In Blow to TCPA Lawsuits, Court Strikes Down FCC's Expanded Autodialer Definition
In a decision likely to impact future litigation over robocalls and texts, a federal appeals court Friday struck down key parts of a Federal Communications Commission order that had expanded the legal definition of an autodialer.
March 16, 2018 at 06:21 PM
4 minute read
In a decision likely to impact future litigation over robocalls and texts, a federal appeals court Friday struck down key parts of a Federal Communications Commission order that had expanded the legal definition of an autodialer.
The FCC's 2015 declaratory ruling and order has been sharply criticized by defense attorneys and representatives from the U.S. Chamber of Commerce, who say it exposes companies to huge penalties under the Telephone Consumer Protection Act, or TCPA, even when making tailored marketing or business calls.
Friday's unanimous, 51-page decision by a panel of the U.S. Court of Appeals for the D.C. Circuit—written by Judge Sri Srinivasan—agreed the FCC order adopted an overbroad definition for what constitutes an “automatic telephone dialing system,” or ATDS. Under the TCPA, calls made via an autodialer without the receiver's consent can carry statutory penalties of between $500 and $1,500 per violation.
“The Commission's understanding would appear to subject ordinary calls from any conventional smartphone to the Act's coverage, an unreasonably expansive interpretation of the statute,” Srinivasan wrote for the panel. He was joined by Judge Cornelia Pillard and Senior Circuit Judge Harry Edwards.
Shay Dvoretzky of Jones Day, who argued against the FCC order for a group of industry petitioners, welcomed the decision in a statement. “For years, abusive class-action lawsuits have been brought against all sorts of legitimate businesses, seeking billions of dollars in statutory penalties for ordinary phone calls,” he said.
“The D.C. Circuit recognized the 'eye-popping sweep' of the FCC's order and properly set it aside as inconsistent with the statute and with reasoned decision-making,” Dvoretzky added. “The court's decision should have a profound effect on TCPA litigation across the country.”
Jay Edelson of Chicago-based Edelson PC, a plaintiffs firm that has pursued a number of TCPA actions, was more downbeat. “This is a good day for companies that want to spam consumers with phone calls and texts messages and a bad day for everybody else,” he said in an email.
The main issue in the case was language in the commission's order further interpreting the TCPA's definition of an ATDS. The statute itself defines it as equipment that has the “capacity” to store or produce telephone numbers to be called, using a random or sequential number generator, and to dial them.
Since the statute's passage, the FCC has adopted a series of interpretive orders about autodialers. The most recent order in 2015 interpreted the term “capacity” as encompassing the device's “potential functionalities” with modifications such as software changes. It also said that equipment that can dial numbers from a list qualifies as an autodialer.
“It is untenable to construe the term 'capacity' in the statutory definition of an ATDS in a manner that brings within the definition's fold the most ubiquitous type of phone equipment known, used countless times each day for routine communications by the vast majority of people in the country,” the panel said in its decision.
“It cannot be the case that every uninvited communication from a smartphone infringes federal law, and that nearly every American is a TCPA-violator-in-waiting, if not a violator-in-fact,” it added.
The decision was also applauded by current FCC Chairman Ajit Pai, who called it “yet another example of the prior FCC's disregard for the law and regulatory overreach.”
FCC Commissioner Jessica Rosenworcel, meanwhile, issued a separate statement condemning the ruling and called on the commission to take action in response. “Robocalls are already out of control. One thing is clear in the wake of today's court decision: robocalls will continue to increase unless the FCC does something about it,” she said.
“That means that the same agency that had the audacity to take away your net neutrality rights is now on the hook for protecting you from the invasion of annoying robocalls,” Rosenworcel added.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllCuomo Accuser Drops Federal Lawsuit Against Ex-Governor
Atkins Likely to Bring Pro-Business, Light Regulatory Touch to SEC, Say Agency Observers
'Stake Out My Space': Attorneys, Law Professors Flock from X to Bluesky
Trending Stories
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250