DC Circuit Court holds that FCC Guidance on Agency Law in TCPA Cases is Not Binding on Courts
On January 22, 2014 the D.C. Circuit Court of Appeals issued a two-page per curiam decision dismissing a petition by DISH Network, LLC that challenged the FCC’s “guidance” on the interpretation of agency law in the context of Telephone Consumer Protection Act of 1991, 47 U.S.C. § 227 (“TCPA”). In its May 9, 2013 Declaratory Ruling, the FCC held that a seller could be held vicariously liable for a telemarketer’s TCPA violations if the telemarketer acted as an agent of the seller under the federal common law of agency. Declaratory Ruling, ¶ 28; see Kelley Drye Client Advisory: FCC Opens the Door to Vicarious Liability for Third-Party Telemarketing Under Certain Conditions. However, the Declaratory Ruling went on to provide “guidance” to Courts applying the federal common law of agency. The paragraphs of the Declaratory Ruling at issue on appeal provided hypothetical examples which purported to apply the federal common law of agency and to detail factors for a Court’s consideration. Id. at ¶¶ 46, 47. DISH Network, LLC challenged this guidance as beyond the FCC’s authority and as an incorrect application of the federal law of agency. On review, the FCC asserted that this portion of the order was not intended to be binding, and thus challenged the court’s jurisdiction to hear challenges to the context of the guidance. Relying on the FCC’s concessions in its brief and oral argument, the Court concluded that the FCC’s guidance is not a final order ripe for judicial review. See Fox Television Stations, Inc. v. FCC, 280 F.3d 1027, 1037 (D.C. Cir. 2002). As a result of the D.C. Circuit’s decision, no Court will be bound by the FCC’s guidance applying the law of agency in the context of TCPA violations. Questions of agency will be litigated in individual cases, but courts may not afford the FCC’s guidance special deference and are free to credit or disregard the FCC’s opinions on the application of agency law.