ACA Int'l v. FCC

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One of the key issues in any case under the Telephone Consumer Protection Act (TCPA) is whether the plaintiff consented to be called or texted.  If the recipient has provided “prior express consent,” the TCPA permits calls or texts to either (i) wireless numbers using autodialers or artificial or prerecorded voices; or (ii) residential telephones using artificial or prerecorded voices.  47 U.S.C. § 227(b)(1)(A)(iii) (cellular telephones); id. § 227(b)(1)(B) (residential telephones).  Courts currently are divided on the impact of contracts specifying that consumers agree in advance to receive such calls or texts.
Continue Reading Courts in Telephone Consumer Protection Act cases Are divided on plaintiffs’ ability to revoke their contractual consent to be called

One of the most hotly-contested issues in litigation under the Telephone Consumer Protection Act (TCPA) is what equipment counts as an “automatic telephone dialing system” (ATDS) triggering the TCPA’s restrictions.  In 2018, the D.C. Circuit threw out the FCC’s interpretation of the statutory definition of an ATDS—which was so broad as to encompass smartphones—as arbitrary and capricious.  (See our report on the D.C. Circuit’s ACA International v. FCC decision.)  In the wake of that decision—while parties await the FCC’s new rule—courts around the country have been weighing in how best to interpret the statutory text.

The issue is now the subject of a deep circuit split.  In recent months, both the Seventh Circuit in Gadelhak v. AT&T Services, Inc. and the Eleventh Circuit in Glasser v. Hilton Grand Vacations Co. (pdf) have concluded that equipment that dials from a pre-selected list of phone numbers does not qualify as an ATDS.  (Disclosure: Mayer Brown represented AT&T in Gadelhak; Archis was on the briefs in the Seventh Circuit.) The Seventh and Eleventh Circuits thus rejected the Ninth Circuit’s more expansive interpretation of ATDS in Marks v. Crunch San Diego, LLC.  (See our report on Marks.)  The Second Circuit, in contrast, recently followed the Marks interpretation in Duran v. La Boom Disco.

In light of this growing divide, lawyers on both sides of the “v.” are waiting for the Supreme Court to step in.Continue Reading Seventh and Eleventh Circuits Reject, But Second Circuit Follows, Ninth Circuit’s Expansive Autodialer Definition in Marks

The key question in many Telephone Consumer Protection Act lawsuits is whether the equipment used to call the plaintiff constitutes an autodialer—that is, an “automatic telephone dialing system” or ATDS—within the meaning of the statute.  TCPA practitioners have been awaiting the FCC’s guidance regarding the definition of an autodialer.  Last spring, the D.C. Circuit set aside the FCC’s expansive definition of that term as arbitrary and capricious.  (See our report on the D.C. Circuit’s ruling in ACA International.)  Since then, the FCC has been working on its new definition.

The Ninth Circuit apparently couldn’t wait.  In Marks v. Crunch San Diego, LLC (pdf), a Ninth Circuit panel held that an ATDS is any “device that stores telephone numbers to be called,” “whether or not the numbers were not generated by a random or sequential number generator.”Continue Reading Ninth Circuit creates circuit split on what counts as an autodialer under the TCPA

Last Friday, a panel of the D.C. Circuit issued its decision in ACA International v. FCC (pdf).  The decision, which arrived nearly 17 months after the oral argument, struck down key elements of the FCC’s controversial 2015 Declaratory Ruling and Order interpreting the Telephone Consumer Protection Act  (TCPA).

Here are the key takeaways from the decision:

  • The court held that the FCC’s broad definition of an automatic telephone dialing system (ATDS), which threatened to include all smartphones, is arbitrary and capricious, and required the FCC to reconsider its definition.
  • The court overturned the FCC’s conclusion that a caller could be subjected to liability for calls placed or text messages sent to a phone number that had been reassigned after a “safe harbor” of a single errant call or text. Because the “safe harbor” ruling was arbitrary and capricious, the court concluded that the FCC was required to reexamine whether a caller should be liable for any calls or texts to reassigned numbers.
  • The panel sustained the FCC’s rule authorizing consumers to retract their consent to receive autodialed calls or text messages through “any reasonable means.” But the panel decision notes that the FCC’s rule doesn’t speak to situations where parties have contractually agreed to a specific method of revocation.

Unless the FCC seeks further appellate review (which seems unlikely), the agency will be reconsidering the autodialer and reassigned-number issues. Notably, the composition of the FCC has changed since the 2015 order; the chairman of the FCC is Commissioner Ajit Pai, who dissented from the 2015 ruling.

We summarize the decision in detail below. In the meantime, we expect businesses facing TCPA litigation to take at least three possible approaches.

First, the D.C. Circuit’s decision reopens a number of questions that plaintiffs have argued were resolved by the FCC’s 2015 ruling, and parties will seek to litigate those issues.

Second, the FCC will have something new to say on each of the issues remanded to it by the D.C. Circuit, and businesses and trade associations will doubtless want to participate in that regulatory discussion—especially given their extensive experience on the receiving end of TCPA lawsuits.

Third, and relatedly, a number of courts will surely find it more efficient to wait for the FCC’s pronouncements on these issues before allowing TCPA litigation to proceed.Continue Reading DC Circuit issues long-awaited TCPA decision and invalidates FCC’s 2015 autodialer and reassigned-number rules

Good news for businesses that use fax machines to communicate with customers: A panel of the D.C. Circuit has just struck down the FCC’s 2014 order mandating that even faxes requested by the recipient that contain advertising material include a special opt-out notice. The decision issued today in Bais Yaakov of Spring Valley v. FCC, No. 14-1234 (D.C. Cir. Mar. 31, 2017), is available here (pdf).
Continue Reading DC Circuit invalidates FCC’s opt-out requirement for solicited faxes

Today, a panel of the D.C. Circuit—composed of Judges Srinivasan and Pillard and Senior Judge Edwards—heard argument in ACA International v. FCC, the consolidated appeals from the FCC’s 2015 Declaratory Ruling and Order, which greatly expanded the reach of the Telephone Consumer Protection Act (“TCPA”). (An audio recording of the argument is here, and Kevin attended the argument.) The case has been closely watched, and a number of TCPA class actions around the country have been stayed to await the D.C. Circuit’s decision.  More detail is below the fold, but here are our quick impressions from the argument:

  • The panel asked tough questions of lawyers for both sides in an argument that went two full hours over the allotted 40 minutes.
  • The panel focused most of its attention on the FCC’s new—and far-reaching—definition of an automatic telephone dialing system (ATDS, or “autodialer”). All three judges expressed discomfort with the fact that the FCC’s new definition could be read to cover smartphones.
  • Judge Edwards repeatedly voiced criticisms of the FCC’s expansive readings of the TCPA across the board, and may be inclined to vacate large portions of the FCC’s Declaratory Ruling.
  • Judge Pillard seemed the most receptive to the FCC’s arguments.
  • Judges Srinivasan was the hardest to read, but it seems possible that he might join Judge Edwards in setting aside major portions of the FCC’s Declaratory Ruling.

Continue Reading D.C. Circuit Weighing FCC’s Controversial 2015 TCPA Declaratory Ruling