) Any material term or condition of the seller's refund,

 

cancellation, or exchange policy, including a consumer's right to

 

cancel a home solicitation sale under section 2 and, if applicable,

 

that the seller does not have a refund, cancellation, or exchange

 

policy.

 

     (iv) Any material costs or conditions related to receiving a

 

prize, including the odds of winning the prize, and if the odds are

 

not calculable in advance, the factors used in calculating the

 

odds, the nature and value of a prize, that no purchase is

 

necessary to win the prize, and the "no purchase required" method

 

of entering the contest.

 

     (v) Any material aspect of an investment opportunity the

 

seller is offering, including, but not limited to, risk, liquidity,

 

earnings potential, market value, and profitability.

 

     (vi) The quantity and any material aspect of the quality or

basic characteristics of any goods or services offered.

 

     (vii) The right to cancel a sale under this act, if any.

 

     (b) Misrepresent any material aspect of the quality or basic

 

characteristics of any goods or services offered.

 

     (c) Make a false or misleading statement with the purpose of

 

inducing a consumer to pay for goods or services.

 

     (d) Request or accept payment from a consumer or make or

 

submit any charge to the consumer's credit or bank account before

 

the telephone solicitor or seller receives from the consumer an

 

express verifiable authorization. As used in this subdivision,

 

"verifiable authorization" means a written authorization or

 

confirmation, an oral authorization recorded by the telephone

 

solicitor, or confirmation through an independent third party.

 

     (e) Offer to a consumer in this state a prize promotion in

 

which a purchase or payment is necessary to obtain the prize.

 

     (f) Fail to comply with the requirements of section 1a or 1b.

 

     (g) Make a telephone solicitation to a consumer in this state

 

who has requested that he or she not receive calls from the

 

organization or other person on whose behalf the telephone

 

solicitation is made.

 

     (h) While making a telephone solicitation, misrepresent in a

 

message left for a consumer on his or her answering machine or

 

voice mail that the consumer has a current business matter or

 

transaction or a current business or customer relationship with the

 

telephone solicitor or another person and request that the consumer

 

call the telephone solicitor or another person to discuss that

 

matter, transaction, or relationship.

     (2) Except as provided in this subsection, beginning 210 days

 

after the effective date of the amendatory act that added this

 

section, a person who that knowingly or intentionally violates this

 

section is guilty of a misdemeanor punishable by imprisonment for

 

not more than 6 months 180 days or a fine of not more than $500.00,

 

or both. This subsection does not prohibit a person from being

 

charged with, convicted of, or punished for any other crime

 

including any other violation of law arising out of the same

 

transaction as the violation of this section. This subsection does

 

not apply if the violation of this section is a failure to comply

 

with the requirements of section 1a(1), (4), or (5) (2), or (3) or

 

section 1b.

 

     (3) A person Subject to subsections (4) and (5), an individual

 

who suffers loss as a result of violation of this section may bring

 

an individual or class action to recover actual damages or $250.00,

 

whichever is greater, together with reasonable attorney fees. This

 

subsection does not prevent the consumer individual from asserting

 

his or her rights under this act if the telephone solicitation

 

results in a home solicitation sale, or asserting any other rights

 

or claims the consumer may have individual has under applicable

 

state or federal law.

 

     (4) If a consumer whose name and home or mobile telephone

 

number is on the then-current version of the do-not-call list

 

receives a telephone solicitation that consists in whole or in part

 

of a recorded message, the consumer may notify the telephone

 

solicitor in writing that it has violated section 1a and provide

 

with the notice the time and date of the solicitation and evidence

that the consumer is on the do-not-call list. A telephone solicitor

 

that receives notification from a consumer under this subsection

 

shall pay the consumer $1.00 for each telephone solicitation it

 

made to the consumer within 30 days after it receives notification

 

under this subsection. If the telephone solicitor does not pay the

 

consumer the amount owed under this subsection within that time

 

period, the consumer may proceed under subsection (3), and the

 

amounts owed to the consumer under this subsection are considered

 

the consumer's actual damages for the violation or violations of

 

section 1a.

 

     (5) The attorney general may bring a class action on behalf of

 

consumers described in subsection (3) or (4) to enforce this act,

 

in the manner provided in section 10 of the Michigan consumer

 

protection act, 1976 PA 331, MCL 445.910.

 

     Sec. 1d. (1) Beginning 210 days after the effective date of

 

the amendatory act that added this section, if If a telephone

 

directory includes residential telephone numbers, a person that

 

publishes a new telephone directory shall include in the telephone

 

directory a notice describing the do-not-call list and how to

 

enroll on the do-not-call list.

 

     (2) Beginning 210 days after the effective date of the

 

amendatory act that added this section, October 27, 2003, each

 

telecommunication provider that provides residential telephone

 

service to telephone consumers shall include a notice describing

 

the do-not-call list and how to enroll on the do-not-call list with

 

1 of that telecommunication provider's bills for telecommunication

 

services to a residential telephone subscriber the telephone

consumer each year. If the federal communication commission or any

 

other federal agency establishes a federal "do not call" list, the

 

notice shall also describe that list and how to enroll on that

 

list. As used in this subsection, "telecommunication provider"

 

means that term as defined in section 102 of the Michigan

 

telecommunications act, 1991 PA 179, MCL 484.2102.

 

     Sec. 1e. Sections 1a, 1b, 1c, and 1d do not apply to a person

 

that is subject to any of the following:

 

     (a) The charitable organizations and solicitations act, 1975

 

PA 169, MCL 400.271 to 400.294.

 

     (b) The public safety solicitation act, 1992 PA 298, MCL

 

14.301 to 14.327.

 

     (c) Section 527 of the internal revenue code of 1986, 26 USC

 

527.

 

     Enacting section 1. This amendatory act takes effect 90 days

 

after the date it is enacted into law.