In the face of ongoing uncertainty regarding permissible uses of modern telephone equipment under the TCPA, lawsuits and important precedents continue to pile up.

The Telephone Consumer Protection Act of 1991 (TCPA), 47 U.S.C. § 227 et seq., and the rules of the Federal Communications Commission (FCC) implementing it, regulate telephone solicitations to residential landlines andall calls to cellular phones, as well as the sending of fax transmissions. In particular, the TCPA and FCC rules prohibit using an automated telephone dialing system (also referred to as an autodialer or ATDS) or a pre-recorded message to make telephone solicitations to residential landlines or any calls to cellular phones, unless the recipient of the call has granted prior express consent (or in cases of emergency). The stated purpose of the TCPA is to protect individuals from unwanted robocalls, which the FCC interprets as including both voice and text messages, while ostensibly still permitting legitimate telemarketing practices.

In the early years, TCPA litigation was relatively uncommon, but the rapidly expanding market for smartphones has opened up new, often more efficient and even pro-consumer, ways for businesses to communicate with their customers that were not conceived of when the TCPA was originally drafted. The FCC’s broad interpretation of “autodialer” to include almost all modern telephone equipment except a rotary dial telephone, and the proliferation of text messaging, however, have led to confusion as to whether using new device capabilities, particularly in light of changes they have brought about in the way users communicate today, in fact violates the 25-year-old statute. In addition, the TCPA’s authorization of $500 in statutory damages per call (or text), trebled in the case of a knowing violation, has resulted in most TCPA suits being brought on a class action basis.

According to recently published statistics,an astonishing 3,710 TCPA cases were filed in state and federal courts in 2015, as compared with only fourteen cases in 2007,2 and 2016 could be another record-breaking year. Given this proliferation of TCPA litigation, and the many significant monetary judgments against a wide variety of consumer-facing companies that have resulted from it, businesses that communicate with consumers via telephone desperately need clarity. Dozens of businesses have filed petitions with the FCC seeking exemption from the TCPA for a variety of calling/texting practices. The FCC issued an Omnibus Order addressing a number of these petitions, however, as described in Section I below, that ruling also raised new questions and is currently being appealed by numerous parties. Thus, the Omnibus Order has not served to clearly distinguish practices that violate the TCPA from many ordinary calling behaviors. Accordingly, businesses must continue to stay abreast of the numerous TCPA cases making their way through the courts and administrative process. To that end, three recent cases that significantly impact TCPA jurisprudence and the way in which companies conduct TCPA litigation are discussed in Section II below.

2015 FCC Omnibus Order

On July 10, 2015, the FCC issued the agency’s long-awaited omnibus Declaratory Ruling and Order (Omnibus Order) resolving nearly two dozen petitions seeking specific exemptions or clarification of the TCPA to permit the various businesses to conduct what they perceive to be their ordinary business activities free from concern for class action TCPA litigation.3

Among the Omnibus Order’s most broadly-applicable holdings were:

  • Despite the confusion it has wrought, the term ATDS must continue to be defined very broadly as any device with the “capacity”—that is, that has “more than a theoretical potential”—to be modified to dial random or sequential numbers (including dialing in sequence numbers on a list or from a database, as well as devices called “predictive dialers”), even if the device does not have that capacity at the time a complained-of text or call is made;4
  • A called party must always have the opportunity to revoke previously given consent at any time and through any reasonable means, i.e., callers cannot limit the means by which called parties can opt-out of receiving more calls;5
  • Callers to a reassigned telephone number can still face liability under the TCPA despite having had consent from the prior holder of the telephone number, although unknowing callers may make one liability-free call after which they are deemed to have learned of the reassignment of the telephone number, regardless of whether they actually did;6
  • Callers are permitted to send one text in response to a text requesting specific information, such as sending a coupon or discount code in response to an in-bound text directed to the short code contained in an advertisement advising of the availability of that coupon/code;7 and
  • Certain free, pro-consumer financial- and health-care-related messages that comply with strict conditions and limitations to protect consumer privacy are exempt from the consumer-consent requirement.8