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July 16, 2015Client Alert

FCC Expands the Scope of the TCPA Creating New Challenges for Businesses

On July 10, 2015, the Federal Communications Commission (FCC) released its Telephone Consumer Protection Act (TCPA) Omnibus Declaratory Ruling and Order (Declaratory Ruling), which resolved 21 pending FCC petitions that sought clarity of TCPA enforcement. (See June 8, 2015 Dama MBF Client Alert: FCC Chairman Issues “Fact Sheet” Announcing Proposed TCPA Declaratory Rulings). The Declaratory Ruling took effect immediately and expanded the scope of the TCPA in ways that will have a real impact on businesses with any calling and/or texting practices, whether for marketing, customer support or debt collection. Accordingly, the Declaratory Ruling provides little solace to businesses facing TCPA claims and is predicted to only heighten the recent upsurge of TCPA class action litigation.

Below are a few of the Declaratory Ruling’s highlights:

Revocation of Consent

Under the Declaratory Ruling, consumers can revoke consent “through any reasonable means,” including oral revocation through a call or at an in-store location. The FCC further held that companies “may not infringe on that ability by designating an exclusive means to revoke.” This will inevitably create difficult he said-she said situations and will require more detailed business records on the part of companies.

Reassigned Numbers

Under the Declaratory Ruling, businesses will be held liable for calls to reassigned phone numbers even if the original subscriber to the number had previously provided his or her consent to receive phone calls. The Declaratory Ruling permits one call to the phone number after reassignment. However, the FCC “reject[ed] the argument that this one call must connect to a person, answering machine or voicemail or must otherwise provide the caller with actual knowledge of reassignment.”

Definition of “Autodialer”

The TCPA defines an autodialer as equipment that has the “capacity” to store, produce or dial telephone numbers “using a random or sequential number generator.” Under the Declaratory Ruling, “the capacity of an autodialer is not limited to its current configuration but also includes its potential functionalities.” (Emphasis added). The FCC also reiterated its prior holding that a text message counts as a “call” under the TCPA.

Limited Exceptions to Consent Requirements

The Declaratory Ruling created an exception to the TCPA’s consumer consent requirements for certain calls related to time-sensitive financial and health-related issues. Despite these exceptions, the Declaratory Ruling provides little guidance on any other specific types of time-sensitive calls, such as calls made by utility companies regarding power outages.

89-Days to Obtain Prior Express Written Consent

The Declaratory Ruling imposes an 89-day period from July 10, 2015 or October 7, 2015, for all businesses to obtain new consent from consumers if the consent those consumers gave prior to October 2013 does not conform to the more stringent written consent requirements.

The Declaratory Ruling triggered not only critiques from the business community but also an immediate court challenge. The same day the Declaratory Ruling was issued, ACA International filed a lawsuit in the United States Courts of Appeals for the D.C. Circuit seeking judicial review of the ruling alleging the FCC expanded the scope of the TCPA further than Congress intended. 

While it is yet to be seen how courts will interpret the ruling, we do know the Declaratory Ruling leaves business and organizations exposed to increased liability under the TCPA. Therefore, because of the FCC’s expansive view of the TCPA, now is the time to review your company’s TCPA compliance policy, dialing systems (and your contractor’s) and call recording policies with in-house or outside counsel.    

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