DC Circuit Partial Reversal of 2015 TCPA Robocalling Order Seen Unlikely to Be Overturned

Attorneys were skeptical the FCC would litigate further at the D.C. Circuit or the Supreme Court. "I highly doubt the FCC will appeal the ruling or seek en banc review," emailed Dorsey & Whitney's Eric Troutman, who represented financial services and mortgage associations that supported petitioners. "The Commission’s current leadership seems pleased with the result and the Republican-leaning FCC is likely eager to sharpen their pencils and try again." There were no intervenors (which can also appeal) supporting the 2015 order.

"The decision was a really good win for the industry petitioners,” said Megan Brown of Wiley Rein. “I think the action is back at the FCC now, not in further judicial review.” Because the case was pending for 17 months after oral argument and technology is changing, "I don’t think anyone has the appetite to prolong the uncertainty," she said. "There’s a very dated statute, the FCC rules are pretty dated, and there’s all sorts of innovation; so let’s just get some modern rules that work.” Others also doubted industry parties, including intervenors, will appeal. "I don't think they're going to," said Margot Saunders, senior counsel at the National Consumer Law Center (NCLC), which backed the order.

An appeal is "possible but not likely to be successful," emailed Kelley Drye's Steve Augustino, who represented industry intervenors. "Because the decision was unanimous, it’s not likely that en banc review would be sought or granted. A petition for certiorari to the Supreme Court is possible, but there is neither a circuit split on the issue nor a broad underlying question of law, two factors that usually are present in a case accepted by the Court. Thus, any cert petition would be highly unlikely to prevail."

A D.C. Circuit panel partially granted and denied challenges to the 2015 order in a unanimous opinion by three Democratic appointees. The judges upheld the FCC's standard for revoking consumer consent "through any reasonable means clearly expressing a desire to receive no further messages," and affirmed the scope of an agency exemption "for time-sensitive healthcare calls." But they set aside an "automatic telephone dialing system" (ATDS) definition of "the types of calling equipment that fall within the TCPA's restrictions." They said it "would appear to subject ordinary calls from any conventional smartphone to the Act's coverage," an "unreasonably expansive interpretation." They also vacated the FCC's approach to calls made to numbers reassigned from people who had given consent, ruling the agency's safe harbor protecting callers on only the first call is arbitrary and capricious.

FCC Chairman Ajit Pai and fellow Republicans welcomed the ruling, as did industry attorneys and ACA (see 1803160053 and 1803190050). The FCC, ACA and counsels for other litigants -- including Rite Aid, which argued the FCC went too far in restricting healthcare calls -- didn't comment on whether they would seek an appeal.

"I doubt that the Commission will seek further review," emailed Kennedy Privacy Law Firm's Charles Kennedy, who represented banking and credit union groups backing petitioners. Drinker Biddle's Laura Phillips said "it's hard to see why" the FCC would appeal, and it may feel pressure to advance a proceeding on creating a reassigned-number data base (a draft NPRM is set for a vote Thursday). "So long as the FCC signals that it will step up to the plate to consider appropriate statutory parameters on the ATDS definition question that resolves uncertainty, it’s tough to envision an appellate path forward rather than one leading back to the expert agency," she said.

The attorneys also doubted challengers would appeal, or win if they do. "The petitioners only have a gripe as to the DC Circuit’s finding on revocations of consent; whether that is worth seeking further review over is doubtful, at least to me, but we’ll find out soon," Kennedy said. Troutman said, "While I cannot speak for the Petitioners, in my view -- other than Rite Aid -- they all have good reason to be pleased with the ruling, and with the new industry-leaning FCC poised for further action in this space there does not appear to be much incentive to pursue an appeal. Then again, they have great lawyers and maybe they’ll see something that I don’t."

"My strong sense is that further appeals would be futile and plaintiffs’ lawyers will reach that conclusion and not bother trying," said another industry attorney. "I think all the action will be (1) in district courts and other courts of appeals where various TCPA cases will continue to be litigated, with parties debating what standards should apply now that the FCC’s order was largely vacated, and (2) before the FCC, as it considers new rules."

Kennedy expects the FCC to launch a broad TCPA proceeding. "That process will take quite some time, and while all that is going on the big questions for calling parties and defendants in TCPA lawsuits are: (1) what calling practices can safely be undertaken in reliance on the DC Circuit order while FCC proceedings are pending; and (2) will the DC Circuit decision, in itself, support motions to dismiss class-action lawsuits based upon the robocall provisions of the TCPA? These are complex questions.”

"Not a lot was firmly resolved" by the court, which "kicked it back to the FCC," said NCLC's Saunders. She believes the ruling "leaves wide open" the definition of an autodialer that must gain consent to call wireless consumers and connect them to a live person. "We would all like the FCC to write a definition that we like. You have to be careful what you ask for," she said. “Industry may think they’re looking at an FCC that is business friendly, but they’re also looking at an FCC that clearly does not like robocalls.” If the agency writes an industry-friendly definition, wireless consumers will get many more unwanted telemarketing robocalls, which the agency's trying to curb, she said: "It's up to the FCC to define autodialer to protect consumers from getting too many of these calls. And if the FCC doesn't do it, it'll be up to the courts."

The "most significant" part of the ruling was to affirm "that consumers can revoke consent to be called by any 'reasonable means,'" emailed Alan Butler, senior counsel of the Electronic Privacy Information Center, which backed the 2015 order. He disputed any suggestion that consumer right was obviated by the autodialer reversal. Revocation is "critical" to ensuring TCPA "operates as intended -- by putting consumers, and not telemarketers or robocallers, in control of when and how they can be contacted," he said. "The problem of unwanted robocalls has gotten significantly worse in recent years as technological shifts have decreased the cost of making automated calls. The impact on consumers has also shifted as most people rely primarily on cell phones and keep them nearby at all times (harassing calls are even more invasive)."