Removing Barriers Blog

FCC Responds to Court Challenge of TCPA Order
Posted January 19, 2016 by CUNA Advocacy

Last Friday the Federal Communications Commission (FCC) filed an answer to the litigation challenging its omnibus Telephone Consumer Protection Act (TCPA) order, which charges that it is arbitrary, capricious and should be vacated. Last month, we filed a joint amicus brief on this case along with several other trade associations.

The FCC’s reply includes a several dozen page defense of the Order. The FCC begins by defending its statutory authority for interpreting the TCPA in the way it did. Specifically, the FCC also defends its definition of an autodialer, its guidance for treatment of reassigned numbers and revoking consent, and the exemption provided for healthcare calls. However, it does not mention the exemption for financial institutions, which CUNA has argued includes conditions that are unworkable for credit unions to comply with. The answer also argues against the constitutional challenges brought under the first amendment.

CUNA, long with the American Bankers Association and Independent Community Bankers Association, filed a joint amici brief in the litigation, saying that the order “severely restricts the ability of financial institutions and other callers to engage in useful, and often urgent, communications with their customers and members.” This was the only filing primarily focusing on how financial institutions and their customers and members are detrimentally impacted by the Order.

Some of the specific consequences of the order that our brief took issue with include:

  • The inability to use automated calling methods delay the institution’s ability to contact credit union members about fraud and identify theft and other important account information that can help members avoid hardship or embarrassment;
     
  • The expanded scope of the definition of autodialer, which effectively prohibits financial institutions from using many efficient dialing technologies. The brief argues that this leaves financial institutions with no useful guidance as to the kinds of dialing devices they may use to contact their members of customers with communications that must be made promptly and in substantial volume;
     
  • The ruling provides a strong disincentive for a financial institution to make calls to its customers or members as a result of the onerous guidance about calling reassigned numbers. The potential liability for calls made in good faith to parties who have consented to receive them, but whose telephone number has subsequently been reassigned without notice to the financial institution, threatens to curtail important and valued communications;
     
  • The problematic guidance about how a consumer can revoke consent. The brief notes that the TCPA order requires financial institutions to receive revocations through any and all communication channels by which institutions receive communications and by any employee who works for the institution or, potentially, who works for a partner of the institution; and
     
  • The practical limitations of the financial institutions exemption. The exemption is of particular concern to small financial institutions, and as articulated in the TCPA order offers very limited relief. The brief states that some small financial institutions have even concluded that the restrictions established by the FCC in the TCPA Order result in a de facto ban on their ability to utilize the exemption.

The joint brief for intervenors supporting the FCC is due January 22, the reply briefs of those who brought the challenge are due February 16, the joint appendix is due on February 19, and final briefs are due on February 24. We are also waiting to see when oral arguments will be scheduled, and plan to attend them. We continue to closely follow all aspects of this litigation.