FCC DECLARATORY RULING Michele Shuster Mac Murray, Petersen & Shuster Nick Whisler Mac Murray, Petersen & Shuster

DEFINITION OF ATDS Ruling: Equipment can be an ATDS if it has the "potential capacity" to function as an ATDS Rejects “present capacity” standard Equipment can have the requisite capacity even if it requires additional software to function as an ATDS “Theoretical capacity” not sufficient Rotary phone is not an ATDS Stadium capacity analogy Rejects argument that ATDS must have the capacity to dial without human intervention

DEFINITION OF ATDS Ruling: Cannot avoid TCPA by dividing up ownership of dialing equipment Declined to address exact contours of definition Reiterates prior TCPA rulings Predictive dialer is an ATDS ATDS provisions do not apply to speed dialing Basic function is to dial without human intervention Not an issue that smartphones may be an ATDS because no evidence individuals have been sued

DEFINITION OF ATDS Rationale: Congress intended ATDS definition to be broad Congress gave FCC the authority to adapt rules based on new technologies Ruling is consistent with prior FCC rulings “Present capacity” standard would be difficult to enforce “Present capacity” standard would mean that virtually no modern equipment is an ATDS

DEFINITION OF ATDS Dissent: FCC cannot expand statutory definition or “make up the law as it goes” Statutory elements must be met Statute uses present tense (“has the capacity”) Ruling is inconsistent with prior FCC rulings and recent court opinions “Potential capacity” standard conflicts with ordinary meaning of “capacity” 1 gallon bucket analogy Stadium capacity analogy

DEFINITION OF ATDS Dissent: Majority position is unconstitutional Under the Ruling, "each and every smartphone, tablet, VoIP phone, calling app, texting app—pretty much any calling device or software-enabled feature that’s not a ‘rotary-dial phone’ is [an ATDS]” First Amendment violation– chills speech of anyone that owns a phone If no modern equipment is an ATDS, Congress accomplished its goal Not an ATDS if non-de minimus human intervention is required

REASSIGNED NUMBERS Ruling: “Called party” means current subscriber or customary user One call “safe harbor” for calls to reassigned #s Must have consent to call prior subscriber and no knowledge of reassignment No notice requirement– constructive knowledge after one call No requirement for called party to notify caller or “bad faith” defense for businesses

REASSIGNED NUMBERS Ruling: Best practices can mitigate risk Use available databases to detect reassignment Listen for disconnected tones or voic greetings Manually dial numbers (but see ATDS ruling) Procedures for updating contact info (mail, , etc.) Can sue your customers if they violate a contract that requires them to give notice when a number is relinquished!

REASSIGNED NUMBERS Dissent: One Call Safe Harbor = “fake relief” Concept of constructive knowledge is “ludicrous” “Expected recipient” is better interpretation Balances consumers’ privacy rights with commercial speech rights of caller Contrary interpretation may violate Constitution No authoritative database = impossible to comply Lack of “bad faith” defense Often impractical to manually dial numbers Hypocrisy of suggestion to sue customers

REVOCATION OF CONSENT Ruling: May revoke consent at any time and through any reasonable means Orally or in writing Inbound/outbound calls, in-store bill payment location No guidance on what is not a reasonable method Cannot limit manner in which consent may be revoked Must maintain proper business records to establish consent at the time the call was made

REVOCATION OF CONSENT Dissent: Pai: ability to revoke at in-store location creates compliance impossibilities (McDonald’s example) O’Rielly: no right to revoke consent for non- telemarketing calls under the TCPA Statute is intentionally silent 2005 amendment gave right to revoke consent for fax advertisements but not non-telemarketing calls Proving a negative is difficult Issue with non-conforming text opt-out commands

TEXT MESSAGES Ruling: Text message is a “call” under the TCPA TCPA applies to Internet-to-phone text messages Congress gave FCC authority to apply TCPA protections to future technologies Reasonable to interpret “dial” to include act of addressing and sending this type of text message “Congress intended the word ‘dial’ to mean initiating a communication with consumers through use of their telephone number by an automated means that does not require direct human intervention” (note: this discussion of human intervention conflicts with the ATDS ruling)

TEXT MESSAGES Dissent: O’Rielly: TCPA does not cover text messages TCPA enacted in 1991 before text messages existed Should have gone back to Congress rather than “shoehorn a broken regime on a completely different technology” Pai: concurred that TCPA covers texts

ONE-TIME ON DEMAND TEXTS Ruling: o ne time text message sent immediately after consumer’s request does not violate TCPA because it is not a telemarketing text Criteria: Must be requested by consumer; Must be a one-time message sent immediately in response to the consumer’s request; and May only contain info requested by consumer (no other marketing or advertising info).

MAKER OF A CALL Ruling: Reiterates standard adopted in DISH Ruling Person initiates call by physically placing call Person initiates call if “so involved in the placing of a specific telephone call” as to be deemed to have initiated it. Text Message Apps YouMail does not initiate auto-reply texts set up entirely by users Glide does not initiate invitation texts sent by users (by clicking an invitation button) even if suggested language is provided by Glide Glide initiates texts when it sends invitations to phone numbers listed in a user’s contact list

MAKER OF A CALL Ruling: Other Service Providers “the extent to which a person willfully enables fraudulent spoofing of telephone numbers or assists telemarketers block Caller ID, by offering either functionality to clients, can be relevant in determining liability for TCPA violations” “whether a person who offers a calling platform service for the use of others has knowingly allowed its client(s) to use that platform for unlawful purposes may also be a factor in determining whether the provider is [liable for the calls]”

WRITTEN CONSENT Ruling: Reiterates mandatory disclosure requirements Calls will be made with autodialer Consent is not a condition of purchase Written consent obtained without these disclosures is insufficient Granted Petitioners and their members a retroactive waiver from October 16, 2013 through 89 days after release of Ruling (must have obtained written consent prior to October 16, 2013) No waiver specifically given to non-petitioners

LIMITED EXEMPTIONS Ruling: limited exemptions provided for time-sensitive financial and healthcare calls Criteria for Financial Calls: Free to end user Call is to cell phone number provided by customer Name and contact info of company provided in call/text Limited to specific purposes (e.g. fraud and breach alerts) Concise (1 minute or less for calls and 160 characters for texts) Max of 3 calls/texts over 3 day period per event Provide automated opt-out method Honor opt-outs immediately

LIMITED EXEMPTIONS Ruling: limited exemption for time-sensitive financial and healthcare calls Criteria for Healthcare Calls: Free to end user Call is to cell phone number provided by customer Name and contact info of company provided in call/text Limited to specific purposes (e.g. appointment reminders, wellness checkups, pre-registration instructions, prescription notices, etc.) Concise (1 minute or less for calls and 160 characters for texts) Max of 1 call/text per day and 3 calls/texts per week Provide automated opt-out method Honor opt-outs immediately

OTHER RULINGS FCC denied request for clarification that ATDS rules do not apply to non-telemarketing calls made using a predictive dialer FCC reaffirmed “prior express consent” rulings Providing a phone number is consent for non- telemarketing calls absent instructions to contrary Scope of consent must be determined by facts of situation Carriers and VoIP providers may implement robocall blocking technologies