How we use our phones has changed dramatically in the last 30 years, but the law that governs business-to-consumer communications is still living in the early nineties.
The Telephone Consumer Protection Act (TCPA) was enacted in 1991 to bring balance to the telemarketing industry by curbing increases in fraudulent and personally invasive telemarketing calls. No one liked annoying sales calls at dinner, but telemarketing was an important aspect of business communications at the time. While consumer marketing strategies are increasingly online, plaintiffs’ lawyers have abused the outdated TCPA to create a cottage industry of frivolous lawsuits. These lawsuits historically used a broad interpretation of the TCPA’s antiquated term “automatic telephone dialing system” (ATDS) to sue companies lawfully communicating with customers. This broad ATDS definition was adopted by some courts and became the lynchpin for the plaintiffs’ bar to sweep everyday smartphone technology into costly litigation. Other courts favored a much narrower definition of the term, however.
The TCPA lawsuit industry faced a significant setback, thanks to a unanimous April 2021 U.S. Supreme Court decision resolving the dispute between the courts. Specifically, in the landmark Facebook, Inc. v. Duguid decision, the Court rejected the expansive ATDS interpretation frequently used by the plaintiffs’ bar in favor of the narrower definition.
The picture remains mixed about the long-term impacts of the Duguid decision. Recent ILR research uncovered a 31 percent drop in TCPA filings after the decision compared to the six months before. But now, plaintiffs’ lawyers are lobbying state legislatures nationwide to enact “mini-TCPA” laws that would allow them to sidestep the Court’s decision.
So, what are “mini-TCPA” laws? They are laws that regulate telephone solicitations at the state level. The laws vary from state to state and may be more expansive than the federal TCPA. Like the federal TCPA, these laws have multiple requirements for businesses that want to communicate with customers (e.g., calling time restrictions, do not call lists, and “automatic telephone dialing system” restrictions). Florida and Oklahoma recently adopted two of the most expansive “mini-TCPA” laws.
While the Supreme Court’s decision has brought some relief to legitimate businesses against the cottage industry of frivolous TCPA litigation, companies must still be vigilant. As the ILR report shows, the plaintiffs’ bar is not giving up on abusive litigation claims and tactics under the TCPA, and now, more and more states are making it easier for these types of frivolous cases to be brought.
“Mini-TCPA” laws are the topic of ILR’s newest episode of Cause for Action. The episode features Matt Webb, ILR’s senior vice president for legal reform policy, and Megan Brown, a partner at Wiley Rein LLP.
To learn more about state TCPA legislation or the TCPA in general, check out ILR’s recent Cause for Action: Episode 25: State TCPA Legislation on the Rise