The FCC voted a 3-2 majority ‘yes’ today on a TCPA declaratory ruling to expand the law in an attempt to prevent unwanted robocalls and “robotexts,” as well as spam and telemarketing calls to wireless phones. The package of rulings also included the approval of robocalling technologies, oral revocation of consent, redefinition of autodialers, as well as other stipulations and exemptions. The rulings addressed 19 petitions for declaratory rulings, one petition for rulemaking and one request for clarification.
The rulings, as of this writing, have not been released. The commissioners’ discussions indicate they will address “autodialers,” and some emerging technologies. Exceptions to TCPA liability may include forgiveness of one unsolicited robocall to a reassigned number if the former owner of that number had given prior consent, as well as carveouts for robocalls that can be made without consent if they are ones that are free or are alerting consumers about financial or medication reminders. And who may provide prior express consent to receive such calls also appears to be addressed in the rulings.
Strong Dissents Signal Rulings May Compound TCPA Issues
The discussion was plagued with dissent, among the Chairman and the commissioners, and even among the commissioners who voted to pass the rulings. Commissioner Jessica Rosenworcel, who voted for the rulings, dissented on the limited carveouts made for certain calls by financial institutions and healthcare providers. She argued that no matter the nature of the call, robocalls are all the same under the TCPA, saying, “I do not understand why for some sectors…this Commission gives the green light for more robocalls when consumers want a red one. The [TCPA] is straightforward: it requires a company to get a consumer’s prior express consent before making robocalls.”
However, Commissioner Rosenworcel did express concern that school calls regarding attendance would be entangled in the robocall issue, a concern Chairman Tom Wheeler shared. The risk that actors such as schools may be violating the TCPA under the new rules was one that dissenting Commissioner Pai raised in his opinion.
Rulings will Likely Expand Autodialer Definition
Commissioner Migon Clyburn also voted to approve the proposal, saying that the declaratory rulings will “maintain the consumer protections the Act intended.” Furthermore, by “reaffirming the broad interpretation of the definition of an autodialer…we will further incentivize businesses to take the necessary steps to obtain prior consent when it comes to these communications.”
Alison Kutler, chief of the FCC’s Consumer and Governmental Affairs Bureau, added that the rulings state that autodialers will include “equipment [that] has the capacity even with some modification to dial random or sequential numbers . . “ She added that the rulings will expand to even include technology not “currently or presently dialing random or sequential phone numbers but is instead calling a set list of numbers.”
Commissioner O’Rielly had harsh words for this expansive move, saying, “Equipment that could conceivably function as an auto dialer in the future becomes an autodialer today. Indeed the new definition is so expansive that the FCC has to use a rotary phone as an example of technology that would not be covered because the modification needed to make an autodialer would be too extensive.”
Revocation of Consent
The discussion also brought out that the rulings will not provide an “exhaustive set” of reasonable means to revoke prior express consent. Instead, the rulings will “mention things that seem fairly common sense.” Commissioner O’Rielly criticized the revocation of consent for non-telemarketing calls, noting that the right nowhere appears in the statute and instead “turns to common law principles to read in the statute a right to revoke consent.”
Expansive Reach of Rulings Draw Criticism
The rulings “dramatically expanded the reach of the TCPA,” which will “open the floodgates to more TCPA litigation against good faith actors,” said Commissioner Pai. He also said the order does not focus on illegal telemarketing calls, but instead targets communications between legitimate businesses and their customers, making abuse of the TCPA much easier, and benefiting trial lawyers; not American consumers.
Commissioner Pai added that the forthcoming rulings redefine an autodialer to include almost all phone calls under the TCPA, not just fraudulent telemarketers, subjecting almost anyone to a TCPA lawsuit under the new rules. He posed an example of “Jim,” who meets “Jane” at a party; he acquires her number through a mutual friend and calls her for lunch from his smartphone and sends her a text message; violating the TCPA twice, and risking $1,000 in statutory damages if “Jane” chooses to sue.
The new order, according to Commissioner Pai, also contains a carveout for the prison payphone industry, which would allow prison payphone providers to make prerecorded calls to consumers “to set up a billing relationship to pay for future services,” which would only “open the door to more actual robocalls,” he said.
Rulings Bad for Businesses and Consumers, Says FCC Commissioner
Commissioner Michael O’Rielly agreed with Commissioner Pai that the new rules only penalize “businesses acting in good faith to reach their customers using modern technology.” The Commissioner also criticized the process that led to the new rulings, saying “we [were] deceived to produce one of the most slanted documents I have ever seen…today’s order has been held as protecting Americans from harassing robocalls and texts. It’s a farce.” He described the rulings as “a new way for consumers acting in bad faith to entrap legitimate companies.”
Commissioner O’Rielly clarified that he does not condone abusive calling practices, but that the balance in the TCPA between protecting consumers and legitimate businesses while preventing unwanted calls has been overturned by the expansion and large scope of current TCPA rules, including today’s proposed rulings, which could prevent consumer access to valuable information companies and businesses are trying to provide.
Arguing that there is evidence that there are benefits to informational calls and texts, such as those that the Department of Health and Human Services promotes to benefit Americans, Commissioner O’Rielly said companies must face “potentially crushing damages,” or deliver “desired communication.” Some of these communications, he said, include school alerts, product recall and safety notifications, and notifications of utility outages.
“Appropriate Applications for Automatic Calling Technology”
However, Chairman Tom Wheeler disagreed with the dissent, saying that he is with the “215,000 individuals that took the time to write us…about the annoyance of robocalls.” Asserting that robocalls are a bipartisan issue, he referenced 39 state attorneys general of both parties who have requested measures that the FCC voted on today.
The Chairman, who voted yes, said the rulings are necessary, because “technology has outpaced the implementation of the TCPA…that technology [resulted in an] explosion in the number of calls….aided by exploiting the wording of our rules.” Acknowledging that there are “sensible” exceptions and “appropriate applications for automatic calling technology,” such as package delivery notifications, banking alerts and health emergencies, he said “these legitimate purposes should not be a smokescreen that allows the opening of the door to unwanted calls.”
The official FCC press release is available here.
Webinar Will Examine the New Rules
Maurice Wutscher will examine the rulings in our July 17 webinar, A First Look at the FCC’s TCPA Declaratory Rulings. For more information about the webinar and to register, click here.