September 28, 2015

The FCC’s Blurred Interpretation of Robocalls

by Harold Kim
Executive Vice President
U.S. Chamber Institute for Legal Reform

To block or not to block? That is the question facing software developers and service providers creating spam call blocking technology in the aftermath of last month’s Federal Communications Commission (FCC) ruling on liability and the Telephone Consumer Protection Act (TCPA).

This month, the FCC held a workshop on robocalls and caller ID spoofing, during which a distinction was made between abusive telemarketer calls and legitimate business calls that consumers want to receive – a difference the FCC had previously failed to recognize.

The “Robocall and Caller ID Spoofing Workshop” featured panel discussions on why consumers need call blocking technology, what technology options are available, and what the challenges are to making call blocking software more effective. During each of these conversations, panelists affirmed the need for consumers to receive automated calls from businesses they want to interact with, while keeping them protected from telemarketer harassment.

Panelists at the FCC event included call blocking service providers, like Nomorobo, winner of the Federal Trade Commission Robocall Challenge. Nomorobo blocks calls from telemarketers and spammers, but allows “legal robocalls, like school closings and prescription reminders” to go through.

But because the FCC’s recent omnibus declaratory ruling on TCPA did not provide exemptions for such calls as prescription reminders and school closings, if these calls were made from a device capable of automatically calling sequential numbers, the plaintiffs’ bar is likely to argue that they are violations of the TCPA.   

What is a device capable of automatically calling sequential numbers? As interpreted by the FCC, it could be anything more advanced than a rotary phone. Certainly anything that any business or nonprofit group uses to call their customers or members on everything from delivery updates and payment reminders to account notices. The ruling could make organizations liable for these legitimate communications to their customers and lumps them together with telemarketers.

So the speakers at an FCC sponsored workshop are able to differentiate between robocall spam and calls between businesses and their constituents, but the FCC is not able to do so in the formal legal language of a declaratory ruling. This matters, because those prescription calls that the FCC workshop’s panelists consider legitimate were the basis for a TCPA class action lawsuit against Walgreens, costing the company $11 million in a settlement.

The FCC’s ruling could have distinguished these legitimate calls from spam. Its failure to do so means more companies could face similar crippling class actions.

The discrepancy needs to be cleared up. And the agency’s own workshop proved it is not a hard distinction to make.

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