In a decision released last week, the District Court for the Northern District of Illinois denied a plaintiff’s motion for an order altering the court’s order dismissing the second amended complaint without prejudice and granting it leave to file an amended complaint. In Telephone Science Corporation v. Asset Recovery Solutions, LLC, the court previously granted defendant Asset Recovery Solutions, LLC’s (“ARS”) Rule 12(b)(6) motion to dismiss the second amended complaint of plaintiff Telephone Science Corporation (“TSC”), with prejudice, for failure to satisfy the “zone-of-interests” test under the Telephone Consumer Protection Act (“TCPA”) (previously discussed here).
The Southern District of California recently dismissed two Telephone Consumer Protection Act (“TCPA”) 47 U.S.C. § 227 actions for a failure to allege any concrete injury traceable to defendants. In both actions, the court found that plaintiffs had not alleged any concrete harm traceable to defendants’ alleged violation of the TCPA. Due to this, the court held that plaintiffs lacked standing under Spokeo v. Robins, 136 S.Ct. 1540 (2016) (previously discussed here), in which the U.S. Supreme Court held that “a bare procedural violation, divorced from any concrete harm [does not] satisfy the injury-in-fact requirement of Article III.”
At least two courts have recently dismissed TPCA claims where the plaintiffs appeared to manufacture standing. In Telephone Science Corp. v. Asset Recovery Solutions, the Northern District of Illinois dismissed a TCPA complaint brought by a plaintiff whose business model involved the intentional receipt of autodialed or prerecorded calls. There, the plaintiff, Telephone Science Corp. (“TSC”), operated a service called “Nomorobo,” designed to block certain unwanted calls. TSC uses a “honeypot” of telephone numbers, analyzes calls made to those numbers to identify numbers that TSC’s service identifies as being made using an autodialer or artificial or prerecorded voice calls, and then blocks calls made to Nomorobo subscribers made using those identified numbers.
Consumers Union, the consumer advocacy arm of Consumer Reports, has filed a letter in support of the National Consumer Law Center’s (NCLC) request that the Federal Communications Commission (FCC) stay its recent ruling on Broadnet Teleservices LLC’s Petition for Declaratory Ruling in the on-going rulemaking matter In re Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991 while that ruling is under appeal. The July 5, 2016, Broadnet Ruling (previously discussed here) held that the TCPA, and its ban on autodialed calls to cellular telephones, does not apply to calls placed by the federal government itself, or its contractors, so long as the calls are placed in the course of conducting “official government business” and, for calls placed by contractors, the calls comply with the government’s instructions. On July 26, 2016, the NCLC moved the FCC to reconsider its ruling and stay its effect until the motion is resolved. Consumers Union is joining the request for the stay as part of its “End Robocalls” campaign, which purportedly seeks “technological solutions to the unwanted robocall problem,” according to the group’s letter to the FCC. If the requested stay is granted, federal government employees and contractors will continue to be subject to the TCPA unless the Broadnet Ruling is upheld.
On August 4, 2016, the Federal Communications Commission (the Commission) released a Declaratory Ruling clarifying the meaning of the “emergency purpose” exception to the Telephone Consumer Protection Act’s (TCPA) prohibition on certain autodialed or prerecorded-voice calls. The Commission also found that the voluntary provision of cellphone numbers to schools or utilities constituted prior express consent to calls “closely related to” the educational and utility services offered by the callers.
As originally published in Law360
On Friday, July 10, 2015, the Federal Communications Commission issued its much-anticipated Declaratory Ruling and Order clarifying numerous aspects of the Telephone Consumer Protection Act. The commission had adopted the order at a particularly contentious June 18, 2015 open meeting (see earlier post), which one commissioner called “a farce” and another described as “a new low … never seen in politics or policymaking.”
In an unusual move, the commission made the order effective on its July 10 release date, rather than following publication in the Federal Register as is typical, providing companies with no opportunity to digest the order and adjust business practices accordingly.
