In an opinion issued this morning, the U.S. Court of Appeals for the District of Columbia Circuit overturned key provisions of a Federal Communiciations Commission ruling addressing the scope of the Telephone Consumer Protection Act's prohibition on the use of automated dialing devices to make unconsented-to calls to cell phones.
In what may prove the most significant aspect of its ruling, the Court struck down parts of the FCC's ruling addressing the definition of "automated dialing equipment," which the FCC had said included equipment that had the potential to be modified to be used to make autodialed calls. The court took the view that the FCC's definition was so broad it could include any smartphone, and it found unreasonable a construction of the TCPA that could impose liability on any use of a smart-phone to make a call or send a text that the recipient had not consented to in advance. The court also found that the order was ambiguous, and hence, in the court's view, arbitrary and capricious, in defining what potential capabilities a device would have to have to make it a piece of automated dialing. Specifically, the court found it unclear whether the FCC required that a device have the capability of generating a list of numbers in order to qualify. Finally, the court flagged but did not decide another issue: whether the FCC's longstanding view that the TCPA's prohibition applies whether or not a device's automated dialing capability is used to make a particular call is correct.
The FCC will have the opportunity, should it choose to exercise it, to respond to the court's calls for greater clarity and a less sweeping definition of the statute's scope. But the court's decision may push the agency to narrow the TCPA's reach so that much more robo-calling will fall outside the Act's coverage. And pending further FCC rulings on the subject, the decision's reasoning may also be used by telemarketers to attempt to escape liability in private lawsuits alleging violations.
The court also struck down the FCC's ruling that a telemarketer cannot rely on the consent of the former owner of a reassigned cell phone number for more than one call to the new subscriber. The court accepted that the FCC could reasonably view the TCPA's use of the term "called party" to refer to the current owner of a number rather than a former owner who had consented to receive robo-calls, but it held that it was arbitrary for the agency to provide callers relying on a former subscriber's consent with a safe harbor to make only one call to that number. The court suggested that the agency may have ways to avoid the problem by creating a registry of reassigned numbers, but meanwhile defendants in TCPA actions will continue to argue that they can rely on a former subscriber's consent to avoid liability for making unconsented-to calls to current owners of a phone number. With the FCC's ruling vacated, courts may reach varying views on how the statute's language applies, even though the most logical reading of "called party" is that it refers to the person who was actually called.
The court ruled for the FCC in two respects, the most important of which was its holding that the FCC acted lawfully in ruling that telephone owners can revoke consent to receive robo-calls through any reasonable means. However, the respects in which the court overturned the FCC will likely have more far-reaching consequences and continuing reverberations both in further proceedings before the agency and in private TCPA lawsuits.