New Petition Seeking FCC Clarification That Calls Using Soundboard Technology Are Not “Entirely Prerecorded Calls” Prohibited By the TCPA

The FCC’s TCPA docket now has two pending petitions for declaratory ruling on the question as to whether outbound telemarketing calls made through soundboard technology are prohibited communications if made without prior consent under the TCPA. As we predicted in April 2019, industries using soundboard technology to streamline their telemarketing operations are increasing their efforts before the FCC in seeking review of this very issue.

The FCC recently issued a Public Notice seeking comments on a Petition for Declaratory Ruling filed by Yodel Technologies, a Florida-based company providing other entities with outbound telemarketing services using soundboard technology. The Yodel Petition “fully supports” “a currently pending Petition for Emergency Declaratory Ruling filed by NorthStar Alarm Services, LLC, that sets forth a litany of persuasive reasons why the Commission should rule that use of soundboard technology does not violate the TCPA.” The Yodel Petition also “submits its own justifications” to assist the FCC in reaching this conclusion or, alternatively, in waiving application of any rules prohibiting soundboard technology prior to May 12, 2017.

According to Yodel, as “calls using recorded audio clips specifically selected and presented by a human operator in real-time,” soundboard technology should not be considered “prerecorded voice message.” Yodel argues that the FCC’s 1992 TCPA Report and Order implied that prerecorded voice message only refers to calls and messages that are entirely prerecorded. In support, it observes that the FCC has always been and has only been using examples of fully automated calls when discussing TCPA implementing rules in the past twenty-seven years.Yodel’s Petition emphasizes that a caller’s ability to “ascertain the propriety of proceeding with a message” is an important characteristic in distinguishing between live and prerecorded calls – a view supported by case law in the Ninth Circuit. As such, Yodel advocated that outbound calls using soundboard technology would not be prerecorded calls when live operators would remain “available to interact with every called party from inception.”

After the Supreme Court declined in April 2019 to review a challenge to a Federal Trade Commission decision treating outbound telemarketing calls made through soundboard technology as robocalls, a wave of litigation ensued. Many federal courts, including the Eleventh Circuit (with appellate jurisdiction over Florida), have not examined soundboard technology in the context of TCPA claims in the past. Others have not had a consistent view on soundboard technology. As Yodel put it, clarity is needed because of the “serious reliance interests at stake.”

Interested parties have until October 21, 2019 to submit comments to the FCC on the Petition. Reply comments are due on November 4, 2019. Drinker Biddle’s TCPA team will continue to monitor this docket and related developments.

FCC Releases Two Notices of Inquiry Addressing Reassigned Numbers and Caller ID Spoofing

The FCC released two notices of inquiry (NOIs) related to TCPA issues last week: one on how to better track reassigned numbers, and another on tightening industry wide techniques to discourage Caller ID spoofing, one category of illegal robocalls. Each NOI seeks public comment. Continue reading   »

FCC Denies Petition by Mortgage Bankers Association to Exempt Certain Mortgage Servicing Calls from Prior Express Consent Requirement

On November 15, the FCC’s Consumer and Governmental Affairs Bureau denied a petition by Mortgage Bankers Association (MBA)[1] that sought an exemption from the FCC’s prior express consent requirement for non-telemarketing residential mortgage servicing calls to wireless numbers. In its Order, the Bureau concluded that MBA had failed to show (1) that the calls om question would be free of charge to consumers; and (2) that the parties seeking relief should be able to send non-time-sensitive calls to consumers without their consent.[2]

The Bureau’s Order explained that the TCPA “reflects Congress’ recognition of the potential costs and privacy risks imposed on wireless consumers from the use of autodialer equipment, which can generate large numbers of unwanted calls,” and accordingly, the FCC has generally attempted to balance and accommodate the legitimate business interests of callers in addition to recognized consumer privacy interests.[3] Continue reading   »

DC Circuit Court of Appeals Hears Extended Oral Argument In The Consolidated Appeal

As we previously reported, the United States Court of Appeals for the D.C. Circuit held oral argument this morning in the consolidated appeal from the FCC’s July 10, 2015 Declaratory Ruling and Order. The issues before Judges Srinivasan, Pillard, and Edwards were: (1) the definition of an ATDS, particularly the Order’s treatment of the terms “capacity” and “using a random or sequential number generator;” (2) the identity of the “called party” from whom consent must be obtained and the impracticality of the Order’s one-call safe harbor provision; (3) the means by which consent may be revoked; and (4) whether healthcare-related calls should be afforded the same treatment they receive under HIPAA.

Paul Werner from Sheppard, Mullin, Richter & Hampton LLP argued on behalf of petitioner Rite Aid, Shay Dvoretzky from Jones Day argued on behalf of the remaining joint petitioners, and Scott Noveck argued on behalf of the FCC. Although the argument was scheduled to last only forty minutes, it quickly became apparent that Judges Srinivasan, Pillard, and Edwards had concerns about portions of the Order and numerous questions for both parties. The argument ended up lasting more than two and half hours, the majority of which was devoted to what types of equipment qualify as an ATDS, and whether the one-call safe harbor provision strikes a tenable balance between protecting consumers and protecting callers that have been threatened with potentially annihilating liability for calling numbers in good faith that have been reassigned.

An audio recording of today’s argument is available here.