As expected, the order largely brushes aside legitimate business concerns and a sensible approach to TCPA regulation in favor of findings that potentially increase risk for businesses in a variety of circumstances, including the possibility of increased class action litigation. In addition, beyond clarifying that carriers may offer call-blocking technologies to consumers, the order offers little to actually protect consumers from scam telemarketing schemes, including offshore “tele-spammers” that use robocalling or phone-number spoofing technologies.
As originally published in Law360
At its June 18, 2015, open meeting, a sharply divided Federal Communications Commission made good on Chairman Tom Wheeler’s recent promise to bolster the Telephone Consumer Protection Act’s already strict rules and to bring about “one of the most significant FCC consumer protection actions since it established the Do-Not-Call Registry with the FTC in 2003.” While plaintiffs’ class action lawyers are likely to applaud the new measures, businesses are concerned that the new rules could unfairly restrict legitimate communications with customers.
Congress enacted the TCPA in 1991 to address what it perceived as the growing problem of unsolicited telemarketing with technologies such as fax machines, pre-recorded voice messages and automatic dialing systems. The TCPA requires anyone making a call to a wireless line using autodialer or pre-recorded voice-call technologies to obtain the “called party’s” “prior express consent,” and, following a 2012 FCC decision, “prior express written consent” for calls that introduce advertising or constitute telemarketing. Similarly, under that ruling, calls to residential lines using an artificial/pre-recorded voice that introduce advertising or constitute telemarketing require the called party’s prior express written consent. Read More
The Ninth Circuit recently held that a consumer’s TCPA class action against Sirius XM Radio Inc. (“Sirius XM”) was not subject to Sirius XM’s arbitration agreement. The consumer brought suit alleging that the satellite radio provider violated the TCPA by placing automated calls to his cellular phone without his consent. Sirius XM sought to compel arbitration on an individual basis. The consumer countered that although he purchased a car that was preloaded with a trial subscription to Sirius XM radio, the purchase agreement made no mention of a contract governing the satellite radio service. Rather, the consumer asserted that he did not receive Sirius XM’s terms and conditions until more than a month after he purchased the car, but that those terms required cancellation of service within three days of activation of the trial subscription. Because of the manner in which Sirius XM delivered its terms and conditions to purchasers of cars with trial subscriptions, the Ninth Circuit found that the consumer could not have provided assent to be bound by the arbitration provision. Thus, the Ninth Circuit ruled that neither the arbitration provision nor the class action waiver it contained was enforceable. The decision was issued in a case styled Knutson v. Sirius XM Radio Inc., — F.3d —-, 2014 WL 5802284 (9th Cir. Nov. 10, 2014).
The United States Court of Appeals for the 11th Circuit recently ruled in Palm Beach Golf Center-Boca, Inc. v. Sarris that a company that contracted with a third party advertising firm to send fax advertisements could be directly liable under the Telephone Consumer Protection Act for faxes sent by the third-party firm on the company’s behalf. In so holding, the 11th Circuit adopted a framework advanced by the Federal Communications Commission that imposes broader liability for third-party faxing than for third-party calling made on a company’s behalf. Read More
The U.S. Court of Appeals for the Eleventh Circuit recently bolstered the Federal Communications Commission’s (“FCC”) interpretation of “prior express consent,” a key term under the Telephone Consumer Protection Act (“TCPA”).
In Mais v. Gulf Coast Collection Bureau, Inc., the plaintiff’s wife provided the plaintiff’s cellphone number on a hospital admittance form. The form disclosed that any information supplied could be shared with the hospital’s affiliates and used for any purpose, including for billing. After the plaintiff failed to pay a hospital affiliate’s invoice for treatment services rendered, the affiliate provided the plaintiff’s contact information to the defendant, which initiated collection activity, including contacting the plaintiff at the cellphone number that was provided on his admittance form by his wife.