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Whirlwind of Activity Ends With Eleventh Circuit Invalidating FCC’s Lead Generation Rule

Our regular readers will no doubt be familiar with the one-to-one-consent and logically-and-topically-related requirements the FCC (under the prior administration) had tried to impose as a way to close what it had described as a “lead generator loophole.” On Friday, the FCC (now under a new administration) postponed the effective date of the rule, the validity of which was still being reviewed by the Eleventh Circuit Court of Appeals. Later that day, the Eleventh Circuit issued its ruling in that appeal, finding that the rule is invalid. As a result, in the absence of further appellate review of that ruling, the proposed rule is no more.

The Eleventh Circuit’s decision should be read by anyone who litigates in this space, or indeed in any space where alleged liability is premised on supposed violations of federal or state regulations. The main question on appeal was whether the FCC had statutory authority to impose the new one-to-one-consent and logically-and-topically-related requirements. The Eleventh Circuit found that it did not, as the FCC only has statutory authority to “implement” the TCPA, and the plain language of the TCPA “requires only ‘prior express consent’ — not ‘prior express consent’ plus.” Opinion at 14. As the Eleventh Circuit explained, “implement” means “to complete,” “perform” and “carry into effect,” not to “alter.” Id.

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Python Bites Back: Counterclaims Based on Alleged Consent Survive Plaintiff’s Motion to Dismiss

TCPA defendants often assert, in either a motion to dismiss or answer (or both), that a plaintiff gave prior express consent to receive the calls or text messages at issue. But it is the exceptional case where a defendant actually files a counterclaim against a plaintiff on this ground. Rarer still is the case where a plaintiff then moves to dismiss that counterclaim. This series of events is precisely what occurred, however, in Estrada v. Aragon Advertising, LLC, et al., No. 4:23-3407, 2024 WL 5059166 (S.D. Tex. Dec. 10, 2024).

Plaintiff Nelson Estrada (Plaintiff) filed a putative class action claiming TCPA violations by Defendants Aragon Advertising, LLC (Aragon) and Python Leads, LLC (Python) (collectively, “Defendants”). Plaintiff alleged that Aragon bought leads from lead generators, including Python, to obtain consumer contact information, and then Defendants made prerecorded telemarketing calls to people who had never consented, had no established business relationship with Defendants, and/or had placed their numbers on the national do-not-call registry.

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