Mind the Details: Defendant Observes that Key FCC Order Never Took Effect; Wins Judgment on Pleadings

A new case out of Indiana, Sanford v. Navient Solutions, LLC, 2018 WL 4699890 (S.D. IN Oct. 01, 2018), underscores the importance of delving into the details of the FCC materials on which plaintiffs rely to support their claims.

In Sanford, relatively straightforward allegations—the defendant’s continued use of autodialed calls after the plaintiff revoked consent—were complicated by the fact that the federal government owned the debt at issue in the calls. The TCPA prohibits “mak[ing] any call (other than a call made for emergency purpose or made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice” to “a cellular telephone service   . . . unless such call is made solely to collect a debt owed to or guaranteed by the United States.” 47 U.S.C. § 227(b)(1)(A)(iii) (emphasis added).

Neither party disputed that the calls related to federal student loan debt, and the defendant argued that they were therefore exempted from the TCPA by the plain language of the statute. The plaintiff countered with a Report and Order adopted by the FCC on August 11, 2016 (the “August 2016 Order”) limiting the number of calls that could be made to a debtor without the debtor’s consent.

The only problem: the order would not to go into effect until after “publication of a notice in the Federal Register [announcing] approval of portions of the rules requiring approval by [the Office of Management and Budget] under the [Paperwork Reduction Act of 1995].”

The August 2016 Order was published in the Federal Register on November 16, 2016. Following the 2016 presidential election, however, Office of Management and Budget approval never came. The court determined that publication of the subsequent notice “does not seem to have occurred, and the Plaintiff has provided no document suggesting otherwise.” In fact, the rules were submitted for Office of Management and Budget approval on January 17, 2017—and promptly withdrawn at the FCC’s request ten days later.

Accordingly, the court reasoned that “the August 2016 R & O has little authoritative value” and concluded that the TCPA was “a complete defense to the Plaintiff’s claim.” The court granted the defendant’s motion for judgment on the pleadings.

Marsha J. Indych

About the Author: Marsha J. Indych

Marsha Indych handles complex commercial litigation and arbitration matters in jurisdictions throughout the United States, focusing on consumer class actions and domestic and international business disputes. She represents clients from a broad array of industries, including the health care, financial services, media, technology and energy industries. Marsha defends leading businesses against consumer protection-based claims. She has successfully defended dozens of Telephone Consumer Protection Act (TCPA) actions, including class actions, individual actions, arbitrations and prelitigation disputes in jurisdictions across the country. Her practice includes helping clients navigate evolving — and sometimes conflicting — standards for TCPA compliance. She regularly contributes to the TCPA Blog, providing analysis about recent developments regarding the statute.

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