TCPA Tracker-November 11, 2014
November 11, 2014

Recent News

In One Action, FCC Rules Against 24 TCPA Petitioners but Grants Retroactive Waivers of Opt-Out Requirements for Faxes

On October 30, 2014, the FCC released an order that effectively resolves nearly half of the Telephone Consumer Protection Act (“TCPA”) petitions pending before it. This order addresses 24 petitions seeking clarification of the Commission’s rules requiring individuals and entities that send fax advertisements to include certain information on the fax to allow recipients to “opt-out” of receiving such transmissions in the future. To read more click here.

FCC Reminds Political Campaigns of TCPA Obligations Ahead of Elections
Just before the mid-term elections, the FCC’s Enforcement Bureau issued a stern warning to political campaigns and calling services regarding their obligation to comply with the TCPA and stating that the Commission “will not hesitate to act to protect consumer privacy and their freedom from the nuisance of unwanted calls.” The Enforcement Advisory reminded potential political callers that they may be liable for forfeiture penalties of up to $16,000 per violation of the rules. To read more click here.

With the rise in TCPA litigation, numerous parties have sought clarification of the rules. Kelley Drye’s Communications group has compiled this comprehensive summary of the pending petitions.

Number of Petitions Pending New Petitions Filed Upcoming Comments Decisions Released
27 American Ass’n of Healthcare Admin. Management (prior express consent; filed 10/21/14)

Francotyp-Postalia, Inc. (junk faxes; filed 10/17/14)

American Bankers Ass’n (exception to the “prior express consent” rules; filed 10/14/14)

Bijora, Inc. (whether the opt-out rule for faxes applies to text messages sent with the recipients prior express consent; filed 10/7/14)
Consumer Bankers Association(definition of “called party”; Comments due 11/17/14; replies due 12/1/14)

Allscripts and Francotyp-Postalia (opt-out requirements on fax ads; Comments due 11/18/14; replies due 11/25/14)

Bijora, Inc. (whether the opt-out rule for faxes applies to text messages sent with the recipients prior express consent; filed 10/7/14)


10/30/14 - Order denying the petitions of Anda, Inc. and 23 other entities seeking clarification of the “opt-out” notice requirements for fax advertisements (FCC 14-164)
Click here to see the full FCC Petition Tracker.


Upcoming Events

It's Complicated: Maximizing Customer Retention and Acquisition Through Text, Email, and Social Media Without Getting "Unfriended" by the Law

MVNOs Industry Summit USA

On November 19, 2014 partner John Heitmann will speak at the MVNOs Industry Summit USA on "It's Complicated: Maximizing Customer Retention and Acquisition Through Text, Email, and Social Media Without Getting "Unfriended" by the Law." This roundtable will discuss designing effective customer acquisition and retention strategies, key federal and state telemarketing laws (TCPA, Do Not Call, CAN-SPAM), using CPNI for marketing purposes, and best practices for calling, texting and social media campaigns.

Cases of Note

District Court Crunch-es FCC’s Interpretation of ATDS
On October 23, 2014, a California federal district court granted defendant’s motion for summary judgment on the basis that the technology at issue was not an Automated Telephone Dialing System (“ATDS”). See Marks v. Crunch San Diego, LLC, No. 14-CV-00348-BAS-BLM, 2014 WL 5422976, at *1 (S.D. Cal. Oct. 23, 2014). The Court found that the technology at issue did not constitute an ATDS because it required “human curation and intervention” to generate the calls. More specifically, because the phone numbers were inputted into the platform by one of three methods -- (1) when the user manually uploads a phone number onto the platform; (2) when a customer responds to a user’s marketing campaign via text message; and (3) when customer manually inputs the phone number on a consent form through the user’s website that interfaces with the platform -- the technology lacked a random or sequential number generator and, therefore, was not an ATDS. In reaching its holding, the Court determined that the FCC does not have statutory authority to change the definition of ATDS, and joined the growing list of federal courts declining to follow the FCC interpretation of an ATDS as “any equipment with the capacity to generate numbers and then dial them without human intervention.” The decision is important because it adds another layer to the reasoning in Gragg – namely, that courts should avoid adopting the FCC’s interpretation as it will “lead to an absurd result” that use of smartphone results in TCPA exposure. Gragg v. Orange Cab Co., 995 F. Supp. 2d 1189, 1192 (W.D. Wash. 2014).
Eleventh Circuit Tells District Court to Take a Mulligan in Palm Beach Golf Center Class Action
On October 30, 2014, the Eleventh Circuit reversed and remanded a district court’s grant of summary judgment in favor of the defendant in a TCPA putative class action. Palm Beach Golf Ctr.-Boca, Inc. v. Sarris, No. 13-14013, 2014 WL 5471916 (11th Cir. Oct. 30, 2014).

With respect to its TCPA claim, the district court determined that Plaintiff lacked Article III standing because it did not demonstrate that any employee of Plaintiff’s saw or printed the transmitted fax, and, even if it had standing, the record facts did not support any of the three theories of vicarious liability (actual approval, apparent approval, and ratification).

On the issue of standing, the Eleventh Circuit relied on House Report No. 102-217 and a few district court opinions to conclude that “the specific injury targeted by the TCPA is the sending of the fax and resulting occupation of the recipient’s telephone line and fax machine, not that the fax was actually printed or read.” Id., at *2. The Eleventh Circuit went on to determine that there is undisputed record evidence that the fax was successfully sent, and occupied the Plaintiff’s fax machine and phone line. Then, the Eleventh Circuit went on to analogize the TCPA to qui tam statutes, and ultimately concluded that Plaintiff has “Article III standing as a result of Congress’s assignment to Plaintiff or the United States’ injury resulting from [the Defendant’s] alleged violation of the TCPA’s fax ban.”

Turning to the merits of Plaintiff’s TCPA claim, the Eleventh Circuit found that the district court’s reliance on In re DISH Network LLC, 28 FCC Rcd. 6574 (2012) for the proposition that only the actual “sender”—the person that physically sent the fax--can be held directly liable was “misplaced.” In reaching this conclusion, the Eleventh Circuit relied on an FCC amicus letter stating that the In re DISH Network ruling was limited to telemarketing calls, did not apply to unsolicited facsimiles, and did not abrogate the FCC’s 1995 Opinion and Order attributing direct liability to those on whose behalf faxes are sent.

The Eleventh Circuit then went on to find that the record contains sufficient evidence for a jury to find that the faxes were sent on behalf of Defendant because (1) the Defendant gave his marketing manager “free rein” to market his practice, (2) the marketing manager contracted with the third party fax sender to send faxes on behalf of Defendant, (3) after receiving payment the third party sent a fax to Plaintiff. The Eleventh Circuit, however, left that decision for a jury.