Proposed TCPA Rules for Calls, Texts Expected to Divide FCC
A big fight is expected at the FCC as the agency considers a declaratory ruling ​on the Telephone Consumer Protection Act, slated for a vote at the commission’s June 18 meeting (see 1505270048), FCC and industry officials told us. Commissioners Ajit Pai and Mike O’Rielly have major concerns with the order, which was cast by Chairman Tom Wheeler as being strongly pro-consumer. The FCC’s item on Lifeline changes is also expected to divide the commission (see 1506010045).
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“The renewed clarity that will come from the Chairman’s proposal will only help consumers and industry to assure compliance with the Act’s consumer protections," an FCC spokesman said in an emailed statement.
The U.S. Chamber's Institute for Legal Reform (ILR) blasted the proposed TCPA rules in a news release. "Plaintiffs' lawyers are already exploiting the TCPA’s outdated language and using conflicting federal court rulings to bring abusive and costly class action lawsuits against businesses,” the group said. “The FCC’s proposals would only worsen the problem by lowering the bar for filing such lawsuits, while providing few if any meaningful benefits to consumers.” Companies are already “being dragged into court and strong-armed into large settlements on an almost daily basis under the TCPA for actions that do not remotely threaten the privacy interests that the law was intended to protect,” ILR said.
“We look forward to reading the FCC’s proposal and hope the details benefit consumers, instead of furthering the unintended consequences of the TCPA," the Consumer Bankers Association said Wednesday. "We support the logical notion that companies can only be sued once they know their customer’s number has been reassigned. Also, we hope the commission confirms capacity means 'present capacity,' otherwise every smartphone could be deemed an autodialer. We are optimistic the commission will endorse these common sense solutions, but, as with most things in life, the devil is in the details.”
In proposing “pro-consumer” rules the agency “has completely overlooked the significant negative impact on a wide variety of industry sectors that are attempting to meet the needs of their clients, consumers, patients and account holders,” said a lawyer who's active on the issue and represents clients concerned about TCPA-related lawsuits. “Based on reports, the order includes a number of provisions that would create a lively playground for plaintiff’s attorneys to trap organizations into TCPA lawsuits.” The lawyer said the item is as blatantly anti-business as the FCC’s February order reclassifying broadband as a Communications Act Title II service.
As an example of problems with the item, agency and industry officials pointed to Wheeler’s statement in a blog post that the FCC would address the reassigned number “loophole.” When companies get prior express consent from a consumer and the customer changes numbers, companies are already getting sued for the first call to the number if it's now in use by another subscriber, officials said. Under the new rules the FCC would allow one call before TCPA prohibitions kick in, according to an FCC fact sheet.
“The entire compliance problem here is callers have no way of confidently knowing when a number has been reassigned,” said a lawyer active on TCPA issues. This one free-call solution is “meaningless” when the caller has no way to verify who the recipient is until the person answers the phone and mentions the reassignment, the lawyer said. This “incentivizes” potential plaintiffs to keep switching their numbers “in hopes of winning the TCPA class-action lottery.”
Harold Feld, senior vice president at Public Knowledge, defended the FCC’s proposed approach on TCPA. “How many times will we hear the same stale sound bite that allowing consumers to fight back against abuse is a bonanza for lawyers?" Feld asked. “Republicans apparently live in fear that consumers might actually have enforceable rights rather than mere pious expressions of sympathy -- which is all we have seen Pai and [O'Rielly] offer. If Republicans want to be taken seriously when they claim they care about consumers, they should actually demonstrate that they care enough to act.”
“All consumers end up paying when government rules create windfalls for the privileged few that know how to take advantage of them,” countered Fred Campbell, president of FBC Enterprises and former chief of the FCC Wireless Bureau. “Caring about consumers requires well-crafted consumer protection rules."
In a March 2014 blog post, O’Rielly said the FCC should provide clarity for the many companies facing TCPA lawsuits. “The FCC must hold bad actors accountable when they violate this law,” he said at the time. “But the FCC should also follow through on the pending TCPA petitions to make sure that good actors and innovators are not needlessly subjected to enforcement actions or lawsuits, which could discourage them from offering new consumer-friendly communications services.”