The TCPA does not preempt an Indiana law banning all robocalls made without consent, including calls made by not-for-profit groups, the 7th U.S. Circuit Court of Appeals has ruled.
Indiana enacted the Automated Dialing Machine Statute, a law banning all calls made by automated dialing machines absent consent by a recipient prior to the call being received. Non-profit group Patriotic Veterans Inc. filed suit to challenge the law, arguing that it violates the First Amendment and was preempted by the federal TCPA (which contains an exception for noncommercial calls by charities and political groups).
The political advocacy group argued that an automated dialing machine is necessary to inform voters about the positions of politicians on issues relevant to veterans because live operators are too expensive and too slow.
A federal district court agreed with Patriotic Veterans that the TCPA preempted the state law, but the 7th Circuit reversed its finding, ruling that the language of the statute expressly allows states to enact more restrictive legislation on autodialers.
Specifically, the 7th Circuit found that the TCPA’s preemption clause (also called the savings clause), 47 U.S.C. § 227(f)(1), states that “nothing in this section or in the regulations prescribed under this section shall preempt any State law that imposes more restrictive intrastate requirements or regulations on, or which prohibits . . . (B) the use of automatic telephone dialing systems; (C) the use of artificial or prerecorded voice messages.”
Although the 7th Circuit’s reading – that state laws may impose more restrictive laws on automatic dialing systems or a total prohibition of both intrastate and interstate automatic dialing systems – may lead to an “odd result,” the “plain language of the statute decrees that state laws that prohibit autodialers are not preempted by the statute,” the court wrote.
“Given the myriad variations possible in state regulations of autodialers which might or might not coincide with those promulgated by the federal government, Congress may have determined that states could pass regulations with flat-out prohibitions but not regulations with more restrictive interstate constraints. An absolute prohibition makes the rules on the use of autodialers easy to follow on a state-by-state basis (and, one might argue, so do black-and-white rules requiring consent), but asking autodialing companies to comply with a web of fifty different state regulatory systems with different requirements about the permissible hours and types of call recipients might create havoc.”
Although there was no express preemption, the three-judge panel also considered whether the TCPA impliedly preempted the Indiana statute and found that it did not. Conflict preemption did not exist because Patriotic Veterans had not shown that it was impossible to comply with both the state and federal laws and the state law did not impede congressional objectives. “The veterans group could comply with the Indiana requirements for consent without violating any aspects of the TCPA,” the court said. “Conflict preemption requires complete impossibility – not mere inconvenience or hardship.”
The court found Patriotic Veterans’ field preemption argument similarly unavailing. The Indiana statute could have been preempted if the TCPA protected a federal regulatory scheme that was so pervasive and a federal interest so dominant that it could be inferred that Congress intended to occupy the entire legislative field. However, “The non-preemption clause of the TCPA is the first and best evidence that the federal government did not intend to occupy the entire field of robocalls regulation,” the court noted. States “historically have held the power to police harassing telephone calls,” as well as “activities that violate the peaceful enjoyment of the home,” and the “TCPA also expressly contemplates that states will continue to regulate telemarketing.”
The 7th Circuit also noted that courts in other states have reached the same conclusion when evaluating whether the TCPA preempts state laws, citing decisions from the 8th Circuit, a New York federal court, and courts in North Dakota and Utah.
Because the district court decided the case on preemption grounds, it never addressed Patriotic Veterans’ alternative argument – that Indiana’s law violates the First Amendment. Thus the 7th Circuit found that issue should first be considered by the district court, and remanded the case for consideration of the issue.
To read the decision in Patriotic Veterans v. State of Indiana, click here.
Why it matters: The 7th Circuit resoundingly concluded that the TCPA does not preempt the more restrictive Indiana autodialing statute. The court emphasized that even if the phrasing of the TCPA’s savings clause yielded an “odd result,” the “court’s job is not to fix it,” cautioning that courts should examine the text of a statute – not psychoanalyze those who enacted it. Thus, companies making autodialed calls must not look just to the TCPA, but to state laws as well, to ensure compliance with all applicable laws.