Relying upon a Federal Communications Commission regulation, the 8th U.S. Circuit Court of Appeals held that a fax advertisement lacking opt-out language pursuant to the Telephone Consumer Protection Act may violate the statute even where the recipient consented to receive the ad.
The TCPA mandates that a “conspicuous” notice be included in advertisements, accompanied by a domestic telephone number and a cost-free mechanism for the recipient to opt out of receiving future “unsolicited advertisements.”
But what if consent was given to receive the ad?
Missouri resident Michael Nack consented to receive ads from Douglas Walburg. But after Nack received one faxed ad lacking opt-out information, he filed a class action suit pursuant to the TCPA.
Walburg moved for summary judgment, arguing that the statute itself does not expressly impose the requirement to include opt-out language in solicited advertisements. A federal district court agreed.
But on appeal the 8th Circuit solicited the input of the FCC, which informed the court that the contested opt-out language is required even on ads sent after obtaining a potential recipient’s consent. The agency pointed to FCC Regulation 47 C.F.R. § 64.1200(a)(3)(iv) and a 2006 order to support its position.
“[C]onsent, once granted, need not be interpreted as permanent,” the court said. “The FCC sought to ensure that even recipients who consented to receive a fax could easily and without expense stop the sending of any possible future faxes.”
Extending deference to the agency, the panel said the regulation requires senders to employ the opt-out language even with prior express permission to send the ad. The posture of the lawsuit was an inappropriate vehicle to challenge the validity of the regulation, the court added.
A party seeking to challenge an FCC regulation must first petition the agency itself and then, if denied, appeal directly to the Court of Appeals as provided by the Hobbs Act. Therefore, the statute precluded the court from evaluating the contested regulation, it concluded.
To read the opinion in Nack v. Walburg, click here.
To register for Manatt’s upcoming webinar, “Are You Ready for New TCPA Consent Requirements?” click here.
Why it matters: The 8th Circuit afforded the FCC regulation appropriate deference and reversed summary judgment for the defendant. The panel dropped several hints, however, that Walburg still had an available route if he wished to challenge the validity of the regulation and continue to fight the suit. An end run around the Hobbs Act was not permitted, but the court noted that the defendant “has not yet” elected to seek a stay of litigation to pursue his administrative remedies through the FCC. “On remand, the district court may entertain any requests to stay proceedings for pursuit of administrative determination of the issues raised herein,” the panel concluded, thereby providing a road map for the defendant.