The Supreme Court has granted certiorari in McLaughlin Chiropractic Associates v. McKesson Corporation (No. 23-1226) to address whether the Hobbs Act requires district courts to follow the FCC’s interpretation that the TCPA does not prohibit faxes received via “online fax services.” This case revisits a key question left unresolved in 2019’s PDR Network v. Carlton & Harris Chiropractic about the binding nature of FCC orders in TCPA litigation. The Court’s decision could potentially determine whether and to what extent courts must follow FCC interpretations in TCPA cases going forward. Oral arguments have not yet been scheduled.
Matthew J. Adler
Articles by Matthew J. Adler:
Texas Federal Court Finds Prerecorded Calls to Schedule Pest Inspections Were Informational, Not Telemarketing
A Texas federal court recently granted summary judgment for the defendant in a TCPA putative class action, finding that prerecorded calls to schedule a pest inspection were informational rather than telemarketing. Bradford v. Sovereign Pest Control of TX, Inc., No. 4:23-cv-00675, 2024 WL 3851229 (S.D. Tex. Aug. 10, 2024). This ruling provides a helpful reminder for defendants to carefully assess the nature of prerecorded or autodialed calls in every case, given that informational calls require only “prior express consent” as compared to the detailed, written consent needed for telemarketing calls.
In Bradford, the plaintiff had entered into a two-year pest control service agreement, which the parties renewed for multiple one-year terms. The agreement provided for free annual inspections, with no renewal obligation, during both the initial term and each renewal term. If a customer could not schedule an annual inspection to take place until after the expiration of the initial (or renewal) term, the defendant offered a 30-day grace period to schedule the inspection.
Attention to Detail — and the Defense — Prevails in Two Recent Cases
Two recent decisions emphasize the necessity of precisely examining a plaintiff’s complaint for potential defenses while keeping each element of the TCPA in mind.
First, in Hulce v. Zipongo, Inc., No. 23-C-0159, 2024 WL 1251108 (E.D. Wis. Mar. 18, 2024), the United States District Court for the Eastern District of Wisconsin granted the defendant’s motion for summary judgment, finding that an unsolicited advertising call must “encourage the purchase of any good or service.” Id. at *6 (emphasis added). The defendant’s services at issue, however, were being offered for free. Specifically, the defendant contracted with the Wisconsin Medicaid program to provide free nutritional consulting to state-funded plan holders. Defendant promoted its free services via calls and texts and would bill the state a fee “per eligible member per month, whether or not the member utilized [defendant]’s services.” Id. at *1. Plaintiff, a state-funded health plan user, sued defendant for approximately 20 calls and texts he received promoting defendant’s services. Id. Defendant moved for summary judgment on the grounds that, notwithstanding plaintiff’s advertising allegations, the calls and texts were distinct; they were not actually solicitations because they promoted a free service—at least to the plan holders. The court agreed and ruled in favor of the defendant.
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Missouri Federal Court Dismisses Another TCPA Claim Due to Traceability Issues
A federal judge in the United States District Court for the Eastern District of Missouri recently dismissed a claim alleging multiple violations of the TCPA’s do-not-call regulations upon finding that plaintiffs had failed to sufficiently plead the traceability element of standing. Thompson v. Vintage Stock, Inc., No. 4:23-cv-00042-SRC, 2024 WL 492052 (E.D. Mo. Feb. 8, 2024). This decision follows a similar ruling issued by the same judge just last month in another case involving the same plaintiffs (discussed here).
In the Vintage Stock case, the plaintiffs’ complaint asserted three counts: (1) violation of “the Federal Do Not Call List statute and regulations”; (2) violation of 47 C.F.R. § 64.1200(d); and (3) violation of Missouri’s no-call-list statute, MRS § 407.1098.
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Washington Federal Court Finds Sufficient Allegations of Prerecorded Calls But Dismisses Claims for Treble Damages and Injunctive Relief
Recently, a federal judge in the United States District Court for the Western District of Washington granted in part a motion to dismiss a TCPA claim in a putative class action. The Court found that although the plaintiff plausibly alleged that he received multiple calls using a prerecorded voice, he did not sufficiently allege facts to support his request for either treble damages or injunctive relief. Blair v. Assurance IQ LLC, No. 2:23-00016-KKE, 2023 WL 6622415 (W.D. Wash. Oct. 11, 2023).
The plaintiff claimed that he received 12 unsolicited calls, one of which he answered, and three of which resulted in voicemails. He alleged that the latter four calls used a prerecorded voice “because of the tone, cadence, and timing of the speaker, which sounded unnaturally perfect,” and because all of the voicemails were “identical.” In its motion to dismiss, the defendant argued that the Court could not reasonably infer that the voice the plaintiff allegedly heard was either prerecorded or live because the plaintiff failed to specify “what about the tone, cadence, and timing” indicated that the call was prerecorded. The Court rejected this argument, however, finding that the allegation of an “unnaturally perfect” voice was enough at the pleadings stage to infer that it was artificial or prerecorded. The Court also held that although the plaintiff “could have expounded more” on how the voicemails were identical (e.g., the tone and cadence of the voice), the fact that the voicemails had “suspicious timing” (they were left at the exact same time on three separate days) and contained “generic content” (identical sales pitches) was enough to infer the use of an artificial or prerecorded voice.
