Yesterday the Federal Communications Commission (FCC) published a Notice seeking comment on how it might re-interpret the Telephone Consumer Protection Act (TCPA) in light of the recent D.C. Circuit Court Decision in ACA International v. FCC.

In March, the court reversed several key provisions in the FCC’s 2015 TCPA expansion, including the FCC’s autodialer definition as well as the regulator’s approach to the treatment of consent and reassigned phone numbers. The industry had been waiting for the outcome of the case since it was filed by ACA International within days of the 2015 Declaratory Ruling and Order.  

The March 2018 decision leaves the FCC back at square one, with industry once again calling for clarification of the law, but hoping that this time the definition will be different.

The Public Notice issued yesterday asks the following questions:

  1. What constitutes an “automatic telephone dialing system” (ATDS)?
  2. How should calls to reassigned wireless numbers be treated?
  3. How may a called party revoke prior express consent to receive robocalls?

The Notice also requests input on the following related open matters:

  1. Two pending petitions take opposite positions regarding the FCC’s interpretation of “person” in the Broadnet Declaratory Ruling. One asks the FCC to clarify that federal government contractors are “persons” under the TCPA. The other asks the FCC to clarify that contractors acting on behalf of the federal government are not “persons” under the TCPA.
  2. A pending petition for reconsideration of the 2016 Federal Debt Collection Rules which asks: If a federal contractor is not a “person” for purposes of the TCPA (as per the Broadnet decision), would the 2016 Federal Debt Collection Rules apply to a federal contractor collecting a federal debt? The petition argues that the Rules are not supported by the text of the statute and are contrary to Congress’s intent, and that the FCC’s 2016 interpretation of its rulemaking authority is impermissibly broad.

Read the full Public Notice here.

Interested parties may file comments by June 13, 2018, and replies to comments by June 28, 2018.

insideARM Perspective

2018 will certainly go down as the year the ARM industry gets its chance to have a say – in front of a friendly ear. Former FCC Chairman Thomas Wheeler was the primary architect of the rules. He has since been replaced as Chairman by former Commissioner Ajit Pai, who had been an outspoken critic of policies enacted under Wheeler.

Pai’s dissent in the July 10, 2015 TCPA Omnibus Declaratory Ruling and Order provides some insight into his thinking regarding the TCPA and its application to legitimate business communications with consumers:

“The TCPA’s private right of action and $500 statutory penalty could incentivize plaintiffs to go after the illegal telemarketers, the over-the-phone scam artists, and the foreign fraudsters. But trial lawyers have found legitimate, domestic businesses a much more profitable target. As Adonis Hoffman, former Chief of Staff to Commissioner Clyburn, recently wrote in The Wall Street Journal, a trial lawyer can collect about $2.4 million per suit by targeting American companies.

So it’s no surprise the TCPA has become the poster child for lawsuit abuse, with the number of TCPA cases filed each year skyrocketing from 14 in 2008 to 1,908 in the first nine months of 2014.

Some lawyers go to ridiculous lengths to generate new TCPA business. They have asked family members, friends, and significant others to download calling, voicemail, and texting apps in order to sue the companies behind each app. Others have bought cheap, prepaid wireless phones so they can sue any business that calls them by accident. One man in California even hired staff to log every wrong-number call he received, issue demand letters to purported violators, and negotiate settlements. Only after he was the lead plaintiff in over 600 lawsuits did the courts finally agree that he was a 'vexatious litigant.' 

The common thread here is that in practice the TCPA has strayed far from its original purpose. And the FCC has the power to fix that. We could be taking aggressive enforcement action against those who violate the federal Do-Not-Call rules. We could be establishing a safe harbor so that carriers could block spoofed calls from overseas without fear of liability. And we could be shutting down the abusive lawsuits by closing the legal loopholes that trial lawyers have exploited to target legitimate communications between businesses and consumers.

Instead, the Order takes the opposite tack. Rather than focus on the illegal telemarketing calls that consumers really care about, the Order twists the law’s words even further to target useful communications between legitimate businesses and their customers.561 This Order will make abuse of the TCPA much, much easier. And the primary beneficiaries will be trial lawyers, not the American public.” 

Now that the court has opened the door to reconsideration of the Ruling, we may get to see Pai’s influence on the re-interpretation.


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