Less than a week after the D.C. Circuit Court of Appeals issued its mandate following the ACA Int'l v. FCC Decision, the Consumer and Governmental Affairs Bureau of the FCC has released a Public Notice seeking comment on the interpretation and implementation of the Telephone Consumer Protection Act ("TCPA"), including the burning question of the hour: "What constitutes an 'automatic telephone dialing system'?"
Everyone is waiting with baited breath as the Commission ferrets through their clarifications on the TCPA following ACA Int'l, but what comes next is also a key question. Will the Commission come out with a Declaratory Order clarifying the items addressed in the Public Notice or will a Notice of Proposed Rulemaking follow? It's a great question, and one we hope to get some further clarity on in the coming weeks.
What follows is a deep-dive into the Public Notice and some takeaways on the questions the Commission raised.
What is an Autodialer?
First up, the Public Notice tackles the question of what constitutes an "automatic telephone dialing system," otherwise known as an autodialer, under the TCPA. The TCPA defines an automatic telephone dialing system as equipment that has the capacity to "store or produce" phone numbers to be called "using a random or sequential number generator," and further has the capacity to automatically dial those numbers. Pre-ACA Int'l v. FCC, the Commission had interpreted "capacity" broadly to encompass any equipment that could meet the requirements of the definition. The D.C. Circuit threw out this interpretation finding that the Commission had overreached by interpreting the term so expansively that it could subject every day smartphones to the TCPA. In the Public Notice, the Commission now seeks comment on how to more narrowly interpret the word "capacity," so as to better conform to the intent of the statute. For example, the Commission queries, does capacity simply require the "flipping of a switch"?
The Public Notice also addresses the key question of functionality, i.e., what type of functionality in automatic telephone dialing equipment makes such equipment capable of "random or sequential number generation" and "automatic" number dialing. In the 2015 Omnibus Order, the Commission had been less than clear on the issue of whether equipment that required some level of human intervention would be considered automatic or manual. The courts have since been forced to tackle the issue of how much human intervention is necessary to convert an automatic dialing system into a manual one absent such clarity from the Commission. The Public Notice now seeks comment on how human intervention should affect whether a dialing system is automatic and just how "automatic" dialing equipment must be in order to be considered an automatic telephone dialing system.
Lastly, the Commission seeks comment on whether the ban on making calls using an automatic telephone dialing system only applies to calls made utilizing the autodialer functionality on a piece of equipment and, alternatively, would not apply if one were to use the same equipment absent the autodialer functionality. As part of addressing the autodialer issue, the Commission also seeks comment on the petition for declaratory ruling filed at the beginning of May by the U.S. Chamber Institute for Legal Reform, which our Womble Bond Dickinson site, TCPAland, covered here at the time it was filed.
The good news here is that the questions the Commission raises in the Public Notice are precisely the questions left open by ACA Int'l v. FCC and clarification on them would be welcome.
Reassigned Wireless Numbers
The Commission seeks comment on how to handle calls to reassigned wireless numbers in light of the D.C. Circuit's decision to vacate the Commission's interpretation of the term "called party" and the Commission's one-call safe harbor, which the court deemed arbitrary. Specifically, the Commission asks to whom the term "called party" should refer, and whether that party should be the person the caller expected, or reasonably expected, to answer the call; the person the caller actually reached; the actual subscriber answering the call; or the phone's customer user. The Commission also asks whether a safe harbor is necessary for reassigned numbers.
The questions raised by the Commission with regard to the safe harbor are similar to those raised in a Notice of Proposed Rulemaking ("Reassigned Numbers NPRM") that the Commission kicked off in March related specifically to the problem of reassigned numbers. In the Reassigned Numbers NPRM, the Commission considers establishing a database for reassigned numbers, and proposes to adopt a safe harbor from TCPA liability for calls to reassigned numbers where the caller uses the reassigned numbers database. (Wouldn't that be a welcome development!) The Commission also seeks comment on when the safe harbor might be triggered and also, in lieu of a Commission-sanctioned database, whether the Commission should instead adopt a safe harbor for callers using existing commercial solutions.
Any reassigned number safe harbor would obviously be a significant positive development, but the particular details of any such safe harbor would also be important. While the one-call "[un]safe harbor" as we like to call it, is now gone under ACA Int'l v. FCC, it is important that the Commission act quickly, and, in particular, consider taking interim steps on a safe harbor using commercial services, while it resolves the details of the database approach.
Notably, however, the Commission would not have to even get to the question of a safe harbor, or the need for a reassigned number databased, if it adopted the notion that the term "called party" refers to the expected recipient of the call. If the called party were the expected recipient of the call, a caller would have consent for the call under the TCPA, so long as it had the required consent of the person who provided the number, and could continue making calls to that number until the calling party had reason to know that the number had moved to a new subscriber.
Revocation of Prior Express Consent
The Commission also seeks comment on the methods a called party may use to revoke consent in light of the D.C. Circuit's finding that a called party may revoke consent through "any reasonable means clearly expressing a desire to receive no further messages from the caller." In light of the court's finding, the Commission seeks comment on a recommended opt-out method or methods that could be used by callers to provide called parties with a reasonable and clear way of revoking prior express consent.
Notably, there been a number of cases where courts have tossed a TCPA action based on unreasonable revocation of consent. The Commission's proposal would potentially go a step further in reversing the Commission's 2015 Omnibus Order, which had permitted revocation of consent by any reasonable means, following industry requests for clarification that certain methods of revocation of consent are clear.
The establishment by the Commission of a standardized revocation process, requiring called parties to use so-called "magic words" to revoke consent, would remove a huge burden for the industry from a revocation detection and training standpoint.
Pending Reconsideration of Petitions following the Broadnet Order
The Commission seeks comment on whether contractors acting on behalf of federal, state, and local governments are considered "persons" under the TCPA, such that they should be subject to the restrictions of the TCPA. The comment is sought in response to two pending petition for reconsideration of the Commission's Broadnet Declaratory Ruling, which clarified that the TCPA does not apply to calls made by or on behalf of the federal government for official government business, except if the call is made by a contractor who was acting outside the scope of his/her agency.
2016 Federal Debt Collection Rules
In the 2016 Federal Debt Collection Order, the Commission implemented Section 301 of the Bipartisan Budget Act of 2015, which amended the TCPA by excepting from the consent requirements robocalls that were made "to collect a debt owed to or guaranteed by the United States." In implementing the Bipartisan Budget Act of 2015, the Commission placed strict requirements on debt collectors falling within the exemption including: limiting the number and duration of debt collection calls, capping the number of permitted calls to wireless numbers to no more than three within a thirty-day period, and providing consumers with the right to stop autodialed, artificial-voice, or pre-recorded debt collection calls to wireless numbers at any time.
The Commission now seeks comment on a pending petition for reconsideration of the rules, which asked the FCC to reconsider applying the one-call safe harbor to debt collection calls. With the one-call safe harbor no longer in play, the Commission asks how it should treat debt collection calls made to reassigned wireless numbers. The Commission also questions the interplay of the Broadnet Declaratory Ruling with the 2016 Debt Collection Rules and whether, if a federal contractor is not a "person" for purposes of the TCPA, the 2016 Federal Debt Collector Rules would apply to federal contractors collecting on a federal debt.
The Commission has set a comment deadline date of June 13, 2018 and a reply comment date of June 28, 2018.
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