Recent Ninth Circuit Opinions Address Standing and the Meaning of ‘Automatic Telephone Dialing System’
The Ninth Circuit recently issued two noteworthy TCPA decisions. Most recently, in Borden v. eFinancial, LLC, No. 21-35746, 2022 WL 16955661 (9th Cir. Nov. 16, 2022), the Court addressed one of the most hot-button issues in this space: the definition of “automatic telephone dialing system” (“ATDS”). Shortly before that, in Chennette v. Porch.com, Inc., 50 F.4th 1217 (9th Cir. 2022), the Ninth Circuit discussed both Article III and statutory standing.
Borden and the ATDS Definition
In a unanimous opinion, the Ninth Circuit recently affirmed the dismissal of a text message TCPA suit based on its holding that to qualify as an ATDS, dialing equipment “must generate and dial random or sequential telephone numbers,” not just any numbers. See Borden, 2022 WL 16955661, at *1.
FCC Acts to Curb Foreign-Originated Illegal Robocalls, Imposes Several New Requirements on Gateway Providers
Recently, on May 20, 2022, the Federal Communications Commission (“FCC”) issued a Report and Order (“Order”), as well as a Further Notice of Proposed Rulemaking (all available here), with a plain objective: to “take further steps to stem the tide of foreign-originated illegal robocalls and seek comment on additional ways to address all such calls.” Order ¶ 1. As stated by the FCC, “reducing illegal robocalls that originate abroad is one of the most vexing challenges we face in tackling the problem of illegal robocalls.” Id. The Order was adopted by a unanimous, 4-0 vote by the FCC after it had received comments over the last nine months on various topics, including whether so-called “gateway providers” should be required to authenticate caller identification information and implement other efforts to reduce the number of illegal prerecorded and/or artificial voice “robocalls” originating overseas.
A “gateway provider” is a U.S.-based provider that acts as an intermediary for an international call by receiving a call directly from a foreign provider before transmitting that call downstream to other U.S.-based providers for termination. Order ¶ 25. This definition is not static but rather one that applies on a call-by-call basis, i.e., a provider is a gateway provider—and subject to the FCC’s new Order—only for those calls in which it acts as a gateway provider. Id. ¶ 28. Per the FCC, commenters “overwhelmingly” supported the imposition of additional requirements on gateway providers in order to “stop the flood of foreign-originated illegal calls.” Id. ¶ 21.
Single Fax Received by E-Mail Deemed Insufficient to Confer Article III Standing
As we have reported here and here, courts throughout the country, including most notably the Eleventh Circuit in Salcedo v. Hanna, have grappled with the question of whether a single unsolicited text message may constitute sufficient injury to satisfy the constitutional standing requirement in Article III. The Salcedo court held that one text message does not suffice.
But what about a single fax? That was the question recently presented to the Middle District of Florida in Daisy, Inc. v. Mobile Mini, Inc., No. 20-0017 (M.D. Fla. Sept. 24, 2020). The court similarly found that, at least under the relatively unique circumstances of the case, a single fax did not confer standing.
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FCC Issues Declaratory Ruling Regarding Whether P2P Text Messaging Platforms Are Autodialers
On June 25, 2020, the FCC issued a Declaratory Ruling that granted a Petition that had been filed in 2018 by the P2P Alliance—a “coalition of providers and users of peer-to-peer (P2P) text messaging services.” The Petition had asked the FCC to clarify whether texts sent via its messaging platform were subject to the TCPA restrictions on automated dialing. The FCC did not decide if the Petitioner’s messaging platform is an autodialer, as the record was not sufficient to do so. But it did clarify in the abstract that, “if a texting platform actually requires a person to actively and affirmatively manually dial each recipient’s number and transmit each message one at a time and lacks the capacity to transmit more than one message without a human manually dialing each recipient’s number… then such platform would not be an ‘autodialer’ that is subject to the TCPA.”
Florida Federal Court Stays Putative Class Action to Await Guidance from the FCC and Eleventh Circuit as to What Constitutes an ATDS
It can fairly be said that the statutory definition of “automatic telephone dialing system” (“ATDS”) has generated far more questions than answers—for courts and litigants alike. This is especially true in the wake of ACA International v. FCC, 885 F.3d 687 (D.C. Cir. 2018), where the D.C. Circuit set aside the FCC’s sweeping interpretation of the ATDS definition, and thus handed the baton back to the Commission to provide guidance on what is (and is not) an ATDS. But almost two years later, the FCC has yet to issue its ruling.
In the many TCPA cases that turn on the definition of ATDS, defendants may wish to file a motion to stay the action so that the court can await guidance from the FCC’s anticipated ruling on this issue. Indeed, over the course of the last year, multiple federal judges, at least in Florida, have been willing to grant such motions, particularly because the ATDS definition is also center stage in an appeal pending before the Eleventh Circuit. See Glasser v. Hilton Grand Vacations Co., LLC, No. 18-14499 (11th Cir. filed Oct. 24, 2018).