October 25, 2017

Study: Rx Drug Lawsuit Ads Cause Spike in Reports of Patient Health Incidents, Deaths

A Chicago Cubs World Series championship.

President Trump’s election win.

The Dow reaching 23,000 points.

These are three events that may seem to have occurred an eternity ago — but really only happened within the past twelve months.

They’re also all things that have occurred since October 19, 2016 — the date oral arguments were heard in the D.C. Circuit challenging the Federal Communications Commission’s 2015 Omnibus Telephone Consumer Protection Act (TCPA) Declaratory Ruling.

While those arguments may not have grabbed headlines and the spotlight like those other events mentioned above — the FCC’s initial declaratory ruling has been top of mind for businesses across the United States that have suffered in its wake.

That’s because, quite simply, the FCC’s ruling was an arbitrary and capricious interpretation of an outdated law that has subjected U.S. businesses to an explosion of litigation over the past two years.

According to WebRecon, from November 2016 through September 2017, 4,147 new TCPA cases have been filed across the country, with 782 or 19% of those cases filed as class actions. 

In fact, a recent report by ILR found a 46% increase in case filings in the 17-month period after the FCC’s July 2015 Omnibus TCPA Declaratory Ruling, as compared to the 17-month period before the ruling. 

And seemingly no industry or sector of the economy is safe.  ILR found TCPA suits filed against companies in approximately 40 different industries—and these are not the companies engaged in the kinds of cold-call telemarketing the TCPA was designed to limit. 

The sprawl of TCPA litigation illustrates the serious problem that occurs when uncapped statutory damages and an outdated statute work together to over-incentivize litigation. 

As litigation spirals out of control, there are several issues from the 2015 Omnibus declaratory ruling under consideration by the DC Circuit. 

First, the FCC adopted a broad definition of the types of equipment covered by the TCPA, going so far as to say the only equipment that is definitively not covered by the law is an old-fashioned rotary phone and that mass-market cell phones could be “autodialers.

Second, the FCC concluded that the term “called party” means the subscriber, or typical user of the phone, regardless of whether the caller meant to call someone else.  Under this interpretation, business that in good faith attempt to contact customers who have consented to receive such calls face significant liability when those calls reach another person instead. 

Third, the FCC arbitrarily devised a “one call, that’s all” rule, which imposes strict liability on a caller after phone call; even if the caller is not told or has no knowledge a phone number has been reassigned. 

Finally, the FCC determined that callers can revoke consent by “any reasonable means.”  In reality, this practice can prove unworkable as it is impossible for companies to monitor all possible means of communication for such revocations, particularly verbal ones. 

Swift relief is needed.  Absent intervention companies will continue to be subjected to lawsuit roulette each time they pick up the phone to contact their consumers. 

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