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Earlier this week, the Fourth Circuit Court of Appeals affirmed a lower court decision to dismiss a Telephone Consumer Protection Act (“TCPA”) lawsuit against General Dynamics Information Technology, Inc. (“GDIT”), on the basis that GDIT was immune from suit as a government contractor under what is known as the “Yearsley doctrine.”  Craig Cunningham v. GDIT, No. 17-1592 (Apr. 24, 2018).

GDIT was hired to assist the Centers for Medicare and Medicaid Services (“CMS”), a government agency, by calling individuals using an autodialer and a pre-approved script to provide information about their health insurance options under the Affordable Care Act.  When plaintiff Craig Cunningham received one of these calls, he filed a lawsuit alleging that GDIT had violated the TCPA for failing to obtain his prior consent.

The Fourth Circuit agreed with the lower court finding that GDIT was immune from suit under the Supreme Court’s Yearsley doctrine.  In Yearsley, the Supreme Court held that the doctrine of sovereign immunity that traditionally applies to the U.S. government may be extended to government contractors in instances where (1) the government authorized the contractor’s actions in question; and (2) the government “validly conferred” such authorization.  Yearsley v. W.A. Ross Construction Co., 309 U.S. 18, 20-21 (1940).  More recently, the Supreme Court applied the Yearsley doctrine to the TCPA, holding that contractors may be exempt from TCPA claims so long as they are lawfully acting on behalf of the government.  Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663, 672 (2016).…

Continue Reading 4th Circuit Affirms Dismissal of TCPA Suit Based on ‘Derivative Sovereign Immunity’

The U.S. Court of Appeals for the D.C. Circuit on Friday issued a long-awaited ruling in a lawsuit challenging the Federal Communications Commission’s interpretations of key terms under the Telephone Consumer Protection Act of 1991 (“TCPA”), holding that the FCC in 2015 had adopted an unreasonably broad definition of the type of calling equipment subject to special restrictions under the TCPA — a definition so broad it would include any modern smartphone — and had failed to adequately justify its approach regarding liability for calls placed to cell phone numbers that have been reassigned to a new user.

The court upheld the FCC’s ruling that a party who has consented to receive calls may revoke that consent “through any reasonable means clearly expressing a desire to receive no further messages from the caller.”  The court also upheld the FCC’s decision to exempt from the TCPA’s consent requirements certain calls communicating urgent healthcare messages.

The D.C. Circuit’s unanimous decision addresses a consolidated set of petitions by various companies and trade associations — first filed in the summer and fall of 2015 and argued before the D.C. Circuit in 2016 — seeking review of a declaratory ruling released by the FCC in July 2015 (the “Omnibus Ruling”).  In the Omnibus Ruling, the FCC ruled on a total of 21 petitions seeking “clarification or other actions” regarding the TCPA, principally in connection with automated calls and text messages.

Petitioners sought court review of four aspects of the Omnibus Ruling:…
Continue Reading D.C. Circuit Rejects Portions of FCC Decision Interpreting Key TCPA Terms

Last week, the FCC issued a forfeiture order against Dialing Services, LLC (“Dialing Services”) $2,880,000, finding that Dialing Services made automated calls to wireless phones without prior express consent, in violation of the Telephone Consumer Protection Act (“TCPA”).  Dialing Services is a platform that offers automated calling services to its customers, and this Order is the culmination of the FCC’s investigation of the company dating back to 2012.

In 2012, FCC staff determined that Dialing Services had made more than 4.7 million calls to wireless phones in violation of the TCPA during a three-month period.  The Enforcement Bureau (“Bureau”) issued a citation in March 2013, directing the company to certify that it had stopped making calls in violation of the TCPA.  During a follow-up investigation, the staff determined that Dialing Services had continued placing calls after the citation, including 184 additional unauthorized calls to wireless phones in May 2013.  As a result, the FCC issued a Notice of Apparent Liability (“NAL”) in May 2014, proposing a $2.94 million fine.  (The ultimate forfeiture order reduced this amount to $2.88 million based on evidence that some of the calls were made with consent.)

In response to the NAL, Dialing Services asserted (among other things) that unlike its customers, it was merely a platform and therefore did not “make” or “initiate” the calls at issue under the TCPA.  The FCC applied its test for determining whether a party “initiated” or “made” a call for TCPA purposes from the 2013 Dish Network declaratory ruling:  whether the party “takes the steps necessary to physically place a telephone call” or, alternatively, is “so involved in the placing of a specific telephone call as to be directly liable for making it.” …
Continue Reading FCC Fines Calling Platform $2.88 Million for TCPA Violations

Yesterday, the FCC released an Enforcement Advisory to remind political campaigns about their obligations under the Telephone Consumer Protection Act (“TCPA”).  The Advisory did not set forth any new rules for calls and texts; rather, it confirmed existing rules and reminded political campaigns that they are subject to them.

