Two Additional Challenges to the FCC’s July 10, 2015 Declaratory Ruling and Order

As anticipated, additional parties continue to join the consolidated appeal of the FCC’s July 10, 2015 Declaratory Ruling and Order. On August 26, 2015, inc. and its wholly-owned subsidiary ExactTarget, Inc. (collectively “Salesforce”) filed a petition for review with the United States Court of Appeals for the District of Columbia Circuit. See Inc., et al. v. FCC, No. 15-1290 (D.C. Cir. filed Aug. 26, 2015). On September 1, 2015, the Consumer Bankers Association (“CBA”) filed its own petition for review. See Consumer Bankers Assoc. v. FCC, No. 15-1304 (D.C. Cir. filed Sept. 1, 2015).

Salesforce challenges the FCC’s inconsistent treatment of the term ATDS throughout the Order, stating that the Order unlawfully exceeds the FCC’s authority in one section, reaffirms Congress’s statutory definition in another section, and endorses an entirely different view unsupported by the TCPA in another section. See Salesforce Pet. at 2. Salesforce also challenges the Order’s definition of “called party,” asserting that it “makes it impossible for callers to ensure that at the time of any call or text, the prior express consent they obtained for that number remains valid.” Id. Finally, Salesforce contends that the Order “treats ‘prior express written consent’ and revocation of consent in a way that is inconsistent with prior FCC statements, exceeds the FCC’s authority, and puts an undue and excessive burden on callers, and particularly those communicating by text message.” Id. The petitioners ask the DC Circuit to either find the Order unlawful and set aside the unlawful portions, including but not limited to the portion addressed above, or declare the TCPA unconstitutional. Id. at 3.

CBA asserts that the FCC abused its discretion and acted arbitrarily and capriciously by: (1) finding that the “capacity” of an ATDS includes its “potential functionalities” and any equipment that has “more than a theoretical potential” of being modified to satisfy the ATDS definition qualifies as an ATDS, (2) defining the term “called party” as the subscriber or customary user of the telephone number rather than the intended or expected recipient of the call, (3) establishing a “one-call” exemption for reassigned calls regardless of whether the caller had knowledge of the reassignment or the call was answered, (4) prohibiting callers from establishing reasonable means by which “prior express consent” may be withdrawn, and (5) finding that text messages are calls for purposes of the TCPA and there is no distinction between text messages and telephone calls for purposes of the TCPA. See CBA Pet. at 3-5. CBA asks the DC Circuit to find the above portions of the Order arbitrary, capricious or otherwise unlawful and then vacate and remand to the FCC for proceedings consistent with the Court’s findings. See Id. at 5-6.

As it stands now, the consolidated appeal of the FCC’s Order consists of petitioners ACA International, PACE, SiriusXM, CodeBroker LLC, inc. and ExactTarget, Inc.  We expect that the Consumer Bankers Association’s petition for review will be consolidated shortly.  The consolidated appeal also consists of intervenors MRS BPO, LLC, Cavalry Portfolio Services, LLC, Diversified Consultants, Inc., Mercantile Adjustment Bureau, Council of Americans Survey Research Organizations and Marketing Research Association.  Stay tuned as we continue to provide updates on developments in the consolidated appeal of the FCC’s July 10, 2015 Declaratory Ruling and Order.

John S. Yi

About the Author: John S. Yi

John Yi represents clients in civil and criminal litigations in federal court, as well as investigations and enforcement actions by the Federal Trade Commission (FTC), the U.S. Department of Justice (DOJ), the Securities and Exchange Commission (SEC), and other federal and state regulatory bodies. For clients in health care and other sectors, he handles a full array of antitrust issues. John has helped secure merger clearances from federal regulators and defended clients’ interests in suits alleging a variety of anticompetitive conduct. He has assisted companies with internal investigations and compliance strategies. John also has experience handling all aspects of civil litigation, including discovery, settlement, dispositive motions, trial advocacy and appellate work. John also defends a number of class action cases with a wide variety of claims, including issues arising under federal and state antitrust laws, the Telephone Consumer Protection Act (TCPA) and the Fair Credit Reporting Act (FCRA).

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