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by David N. Anthony, Alan D. Wingfield, Chad Fuller and Tim J. St. George
On June 18, 2015, the Federal Communications Commission (“FCC”) voted 3-2 to approve an order that promises to have major and negative impacts on companies who use modern telephone technology to text and call consumers.
The stark increase in the number of lawsuits that were filed under the Telephone Consumer Protection Act (“TCPA”) has been well documented. This litigation trend also caused companies and industry groups to file 21 petitions with the FCC seeking clarification on a number of different facets of the TCPA. Those petitions concerns macroscopic issues such as what constitutes an “autodialer” and whether text messages are covered by the TCPA, as well as granular issues involving the application of the TCPA to certain market segments (e.g., healthcare).
On June 18, 2015, the FCC held a hearing on a proposed Declaratory Ruling and Order, which FCC Chairman Tom Wheeler claimed will “reaffirm the Telephone Consumer Protection Act’s protections against unwanted robocalls, encouraging pro-consumer uses of robocall technology, and responding to a number of requests for clarity from businesses and other callers.”
The Declaratory Ruling was confirmed by the FCC by a 3-2 vote along political party lines. The three Democrat Commissioners (including Chairman Wheeler) voted in favor of the Ruling while the two Republican Commissioners opposed it.
The Declaratory Rule has not yet been made public. However, the commentary on the ruling at the hearing detailed a number of principles and findings that will be contained within the forthcoming Declaratory Rule. Some of the highlights of the forthcoming Rule are as follows:
The vote passed despite strong dissent from two Republican FCC Commissioners. “In practice, the TCPA has strayed beyond its original purpose, and the FCC can fix that. Instead, the order takes the opposite tact,” said Commissioner Ajit Pai in a prepared statement to the Commission. FCC Commissioner Michael O’Rielly, who also voiced dissent, stated “[t]oday’s order has been hailed as protecting American consumers, but it is a farce.” “The order penalizes businesses and institutions acting in good faith to reach their consumers using technology.”
As a general matter, the FCC’s interpretation of the TCPA is binding on courts applying the TCPA in private lawsuits, including class actions. Many courts have stayed litigation awaiting the FCC’s rulings on the pending petitions. The Declaratory Rule, when released, will need to be carefully studied by affected businesses for compliance.
Read more at Consumer Financial Services Law Monitor by Troutman Sanders LLP.
Troutman Sanders LLP is an international law firm with more than 600 lawyers in 16 offices located throughout North America and Asia. Founded in 1897, the firm’s lawyers provide counsel and advice in practically every aspect of civil and commercial law related to the firm’s core practice areas: Corporate, Energy and Industry Regulation, Finance, Litigation and Real Estate. Firm clients range from multinational corporations to individual entrepreneurs, federal and state agencies to foreign governments, and non-profit organizations to businesses representing virtually every sector and industry. See troutmansanders.com for more information.
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