The Advisory first confirmed that prerecorded or autodialed calls to mobile phones are prohibited, except in cases of emergencies, federal debt collection, or with the prior express consent of the recipient.  The Advisory then summarized the requirements for prerecorded or autodialed calls to landline phones, including identification and line seizure requirements. …
Continue Reading FCC Releases TCPA Enforcement Advisory Directed to Political Campaigns

A man who alleges he received an unauthorized prerecorded call on the landline he shared with his roommate has standing to proceed with his lawsuit under the Telephone Consumer Protection Act (“TCPA”), the U.S. Court of Appeals for the Third Circuit ruled.

Mark Leyse’s lawsuit against Bank of America alleges that a telemarketer advertising Bank of America credit cards called a residential landline registered to Genevieve Dutriaux, Leyse’s roommate, using a prerecorded message. Among other things, the TCPA generally prohibits making a non-emergency call “to any residential telephone line using an artificial or prerecorded voice” unless the caller has “the prior express consent of the called party” or the FCC has exempted the type of call at issue. The TCPA further states that “[a] person or entity” may sue based on a violation of that restriction, and may seek $500 in statutory damages for each violation (or $1,500 if the plaintiff proves the violation was willful or knowing).

The parties agreed that the telemarketer intended to call Dutriaux, who was listed as the subscriber to the phone line. Accordingly, Bank of America moved to dismiss Leyse’s lawsuit, arguing that Leyse was not the “called party” and thus had no standing to sue under the TCPA. Courts have disagreed on whether a TCPA plaintiff must be the “called party,” and if so whether the “called party” is the same as the “intended recipient.”…
Continue Reading Third Circuit: TCPA Suit By Roommate Who Answered Prerecorded Call Can Proceed

In one of the first decisions evaluating Telephone Consumer Protection Act (TCPA) claims under the FCC’s recent omnibus TCPA order, the Northern District of California dismissed a putative class action lawsuit alleging that AOL violated the TCPA when users of its Instant Messenger service (AIM) sent text messages to incorrect recipients.  After the court dismissed…

Last week, the Federal Communications Commission (FCC) released the text of its long-awaited order addressing certain aspects of the Telephone Consumer Protection Act (TCPA) and related FCC rules.  The order addressed a total of 21 petitions seeking “clarification or other actions” regarding the TCPA, principally in connection with automated calls and text messages.

Although the order purports only to “clarify” existing FCC precedent, there is widespread debate over whether the order imposed new requirements on entities that transmit automated calls and text messages.  The order already has been appealed by one party and other appeals are expected.  Nevertheless, because the FCC claims the order only clarifies existing precedent, its provisions became effective when the order was released on July 10, 2015.

The order focuses on ten key areas, which are summarized after the jump.
Continue Reading Ten Key Takeaways From Last Week’s TCPA Order

In an order adopted at Thursday’s Open Meeting, the Federal Communications Commission acted on 23 petitions or other requests for clarification regarding the application of the Telephone Consumer Protection Act, a federal law that restricts telemarketing  and certain other types of calls.  The FCC has issued a news release describing yesterday’s order as an effort to “clos[e] loopholes and strengthen[] consumer protections already on the books.”  The text of the order is expected to be released in the coming days.
Continue Reading FCC Ruling Tightens TCPA Restrictions; Dissenters Warn of Increased Class-Action Abuse

On June 1, the Northern District of California dismissed a putative TCPA class action against AOL, finding that the plaintiff had failed to allege that AOL utilized an automated telephone dialing system (ATDS), as required to state a cause of action under the TCPA.  In dismissing the plaintiff’s complaint in Derby v. AOL, the court rejected the plaintiff’s arguments that AOL Instant Messenger (AIM), which allows individuals to send instant messages as text messages to cell phones, constitutes an ATDS.  Instead, the court agreed with AOL’s argument that AIM relied on “human intervention” to send the messages at issue, which foreclosed the possibility of potential TCPA liability.  (Covington represented AOL in this case.)  The decision should be beneficial to a variety of services that enable their users to send text messages to cell phones.
Continue Reading Court Dismisses Text-Message TCPA Suit Against AOL, Finding Instant Messaging Service Does Not Constitute an ATDS

Yesterday, the U.S. Supreme Court granted certiorari and agreed to consider Campbell-Ewald Company v. Gomez, in which the U.S. Court of Appeals for the Ninth Circuit held that a consumer’s failure to accept an advertiser’s settlement offer that would fully satisfy the consumer’s claim did not render moot either the consumer’s individual claim under the Telephone Consumer Protection Act (TCPA) or his putative class action, arising from the alleged transmission of unsolicited automated text messages.
Continue Reading Supreme Court to Consider Whether A Settlement Offer for Complete Relief Moots a Plaintiff’s TCPA Claim