Plaintiff Intervenor Petitioners Challenge Majority Opinion in Bais Yaakov, Fail to Address Standing to Do So

As we’ve previously reported, on March 31, the DC Circuit issued a 2-1 opinion in the Bais Yaakov appeal holding that “the FCC’s 2006 Solicited Fax Rule is . . . .unlawful to the extent that it requires opt-out notices on solicited faxes.” Slip Op. at 4. Given the profound impact we expect that ruling to have in TCPA fax litigation, it is no surprise that the plaintiffs’ bar is fighting that decision: on April 28, 2017, the plaintiff intervenors in the Bais Yaakov appeal filed a petition for rehearing en banc before the full D.C. Circuit.

The petition for rehearing relies principally on the dissent authored by Judge Pillard, and argues that the majority’s opinion was wrong because it supposedly (i) failed to account for Supreme Court and other D.C. Circuit precedent allegedly holding that broad grants of authority should not be subject to review regarding whether a particular issue was committed to agency discretion; (ii) mischaracterized the Commission’s and the plaintiff intervenor petitioners’ argument that such broad authority affirmatively empowered the Commission to require opt-out notices on solicited faxes; (iii) misapplied the expressio unis canon in derogation of Supreme Court and other D.C. Circuit precedent; and (iv) failed to consider the fact that the decision is contrary to the legislative history and purpose of the TCPA (to help consumers stop receiving unwanted faxes).

What the petition does not address, however, is how the plaintiff intervenor petitioners have standing in light of the real party in interest’s likely abandonment of the appeal.

As we noted previously, immediately following the D.C. Circuit’s decision, Chairman Pai issued a statement that criticized the Commission’s prior affirmation of its authority to require opt-out notices on solicited faxes as being “adopted in relevant part on a 3-2 party-line vote”; asserted that the D.C. Circuit’s Bais Yaakov opinion “highlights the importance of the FCC adhering to the rule of law”; reiterated his original statement in dissent that the Commission’s regulation of solicited faxes “reflected ‘convoluted gymnastics’”; and vowed that “[g]oing forward, the Commission will strive to follow the law and exercise only the authority that has been granted to us by Congress.”

In light of the foregoing, the Commission almost certainly will not join the intervenors in challenging the majority opinion in Bais Yaakov. And based on a long line of Supreme Court authority, that will likely doom any challenge mounted without the Commission’s participation. Indeed, the U.S. Supreme Court recently disposed of a challenge to the constitutionality of California’s Proposition 8 (which amended the California Constitution to provide that “[o]nly marriage between a man and a woman is valid or recognized in California”) on similar grounds, holding that intervenors lacked Article III standing to appeal a district court decision overturning Proposition 8 where the California government entities charged with enforcement of California’s laws refused to appeal the district court decision. See Hollingsworth v. Perry, 133 S. Ct. 2652, 2661 (2013). The similarities in the procedural postures are patent, and based on how the Supreme Court approached the issue in Hollingsworth, we expect the D.C. Circuit to issue an order directing the parties (or perhaps just the plaintiff intervenor petitioners) to brief the issue of “[w]hether petitioners have standing under Article III, §2, of the Constitution” to pursue an appeal. Id. at 2662.

Justin O. Kay

About the Author: Justin O. Kay

Justin Kay advises and defends business clients regarding their interactions and communications with consumers. He appears regularly on behalf of clients before federal and state courts, federal agencies and independent self-regulatory bodies, such as the National Advertising Division of the Better Business Bureau. Justin’s practice focuses on defending clients in the growing number of complex class actions arising under federal and state consumer protection and privacy laws such as the federal Telephone Consumer Protection Act, the Illinois Biometric Information Privacy Act and the California Consumer Privacy Act. He is a deputy leader of the litigation practice group.

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