On January 23, 2017, President Trump appointed Commissioner Ajit Pai to serve as the next chairman of the Federal Communications Commission. Pai was appointed to the FCC in 2012 and has vehemently criticized the FCC on TCPA rulings and orders. Many believe that his appointment will result in significant changes to the FCC’s position on related issues and, consequently, relief to the telemarketing marketing industry.
Notable was Pai’s dissent in the FCC’s 2015 TCPA omnibus Declaratory Ruling and Order.
The Declaratory Ruling addressed several key issues, including an extremely broad interpretation of “automatic telephone dialing system.” Of course, the expansive interpretation and lack of specific guidance remain a legitimate concern for all those that utilize an automated system to place telephone calls and transmit text messages.
An autodialer is system with the capacity to make calls without human intervention. The degree of human intervention analysis is fact specific and made on a case-by-case basis.
The Declaratory Ruling states that all predictive dialers – however named – constitute autodialers under the TCPA, given their “capacity” to autodial, and are “not limited to any specific piece of equipment and [are] without regard to the name given the equipment for “marketing purposes.”
Additionally, pursuant to the Declaratory Ruling, any dialing equipment that “has the capacity to store or produce, and dial random or sequential numbers” or to call from a list of phone numbers is an automatic telephone dialing system, even if calls are not presently being made using autodialing functions. In other words, according to the Declaratory Ruling, if a system could be enabled to autodial via the implementation of software, then it is potentially an autodialer.
Despite the foregoing, not all dialers with the capacity to autodial are necessarily covered.
In his dissent, Pai held that the majority’s interpretation of the term automatic telephone dialing system “transforms the TCPA from a statutory rifle-shot targeting specific companies that market their services through automated random or sequential dialing into an unpredictable shotgun blast covering virtually all communications devices.”
Opining on other issues addressed by the Declaratory Ruling, Pai called attention to what he considered to be “perverse incentives” for “litigious individuals” and their “trial lawyers.”
The Declaratory Ruling has been appealed and is currently pending in the D.C. Circuit Court of Appeal. Depending upon the ruling and given Pai’s recent appointment, it is not inconceivable that he will strive to soften the Declaratory Ruling to “shut down the abusive lawsuits by closing the legal loopholes that trial lawyers have exploited to target legitimate communications between businesses and consumers.”
Contact an FTC defense lawyer if you would like to discuss the design and implementation of compliant telemarketing campaigns, or how Pai’s appointment might impact entities that communicate with prospects via telephone and/or text message.
Richard B. Newman is an Internet marketing compliance and regulatory defense attorney at Hinch Newman LLP focusing on advertising and digital media matters. His practice includes conducting legal compliance reviews of advertising campaigns, representing clients in investigations and enforcement actions brought by the Federal Trade Commission and state attorneys general, commercial litigation, advising clients on eCommerce guidelines and promotional marketing programs, and negotiating and drafting legal agreements.
HINCH NEWMAN LLP. ADVERTISING MATERIAL. These materials are provided for informational purposes only and are not to be considered legal advice, nor do they create a lawyer-client relationship. No person should act or rely on any information in this article without seeking the advice of an attorney. Information on previous case results does not guarantee a similar future result.