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In a new insight post on NAFCU’s Compliance, Risk, & BSA Network, NAFCU Regulatory Affairs Counsel Dale Baker highlights two cases regarding the Telephone Consumer Protection Act (TCPA) that deal with outreach to consumers through the use of autodialers and automated telemarketing text messages.

Baker first discusses the U.S. Court of Appeals for the Ninth Circuit’s recent reversal of the U.S. District Court for the Western District of Washington’s Borden v. EFinancial, LLC, which held that autodialers must have the capacity to use a random or sequential number generator to both generate and dial phone numbers. In its reversing the lower court, the Ninth Circuit made clear it believed the lower court’s autodialer definition was far too narrow and would allow telemarketers could purchase telephone numbers in a specific area then use a random number generator to auto dial each number in the context of mass telemarketing, without fear of violating TCPA. . In Facebook, the Supreme Court held an autodialer is any system that has the “capacity either to store a telephone number using a random or sequential number generator, or to produce a telephone number using a random or sequential number generator.”

Next, Baker details the case of Mantha v. QuoteWizard.com, LLC, in which the plaintiff alleges the defendant’s online insurance business violated the TCPA when it sent the plaintiff two automated telemarketing text messages without receiving prior consent. The magistrate judge in Mantha recently recommended that the presiding district court judge find, as a matter of law, that even if the plaintiff had provided his number and electronically executed the TCPA consent form at issue, the TCPA consent form is not valid because it does not separately comply with the Electronic Signatures in Global and National Commerce Act’s (ESIGN Act) general rule of validity for consumer disclosures. “By grafting 15 U.S.C. § 7001(c), onto the TCPA, the court would require a company to collect a consumer’s consent to electronic forms delivery before separately collecting a consumer’s signature on an electronic TCPA consent form,” Baker wrote.

Of note, in a letter sent to the Federal Communications Commission (FCC) to announce NAFCU’s 2022 Advocacy Priorities, the association called on the FCC to modernize the TCPA to ensure legitimate callers are able to contact consumers with pertinent information. 

NAFCU-member credit unions that are part of the NAFCU Network can provide feedback and insights on this topic through the post. 

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