The FCC last week issued two declaratory rulings interpreting the Telephone Consumer Protection Act (TCPA).  While the rulings in each are limited to the specific requests set forth in the petitions, they include broad language and reasoning that will be helpful for businesses looking for ways to reach their customers without running afoul of the TCPA.

The TCPA was enacted in 1991 in an effort to address certain practices that were thought to threaten consumer privacy and public safety.  The TCPA and the FCC’s implementing rules prohibit, among other things, the use of an artificial or prerecorded voice or an automatic telephone dialing system to make a non-emergency, informational, or other noncommercial call without “prior express consent” to cellular telephones.  These prohibitions extend to both voice calls and text messages such as those sent via Short Message Service (SMS).  Because the TCPA provides a private right of action and allows for hefty fines, the TCPA has received substantial attention from the plaintiffs’ class action bar, which has grown exponentially in recent years.

At the same time, consumers increasingly rely on mobile phones, including text messages, for day-to-day communications, and companies increasingly want to communicate with their customers through those devices.  Given the high litigation costs and ambiguity of the TCPA, many companies recently petitioned the FCC to clarify the meaning and application of various provisions of the TCPA.  FCC Commissioner Michael O’Rielly recently blogged that the FCC needs to address the backlog of petitions seeking clarification on the TCPA’s mandates, including:

[W]hat it means to initiate a call, whether there is liability for calls made to reassigned phone numbers, whether consent can be obtained through intermediaries, whether consent can be inferred from consumer behavior or social norms, whether devices including smartphones could be considered automatic telephone dialing systems, and what types of faxes are actually unsolicited.

On Friday, March 28, the FCC addressed two of those backlogged petitions.  In the first, a declaratory ruling granting GroupMe’s petition, the FCC found that an intermediary can provide the required consent to send an informational text message to a consumer’s cell phone. However, the FCC did not rule on GroupMe’s request for clarification with respect to the meaning of what constitutes an Automated Telephone Dialing System (ATDS).  In the other ruling—an order granting Cargo Airline Association’s petition—the FCC used its authority to exempt from the TCPA requirements “free to end user” calls or text messages that relate to package delivery information and meet certain other requirements.  Cargo Airline has limited impact outside the context of package delivery notifications but demonstrates the willingness of the FCC to prevent the TCPA from becoming a barrier to ordinary communications upon which businesses and consumers increasingly depend.

Intermediary Consent

The GroupMe App allows users to create group chats of up to 50 people.  When a user invites another to the group, GroupMe sends confirmatory text messages to the recipient, even though the recipient does not have a prior relationship with GroupMe.  GroupMe instead relies on its users to attest that the recipient has consented to receiving the messages.  GroupMe petitioned the FCC to clarify that consent for certain calls under the TCPA may be provided through intermediaries (such as GroupMe users).  The FCC granted GroupMe’s request, finding that recipients of a message need not directly consent and that GroupMe may instead rely on an intermediary to warrant that the user has provided consent.

In granting the petition, the FCC first noted that the TCPA is ambiguous with respect to how consent may be obtained.  It therefore chose to exercise its discretion to permit such messages because allowing users to receive informational messages to which they had consented would not undermine the policies of the TCPA.

At the same time, the FCC emphasized that companies can still be subject to TCPA enforcement and private actions if they send messages to recipients who had not in fact consented.  The FCC encouraged GroupMe to “ensure [] group organizers [were] aware of the need to obtain such prior express consent and that they are representing to GroupMe that they have in fact obtained it.”  Thus, companies seeking to rely on intermediary consent—such as other users of their services—should think of ways to clarify to these users that they may only initiate communications with a nonuser-recipient’s consent.

Broader Reasoning

While the FCC’s ruling is limited to the facts at issue, they include business-friendly language that will clarify some of the uncertainty currently surrounding the TCPA.  Most notably, the FCC acknowledged in GroupMe that the TCPA is ambiguous with respect to how consent may be obtained and rejected claims that the TCPA requires recipients themselves to directly consent to the receiving informational messages: “[N]either the Commission’s implementing rules nor its orders require any specific method by which a caller must obtain such prior express consent for nontelemarketing calls to wireless phones.”  In both decisions, the FCC agreed that the messages at issue would facilitate “normal,” “expected,” and “desired” communications in a manner that still preserves the intended protections of the TCPA.

Overall, the Cargo Airlines and GroupMe rulings are positive developments not only for group messaging services, social networks, and package delivery companies, but for all companies that have struggled to communicate with users under the threat of a highly aggressive TCPA class action plaintiffs’ attorney bar. 

© 2014 Perkins Coie LLP