Alert
Alert
02.25.16
In the face of ongoing uncertainty regarding permissible uses of modern telephone equipment under the TCPA, lawsuits and important precedents continue to pile up.
The Telephone Consumer Protection Act of 1991 (TCPA), 47 U.S.C. § 227 et seq., and the rules of the Federal Communications Commission (FCC) implementing it, regulate telephone solicitations to residential landlines and all calls to cellular phones, as well as the sending of fax transmissions. In particular, the TCPA and FCC rules prohibit using an automated telephone dialing system (also referred to as an autodialer or ATDS) or a pre-recorded message to make telephone solicitations to residential landlines or any calls to cellular phones, unless the recipient of the call has granted prior express consent (or in cases of emergency). The stated purpose of the TCPA is to protect individuals from unwanted robocalls, which the FCC interprets as including both voice and text messages, while ostensibly still permitting legitimate telemarketing practices.
In the early years, TCPA litigation was relatively uncommon, but the rapidly expanding market for smartphones has opened up new, often more efficient and even pro-consumer, ways for businesses to communicate with their customers that were not conceived of when the TCPA was originally drafted. The FCC’s broad interpretation of “autodialer” to include almost all modern telephone equipment except a rotary dial telephone, and the proliferation of text messaging, however, have led to confusion as to whether using new device capabilities, particularly in light of changes they have brought about in the way users communicate today, in fact violates the 25-year-old statute. In addition, the TCPA’s authorization of $500 in statutory damages per call (or text), trebled in the case of a knowing violation, has resulted in most TCPA suits being brought on a class action basis.
According to recently published statistics,1 an astonishing 3,710 TCPA cases were filed in state and federal courts in 2015, as compared with only fourteen cases in 2007,2 and 2016 could be another record-breaking year. Given this proliferation of TCPA litigation, and the many significant monetary judgments against a wide variety of consumer-facing companies that have resulted from it, businesses that communicate with consumers via telephone desperately need clarity. Dozens of businesses have filed petitions with the FCC seeking exemption from the TCPA for a variety of calling/texting practices. The FCC issued an Omnibus Order addressing a number of these petitions, however, as described in Section I below, that ruling also raised new questions and is currently being appealed by numerous parties. Thus, the Omnibus Order has not served to clearly distinguish practices that violate the TCPA from many ordinary calling behaviors. Accordingly, businesses must continue to stay abreast of the numerous TCPA cases making their way through the courts and administrative process. To that end, three recent cases that significantly impact TCPA jurisprudence and the way in which companies conduct TCPA litigation are discussed in Section II below.
2015 FCC Omnibus Order
On July 10, 2015, the FCC issued the agency’s long-awaited omnibus Declaratory Ruling and Order (Omnibus Order) resolving nearly two dozen petitions seeking specific exemptions or clarification of the TCPA to permit the various businesses to conduct what they perceive to be their ordinary business activities free from concern for class action TCPA litigation.3
Among the Omnibus Order’s most broadly-applicable holdings were: