FCC

FCC CHAIRMAN PROPOSES DECLARATORY RULINGS TO ADDRESS PENDING TCPA PETITIONS

On May 27, 2015, Federal Communications Commission (“FCC”) Chairman Tom Wheeler circulated his proposed declaratory rulings to the five FCC Commissioners for consideration.  While the details of the proposal have not been made public, the Chairman released a fact sheet and issued a blog post which provides some insight as to declaratory rulings to be voted on.  The proposal is intended to address two dozen petitions from companies – including bankers, debt collectors, app developers, retail stores, and others – that sought clarity on how the FCC enforces the Telephone Consumer Protection Act (“TCPA”). The proposal is described by the Chairman as an effort to close loopholes and strengthen consumer protections already on the books.  The Chairman’s fact sheet and blog post suggest the following declaratory rulings are being proposed:

■ Empowering consumers to say “No”: Consumers shall have to the right to revoke consent to receive robocalls and robotexts in any reasonable way at any time. People cannot be required to fill out a form and mail it in to stop unwanted calls or texts.

■ Giving the green light for robocall-blocking technology: Carriers can and should offer robocall-blocking technology to consumers to stop unwanted robocalls.

■ Closing the “reassigned number” loophole: If a phone number has been reassigned, callers must stop calling the number after one phone call.

■ Clarifying the definition of “autodialers:” Autodialers shall include any technology with the potential to dial random or sequential numbers.

■ Very limited and specific exceptions for urgent circumstances: Exceptions shall not include practices like debt collection and marketing and consumers will have the right to opt-out of such calls.  Free calls or texts to consumers to alert them of possible fraud on their bank accounts or to remind them of important medication refills shall be allowed.

The proposed declaratory rulings are scheduled to be voted on as a single omnibus item by the full Commission on June 18, 2015 during the FCC’s June Open Commission Meeting.  As adjudications of the pending petitions before the FCC, if adopted, the declaratory rulings would be effective immediately upon release.  Unfortunately, however, the specifics of the declaratory rulings will not be known until the adoption and release of same.

For more information with respect to the TCPA, please contact Katherine Olson at (312) 334-3444 or kolson@messerstrickler.com.

 

Window to Apply for FCC’s Retroactive Solicited Fax Opt-Out Waiver Closing

On October 30, 2014, the Federal Communications Commission (“FCC”) released an Order requiring opt-out notices to be presented on all fax advertisements, conforming to the rules outlined in the FCC’s 2006 Junk Fax Order. To be in compliance with the Order, senders must satisfy all components listed within:

(1)       be clear and conspicuous and on the first page of the ad;

(2)       state that the recipient may make a request to the sender not to send any

           future ads and that failure to comply, within 30 days, with such request is

           unlawful; and

(3)       contain a domestic contact telephone number and fax number for the

           recipient to transmit an opt-out request. Fax ads sent pursuant to an

           established business relationship must also contain this opt-out information.

The opt-out notice must be included in all faxed ads, even those sent with prior express consent. However, the FCC is granting retroactive waivers for those who sent such solicited advertisements up until April 30th, 2015. These waivers are intended to provide temporary relief from past offenders and allow for more time for waiver recipients to come into full compliance with the Order.

Even if your company does not qualify for such a waiver, there are still numerous defenses that can be asserted in a lawsuit such as this. Contact Nicole Strickler at 312-334-3442 or nstrickler@messerstrickler.com for more information about applying for the FCC’s waiver and other consumer litigation compliance issues.

View the Order Here.

ELEVENTH CIRCUIT REVERSES CONTROVERSIAL TCPA RULING

On September 29, 2014 the Eleventh Circuit unanimously reversed the controversial lower court ruling in Mais v Gulf Coast Collection BureauSee Docket No. 13-14008 (11th Circuit Sept. 29, 2014).  In Mais, the plaintiff’s cellphone number was provided to a Florida emergency room in connection with the plaintiff’s receipt of medical services.  The plaintiff’s medical debt went unpaid and the account was forwarded to collections.  Plaintiff filed suit under the Telephone Consumer Protection Act (TCPA), against the hospital-based radiology provider and the third-party debt collector for making autodialed calls to his cellphone.  The debt collector, Gulf Coast, contended that the calls fell within the statutory exception for “prior express consent,” as interpreted in a 2008 declaratory ruling from the Federal Communications Commission (FCC).   The FCC concluded in its 2008 Ruling that “the provision of a cell phone number to a creditor, e.g., as part of a credit application, reasonably evidences prior express consent by the cell phone subscriber to be contacted at that number regarding the debt.”  The FCC further concluded in its 2008 Ruling that “calls placed by a third party collector on behalf of that creditor are treated as if the creditor itself placed the call.”

The district court granted partial summary judgment in favor of Plaintiff, finding that the FCC’s interpretation of “prior express consent” was inconsistent with the language of the TCPA, and alternatively, that the 2008 FCC Ruling did not apply to medical debts and was therefore inapplicable to the case at hand.  In reversing the ruling, the Eleventh Circuit found that “the district court lacked the power to consider in any way the validity of the 2008 FCC Ruling and also erred in concluding that the FCC’s interpretation did not control the disposition of the case.” 

