Credit unions have faced challenges in complying with the Telephone Consumer Protection Act (TCPA), in large part because of a 2015 Declaratory Ruling (2015 Order or 2015 TCPA Order) released by the Federal Communications Commission (FCC). Among other things, this order adopted a broad definition of “automatic telephone dialing system” (ATDS or autodialer) and provided a very narrow, unworkable safe harbor concerning reassigned numbers. The 2015 TCPA Order faced fierce judicial challenges.
When a coalition of groups sued the FCC over the 2015 Order, given the importance of the issue to credit unions, NAFCU filed an amicus brief on Sept. 25, 2015. A federal appeals court heard oral arguments on Oct. 19, 2016, and after a long wait, on March 16, 2018, the court released a decision in ACA International v. FCC, unanimously ruling to narrow the 2015 TCPA Order that expanded the scope of the TCPA.
In its ruling, the court ruled on four issues, only three of which impact credit unions:
- Autodialer: The definition of “autodialer” that the FCC adopted in 2015 included even systems with the “potential functionalities” or “future possibility” of automatically dialing calls. The court rejected this as well as prior FCC rulings that had appeared to deviate from the TCPA’s requirement that in order to qualify as an ATDS, the equipment must “store or produce” telephone numbers using a random or sequential number generator, and then dial them.
- Reassigned Numbers: Often, a disconnected phone number is assigned to a new consumer, so the 2015 Order addressed whether having the consent of the intended recipient of a call could limit liability for calling reassigned numbers. In the 2015 Order, the FCC determined that a caller could make only one call to a reassigned number without incurring liability under the TCPA. The court rejected the 2015 Order’s one-call safe harbor as not sufficiently justified by the regulator.
- Revocation of Consent: The TCPA allows consumers to revoke their consent to be called, and the 2015 Order rejected requests to allow businesses to establish set ways for consumers to revoke consent, such as by calling a specific toll-free number. Instead, the 2015 Order stated that consumers may revoke consent through any reasonable means. The court upheld this standard but indicated that while credit unions are not allowed to unilaterally impose revocation methods, it may be permissible to use contractual agreements with members on revocation methods.