In McLaughlin Chiropractic Assocs. v. McKesson Corp.,1 the U.S. Supreme Court just held that the “Hobbs Act does not bind district courts in civil enforcement proceedings to an agency's interpretation of the statute.” This holding is a game-changer for Telephone Consumer Protection Act (“TCPA”) cases. Now, district courts are no longer bound by the Federal Communications Commission's (“FCC”) final orders in individual and class action TCPA cases.
Before McLaughlin, courts routinely refused to assess the wisdom or statutory provenance of final orders of the FCC, believing those matters reserved to the Circuit Courts of Appeal on direct appeals of those FCC orders. With the U.S. Supreme Court having just struck down the Chevron doctrine, and now issuing a more restrictive interpretation of the Hobbs Act, this will have a substantial impact on the FCC's TCPA-implementing and carrier robocall-related regulations. Courts now have authority to assess the merits of individual cases without being bound to slavishly apply FCC Orders.
The Hobbs Act and the FCC
Before the Supreme Court's new ruling in McLaughlin, under the prevailing interpretation of the Hobbs Act, only the circuit courts of appeal had the authority to review an FCC final order—and even then only by parties who participated in and were harmed by the FCC's final order and who timely appealed that decision. Therefore, the Hobbs Act had largely been interpreted to mean that all 94 district courts were bound by the FCC's final orders—they were powerless to do anything but apply them to the facts at hand, no matter how unmoored the FCC's decision may have been from the statutory authority it has (or doesn't have) under the TCPA. Thus, the Hobbs Act previously afforded a great deal of protection to the FCC's final orders (and, in some practitioners' view, encouraged agency action undisciplined by its actual statutory authority). But now that has all changed.
McLaughlin Chiropractic Assocs. v. McKesson Corp.
In McLaughlin, the putative class plaintiffs alleged that they received faxes from the defendant that violated the TCPA. The district court decertified a portion of the class because of an issue with determining how the faxes were received. The FCC, in a final order, had declared that the TCPA does not apply to faxes received through an online fax service. The district court found the plaintiffs had no viable methodology for distinguishing between persons who received faxes on a stand-alone fax machine and those who received them through an online fax service. The plaintiff appealed the district court's class-decertification order to the Ninth Circuit.
On appeal, the Ninth Circuit found that the district court did not abuse its discretion in decertifying the class because, per its interpretation of the Hobbs Act, the district court was bound by the FCC's final order. The plaintiffs petitioned the Supreme Court to hear this case, which was granted. Now the Supreme Court has decided that such orders are not binding on district courts, but district courts must still afford appropriate respect to the relevant agency's interpretation of the relevant statute.
What Now?
The Supreme Court's ruling allows parties to attack FCC final orders at the district court level. Thus, TCPA litigants now have an easier road to attack FCC final orders and regulations pertaining to the TCPA. This also enables those in the carrier community to more quickly and/or broadly challenge the FCC's final orders implementing KYC, robocall-mitigation, and STIR/SHAKEN obligations.
A 2022 opinion from the United States District Court for the Southern District of Florida in Turizo v. Subway Franchisee Adver. Fund Trust Ltd., provides an example of what is on the table now that the Supreme Court has held that the Hobbs Act does not bind district courts to follow FCC final orders. In Turizo, the plaintiff alleged that he received unsolicited text messages from Subway to his cellphone number that was registered on the National Do Not Call Registry (“NDNCR”), giving him a TCPA claim in the process. The FCC, in a 2003 order, implemented a rule that prohibited making live-call telephone solicitations to residential telephone subscribers that have registered their residential telephone number on the NDNCR (“DNC rule”). In that order, the FCC provided that its DNC rule applies to live calls to cellphones. Subway argued that its text messages to the plaintiff's cellphone number did not violate the TCPA because the FCC exceeded its authority in the 2003 order by expanding its DNC rules to apply to cellphones at all, because Congress clearly only gave the FCC authority to make telephone-solicitation rules about calls to “residential” services, not cell phones. Subway explained that the portion of the FCC's 2003 order expanding the DNC rule to apply to cellphone numbers was invalid as it exceeded the authority Congress provided to the FCC under the TCPA. The court agreed, stating that Congress provided the FCC authority to create a DNC rule that applied to residential telephone lines, but specifically “withheld from the FCC any authority to create a” DNC rule that applied to cellular telephone numbers. But despite the court finding at least part of the FCC's 2003 order invalid, the court acknowledged it was bound by that order under the Hobbs Act. Thus, the court found it was powerless to do anything about the FCC's unauthorized expansion of its authority. But, if the same issue reached that same judge now, that district court would likely find the FCC's 2003 order to be invalid and hold that the DNC rule does not apply to cellphones.
Despite the Supreme Court's ruling in McLaughlin being relatively good news for TCPA defendants, it does present some potential challenges. For one, national rules will be eroded with this approach now that hundreds of federal judges are able to decide the issues before them with something like a clean slate. And plaintiff's lawyers will surely find creative ways to attack caller/texter-friendly decisions that the FCC has issued. Thus, it will be important for those in the calling industry to stay apprised of new TCPA cases in this post- McLaughlin world.
Footnote
1. No. 23-1226 (June 20, 2025).
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.
