United States: FCC Closes Loopholes And Expands Telephone Consumer Protection Act "TCPA" Consumer Protections In Declaratory Ruling And Order

On July 10, 2015, the Federal Communications Commission ("FCC" or "Commission") released a Telephone Consumer Protection Act ("TCPA") Declaratory Ruling and Order ("TCPA Declaratory Ruling and Order" or "Order") offering clarification and new guidance on robocall restrictions.  The Order further clarifies 21 distinct open issues on which petitioners had sought FCC guidance or action to interpret the TCPA statute and how it should apply to certain problematic gray areas.  The Commission majority that voted in favor of the Order sought to "close loopholes and strengthen consumer protections already on the books" through this Order.  This alert summarizes many of the key rulings in the Order.

Clarification of Autodialers

The TCPA defines "automatic telephone dialing systems" or "autodialers" as "equipment which has the capacity – (A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers."  The Commission broadly interpreted that definition to mean any dialing equipment that has the capacity to store or produce and dial random or sequential numbers, regardless of whether the equipment is actually used for that purpose or is used to separately call a set list of customers.  Likewise, predictive dialers satisfy the TCPA's definition of autodialer.  Callers cannot avoid the consent requirement by separating ownership of dialing equipment among multiple entities. 

Defining Who Initiates the Call

Texting and Calling Apps

The Commission clarified whether, and under what circumstances, the owner of a calling application ("app") can be deemed the party who "initiate(s)" a telephone call and therefore subject to TCPA regulations.  The Commission determined that an app itself does not make or initiate a call when: (1) an individual uses the app to send an automatic text in response to a voicemail; or (2) an individual user chooses to send an invitational text using an app.  However, an app does make or initiate a call when the app "facilitates" the sending of the invitational text message by automatically sending the individual text utilizing a user's contact list without significant input from the user.

Collect Calling Services and Prerecorded or Artificial Voice Messages

The Commission clarified that collect calling service providers that use prerecorded messages, on an individual call basis, to provide initial information when attempting to connect a collect call to a residential or wireless telephone number may complete the call without prior express consent and not be liable for a TCPA violation.  The Commission found that the person who dialed the number, rather than the collect calling service, is the person who initiates the call for purposes of the TCPA. 

The Commission further examined the issue of follow-up calls from an inmate calling service that requests the initiation of a prepaid account for collect calls from prison inmates.  The Commission found that prior express consent was required for such calls to wireless phones, but used its authority under Section 227(b)(2)(C)¹ to grant an exemption for the calls.  The exemption requires satisfying certain conditions for such calls, including that collect call notifications not be charged to the calling party, that the notifications must be clear and concise and identify the service provider, that no more than three notifications may be sent for each inmate call, and that information regarding opting out of future calls must be provided.

Wireless Number in a Contact List Does Not Establish Prior Express Consent

The Commission clarified that the presence of a consumer's wireless number in the contact list of another person's wireless phone does not, on its own, demonstrate consent by the consumer to the receipt of autodialed or prerecorded calls, including texts.   

Revocation of Consent by the Called Party

The Commission clarified that consumers may revoke consent through any reasonable means if they no longer desire to receive voice calls or texts.  Moreover, callers may not designate the manner in which a called party must revoke consent.  Rather, consent may be revoked using any reasonable method, including even verbal communication. However, the Commission clarified that porting a telephone number from wireline service to wireless service does not, by itself, revoke prior express consent.  If express consent was granted for calls to the wireline number and the number is then ported to a wireless phone, the consumer is responsible for taking action to revoke consent, if desired.

Reassigned Wireless Telephone Numbers

The Order clarified that the TCPA requirements apply to the current subscriber of the wireless number, not the intended recipient of the call.  Moreover, the term "called party" includes both the actual subscriber and the customer using the number.  However, the Commission stated that where a caller makes a call without knowledge of the number reassignment and with a reasonable basis to believe that it has valid consent to make the call, the caller may initiate one call after the reassignment as an opportunity to learn about the reassignment but must thereafter cease future calls to the new subscriber unless proper consent is obtained.  If no further knowledge is received during the call, the caller will be deemed to have constructive knowledge of the situation.

One-Time Follow-Up Text Message

The Commission found that a one-time text message sent immediately after a consumer requests a text does not violate the TCPA or the Commission's rules.  The one-time text in response to a consumer request does not violate the rules, so long as it is: (1) requested by the customer; (2) a one-time only message that is sent immediately in response to the request by the customer; and (3) contains nothing more than the information requested by the customer with no other marketing or advertising.

Text Messages are "Calls" under the TCPA

The Commission reiterated earlier authority that SMS text messages are subject to the same rules under the TCPA as voice calls.  The Commission also clarified that Internet-to-Phone text messaging technology is a type of autodialer under the TCPA, and therefore calls made using Internet-to-Phone text messaging technology also require consumer consent.

Financial and Healthcare Exemptions

The Commission exempted from the prior express consent requirement certain financial institution calls to wireless numbers which specifically concern: (1) the prevention of fraudulent transactions or identity theft; (2) data security breaches; (3) actions a consumer may take to prevent identity theft after a data breach; and (4) calls regarding money transfers.  These exemptions, however, are limited to no more than three calls over a three-day period from a single financial institution to the owner of the affected account.  They are also subject to a number of restrictions.  These restrictions require including an opt-out mechanism, identification of the calling party, and a prohibition on telemarketing, cross-marketing, solicitation, debt collection or advertising.

Similarly, the Commission granted an exemption from the prior express consent requirements for healthcare provider calls for which there is an "exigency" and which have a "healthcare treatment purpose," specifically: "appointment and exam confirmations and reminders, wellness checkups, hospital pre-registration instructions, pre-operative instructions, lab results, post-discharge follow-up intended to prevent readmission, prescription notifications, and home healthcare instructions."  As with the exemption for financial institutions, the Commission places a number of restrictions on calls from healthcare providers, including abiding by HIPAA regulations. 

Use of Call-Blocking Technology

The Commission affirmed that nothing in the Communications Act FCC regulations prohibits carriers or VoIP providers from implementing call-blocking technology to assist consumers in stopping unwanted robocalls.  To the extent that a call blocking technology may be flawed, the Commission requires that the provider offer adequate disclosures regarding, for example, the fact that the technology utilized to block calls may inadvertently block wanted calls.

Footnote

[1] 47 U.S.C. 227(b)(2)(C) (granting the Commission authority to provide for exemptions for calls to wireless numbers that are not charged to the calling party).

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