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Company sues over North Dakota's new caller ID anti-spoofing law

Company sues over North Dakota's new caller ID anti-spoofing law

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Wayne Stenehjem

Wayne Stenehjem at the North Dakota Capitol on Oct. 27, 2016.

A New Jersey-based company that sells caller ID spoofing services is suing over North Dakota’s new anti-spoofing law, arguing it’s preempted by federal law and unconstitutional.

SpoofCard LLC and CEO Amanda Pietrocola are asking a federal judge to stop the state from enforcing the law that took effect in August and to award them unspecified money damages.

Attorney General Wayne Stenehjem on Tuesday said robocalls and spoof calls are “our No. 1 consumer complaint.” He estimated that such calls number in the “hundreds of thousands” in the state and said “the citizens of North Dakota are tired and fed up.”

Spoofing involves altering or disguising the number that shows up on the caller ID of the person being called. SpoofCard on its website touts the technique as a means to protect privacy, with one example showing a person texting someone else about dating without giving out a phone number. 

But the method also is used by telemarketers and scam artists.

“Scammers often use neighbor spoofing so it appears that an incoming call is coming from a local number, or spoof a number from a company or a government agency that you may already know and trust,” according to the Federal Communications Commission. “If you answer, they use scam scripts to try to steal your money or valuable personal information, which can be used in fraudulent activity.”

The North Dakota Legislature earlier this year passed a law that makes it a crime to “transmit misleading or inaccurate caller identification information with the intent to defraud or cause harm.” It also outlaws using a telephone number the caller does not own or have the consent to use.

Violations carry a maximum punishment of a year in jail and a $3,000 fine. A provision in the law also allows spoofing victims to file a civil lawsuit for up to $10,000 in damages per violation.

The bill passed unanimously in both the House and Senate and was signed by Gov. Doug Burgum.

“We worked closely with the Legislature to enact a statute that we think complies with federal law and the Constitution but also enables us to try to do what we can to try to put a stop to this type of activity,” Stenehjem said.

SpoofCard attorney Seth Thompson argues in the complaint filed Monday in U.S. District Court in Bismarck that North Dakota’s law conflicts with federal law that allows caller ID spoofing unless the call is nefarious in nature.

North Dakota’s law “also prohibits various forms of constitutionally protected speech, including anonymous speech, pseudonymous speech and the use of false identification to avoid social ostracism, to prevent discrimination and harassment, and to protect privacy,” Thompson wrote.

North Dakota's law has certain exceptions, such as for law enforcement, certain federal agencies, and telecommunications and other providers "acting solely as an intermediary" for telephone service between caller and recipient.

SpoofCard argues that since it does not fall under that exception, the company "has potential liability under the Anti-Spoofing Act for the actions of its customers." Potentially hundreds of its customers might be making calls to or from North Dakota using caller ID spoofing on any given day, according to the lawsuit.

“The SpoofCard service is the most widely used service of its type offered to consumers in the United States, with approximately 500,000 active users,” the complaint says.

Stenehjem said his office will fight the lawsuit.

“We pay for caller ID and have a right to expect that it’s accurate and that nobody is using it for deceptive purposes,” he said.

Reach Blake Nicholson at 701-250-8266 or blake.nicholson@bismarcktribune.com.

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