In a case called Gils v Patagonia, a law firm that specializes in high-stakes contingency fee and class-action litigation is representing an individual (and her cohort of California teleshoppers) who claim that calls to the Patagonia (yes, the super environmentally-conscious outfitter) are "intercepted, listened to, recorded, and used by an undisclosed third party."
The accusation is carefully worded to sound nefarious. Yet, if you delve into it very closely, it attempts to include a long-standing process described in preambles as "This call is monitored and recorded for quality and training purposes."
In the Patagonia case, the third party is contact center-as-a-service (CCaaS) provider Talkdesk. Privacy concerns about sharing personal information with an undisclosed third party customarily refers to the sale of that information to businesses like credit bureaus or advertising networks whose business cases are built on brokering that information with financial institutions or advertisers seeking to hone their credit ratings or target advertising messages.
Talkdesk, is not one of those. Like Verint, NICE, Five9, Amazon (with AmazonConnect), and about a dozen other CCaaS providers, Talkdesk has augmented its commercial offerings by introducing generative artificial intelligence-powered resources to improve customer experience by helping agents quickly understand each caller's intent, recognize when conversations are going sideways (when a caller is upset), and extract other insights that ensure better customer service, or at least comply with guidelines that every agent (and virtual agent) should follow.
There is an even larger group of technology providers that provide companies with resources that capture and transcribe conversations and then use AI to summarize the content of the call, detect and suggest follow-up actions , and provide other fodder for genAI-infused platforms to work their magic. Entire workflows are being designed to speed up the processes involved in booking appointments, composing follow-up emails, and sharing insights with product or marketing teams that can do something about it. Anyone who has participated in a Zoom call or Teams Meeting where the AI Assistant or Copilot has summarized hours-long discussions into quickly reviewable five-paragraph documents might share my opinion that this use of the technology is beneficial and nobody has been injured in their production.
Contingency-only law firms are opportunistic in picking their battles. It helps when there is a large class to represent. In this case they are talking about every California resident who has called a customer support line that is hooked up to a CCaaS. It also helps to have a statute like the California Invasion of Privacy Act (CIPA), which is crafted to describe prohibited activities in language that is subject to interpretation, like cataloguing a broad spectrum of devices and resources that can be used to help companies automate tasks or mine customer data.
The brief calls Talkdesk a "data intelligence company" rather than a CCaaS provider. This term is used quite purposefully to demonstrate that companies violate the California Invasion of Privacy Act when they intercept, record, and analyze conversations with their customers without proper consent. The word intercept has a history and is a loaded term. It has been used most broadly to refer to lawful intercept, or the use of facilities in telecommunications and telephone networks that selectively wiretap individual subscribers. That is not what is going on here.
"This call may be monitored for security and training purposes" might be a pale flavor of disclosure and does not equate to a fully-transparent description of the treatment of personally identifiable information (PII), but Patagonia is not intercepting" calls into its own contact center and sharing it with Talkdesk, anymore than companies are intercepting conversations among their employees and sharing them with Microsoft, Zoom, Vonage, or another third party for some nefarious purpose.
Take This Case as a Warning
The plaintiff's logic is flawed. Its lawyers accuse Patagonia of wiretapping its own phone calls so a third party, Talkdesk, can use it for its own purposes without gaining the explicit consent of a caller. Among the nefarious ends that Talkdesk seeks to achieve are rapid recognition of customer intent to provide prompt responses; sentiment detection to help agents be more effective; and automated quality monitoring to improve services. That hardly amounts to unlawful access to data to be used by a third party for its own purposes.
Just about every solution provider and consultant advises clients to craft preambles to inform customers that calls are recorded for training and security purposes. Now that asynchronous conversations take place across multiple channels over spans of time, an audio prompt at the beginning of a phone call is already inadequate. Regulators and legislators would prefer fully-transparent descriptions of the measures taken to protect customer privacy and gain explicit consent surrounding specific uses.
Let's hope that solution providers take those measures and customers recognize that it is worth it to permit the recording, transcription, and analytics of conversational content to gain better service quality.
Dan Miller is founder and lead analyst of Opus Research.