DISH Network's $210 Million Telemarketing Settlement: How the Case Ended

What happened

On December 7, 2020, the Department of Justice (DOJ) announced the settlement. According to the DOJ, the $126 million payment was the largest civil penalty ever paid to resolve telemarketing violations under the Federal Trade Commission Act, and exceeded the total penalties paid to the government by all prior violators of the Federal Trade Commission's (FTC) Telemarketing Sales Rule (TSR).

The four state co-plaintiffs, California, Illinois, North Carolina and Ohio, received $84 million for violations of the Telephone Consumer Protection Act (TCPA).

The history of the case

• 2009: The United States and the four states filed suit. They alleged DISH made millions of unlawful telemarketing calls and was responsible for millions more made by retailers marketing DISH products.
• 2016: The case went to trial.
• 2017: The district court found DISH liable for more than 66 million violations of the TSR and other federal and state laws. It imposed compliance measures and awarded $280 million in civil penalties and damages: $168 million to the United States and $112 million to the states.
• 2020: The U.S. Court of Appeals for the Seventh Circuit affirmed the liability findings but vacated and remanded the monetary awards for recalculation.
• December 2020: The parties resolved the monetary portion through a stipulated judgment.

Terms of the stipulated judgment

• DISH pays the United States $126 million in civil penalties.
• DISH agreed not to contest the court's factual findings or liability determination.
• DISH continues to follow the compliance measures imposed in 2017. The injunction prohibits future telemarketing violations and significantly restricts DISH's future telemarketing.
• DISH must prepare and follow a telemarketing plan, submit compliance materials to the DOJ and the FTC twice a year until 2027, and provide compliance reports on request.

The DOJ Civil Division's Consumer Protection Branch handled the case, with FTC attorneys representing the FTC.

Why it matters

The core lesson is about retailers and other third parties. DISH was held responsible for calls placed by companies that marketed its products. A seller that benefits from telemarketing can be liable for calls made on its behalf, even if it did not dial them.

The second lesson is about duration. This case took more than a decade, and compliance obligations run to 2027. The cost of a telemarketing case is not only the penalty.

Practical steps

• Audit every third party that markets your products by phone.
• Require Do Not Call compliance in contracts and verify it.
• Act on complaints about dealer or affiliate calls.
• Document your telemarketing plan before a regulator asks for one.