United States: Leading Trade Group Launching Broad-Ranging Attack On FCC's Expansive Interpretation Of The TCPA

Last Updated: September 4 2015
Article by Alan D. Wingfield, David M. Gettings and Timothy St. George

On July 10, the Federal Communications Commission enacted major changes and clarifications to the Telephone Consumer Protection Act of 1991 ("TCPA"). Approved on a contentious 3-2 vote by the FCC commissioners, the FCC released its Declaratory Ruling and Order (FCC 15-72) ("the FCC's Order") formally stating its interpretation of numerous provisions of the TCPA. The FCC's Order will have profound effects on the scope of the TCPA and the way businesses reach out to consumers for many purposes, including debt collection, account updates, and even medical reminders. Because of the wide-ranging implications of the FCC's Order, industry groups have begun fighting back.

The FCC's Order increased the scope of the TCPA in several different areas. These areas of expansion include:

  • Expanding the definition of an automatic telephone dialing system ("ATDS"), which is the principal type of technology the TCPA regulates;
  • Expanding the manner by which consumers can revoke their consent to receive ATDS calls to allow revocation through "any reasonable means;"
  • Expanding potential liability for calls to reassigned cellular telephone numbers through the creation of a "constructive knowledge" of the reassignment standard; and
  • Expanding the reach of restrictions under the TCPA to certain text messages.

Troutman Sanders previously reported on these developments in more significant detail.

Given the FCC's attempt to unilaterally and dramatically expand the reach of the TCPA, industry groups have taken up the fight. ACA International has spearheaded this attack by challenging the FCC's Order in the United States Court of Appeals for the District of Columbia Circuit.

On August 12, ACA International filed its Statement of Issues with the D.C. Circuit, explaining the issues in the FCC's Order that ACA International is challenging in its Petition for Review. This statement lists three main issues:

  • First, ACA International is challenging the FCC's "attempted redefinition" of what constitutes an ATDS, including its incorporation of the concept of "capacity" to be used as an ATDS in the definition. According to ACA International, this expansive definition of ATDS is arbitrary, capricious, an abuse of the FCC's discretion, and not in accordance with the law. Specifically, ACA International contends the FCC's definition of ATDS "disregards the statutory definition" in the TCPA and "unlawfully expands" its scope. In addition, ACA International claims the definition is unconstitutionally vague and overbroad.
  • Second, ACA International challenges the FCC's interpretation of "prior express consent" as arbitrary, capricious, an abuse of discretion, and unconstitutional. One element of this challenge is the FCC's treatment of a "called party," which ACA International contends will result in "liability for innocent and unknowing conduct," and the FCC's handling of number reassignments under its new "constructive knowledge" standard.
  • Third, ACA International's petition describes the FCC's conduct as disregarding Congressional findings that the TCPA balances privacy rights, public safety, and commercial freedom of speech. According to ACA International, the FCC's Order "repeatedly rejects that balance" and "weaves a regulatory web so tangled that it snares legitimate, compliant, law-abiding actors along with the abusive and intrusive callers at whose conduct the law is aimed."

ACA International may not be alone in its fight. Recently, several businesses have sought leave to intervene in ACA International's action. On August 12, a host of debt collection agencies filed a motion to intervene in support of ACA International. According to these debt collection agencies, the FCC's actions "expose the caller to spurious class action claims that seek to impose ruinous damages invariably prompting extortionate settlements."

Also on August 12, two non-profit national associations that represent the interests of the marketing, opinion, and social research industry sought leave to intervene. According to these associations, the FCC's Order is flawed in a variety of ways and will likely cause harm to their members.

These petitions to the D.C. Circuit mark the beginning of a long and involved battle against the FCC's Order. In fact, the D.C. Circuit has become the hub of litigation challenging the FCC's Order. Recently, the Seventh Circuit transferred an action challenging the FCC's Order initially filed in the Seventh Circuit to the D.C. Circuit pursuant to an order from the judicial panel on multidistrict litigation. These numerous attempts to challenge the FCC Order indicate businesses will not allow the FCC's recent interpretations to take hold without a substantial and crucial fight.

Troutman Sanders LLP has unique industry-leading expertise with the TCPA, with experience gained trying TCPA cases to verdict and advising Fortune 50 companies regarding their compliance strategies. We will continue to monitor regulatory and judicial interpretation of the TCPA in order to identify and advise on potential risks.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Authors
Alan D. Wingfield
Timothy St. George
 
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