Importantly, the Hobbs Act provides that courts of appeals have exclusive jurisdiction to determine the validity of all FCC final orders.  By refusing to enforce the FCC’s interpretation, the Eleventh Circuit ruled that the district court exceeded its power.  The Eleventh Circuit further concluded that the FCC did not distinguish or exclude medical creditors from the 2008 Ruling, but rather the general language contained in the Ruling was meant to reach a wide range of creditors and collectors, including those pursuing medical debts.  Accordingly, the Eleventh Circuit reversed the partial grant of summary judgment to plaintiff and remanded the case to the district court with instructions to enter summary judgment in favor of Gulf Coast. 

The Eleventh Circuit is the first federal appellate court ruling that clarifies the scope of the 2008 FCC Ruling.  While the majority of courts have deferred to the FCC’s Ruling, the judge in Mais has twice ruled contrary to the 2008 FCC Ruling.  See also Lusskin v. Seminole Comedy, Inc., 2013 U.S. Dist. LEXIS 86192 (S.D. Fla. June 19, 2013).  The only other district court to do so is the Southern District of New York, which recently disregarded the 2008 FCC Ruling when it granted class certification in Zyburo v. NCSPlus, Inc.  Notably, the Second Circuit Court of Appeals may soon rule on the issue too, as the defendant in Zyburo has recently filed a petition for permission to appeal the class certification order with the Second Circuit Court of Appeals.  

For more information on the Mais decision and/or the TCPA generally, contact Katherine Olson at (312) 334-3444 or kolson@messerstrickler.com.

FCC Clarifies TCPA: Prior Express Consent May Be Obtained by a Third Party

On March 27, 2014, the Federal Communication Commission (“FCC”) released a Declaratory Ruling in the matter of GroupMe, Inc./Skype Communications S.A.R.L petition to clarify the rules and regulations implementing the Telephone Consumer Protection Act (“TCPA”) of 1991.  This ruling relates to situations in which a consumer may give their express consent to receive calls to an intermediary rather than to the calling party itself.

According to its petition, GroupMe provides a free group text messaging service for groups of up to 50 members.  Those creating groups must be registered member with GroupMe, and in so doing agree to GroupMe’sTerms of Service (TOS).  The TOS contains a representation that all members being added to the group have consented to receiving text messages.

Considering the consumer protection policies and goals underlying the TCPA the FCC ruled: “We clarify that text-based social networks may send administrative texts confirming consumers’ interest in joining such groups without violating the TCPA because, when consumers give express consent to participate in the group, they are the types of expected and desired communications TCPA was not designed to prohibit, even when that consent is conveyed to the text-based social network by an intermediary (emphasis added).”  The FCC added that consumer’s prior express consent may be obtained through and conveyed by an intermediary, such as the group organizer using GroupMe’s service.

The FCC’s ruling is helpful clarification that prior express consent as required under the TCPA may in certain circumstances be obtained through a third party.  To learn more about the TCPA and its restrictions on debt collection industry, you may contact Joseph Messer at jmesser@messerstrickler.com or at (312) 334-3440.

United States District Court Judge Grants Collection Agency’s Motion to Stay TCPA Class Action Pending FCC Clarification

On February 20, 2014, the Western District of Washington granted a defendant-collection agency’s motion to stay a Telephone Consumer Protection Act (“TCPA”) class action.  In Hurrle v. Real Time Resolution, Inc., 2014 U.S. Dist. LEXIS 2204 (W.D. Wash. Feb. 20, 2014), a consumer filed a class-action lawsuit against a collection agency for allegedly calling his cellular telephone number using an autodialer to collect on a debt.  The plaintiff alleged that the calls were in violation of the TCPA, 47 U.S.C. § 227(b).  The collection agency filed a motion to stay the action pending the outcome of several petitions to Federal Communications Commissions (“FCC”), the Federal agency tasked with creating rules to implement the TCPA.  Specifically, the agency argued that debt collection calls, as non-telemarketing calls, were not subject to the TCPA.  The collection agency reasoned that the FCC, rather than the court, had the requisite expertise to determine whether the TCPA applied to debt collection calls.

Because plaintiff’s complaint alleged that the collection agency implemented an autodialer to call debtors regarding unpaid debt, the Western District agreed that the action should be stayed pending an FCC declaratory ruling.  In the Order, District Judge Benjamin H. Settle wrote, “[t]he law is unclear whether Congress intended the TCPA to prevent this activity.  Telemarketing is one activity while collecting debt from known debtors seems to be a wholly separate activity.  Whether the latter activity falls within the scope of the TCPA is currently being addressed by Congress and the FCC.”

This decision is interesting because the FCC has already ruled that content is irrelevant to a determination of whether the TCPA applies, at least in regard to cellular telephone numbers. In its 2008 Ruling, the FCC stated in relevant part,

“[t]he Commission also reiterates that the plain language of section 227(b)(1)(A)(iii) of the [TCPA] prohibits the use of autodialers to make any call to a wireless number in the absence of an emergency or the prior express consent of the called party.  The Commission notes that this prohibition applies regardless of the content of the call, and is not limited only to calls that constitute ‘telephone solicitations.’” 

Thus, the FCC has already recognized that all calls, at least to wireless telephone numbers, do implicate the TCPA. Further, in its TCPA orders, including those entered prior and subsequent to 2008, the FCC has specifically addressed debt collection and created specific regulations thereto. Moreover, several district courts throughout the country, relying on the FCC’s regulations, have held that the TCPA’s prohibition on calls to wireless telephone numbers applies to debt collection calls. Thus, to say the least, it is odd that this particular court has ruled that action should be stayed pending a decision on whether debt collection is exempted from the TCPA’s requirements.

For more information on this subject, contact Stephanie Strickler at 312-334-3465 or sstrickler@messerstrickler.com.