TCPA Regulatory Update — FCC Wakes from TCPA Hibernation with Orders Granting Two Petitions
Although comprehensive TCPA reform appears to be on the backburner at the FCC for now, the Commission granted two outstanding petitions and is currently reviewing comments submitted on a third. The actions break a period of TCPA hibernation and appear to demonstrate that where requests for clarification or waiver are narrow, straightforward, and relatively unopposed, the FCC may grant relief before it adopts an omnibus TCPA item.
AmeriCredit Financial Services Inc. d/b/a GM Financial Order
On December 6, the FCC released an Order granting a limited waiver to AmeriCredit Financial Services Inc. d/b/a GM Financial (GM Financial) of the requirement that all artificial or prerecorded voice telephone messages shall, among other things, state “the name under which the entity is registered to conduct business with the State Corporation Commission (or comparable regulatory authority).” AmeriCredit Financial Services Inc. had used its d/b/a name, GM Financial, in all of its voice messages. GM Financial explained that the d/b/a name is used on all customer-facing communications and interactions (including bills, websites, and credit applications — and is authorized by the appropriate regulatory authority in every state, Guam, Puerto Rico, and the U.S. Virgin Islands. In contrast, customers are not familiar with the company’s legacy name, AmeriCredit Financial Services, which is used only once in interacting with customers — in the fine print of the welcome letter. GM Financial claimed that the customer confusion that would result from using its legacy name would prolong account delinquency and use of only its d/b/a name would still afford called parties a reasonable opportunity to search for and find the company’s contact information because its d/b/a name is authorized in all relevant states and territories.
In granting the Petition for Waiver, the FCC determined that to the extent the rule would otherwise require using an unfamiliar legacy name, special circumstances may warrant a deviation from the general rule. Specifically, GM Financial had demonstrated that: 1) its customers are familiar with its registered d/b/a name because all customer services are provided in that name; 2) its customers are unfamiliar with the official or legal names, which can cause confusion regarding the identity of the calling party when using artificial or prerecorded messages; 3) it is authorized to use the d/b/a name in each state and territory in which it conducts business; and 4) customers can search for and find the relevant contact information via the state or local databases for d/b/a names. The FCC found that the limited waiver would not undermine public policy and would serve the public interest by avoiding customer confusion. While the FCC did not modify its TCPA rules based on this Order, it is likely that companies that can meet the four conditions expressed in the Order would also be successful in seeking limited waivers.
Amerifactors Order on Online Fax Services
In 2017, Amerifactors filed a Petition for Expedited Declaratory Ruling asking the FCC to clarify that faxes sent to “online fax services” are not faxes sent to “telephone facsimile machines.” Following a wait of over two years, the FCC released a Declaratory Ruling this month, clarifying that an online fax service that effectively receives faxes “sent as email over the Internet” and is not itself “equipment which has the capacity . . . to transcribe text or images (or both) from an electronic signal received over a regular telephone line onto paper” is not a “telephone facsimile machine,” and thus, falls outside the scope of the TCPA.
In its Petition, Amerifactors argued that 1) online fax services do not fit within the plain meaning of the TCPA’s prohibition on conventional faxes; 2) online faxes do not result in the type of harm Congress sought to avoid in the TCPA; 3) a declaratory ruling here would be a first step toward curbing abusive litigation practices; and 4) applying the TCPA to faxes received on a device other than a telephone facsimile machine would be an impermissible restriction on commercial speech in violation of the First Amendment. Although most commenters supported the Petition, several commenters — including the plaintiff in an ongoing class action lawsuit against Amerifactors — opposed it.
The record in this proceeding included much information on the nature and operations of current online fax services, and the FCC made clear that it would not necessarily reach the same conclusion for other types of equipment or services. Thus, the ruling here is quite narrow. The FCC agreed with Amerifactors that Congress did not intend the TCPA’s prohibition to apply to faxes sent to equipment other than a telephone facsimile machine — such as online fax services. It also agreed that faxes sent to online fax services do not cause the specific harms to consumers that Congress sought to protect against in the TCPA; they do not shift the costs of advertising from the sender to the recipient, and they do not occupy the recipient’s fax machine, thereby leaving it unavailable for legitimate business messages. In contrast, online fax services hold inbound faxes in digital form on a cloud-based server, where the user accesses the document via an online portal or an email attachment — no fax is printed unless the recipient chooses to print it. The FCC declined to address arguments that the TCPA prohibition to faxes sent to online fax services would violate the First Amendment.
Capital One Petition on Clarification of Revocation of Consent
Comments were due on December 9 on the Capital One Services, LLC (Capital One) Petition for Declaratory Ruling, which asked whether callers may clarify the scope of a customer’s opt-out request without violating the TCPA. We covered the Petition in greater detail in last month’s TCPA Digest. Only four parties commented on the Petition, all voicing their support. Even consumer groups, which often oppose carve-outs to the consumer protections offered by the TCPA, supported the Capital One Petition subject to certain conditions. They explained that they do not object to the Petition because it is premised on the assumption that if the consumer does not respond to the revocation clarification text, the business must treat it as an opt-out of all messages. Thus, this approach is consistent with past FCC rulings, which allowed callers to send one confirmatory message in response to STOP requests. Reply comments on the Petition are due December 24.