As we reach the peak of this year’s Spooky Season, we thought it would be helpful to revisit some of the scariest recent developments in the realm of TCPA litigation and compliance. The conventional wisdom is that some of the new rules and regulations coming into play around the TCPA are going to lead to even more litigation under the statute. But at the same time, the Supreme Court’s ruling earlier this year in Loper Bright Enterprises v. Raimondo, 144 S. Ct. 2244 (2024), has called into question much of what we thought we knew about administrative law, leading to ambiguity and uncertainty surrounding the TCPA and many other statutes.
One-to-One Consent Rule
We’re now just under three months away from the January 27, 2025 effective date of the FCC’s one-to-one consent rule. Formally adopted in December 2023, the rule requires that prior express written consent be obtained separately for each company seeking to use such consent. This raises significant concerns about a company’s ability to communicate with not only third-party leads but also many first-party leads, if consent is not adequate under the new rule.
The TCPA has long required prior express written consent for calls and texts that contain an artificial or prerecorded voice or are sent using an “automatic telephone dialing system.” But the new rule states, in relevant part, that:
The term prior express written consent means an agreement, in writing, that bears the signature of the person called or texted that clearly and conspicuously authorizes no more than one identified seller to deliver or cause to be delivered to the person called or texted advertisements or telemarketing messages using an automatic telephone dialing system or an artificial or prerecorded voice. Calls and texts must be logically and topically associated with the interaction that prompted the consent and the agreement must identify the telephone number to which the signatory authorizes such advertisements or telemarketing messages to be delivered.
47 CFR § 64.1200 (emphasis added). Thus, soon to be gone may be (subject to court challenges) the days when marketers and lead generators could simply obtain adequate consent by seeking consent for messages from their “partners.” And an existing consent to receive messages from multiple companies may no longer be valid, meaning companies that have not previously used “one-to-one” consent may need to get new consents on or before January 27, 2025.
Record Retention Under Telemarketing Sales Rule
Speaking of consent … if companies intend to use consent as a defense for alleged TCPA violations arising from their telemarketing, they need to ensure compliance with the FCC’s latest rule regarding record retention, which went into effect in May. Under the new rule, to establish consent under the Telemarketing Sales Rule, a telemarketer needs to have records showing:
- the name and telephone number of the person providing consent;
- a copy of the request for consent in the same manner and format in which it was presented to the person providing consent;
- the purpose for which consent is requested and given;
- a copy of the consent provided;
- the date consent was given; and
- documentation specific to consent around billing information (if applicable under other sections of the rule).
More generally, the rule requires telemarketers to maintain for at least five years the following records for all telemarketing calls:
- the name of the telemarketer that placed or received the call;
- the seller for which the telemarketing call is placed or received;
- the good, service, or charitable purpose that is the subject of the telemarketing call;
- whether the telemarketing call is to an individual consumer or a business consumer;
- whether the telemarketing call is an outbound telephone call;
- whether the telemarketing call utilizes a prerecorded message;
- the calling number, the called number, date, time and duration of the telemarketing call;
- the telemarketing script and prerecorded message, if any, used during the call;
- the caller ID number and caller ID name (if transmitted), any contracts or proof of authorization to use that telephone number and name, and the time period that the authorization applies; and
- the disposition of the call.
Standards for Revocation of Consent
Once consent is established, consumers can still revoke their consent and the FCC has a new rule on this topic as well, which goes into effect April 11, 2025. Under the new revocation of consent rule:
- businesses will have 10 business days to honor revocation;
- any reasonable revocation to a marketing message will presumptively require all marketing messages to stop across all channels; and
- any revocation to an informational message will presumptively require all messages to stop across all channels.
Although the rule does allow businesses to send a one-time message to clarify the scope of the opt out in the second or third situations listed above, that message must be sent within five minutes of the opt out.
But does any of it really matter?
As companies, marketers and lead generators scramble to implement these new rules and avoid litigation, the Supreme Court’s decision back in June in Loper Bright raised a compelling question: Does any of this really matter? For decades, companies focused on compliance have closely followed agency guidance and regulations arising out of federal statutes because under Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837 (1984), courts have routinely given deference to agency interpretations. Indeed, we have seen many courts show deference to the FCC’s TCPA regulations, and the FCC has often been the first stop for addressing critical questions like whether a text message is a call under the TCPA or what constitutes an ATDS under the TCPA.
But in Loper Bright, the Supreme Court held that the courts, rather than regulators in executive branch, have the sole prerogative to “say what the law is.” 144 S. Ct. at 2257. Thus, Loper Bright raises the possibility that the FCC’s interpretation of the TCPA is not binding until a court has weighed in – and (in a departure from the prior state of the law under Chevron) the court has no obligation to show deference to the regulator. 144 S. Ct. at 2261.
With Chevron gone, the Hobbs Act, 28 U.S.C. § 2341, et seq., could be the last remaining support structure for agency deference. But the Supreme Court has signaled that the Hobbs Act may be next on the chopping block, granting cert in McLaughlin Chiropractic Association v. McKesson Corp., Case No. 23-1226, where the question at issue is: “Whether the Hobbs Act required the district court in this case to accept the FCC’s legal interpretation of the Telephone Consumer Protection Act.” If the Supreme Court strikes down the Hobbs Act, much of what we think we know will be called into question. And in some ways, that could be exciting – companies will have new opportunities to challenge some of the more restrictive regulations imposed by the FCC. But the uncertainty will also be used by plaintiffs’ attorneys to revisit victories for the defense bar. And the bottom line is that it is hard to ensure compliance with laws and regulations that will suddenly be in flux.
Conclusion
As you negotiate these scary times in the TCPA space, Vedder Price can be your guide. We’ll continue to monitor these developments and report accordingly.